NAKAD raises $7M in a Seed round co-led by Matrix Partners India & Accel

25th May, 2022. New Delhi: NAKAD, a supply chain fintech for Indian MSMEs, has raised $7M in Seed funding. The round was co-led by Matrix Partners India and Accel, along with participation from AdvantEdge Founders. The company will deploy the funds to aggressively hire, build a world-class product and scale operations within India.

Other prominent angel investors that participated in this round include Harshil Mathur and Shashank Kumar (Founders, Razorpay), Rangarajan Krishna (CEO, Five Star Business Finance), Amrit Acharya and Rahul Sharma (Founders, Zetwerk), Sachin Agrawal, Aniket Deb and Ankit Tomar (Founders, Bizongo), Nitin Gupta (CEO, Uni Cards), Raghunandan G (CEO, Zolve), Arindam Bhattacharya (Managing Director & Senior Partner and former India Head, BCG), Sharad Verma and Pranay Mehrotra (Managing Directors & Senior Partners, BCG).

Established in January 2022 by Ujwal Kalra, Sambhav Jain and Avinash Uttav, NAKAD aims to solve the massive problem of working capital of Indian MSMEs in the supply chain. The company is pioneering a new financing paradigm enabled by MicroBill, a proprietary technology. This technology tokenizes invoices and will unlock $30B worth of capital for credit-starved MSMEs. The company has partnered with multiple anchors, their supplier base, banks and NBFCs to enable a seamless solution, designed to benefit the entire ecosystem.

NAKAD's founders are alumni of IIM Ahmedabad, IIT Bombay and IIT Guwahati, and are former leaders from Boston Consulting Group, HUL, Oracle, and Samsung.

Commenting on the announcement, Ujwal Kalra, Co-founder & CEO, NAKAD said, "Hailing from a family of a Chartered Accountants and industrialists, I implicitly understood the massive credit crunch of MSMEs resulting in inability to grow their business and pay their employees on time. This issue is not just confined to MSMEs but also rolls back to their large customers, impacting the entire supply chain. Understanding this issue, Sambhav, Avinash and I started contemplating the solution: NAKAD. The huge impetus we got from the ground while implementing the solution gave us our '˜why' for creating NAKAD, making the mission of our lives - to make a deep impact on a massive underserved market. Our solution creates a win-win case for all the stakeholders.'

He added, "We are thrilled to have marquee investors Accel, Matrix Partners India and AdvantEdge Founders back us, who bring a unique combination of vast experience across Fintech, B2B and industrial expertise.'

Vikram Vaidyanathan, Managing Director, Matrix India said, "Our thesis is that all supply chains in India are getting digitized with both B2B payments and transaction finance crucial to digital adoption and stickiness. NAKAD is addressing a big opportunity in deep-tier supply chain financing. The founders have a unique approach to penetrating large industrial ecosystems with software and then driving formal payments and credit penetration among MSMEs in that ecosystem. We are excited to partner with Ujwal, Sambhav & Avinash as they set out to transform MSME supply chains!"

Prayank Swaroop, Partner at Accel said, "Credit for MSMEs is a misnomer, B2B supply chain credit today is limited to only large enterprises. This is because financial institutions find it extremely hard to access verified information of transactions between OEMs, tier-1, tier-2 and tier-3 suppliers. We are quite excited to partner with the NAKAD team who have built an amazing technology solution to this problem."

Rangarajan Krishnan, CEO of Five Star Business Finance shared, "The opportunity NAKAD is targeting is really large. The team is creating a sustainable link between formal financial institutions and cash strapped MSMEs in a unique and sensible manner. I am very happy to be part of their first fundraise.'

Rajeev Kapoor, former President and CEO of Fiat India said, "Today the entire supply chain is affected because of the credit crunch faced by MSMEs. NAKAD's distinctive solution will be supremely beneficial to the credit-starved companies. This would also make the supply chain more loyal, efficient and resilient. NAKAD's unique solution would also drive down procurement cost and support JIT initiatives."

"AdvantEdge is India's only mobility-focused fund and is backed by the family office of a leading OE and one of the world's largest Tier 1 auto component groups," said Kunal Khattar, Founding Partner AdvantEdge Founders, "We are excited to partner with NAKAD to enhance liquidity across the entire supply chain by fractionalizing receivables with their proprietary tech platform."

About NAKAD:
NAKAD is revolutionizing supply chain finance in India. Our proprietary technology platform provides easily accessible working capital financing solutions to micro, small and medium enterprises at their convenience. Leveraging our MicroBill infrastructure, credit-starved MSMEs can get invoice discounting services previously unavailable to them from formal channels. Through the NAKAD platform, all the stakeholders in the manufacturing value chain can unlock benefits, ranging from timely availability of affordable working capital for MSME suppliers to resilient supply chain and optimised costs for OEMs. NAKAD's unique solution has enabled us to partner with and provide benefits to reputable Indian and global OEMs, suppliers and financial institutions. Post our successful funding round, NAKAD is looking to build a world-class team, enhance the product suite and scale operations.

About Matrix Partners India:
Founded in 2006, the firm invests in companies targeting the Indian consumer and enterprise market at the seed, early, and early growth stages. Matrix India has invested in several market-leading companies such as Ola (mobility), Razorpay (payments), OfBusiness (B2B Commerce, fintech), Five Star Business Finance (SME lending), Ola Electric (electric vehicles), DealShare (social commerce platform), Stanza Living (tech-enabled student housing platform), OneCard (mobile-first credit card), Country Delight (D2C dairy & fresh foods brand), GoKwik (e-commerce enablement platform), Captain Fresh (seafood marketplace), Bijnis (B2B platform for factories), MoEngage (intelligent marketing cloud platform), Jupiter (consumer neobank), Mswipe (mobile POS), Zupee (leading skill-based gaming app), and Oxyzo (a tech-enabled smart financing solution provider) among others. Matrix India has advisory offices in Bangalore, Delhi, and Mumbai. Matrix Partners has a global network of funds investing in the US, China, and India, with approximately $5 billion under management. Further information is available at www.matrixpartners.in. To know more about our investment philosophy & ideologies, check out the #MatrixMoments podcast series.

About Accel:
Accel is a global venture capital firm that aims to be the first partner to exceptional teams everywhere, from inception through all phases of private company growth. Accel has been operating in India since 2008, and its investments include companies like BookMyShow, BrowserStack, Flipkart, Freshworks, FalconX, Infra.Market, Chargebee, Clevertap, Cure Fit, Musigma, Moneyview, Mensa Brands, Myntra, Moglix, Ninjacart, Swiggy, Stanza Living, Urban Company, Zetwerk, and Zenoti, among many others. We help ambitious entrepreneurs build iconic global businesses. For more, visit www.accel.com or https://twitter.com/Accel_India.

About AdvantEdge Founders:
AdvantEdge is a leading early-stage venture capital fund investing across sectors with a focus on auto and mobility, fintech, gaming and crypto sectors in India. The Fund is known for its operational experience and strong global network of strategic LPs and relationships to help its portfolio companies at each stage of growth. The investment in NAKAD is from its second Fund where the family office of a leading OE and one of the world's largest Tier 1 auto component groups is a key LP. The Fund has a history to back category creating and leading companies, and its investments include companies like Rapido, Chalo, ZingBus, Jar, Exponent Energy, Park+, and Grip Invest, among many others.