EnKash eyes break-even in 2-3 years

Vishnoi cofounded EnKash in 2018 with Naveen Bindal and Yadvendra Tyagi.

EnKash, break-even
The starup is currently one of the fastest-growing all-in-one spends management and corporate cards companies in India.

Fintech startup EnKash expects to break even in the next two-three years, as it currently focuses on investments into the business rather than profitability, according to co-founder Hemant Vishnoi.

“There will always be investment into products and technology. You have to do some kinds of inorganic growth also over a period of time. The decision would be build versus buy within the organisation. So, essentially those are the long-term investments which we are making right now. That is where the majority of money is getting invested. And, that is why around two-three years is the timeline where we are looking at break-even,” Vishnoi told FE.

Vishnoi cofounded EnKash in 2018 with Naveen Bindal and Yadvendra Tyagi. The starup is currently one of the fastest-growing all-in-one spends management and corporate cards companies in India. Customers of the startup are mostly the “upper segment” of MSMEs. Its typical customers are either medium-size enterprises or emerging large corporates, who face the most challenges of managing cash flows.

“Effectively, as our business is growing, we need to have some investment space in the business itself rather than than focusing on profitability as of now. I don’t think that would be the right approach, otherwise it will slow down your growth,” Vishnoi said, when asked about breaking even.

The company is currently operating at an annualised run rate of $3 billion of spends through its platform. It is planning to grow three times by the next financial year.

EnKash is looking for inorganic growth as well.

“For cash flow management, you need to have real-time access to your payment processing… So the areas (for possible acquisition) would be complementing around how better we can provide visibility to any business on the cash flow side. Some of these things we have already built on our platform, some are going to be built and others we may decide to have from other players, who can easily get plugged into our platform,” Vishnoi said.

“Our endeavour is to see how we can help businesses by offering our spend management platform, where they can fast-track their cash inflows as well as push certain cash outflows or restrict certain cash outflows which are unnecessary to the business. As we are growing and increasing offerings to our platforms, our idea is cash flow will always be the core and centre of our thought process and objectives and we will offer products and solutions to mitigate cash flow challenges, which a business typically faces,” he said.

EnKash received an in-principle approval from the Reserve Bank of India in January this year to operate as a payment aggregator. It had applied for the Payment Aggregators and Payment Gateways licence so that it can be in control of the fund flows of its customers.

“Typically, this licence is required if you have to operate end-to-end in terms of how the funds are flowing for your customers. Also, on the collection side, RBI has said that whoever is collecting money for end beneficiaries, the systems and processes should be in place. And, this license is about that,” Vishnoi said.

“We want to go deeper into account receivable part of the businesses by having an end-to-end control, which we were doing with the help of existing payment aggregators. Now, with this licence in place, we will be able to do it in-house end-to-end and that will provide us more flexibility in terms of doing customisation for the businesses. Apart from customisation, we can bring in a lot of products and solutions on the back of this licence which can be sold in the markets directly to the businesses. Once the final approval be provided, then only we can kick start our account receivable programme,” he informed.

The fintech startup has so far raised a total of $23 million after bagging $20 million in a Series B funding round in April, 2022. The round was led by Ascent Capital and joined by Baring India and Singapore-based White Ventures. It also saw participation from EnKash’s existing investors, Mayfield India and Axilor Ventures. EnKash had raised USD 3 million in a Series A round from Mayfield India and Axilor Ventures in April, 2019.

“We have enough reserves now. So, we have no plan to raise money from the market at the moment,” the co-founder added.

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First published on: 13-03-2023 at 03:40 IST
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