IIFL’s early-stage investment arm IIFL Fintech Fund has exited fraud detection platform provider TrustCheckr after the recent acquisition of the Bengaluru-based startup by TrueCaller.
The exit marks a first for the fund, which acquired the stake for nearly $1 million in March last year. After 18 months, the fund has sold its holding for close to $1.8 million, the company told FE.
The exit comes at a time when funding in fintech companies is seeing an uptick as investors are optimistic about the country’s digital payments growth. Tracxn data showed while funding in the broader tech sector remained low in the July-September quarter, the same among fintech startups rose 68% over April-June to $436 million.
Founded by Shivraj Harsh and Adhip Ramesh in 2017, TrustCheckr is a software-as-a-service platform that helps businesses verify customer information and detects risk of fraud based on phone numbers and digital signals. Various banks and non-banking financial companies have deployed it.
Earlier this week, caller ID and spam detection app TrueCaller bought a 100% stake in Unoideo Technologies, the company that houses the TrustCheckr platform, for an undisclosed amount. The acquisition was aimed at bolstering Truecaller’s risk intelligence tool for enterprises.
TrustCheckr has so far raised $1.1 million in funding in two rounds at an undisclosed valuation, as per Tracxn data, with the largest investment coming from IIFL’s fund. “IIFL Fintech Fund has been instrumental in our product development and enhancing business growth strategy. It played a vital role in the fundraising and M&A process,” said Adhip Ramesh, co-founder of the company.
IIFL Fintech Fund was set up in August 2021 with a corpus of Rs 210 crore and has invested in 13 early-stage financial technology companies, including stock screening platform Trendlyne, document infrastructure platform Leegality and investment app Multipl. The fund has sponsorship from two group companies – IIFL Finance and IIFL Securities.
The fund focuses on partnering with its investee companies for product development and business growth. Its manager Mehekka Oberoi said the fund has helped the company enhance its overall product and platform to ensure business adoption. “Attaining an 80% IRR and ensuring early liquidity to our investors (in less than 18 months) underscore our commitment to ensuring our investors make maximum returns,” she said in a media statement.