IndiaMART InterMESH, a prominent B2B marketplace, has made a strategic move by acquiring a 10% stake in fraud detection startup Baldor Technologies, operating under the brand name IDfy, for INR 89.7 Cr (approximately $10.7 Mn) through a secondary transaction.
About IDfy
Founded in 2011 by Ashok Hariharan and Vineet Jawa, IDfy specializes in providing innovative solutions for know-your-customer (KYC) processes, background verifications, risk mitigation, digital onboarding, and digital privacy. Leveraging predictive analytics, IDfy assists businesses in authenticating and validating individual profiles. The startup boasts a diverse clientele across sectors such as BFSI, FMCG, ecommerce, and gaming, having served over 1,500 clients since its inception.
Strategic Investment
IndiaMART’s investment in IDfy underscores its long-term objective of diversifying its offerings and providing comprehensive software-as-a-service (SaaS) solutions for businesses. The acquisition includes the acquisition of equity shares, compulsorily convertible preference shares, and compulsorily convertible debentures from existing investors of IDfy. The transaction is expected to be completed within 30 days.
Alignment with Mission
Commenting on the investment, IndiaMART’s founder and managing director, Dinesh Agarwal, emphasized the synergy between IDfy’s expertise in background verification and authentication and IndiaMART’s mission to empower businesses digitally. The strategic partnership is poised to enhance IndiaMART’s value proposition and strengthen its position in the market.
Financial Performance
IDfy reported a revenue of INR 117 Cr in the financial year ended March 31, 2023, reflecting its robust growth trajectory and market potential. The startup has demonstrated resilience and innovation in navigating the evolving landscape of fraud detection and digital identity verification.
Investment Landscape
Earlier this year, IDfy raised $27 Mn in a funding round led by Elev8, bringing its total funding to nearly $45 Mn. The startup has attracted investment from prominent entities such as TransUnion, KB Investment, Blume Ventures, and MegaDelta Capital, highlighting investor confidence in its growth prospects and value proposition.
IndiaMART’s Performance
IndiaMART’s investment in IDfy comes on the heels of its strong financial performance, with a 78% surge in consolidated net profit in Q4 FY24 and a 17% year-on-year growth in operating revenue. Despite the positive results, Nuvama Institutional Equities revised the 12-month price target for IndiaMART InterMESH, reflecting the dynamic nature of the market and evolving investor sentiment.
In conclusion, IndiaMART’s strategic investment in IDfy underscores its commitment to innovation and expansion, positioning the company for sustained growth and success in the competitive landscape of B2B technology solutions.
