Google-backed Neobank Open at a valuation of $1 billion

Neobank Open is the next in line to join the unicorn club with its upcoming funding round that will value the company at over $1 billion.

The round will also see participation from existing investors and is a mix of primary and secondary fundraising. Of the $100 million, the fresh (primary) fundraise is in the range of $50 to $75 million, according to two people aware of the development.

"Open is in talks with sovereign funds Abu Dhabi Investment Authority (ADIA) and Qatar Investment Authority as well, but they may join only in the next round," added one of the people mentioned above. A unicorn is a privately funded company with a valuation of $1 billion or above.

During Open's Series C round, the company raised $100 million led by Temasek and with participation from Google, Japan's SBI Investments and Visa. The previous round valued Open at $500 million, and the current round will double the company's valuation. The startup's other investors include Tiger Global, 3one4 Capital, BEENEXT, Speedinvest, AngelList, Tanglin Venture Partners, Unicorn India Ventures and Recruit.

For TVS Capital Funds, this is the third fintech investment after Digit Insurance and enterprise debt marketplace CredAvenue. Open, which serves as a neobanking platform provides business banking solutions for Small and Medium Enterprises (SME). Its products include providing current account, credit, payroll, invoicing, cash management services, among others, to SMEs, startups and freelancers.

While the neobanking space has a large number of players including Jupiter, Freo, Niyo, EpiFi etc., Open directly competes with RazorpayX which is also an SME-facing neobank. The other players provide banking solutions for individuals.