Gold loan startup Yellow Metal raises $3 Mn

Gold loan startup Yellow Metal has raised Rs 24.83 crore or just over $3 million in a Seed I round led by MSA Capital. With this, the Bengaluru-based company marks its first investment round in 2022.

The Board of Directors of Yellow Metal has approved a special resolution to issue 1 share and 3,662 Seed I Compulsory Convertible Preference Shares (CCPS) at an issue price of Rs 67,773 per share to raise Rs 24.83 crore or $3.02 million. Register of Companies (RoC).

MSA Capital led the funding round with Rs 9.92 crore, followed by WaterBridge Ventures and Spiral Ventures, which injected Rs 7.20 crore and Rs 6.20 crore, respectively. LetsVenture through LV Angel Fund and Java Capital through Csquare Venture Partners Fund also joined the round and invested Rs 80 lakh and Rs 70 lakh respectively.

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In November, the company also passed a special resolution to create an Employee Stock Option Plan (ESOP) under the 2022 Employee Stock Option Plan with 1,465 stock options convertible into the same number of shares. In accordance with FintrakrOn analysis, their ESOP pool is worth around 10 crores.

As the FintrakrEstimates value the company at around Rs 125 crore or $15 million (after money). The company has raised about $3.53 million to date, including its $514,000 seed round in October 2021.

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Founded in 2020 by Rahul and Nikhil Bogaram, Yellow Metal enables rural India to get simple gold loans at their doorsteps in 30 minutes with zero processing fees and interest rates ranging from 0.79% to 1.75% per month.

After the allotment, MSA Capital, WaterBridge Ventures and Spiral Ventures hold 7.99%, 12.45% and 5% stakes respectively. The complete share pattern can be seen below:

Yellow metal

Yellow Metal remained a pre-revenue stage company till FY21, but recorded total revenue of Rs 6.34 crore along with operating income of Rs 1.6 crore in FY22. According to its annual financial statements with the RoC, the startup posted a loss of Rs 62.8 crore during FY22.

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The two-year-old platform competes with companies like Indiagold, Rupeek and Ruptok.

Recently, India Gold has closed its own round of 22 million dollars While Ropik is in the final stages of negotiations to collect 50 million dollars From the existing sponsors according to A ReportThe gold loan market in India is projected to reach approximately USD 77.5 billion by 2025 at a compound annual growth rate (CAGR) of 12.75% over the period 2020-2025.


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