OfBusiness Success Story - How it is Facilitating Raw Materials Procurement and Credit for SMEs?

Sarika Anand Sarika Anand Anik Banerjee Anik Banerjee
May 20, 2022 13 min read
OfBusiness Success Story - How it is Facilitating Raw Materials Procurement and Credit for SMEs?

Company Profile is an initiative by StartupTalky to publish verified information on different startups and organizations. The content in this post has been approved by OfBusiness.

The SMEs or the small and medium-sized enterprises in India comprise over 63.4 mn units, employ about 460 million people, and generate around 30% of the GDP of the country. Here, OfBusiness is one of the Indian startups that is largely focusing on the SMEs and is materialising the procurement of the raw materials and making the availability of credit easy for them. Β 

Through its raw material fulfilment engine and new possibilities platform, OfBusiness delivers value to SMEs' businesses beyond funding. OfBusiness is located in Gurgaon and has operations in 14+ countries. Oxyzo Financial Services, which is a nonbanking finance company that is registered with the RBI and its parent OfBusiness, offers business-to-business credit facilities to small and medium enterprises.

OfBusiness has turned unicorn with a $160 mn funding round that came on July 31, 2021, thereby becoming the 18th Indian startup to turn unicorn in 2021. The OfBusiness company has thus been the only women-led Indian startup to turn unicorn in the same year. Oxyzo, the lending arm, and a subsidiary of OfBusiness, has also joined the unicorn club in March 2022, after it successfully raised $200 mn in funding, in what has been hailed as India's largest Series A round.

OfBusiness is a raw material collector and supplier of procurement financing. The firm collaborates with banks to provide loan lines to small and medium-sized businesses with annual sales of more than $3 million. The platform gathers information about user behaviour that it uses to insure loans to firms who use the OfBusiness platform to get raw materials and bids.

Get to know more about OfBusiness India, its founders and team, industry details, startup story, mission and vision, investors, growth, revenue, business, and revenue model, investments, funding, and more here.

OfBusiness - Company Highlights

Startup Name OfBusiness
Also known as OfBusiness.com, OFB Tech, OFB Tech Pvt Ltd
Legal Name OfB Tech. Pvt. Ltd.
Headquarters Gurgaon, Haryana, India
Industry Fintech, NBFC, Lending
Founders Asish Mohapatra, Bhuvan Gupta, Ex Chandranshu Sinha, Nitin Jain, Ruchi Kalra, Srinath Ramakkrushnan, and Vasant Sridhar.
Founded 2015
Areas Served India
Current CEO Asish Mohapatra
Total Funding $878.1 mn (2022)
Operating Revenue $230.22 mn (Rs 1,748 crore in FY21)
Valuation $5 bn (December 2021)
Website www.ofbusiness.com

About OfBusiness
OfBusiness - Industry
OfBusiness - Founders and Team
OfBusiness - Startup Story
OfBusiness - Vision, Mission, and Values
OfBusiness - Name, Logo, and Tagline
OfBusiness - Business Model and Revenue Model
OfBusiness - Funding, and Investors
OfBusiness - Investments
OfBusiness - Acquisitions
OfBusiness - Growth and Revenue
OfBusiness - Competitors
OfBusiness - Future Plans

About OfBusiness

OFB Tech (OfBusiness) is a tech-enabled platform that enables SMEs in the infrastructure and industrial sectors to acquire raw materials and obtain finance. It incorporates technology into SME purchasing behaviour to provide clients with better items, at better costs, and in shorter time frames, as well as extensive online and offline assistance. Metals, chemicals, polymers, agricultural commodities, petrochemicals, and construction materials are all important raw materials.

Through its NBFC 'Oxyzo Financial Services,' OfBusiness offers SMEs cash flow-based finance for the purchase of raw materials. It has also launched BidAssist on September 20, 2017, which acts as a free of cost, revolutionary platform that brings a wide range of opportunities for the discovery of new SMEs and also makes recommendations of these SMEs based on their profiles.

Small-medium businesses in the manufacturing and infrastructure industries can use the company's platform to acquire financing from local distributors and lenders, allowing them to satisfy their financial needs. OfBusiness provides SMEs with institutional loans (both secured and unsecured). They accomplish this by combining numerous raw materials, obtaining financing from local distributors and financiers, and then passing on the majority of the aggregation advantages to the SME, such as bulk discounts from manufacturers.

OfBusiness allows SMEs to get credit lines for a variety of raw materials, including industrial steel (structures, plates, and coils), electrical items, cement, bulk polymers, chemicals, construction materials, and solar systems, through the aforementioned method. The selected raw materials that SMEs across clusters order directly to the manufacturer are subsequently aggregated through OfBusiness.

OfBusiness - Industry

Non-Banking Finance Companies (NBFCs) have played an essential role in the Indian financial system by augmenting and contending with banks, as well as introducing effectiveness and variation into financial intermediaries. In terms of operations, heterogeneity, asset quality and profitability, and regulatory architecture, NBFCs have come a long way.

In India, the non-banking financial companies (NBFC) sector has seen a tremendous transition in recent years and now plays an important role in the development of the Indian financial system. In India, NBFCs play an important role in the development of core infrastructure, transportation, job creation, wealth creation, and economic growth of the poor.

Technology is assisting NBFCs in customizing credit assessment models and streamlining business operations, lowering time to market, and improving customer experience. NBFCs are now going out to Tier-2, Tier-3, and Tier-4 markets, distributing loans through many client touch-points, and developing a linked channel experience that gives an omnichannel seamless experience with 24/7 sales and service.

With today's customers changing and accessing digital media like never before, NBFCs have embarked on new and better methods to engage with the customer.


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OfBusiness - Founders and Team

OfBusiness was founded by Asish Mohapatra, Bhuvan Gupta, Ex Chandranshu Sinha, Nitin Jain, Ruchi Kalra, Srinath Ramakkrushnan, and Vasant Sridhar.

OfBusiness Founders 

Asish Mohapatra

Since August 2015, Asish Mohapatra has been the Co-Founder and Head of Sales at OfBusiness. From October 2010 through August 2015, Asish worked as a Senior Associate at Matrix Management Corporation in Mumbai. Asish's goal at Matrix was to use his healthcare and operational knowledge to help entrepreneurs grow their businesses. Asish has a B. Tech in Mechanical Engineering from the Indian Institute of Technology, Kharagpur, and an MBA in Finance and Marketing from the Indian School of Business, Hyderabad.

Bhuvan Gupta

Bhuvan Gupta has been the Co-Founder and Chief Technology Officer of OfBusiness since November 2015. Bhuvan formerly worked at Snapdeal as the Vice President of Engineering and Exponential as the Director of Engineering. Bhuvan holds an MBA degree from the University of Delhi and has done his B.Eng in Civil Engineering from the Birla Institute of Technology and Science in Pilani.

Ex Chandranshu Sinha

Ex Chandranshu Sinha, is the Co-Founder and CTO of EkAnek Networks and the Co-Founder and CTO of Foxy. Ex Chandranshu Sinha has also worked at OfBusiness as the co-founder and Head of Products.

Nitin Jain

Since September 2015, Nitin Jain has been the Co-Founder and Head of Construction at OfBusiness. Nitin formerly worked at the Royal Bank of Scotland as Vice President of Structured Solutions Trading. Nitin graduated from the Indian Institute of Technology Delhi with an M.Tech. and a B.Tech. in Computer Science.

Ruchi Kalra

Since 2016, Ruchi Kalra has been the Co-Founder and Head of Credit and Payments at OfBusiness. Ruchi formerly worked for McKinsey & Company as a Partner and Evalueserve as a Senior Business Analyst. Ruchi has a B.Tech. in Chemical Engineering from the Indian Institute of Technology, Delhi, and an MBA from the Indian School of Business.

Srinath Ramakkrushnan

Since November 2015, Srinath Ramakkrushnan has been the Co-Founder and Head of MRO at OfBusiness. Srinath formerly worked with ITC Ltd as an Assistant Manager of Projects, Manager of Operations and Supply Chain, and Manager of Sustainability Operations. Srinath graduated from the Indian Institute of Technology, Madras, with a B.Tech. in Mechanical Engineering.

Vasant Sridhar

Since November 2015, Vasant Sridhar has been a Co-Founder of OfBusiness. OfBusiness is a VC-backed startup that adds value to SMEs through technology-enabled innovations in commerce, lending, and logistics. Vasant was formerly at ITC Limited, where he was in charge of New Business Development & Projects. Vasant received his Bachelor's degree in Chemical Engineering from the Indian Institute of Technology, Madras. He also co-founded Bloodline, a mobile and internet-based solution for bridging the country's significant demand-supply gap for emergency blood.

OfBusiness has been listed on Linkedin as a company that works with an employee strength between 501-1000.

OfBusiness - Startup Story

Asish Mohapatra, Bhuvan Gupta, Ex Chandranshu Sinha, Nitin Jain, Ruchi Kalra, Srinath Ramakkrushnan, and Vasant Sridhar founded OfBusiness in January 2016. They had worked at McKinsey, Religare, Royal Bank of Scotland, ITC, and Snapdeal. Everyone was in various stages of laying their resignation papers down while trying to start their own business in 2015. They believed that real India's companies, which are SMBs, had a significant piece of the issue to solve.

The co-founders aspired to create a major B2B platform that would serve small and medium businesses in industries such as manufacturing and construction. What sparked it was the fact that B2B was a relatively unexplored industry in 2015 and there was a major B2C boom at the time.

OfBusiness is a tech-enabled platform that enables SMEs to acquire raw materials and get loans, with an emphasis on the industrial and infrastructure industries. It incorporates technology into SME purchasing behaviour to provide clients with better items at better costs in shorter time frames, as well as extensive online and offline assistance. It aids in the procurement of critical raw resources such as metals, chemicals, polymeric materials, agricultural commodities, petrochemical products, and construction materials.

BidAssist for new growth prospects is one of the company's many digital services for SMEs.

OfBusiness - Vision, Mission, and Values

It aids in the procurement of critical raw resources such as metals, chemicals, polymeric materials, agricultural commodities, petrochemical products, and construction materials.

All of their activities and plans are guided by guiding principles, according to the firm, which are,

  • Warrior Spirit
  • Unrivaled Culture
  • IntegrityIntegrity
  • Industry Excellence
  • Customer Centricity

OfBusiness - Name, Logo, and Tagline

Ofbusiness Logo
OfBusiness Logo

OfBusiness's tagline says, "Spurring Small and Medium to Large" as small-medium businesses in the manufacturing and infrastructure industries can use the company's platform to acquire financing from local distributors and lenders, allowing them to satisfy their financial needs.

OfBusiness - Business Model and Revenue Model

OfBusiness has lending vertical through its non-banking finance firm, as well as a SaaS business, in addition to its primary commerce operation in the B2B raw material supply chain arena. Oxyzo, the company's lending vertical, is the company's second-largest business vertical, with a loan book of roughly $280 million. The SaaS vertical assists SMEs in the Indian and worldwide industrial and infrastructure industries with online procurement of different tenders.

OfBusiness said in a statement that it is on track to quadruple its income in commerce year over year. The business noted that OfBusiness has been profitable for the past four years, with technology at the core of recruitment, servicing, and productivity. Through its NBFC 'Oxyzo Financial Services,' OfBusiness offers SMEs cash flow-based finance for the purchase of raw materials. BidAssist for new growth prospects is one of the company's many digital services for SMEs.

While commerce accounts for 55% of the company's overall net revenue, loans and SaaS account for 43% and 2%, respectively. Lending is the largest contributor to earnings, followed by trade.


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OfBusiness - Funding, and Investors

Over the course of 11 rounds of financing, OfBusiness has raised a total of $878.1 million. Its most recent funding rounds came in the form of a Series-G and a Secondary Market round on December 20, 2021, with which it raised $185 mn and $140 mn respectively. After receiving $325 million in total funding in the month of December itself via a Series G and a Secondary round, OfBusiness is now valued at over $5 billion.

The company turned unicorn with the July 31, 2021, dated funding round led by Softbank, where it successfully raised funds close to $160 mn. These back-to-back rounds were led by investments from Alpha Wave Global, Tiger Global and SoftBank. Existing investors Matrix Partners India, Creation Investments, and Zodius Technologies sold part of their shares in this round, for a total of about $140 million. The secondary deal included around 80 ESOP (employee stock option plan) participants. Existing investors have sold shares in the secondary share sale, and the proceeds will not go to the company's coffers.

Asish Mohapatra, Co-founder, and CEO of OfBusiness stated that the additional funding will be used to expand the startup's presence in the supply chain on the commerce side, as well as to develop technology for its software-as-a-service (SaaS) solutions and finance sector. Mohapatra further stated that he expects the firm to go public in the next 9 to 12 months.

Date Round Amount Lead Investors
Dec 20, 2021 Secondary Market $140M Alpha Wave Global, SoftBank Vision Fund, Tiger Global Management
Dec 20, 2021 Series G $185M Alpha Wave Global, SoftBank Vision Fund, Tiger Global Management
Sep 30, 2021 Series F $200M Tiger Global Management
Jul 31, 2021 Series E $160M SoftBank Vision Fund
Apr 8, 2021 Series D $110M Alpha Wave Global
Sep 24, 2019 Series D β‚Ή2.4B Norwest Venture Partners
Jan 1, 2019 Venture Round - InnoVen Capital
Jul 18, 2018 Series C $29M Alpha Wave Global, Creation Investments Capital Management, LLC
Oct 27, 2017 Debt Financing β‚Ή250M Kotak Mahindra Bank
Dec 13, 2016 Series B β‚Ή750M Zodius Capital

OfBusiness Shareholding

Ashish Mohapatra, Ruchi Kalra and Bhuvan Kumar Gupta held the highest shares (28.66%) in the company, when last recorded in March 2021. This is followed by Creation Investments and Capital Management, LLC and Matrix Partners, which holds 18.11% and 17.15% of shares in the company.

OfBusiness Shareholders

OfBusiness - Investments

OfBusiness has invested in two companies. FarMart raised $748 million on October 21, 2021, which was their most recent investment.

Date Organization Name Round Amount Raised
Oct 21, 2021 FarMart Series A β‚Ή748M
Aug 17, 2021 UpScalio Series A $42.5M

OfBusiness - Acquisitions

OfBusiness's parent is all set to acquire SMW Ispat. OFB Tech, which is the parent of OfBusiness, has obtained the CCI (Competition Commission of India) nod to acquire 100% stakes in the steel manufacturing company, SMW Ispat, which makes steel products like TMT bars and more under the brand name Sangam TMT, and has a manufacturing plant in Wardha, Maharashtra. Such an acquisition can be justified because, with the acquisition of SMW Ispat, OfBusiness would now be controlling the supply chain in steel. Β 

OfBusiness - Growth and Revenue

The debut of its NBFC subsidiary, OXYZO, in 2017 was a watershed moment. With a loan book of approximately $200 million, the unicorn's lending vertical is the unicorn's second-largest business vertical. The company claims to be growing at a rate of four times every year.

According to the creators, the funding feature has fueled the startup's development to the point where it is now, and this is the genuine turning point for the firm. Normally, the firm gets margins of 5-10%, but (merger and acquisition) might help OfBusiness increase margins to the early teens, and eventually close in on the 20% level.

Here's taking a look at the OfBusiness growth highlights:

  • OfBusiness boasts of having over 700K registered SMEs
  • The company has a list of over 100 product categories, and promises to deliver raw materials at the lowest prices
  • OfBusiness operates in 24+ states of India
  • The unicorn further boasts of having spread its operations to 35+ countries till now
  • OfBusiness has completed 100K+ transactions to date
  • The company is presently serving 3000+ SMEs of India and has already served 4500+ SMEs Β 
  • It has over 50 lending partners
  • OfBusiness has noted 10,000+ crore disbursals to date

When it comes to revenues, OfBusiness has seen around 2X growth in its operating revenues, which stood at Rs 1748 cr in FY21 from Rs 850 cr of revenue that the company received in the previous fiscal.

OfBusiness Revenue Breakdown

A major portion of its revenues (85.7%) came from the sale of its industrial goods and raw materials, which has successfully put in Rs 1494.1 cr for OfBusiness. Here's a look at the other verticals of its revenues:

Revenue Verticals FY21 FY20
Sale of industrial goods and raw materials Rs 1494.1 cr Rs 665.6 cr
Income received from financial services Rs 219.3 cr Rs 164 cr
Other operating income Rs 34.6 cr Rs 20.3 cr

OfBusiness Expenses Breakdown

OfBusiness doubled its expenditure when compared with the last fiscal. The scale of operation, as well as the order flow, doubled for the company. The total expenditure of OfBusiness was measured at Rs 1680 cr in FY21, which was only Rs 815 cr in the previous fiscal. Here's listing its expenditure as compared with FY20:

Expenditure FY21 FY20
Purchases of stock-in-trade Rs 1451.11 cr Rs 645.70 cr
Other operating and admin expenses Rs 56.7 cr Rs 50 cr
Finance costs Rs 99.8 cr Rs 67.7 cr
Employee benefit costs Rs 55.4 cr Rs 43 cr
Transportation costs Rs 17.1 cr Rs 8.8 cr

OfBusiness Financials

OfBusiness Financials FY21 FY20
Operating revenue Rs 1748 cr Rs 850 cr
Expenses Rs 1680.05 cr Rs 815.2 cr
Profit/Loss Profit of Rs 55.7 cr Profit of Rs 32.3 cr
EBITDA margin 10.44% 13.72%

Looking at the unit level calculation, OfBusiness had to spend Rs 0.96 to earn a single rupee of operating revenue.

OfBusiness - Competitors

Funding Circle, Moglix, OnDeck, Zetwerk, Avant, Capital Float, InCred, SMEcorner, Infra Market, and Black Knight are among OfBusiness's main rivals.


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OfBusiness - Future Plans

OfBusiness' valuation has more than doubled in the last year, to $5 billion, thanks to an unparalleled financing boom. According to co-founder and CEO Asish Mohapatra, OfBusiness now expects to submit paperwork for an Initial Public Offering (IPO) by late-2022, with a domestic listing by the end of the year. It intends to hire investment bankers for its initial public offering (IPO) in March-June of next year.

β€œWe are profitable, and going public is the natural next step. Our commerce and lending businesses will continue to grow at 4x and 2x respectively the year after next as well. There is still a long way to go given the depth and unorganized fragmented market structure of B2B in India. We believe that we are in the nascence of the B2B revolution in the country,” Mohapatra said.

FAQs

What does OfBusiness do?

OfBusiness is a raw material collector and supplier of procurement financing. The firm collaborates with banks to provide loan lines to small and medium-sized businesses with annual sales of more than $3 million.

Which country is OfBusiness based in?

OfBusiness is an Indian company.

Which companies do OfBusiness compete with?

Funding Circle, Moglix, OnDeck, Zetwerk, Avant, Capital Float, InCred, SMEcorner, Infra Market, and Black Knight are among OfBusiness's main rivals.

Who founded OfBusiness?

OfBusiness was founded by Asish Mohapatra, Bhuvan Gupta, Ex Chandranshu Sinha, Nitin Jain, Ruchi Kalra, Srinath Ramakkrushnan, and Vasant Sridhar.

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