Uses alternative data to facilitate credit to ‘new to credit’ gig workers
Eyes 10-fold growth in the next 12 months – boost product development, enhance the market footprint and team expansion
KarmaLife, India’s 1st real-time credit solutions provider for gig workers, raised $2.2 million in pre-series A round, led by Artha Venture Fund (AVF). Netgraph Investment, LV Angel Fund, Singularity Ventures, and Angel investors including Abhinav Sinha (CDC Group PLC), Amit Jain (CEO -Global Equity London), Balesh Sharma (MD -Vodacom South Africa, Ex-CEO Vodafone Idea), Vamsi Udayagiri (Founder Hesa), Vikram Kailas (MD & CEO Mytrah Energy) and Prateek Agarwal (ex-CBO BharatPe), also participated in the round. The Fintech platform will utilize the funds for further product development, team expansion, and employer partnerships. This is AVF’s 16th investment from its $33 million micro-VC fund.
Founded by Rohit Rathi, Naveen Budda and Badal Malick, KarmaLife has access to 130k+ users and is eyeing a 10-fold user growth in the next 12 months. Moreover, the company has been witnessing a 40% MoM growth in credit disbursement since July 2021 and will surpass ₹500 crores in disbursals by the next fiscal. KarmaLife plans to scale its business by partnering with 150+ new employers and will be launching various innovative financial products such as liquid savings and micro-insurance customized for this segment.
Taking cue from an unmet demand of relevant credit product at an affordable price for the 15 million data-rich but skill-poor workforce, the B2B2C startup solves their liquidity problem and offers financial products linked to their earnings & transaction history as well as mobile usage behavior. Personalized, subscription-based credit products, such as Earned Wage Access and dynamic Line-of-Credit, are offered based on proprietary real-time credit scoring system called ‘KarmaScore.’ KarmaLife caters to the Gig & Contract workers associated with some of the biggest brands such as Flipkart, Delhivery, Zomato and Uber, among others.
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| Rohit_Rathi co-founder of KarmaLife |
Rohit Rathi, Co-founder, KarmaLife, said, “We were surprised at the sheer lack of appropriate and sustainable credit solutions for low-income working populations. We are on a mission to solve this using technology, and have built a KarmaScore framework using alternative data, and a very scalable deployment model for employers and gig-platforms. We are creating a winning eco-system that brings together Financial Institutions, Employers, and Gig workers, to drive a new and transformative business model. We are already seeing ~85% repeat rates with our product along with significant levels of retention boost in an otherwise very high churn segment. This recent round of funding will help us to accelerate our vision of Financial Inclusion for Blue Collars in India.”
Anirudh A Damani, Managing Partner, Artha Venture Fund, said, “In a time where the gig economy is expected to contribute significantly to India’s GDP, KarmaLife is set to empower the segment’s workforce. KarmaLife’s credit solutions will introduce a sense of financial stability in an otherwise fragmented industry, which is bound to boost productivity. Moreover, the real-time credit access experience for the end-user also helps them overcome the enormous challenge of financial literacy.
We are super impressed by the team at KarmaLife and love they have been capturing the top 3 companies in the most labour-intensive sectors! Rohit has a solid track record as a serial entrepreneur, and we are confident that KarmaLife will cement its position as a category leader.”
How KarmaLife Works
KarmaLife serves Gig workers with subscription-based finance built on Digital Karma. It offers them digitally integrated real-time credit to better manage their day-to-day cash flows and become more financially resilient. They partner with employers/platforms to provide Earned Wage Access and dynamic Line of Credit solutions to their workers based on their work history and other digital data.
By partnering with KarmaLife, employers can provide inclusive, impactful, and easy-to-administer worker benefits that boost productivity and retention without any financial liability. Existing partners have seen up to 30% improvements in worker productivity and reduced churn after using the solution. Today KarmaLife works with major digital gig platforms across segments like ride-sharing, food-tech, e-commerce, logistics, flexi-staffing and others.
About Artha Venture Fund
Artha Venture Fund (AVF) is India’s first early-stage micro-VC firm with a corpus of $33 million. Since its inception in late 2018, AVF has primarily funded and supported multiple startups that operate as enablers and entities focused on solving the challenges of Indian consumers and businesses. The current fund allocates thematic investment for B2B, B2C/D2C, and D2C enablers.
Led by Anirudh A Damani, a second-generation investor, the firm has a network of limited partners, co-investors, founders, and family offices that traverse the globe. AVF’s portfolio includes Agnikul, LenDenClub, HobSpace, PiggyRide, Daalchini, Kabbadi Adda, and more.
Artha Group, the umbrella entity of AVF, has investments in 90+ startups across India, the US, Israel, and Africa like OYO Rooms, Purplle, IconBuild, Tala, LeveragEdu, Coutloot, Karza Technologies, Mobilewalla, Interstellar and more.
For more information, please visit www.artha.vc
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