Spade Financial services which recently acquired majority of ConnectIndia.in for an undisclosed amount in an all cash deal will pump in $ 2 mn – $ 4 mn over a period of 2- 3 years to fund its expansion, Manish Sardana, CEO of ConnectIndia told Pi on Friday.
“Over 2-3 years, Spade will inject $ 2 – $ 4 mn as we expand into 100 cities, introduce more products and improve on technology,” .
In 2012 financial year, the company had a net revenue of Rs 5 cr and is targeting Rs 12 cr in FY 13.
ConnectIndia is a recommendation engine and e-commerce company which sells mobile and internet subscriptions to consumers. It was acquired last month by Spade Financial Services from Noida based Vriti Infocom. This is the financial services company’s first investment in the internet space.
Vriti Infocom was founded in 2006 by a group of IIT graduates and closed a $ 5 mn second round of funding led by Jafco Asia and Intel Capital in 2010. Since the second round of funding, Vriti announced plans to spin off its other web properties including ConnectIndia and IndiaHotelReview to concentrate on the Indian e-learning market – which was the key focus area for their investors.
“We reached a point where we needed more capital to grow and e-commerce was Vriti’s focus. Hence we decided to look for a buyer,” said Sardana. The company, he believes, is sitting on a very large opportunity as the market is similar to how the travel industry was before aggregators like Yatra.com and Makemytrip came into the picture.
“There is a lot of information asymmetry out there. Nearly 2.5 crore new connections are sold every month and there are multiple plans for each mobile operator. We make it easier for consumers to make a choice and purchase,” added Sardana. “Unlike travel, where there are many aggregators, telecom is a $ 40 bn market and it has no aggregators which will help consumers,” said Sardana.
ConnectIndia sells nearly 5,000 post paid connections every month and is now planning to sell DTH connections too, he added. The company sells in 40 Indian cities and has a workforce of 225 employees as of now and offers same day delivery.