M2P Fintech, a company that provides API infrastructure for businesses to offer their own branded financial services, has raised Rs 417.5 crore ($50 million). This funding comes from a new investor, Taj Investment Holdings. M2P Fintech, formerly known as Yap, helps companies create financial services while making sure they follow regulatory rules. The company operates in countries like Nepal, the UAE, Australia, New Zealand, the Philippines, Bahrain, and Egypt.

Recent Growth and Acquisitions

M2P is backed by Tiger Global and has made six acquisitions so far, including companies like Goals101, Syntizen, and BSG ITSOFT. These acquisitions have helped M2P grow its presence in the fintech industry.

In the financial year FY23, M2P’s operating revenue more than doubled, growing 2.26 times to reach Rs 440.7 crore, up from Rs 194.74 crore in the previous year, FY22. However, the company’s losses also grew by 3.35 times, amounting to Rs 134.26 crore in FY23. M2P has not yet released its financial results for FY24.

New Funding and Future Plans

To raise the Rs 417.5 crore, M2P’s board passed a resolution to offer Series D preference shares, as noted in regulatory filings. The company plans to use the funds for expansion and to support its working capital needs. M2P Fintech’s valuation has now reached about $800 million after this funding round.

Interestingly, Taj Investment Holdings has not previously invested in any Indian startup before this. There is limited information available about this fund, and M2P Fintech has been contacted for further comments.

Employee Stock Options (ESOP) Increase

Along with the new funding, M2P has also expanded its Employee Stock Option Pool (ESOP). The company added 38,700 new stock options, bringing the total number of stock options to 1,29,140. This gives employees more opportunities to own a share of the company.

Previous Investors and Ownership

Before this funding round, Beenext was the largest external investor in M2P, holding 10.23% of the company. Tiger Global owned 9.22%, and Insight Partners had 6.44%. The company’s three co-founders—Muthukumar Ayyakannu, Prabhu Rangarajan, and Madhusudanan R—collectively own 34.03% of the company.

Future Funding Plans

M2P Fintech was also reportedly in talks for a larger funding round, aiming to raise $80 million. Out of this, $30 million was expected to come from secondary sales. This means that some existing shareholders might sell their shares as part of the funding deal.

In conclusion, M2P Fintech is rapidly growing, with increased revenue and several successful acquisitions. The new funds will help the company expand further, although it still faces challenges with rising losses. With a strong lineup of investors and big plans for the future, M2P is set to become a significant player in the fintech industry.