Gold loan platform Rupeek raises Rs 40Cr at over 60% valuation cut: Report

Online gold loan platform Rupeek has reportedly raised around Rs 50 crore from 360 One Large Value Fund (formerly known as IIFL Wealth Management).

The startup provides gold loan services and claims to streamline the entire process from underwriting to disbursal in 30 minutes.

At what valuation?

The board at Rupeek has passed a board resolution to issue 1,307 compulsory convertible preference shares at an issue price of Rs 3,82,492 each to raise Rs 50 crore, Entrackr reported citing the company's regulatory filing.

The report also said that Rupeek's valuation has seen a significant decline, dropping by 60% from its peak valuation of $634 million in January 2022 to the current $250 million.

What is the purpose of fundraising?

The startup may use the raised capital towards broadening its market presence, scaling operations, and supporting general corporate activities. 

The financial is also part of Rupeek's broader strategy to solidify its foothold in the competitive online gold loan market and drive future growth.

Backing from notable investors

Rupeek raised approximately Rs 43 crore from existing investors, including Peak XV, Bertelsmann, Accel India, and GGV Investments, during the fiscal year 2024.

TheKredible, a startup data intelligence platform, indicates that Peak XV is Rupeek's largest external stakeholder, followed by Accel and Bertelsmann. The addition of 360 One Large Value Fund, which now holds a 2.44% stake post-allotment.

How well Rupeek is performing financially?

Despite the fresh funding, Rupeek has witnessed some financial setbacks, including a 27.6% drop in revenue from operations, which amounted to Rs 89 crore in FY23, alongside losses totalling Rs 281 crore for the same period.

Notably, The startup has faced stiff competition in the online gold loan market from entities such as Oro Money, Ruptok, Yellow Metal, and Indiagold, which is backed by PayU.