Merchant commerce platform Pine Labs has acquired fintech infrastructure company Setu. According Coach‘s sources, the deal is worth around $70 million.
“Setu will retain its team and brand and continue to operate independently,” company co-founder Sahil Kini said in a virtual press briefing on Thursday.
This is the third acquisition for Pine Labs in 2022. The Singapore-registered company took a majority stake at payment solutions provider Mosambee in April and Mumbai-based online payments startup Qfix in February.
Fintech infrastructure company Setu has expanded its offerings and now covers payments, data, investments and loans through its automated programming interface (API). In August 2021, the company partnered with Google Pay to offer fixed deposits through Equitas Small Finance Bank.
The company also runs the D91 Labs open source initiative to provide research and help fintech companies comply with regulatory requirements.
Setu had raised around $18.5 million, including a $15 million Series A round led by Falcon Edge and Lightspeed in April 2020. The company was valued at around $50 million during the round. Coach had exclusively reported Development.
Setu competes with M2P Fintech, Signzy and Decentro in the area of API infrastructure.
While Setu has yet to file its annual financial statements for FY22, the company reported operating revenue of Rs 3.31 crore in FY21 compared to zero in FY20.
The founders of Setu – Sahil Kini and Nikhil Kumar – have been members of India Stack for over six years. The initiative is a private bouquet of proprietary software applications and APIs powering most Aadhaar applications and the Digital India initiative.
Previously, Kumar was the co-founder of Voyce, a customer feedback system for SMBs which was later acquired by Exotel, while Kini founded Magnet Works, an industrial IoT startup.
The deal comes at a time when Pine Labs is expanding its offerings beyond merchant payments. Besides its Point of Sale (PoS) business, where the company offers card-reading terminals to merchants, Pine Labs also develops Buy Now Pay Later (BNPL), invoice management, gifting solutions and e-commerce solutions. .
Currently valued at $5 billion, the company is also considering an initial public offering (IPO) in the United States. According to media reports, it would fetch around $500 million at a public market valuation of $6-7 billion.