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Open Financial Technologies Case Study – The Unicorn of 2022 success story

Open Financial Technologies Case Study – The Unicorn of 2022 success story

By Startup Authority

About Company

Did you know? As of 2022, there are a total of 91 commercial banks actively operating in India. Now, 20 of them are Public Sector Banks including SBI and 19 other nationalized banks. We cannot call Open Financial Technologies a bank but, it is a bank differently or indirectly and one of the best indian startups.

In simple, Open Financial Technologies is a neo-banking platform that is changing the fundamentals of business banking. In some way or the other, this neo-banking digital financing platform helps businesses to utilize their money effectively. We could also say that they teach businesses how and where to utilize money without wasting them.

Quite recently, this financial technology company made itself on the India's unicorn startups list. They were listed as India's 100th Unicorn company and received many awards from various hosts. Starting back in 2017 the company has established and achieved so much that even we will be awestruck. Today, Open Financial Technology is Asia's very first neo-banking platform for small businesses, SMEs, and startups. The mission and vision of this unique financial company are very much straightforward.

Open Financial Technologies is a Bengaluru-based unicorn startup. Interestingly, this business is fully supported by Kerala Startup Mission (KSUM). The founders of this unique company are Anish Achuthan, Deena Jacob, Mabel Chacko, and Ajeesh Achuthan.

Facts and Figures about Open Financial Technologies

Facts and figures are what anyone would expect from a financial company. Open Financial Technologies is Asia's first neo-banking company so, the facts and figures must be good. The company is trying to solve a huge problem, especially for SMEs.

At Open Financial Technologies problems are solved that two or more parties have experienced. For example, lack of infrastructure, financial problems, investing problems, financial tools usage, and many more. These are some of the parameters for which you will get solutions from the financial company.

Now, many reports say, business banking was broken especially for small businesses. The bigger enterprises enjoyed special privileges of the transaction from other banking groups. But, that was not possible for the newly established companies in the country.

Small and medium-sized enterprises faced a lot of hardships in tracking and forecasting cash flows. This is where Open Financial Technologies came in and solved the huge gaps in small businesses.

Helping many small businesses throughout the journey Open Financial Technologies have some interesting facts and figures for us. Some of the interesting facts and figures are the following:-

  • Open Financial Technologies is serving more than 500,000 SMEs as of today
  • This financial technology company has a transaction of US $ 14 billion annually
  • Using their superior and user-friendly platform any business owner can save up to two hours a day and their resources as well
  • Their product suites include Open Money, Open Book, and Switch
  • Products offered by Open Financial Technologies are Current Accounts, safe Payment Gateway, Cards, App Store, Virtual Accounts, Cash Management, Virtual Cards, and many more
  • As of 2022, Open Financial Technologies raised $140 million from some of the famous investors like Temasek, US Hedge fund Tiger Global, and 3one4 Capital
  • Open Financial Technologies employs between 201 to 500 employees in India itself
  • The total revenue generation of Open Financial Technologies in India ranges between Rs 1 crore to Rs 100 crore
  • The authorized share capital of this company is valued at Rs 35 lakhs and the total paid capital is Rs 28.72 lakhs

These are some of the interesting facts and figures about Open Financial Technologies. Some of them will expand more in the coming years.

How to Open Financial Technologies how Started?

This neo-banking company was founded by Anish, Mabel, Deena, and Ajeesh back in 2017. These people saw a huge gap in business banking in today's world. The idea was pretty simple but, the work ahead of them was quite heavy. Initially, this unique startup started partnering up with other banking brands in India. Yes, to survive in the market they needed to collaborate with other banking partners.

The founders of this neo-banking system did not delay and did their first collaboration with Kotak Bank. Interestingly, their first collaboration was done in the same year they established this neo-banking system. Open Financial Technologies started its very first beta program in partnership with Kotak Mahindra Bank. Interestingly, the program was appreciated by many small businesses in the country.

After the launch of their first program in the same year people started recognizing their brand. In the first half of 2018, Open Financial Technologies signed its first commercial partnership for payment accounts with two banks in India. Now, these two banks included Kotak and the other bank was Yes Bank.

Now, while opening this startup company Open Financial Technologies had already received an early-stage fund of Rs 2 crore from KSUM. This was the initial stage where Open Financial Technologies did not partner up with anyone.

Just after partnering up with two banks in the year 2018, this financial company raised $2 million in Pre Series A from lending VC funds and Yes Bank. Now, this was the stage where Open Financial Technologies grew rapidly and did not fall back.

Now, this is how Open Financial Technologies made its effective presence in the Indian market. They received many funds from many rounds and they are in a continuing process to date.

Open Financial Technologies Success Story

Starting this neo-banking company was a great success for them. The unique banking idea was greatly appreciated by all of its clients and workers. Interestingly, even before coming into the market Open Financial Technologies got huge funding from KSUM. Some of its initial achievements are mentioned in the above paragraph.

Just after acquiring 3000 businesses this neo-banking company never looked back. All it faced was only growth not only in the Indian market but, in other markets as well. In October 2018, Open Financial Technologies was first listed by CB Insights in '60 Global Fintechs Disrupting Traditional Banking. The introduction of Open Financial Technologies in the world market changed the face of the old traditional banking system.

The next month in December 2018, Open Financial Technologies processed more than $1 billion in a transaction. This is where the company received great clients and customers.

The next year in February 2019, Open Financial Technologies raised a whopping $5 million in Series A from 3one4 Capital, Beenext, and Speedinvest. Again in this phase of the company, the transactions went booming high. More and more people and clients started getting attracted to Open Financial Technologies.

Again in June 2019, this company raised $30 million in Series B from Tiger Global, Tanglin, 3one4, Ventures Partners, Speedinvest, and AngelList Syndicate. This amount was double what the previous time they raised in Series A funding.

The following month in 2019, Open Financial Technologies announced its first VISA partnership. Along with this partnership, they grew their tribe to 100 openers. In November 2019, they launched the famous OneCard especially built for SMEs and small startups. Again on February 2020, the company generated $11 billion in transactions and that is growing every year to date.

Open Financial Technologies Business Model

The business model of this financial company is quite simple. They only focus to support small businesses and medium-sized businesses in the world. Today, the company's platform includes a special digital business account. This account can be activated using a fully digital onboarding process and comes with integrated GST-complaint invoicing, payments, API banking, and many more.

In a nutshell, Open Financial Technologies help companies to use resources effectively. Open Financial Technologies offers business accounts that are in partnership with banks. This helps small and medium-sized businesses to automate their finances effectively.

Open Financial Technologies Revenue Model

Over the years, this neo-banking company is doing quite well. The company is receiving double the funds almost every year. On the other hand, it is also gaining enormous clients and customers in today's market.

The operating revenue of this company jumped over 7 times to Rs 40.9 crore in Financial Year 2022. Interestingly, their operating revenue for Financial Year 2021 was only Rs 5.7 crore. So, we can see the results of how the revenue is rapidly increasing within one financial year. The company is hoping that the revenue will increase in the coming years.

How Open Financial Technologies became a Unicorn?

The success story of this neo-banking company says how it became a unicorn. Yes, there is always hard work, efficiency, and determination behind all of their success.

Open Financial Technologies is Kerala's first unicorn startup. This company raised $50 million from Mumbai-based IIFL Finance in Series D which made them a unicorn. This is their latest transaction received which made them a unicorn. Additionally, if you are willing to know more about their revenue generation do visit their official website.

How Open Financial Technologies is different from Traditional Banking Systems?

There is a huge difference between the banking system when it comes to Open and the traditional one. Most know how traditional banks or its system work in the current Indian market. Small businesses or startups do not get enough help from these old traditional banks. But, that is not the case with Open Financial Technologies.

Open not only offers financial support and help but, they offer all support to start and run SMEs and medium-sized businesses financially. The fintech bank uses new technologies while the traditional banks still resort to the old ones. On the other hand, traditional banks lag when it comes to innovation and technological advances. But, this is not followed by Open Financial Technologies.