Mountain Capital, an investment subsidiary of fabless semiconductor producer MediaTek, has invested $60m in India-based financial services platform Paytm, Paytm founder and CEO Vijay Sharma confirmed to TechCrunch yesterday.
MediaTek provided the funding to Paytm’s parent company One97 Communications at a $4.83bn valuation as part of a larger round expected to reach $300m, two separate sources close to the company said.
One97 was founded as an e-commerce operator but intends to spin out Paytm in the next few months as it begins operating an online banking service called Paytm Payments Bank. It will use the cash both to expand its online services, which include booking events, rides and accommodation, and launch the bank.
Sharma told TechCrunch: “The majority of smartphones in India today are sold with MediaTek chipsets.
“MediaTek wants to expand into security and services because they believe that from chipsets they can grow into services. We can expand our business by integrating into MediaTek’s smartphones, and MediaTek can grow its business by offering security integrations to us and others.”
The Mountain Capital investment took One97’s total funding to $760m, according to Sharma. China-based e-commerce group Alibaba and its financial services affiliate Ant Financial reportedly provided $680m for the company in 2015, and were said to each own a 20% share of One97 prior to MediaTek’s investment.
Alibaba and Ant are expected to take part in the $300m round along with fellow existing investor SAIF Partners as well as manufacturing services provider Foxconn and conglomerate Fosun.
Earlier reports suggested One97 had received about $90m in funding from SAIF Partners, Intel Capital, the corporate venturing unit owned by chipmaker Intel, Silicon Valley Bank and Sapphire Partners between 2000 and 2014.