MobiKwik posting losses since its establishment in 2009, but CEO says it will generate profits by FY17
Mobile payment wallet firm MobiKwik’s losses widened almost six times to Rs 41.5 crore in FY15 from Rs 6.4 crore in the previous year, according to a company filing with the registrar of companies. The company has been posting losses since its establishment in 2009 but expects to generate profits by FY17, according to Bipin Preet Singh, founder and CEO.
The m-commerce company generated income worth Rs 14 crore during the period, which is up almost three times from Rs 5.1 crore registered in FY14. MobiKwik’s revenues are largely generated from commission it charges its merchants for every transaction that ranges from 3% to 4%.
MobiKwik is eyeing financial services as an additional revenue stream to reduce the burden on commission. Controlling losses will continue to be a challenge for payment companies unless they find alternate revenue sources and offer exclusive deals.
As on March 31, 2015, majority shares of the company are held by promoters Upasana Taku and Singh, who hold 415,000 and 585,000 shares, respectively. Other investors such as Sequoia Capital India Investments holds 411,620 shares, Tree Line Asia Master Fund 88,058 shares and American Express Travel Relates Services Company holds 47,120 shares.
In April, MobiKwik had raised $25 million via Series B funding and investors included Tree Line Asia, Cisco Investment, American Express and Sequoia Capital. in 2013, it had raised $5 million in Series A funding from a US-based VC firm.
Later in August 2015, Mobikwik purchased a 99.9% stake, or 10,100 shares, of Delhi-based payment platform Zaak ePayment Services, according to a filing with the ROC. Taku and Singh had founded the company in 2010.