Indian fintech Jar, which closed a $32 million funding round in February this year, is in talks to raise new funding as it seeks to scale its product and expand its offerings.
The Bengaluru-based startup is engaging with several investors to raise around $50 million at a $350 million valuation, according to four people familiar with the matter. Asked to comment on Wednesday, Misbah Ashraf, co-founder of Jar, said it was too early to comment.
Tiger Global, an existing backer of Jar, is positioning itself to lead the startup’s one-year Series B funding, the sources said, requesting anonymity as the details are private. Folius Ventures and Paramark are also committed to investing in the new round, the sources said.
Jar, which operates an eponymous app, helps millions of Indians start their investments and save trips. The startup has amassed more than 7.5 million registered users, it revealed to investors last month.
Nearly a billion Indians today have bank accounts, but they have never made an investment. Part of the reason is confusion, explained Nishchay Ag, co-founder and managing director of Jar, in an earlier interview with TechCrunch. “Their world is littered with advertisements of different financial instruments,” he told TechCrunch in a previous interview.
For decades, banks and mutual funds have attempted to exploit the Indian masses with their products. Despite the hundreds of millions of dollars they have swallowed to conquer the market, they have managed to woo less than 30 million individuals.
“Making a product is one thing, being able to sell it is another. All of these institutions are good at manufacturing. To sell, you must align with the individual’s personality, idiosyncrasies, insecurities, cognitive load, and cultural significance. It’s an art and a science in itself,” he said at the time.
Jar tackles it by choosing a financial instrument familiar to most Indians: gold. For more than a century, Indians have hidden gold in their homes, treating the yellow metal as both a good investment and a status symbol, he said.
To say that the Indians, who have a private reserve worth $1.5 trillion worth of precious metal, would be an understatement. For generations, Indians from all socio-economic backgrounds have preferred to store their savings – or at least a part of them – in the form of gold. In fact, the demand for gold in India is such – Indians store more gold than citizens of any other country – that the South Asian nation is also one of the world’s largest importers of the precious metal.
Jar fetches a small amount each time a user makes a transaction. It rounds up an individual’s daily expenses and sets money aside as an investment. Users’ investments in digital gold are backed by physical gold of the same amount and they can choose to withdraw that much gold or liquidate their investments at any time.