Investment Memos

Investing in Mintifi

Building B2B BNPL & business payments for India


Mridul Arora, Vasudha Wadhera, Kshitij Jayakrishnan

8th February 2022

You’re at a store - you pick up a few items, go to the counter and choose from an array of payment options: scan the QR, swipe your card or opt to break the transaction into a few easy installments. However you choose, the cashier receives a confirmation instantly, and you walk out a happy shopper. Probably the highest friction point was deciding what to buy.

But walk a few steps behind in this supply chain, and the ease of closing a transaction changes dramatically. Unlike consumer purchases, business buying is a broken experience. Distributors and dealers purchase inventory from brands, with short credit periods or even often in cash. However, converting these goods to sales could take another 15-90 days, creating a working capital gap. For brands, tracking repayment, ensuring on-time collections and reconciliation is an additional overhead.

Enter Mintifi: through its plug & play platform, Mintifi partners with leading brands, including Tata Motors, Jockey, Berger Paints, TTK Prestige and Philips, and enables inventory financing for their distributors and retailers. Traditional lending products do not meet the immediate, short-term needs of SMEs, which constitute ~80% of their total  financing needs. With proprietary credit underwriting technology and real-time digital processing, Mintifi provides credit on tap to these SMEs. This creates a win-win proposition for brands, distributors and retailers, fuelling revenue growth across the supply chain.

Mintifi App

At Elevation, we are big believers in contextual financial services, especially in the B2B world. As supply chains get more organized - online and offline - we believe financial products will be a big enabler, be it seamless in-platform payments, credit options at the point of purchase, or thoughtfully designed insurance products.

From a business quality perspective as well, being part of the supply-chain offers multiple advantages:

  • high LTV due to the high-repeat nature of the product
  • costs are lower due to aggregated acquisition
  • underwriting is tighter due to proprietary purchase data shared by anchors
  • credit quality is healthier due to the known end-use, the short tenure nature of product (hence quicker learning cycle) and ongoing dependency of distributors on anchors (hence lower propensity to default)

A strong downstream SCF program rests on 3 tenets:

1. Win-win across stakeholders - entry is via anchor brands, but engagement & retention are determined by distributors who are the end-borrowers

2. Strong ability to win anchors - network effects start to come into play as industry-depth gets established

3. Seamless and instant transactions - given the urgent, short tenure nature of the product, inventory financing is well-suited for a tech-first play

Mintifi Team

We have known Anup, Ankit and Sanjoy for a few years and have always been impressed by their desire to create a business rooted in strong fundamentals. With strong advocacy from 100+ blue-chip anchors and >100% AUM retention of distributors across cohorts, the team has built a compelling proposition for all participants in the supply chain. They have scaled to $300M in annual purchases financed, with capital efficient execution - they are profitable! All this, in one of the toughest lending environments for SMB lenders in the last few years.

We’re excited to partner with Mintifi, along with Norwest Venture Partners, IFC and Lok Capital. Inventory financing and payments are the starting point - with Mintifi’s pivotal role in the supply chain, the team is well placed to service the B2B ecosystem across financial and fulfillment services. It’s still day one!

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