Early-stage venture capital firm 8i Companies has fully divested its investment in M2P Fintech, realizing a remarkable 12x return on its initial capital.
The company had initially invested Rs 9.7 crore in the fintech startup in January 2020, and with its recent exit, it made a total return of Rs 115.9 crore.
This exit was part of M2P Fintech’s recent $100 million capital raise, which included primary and secondary transactions.
“We had the opportunity to return capital to our investors, and our limited partners are receiving more capital than they invested,” said Vikram Chachra, founding partner of 8i Ventures, describing the investment as a significant success for the company.
Investing in M2P fintech generates high returns
8i Ventures’ decision to invest in M2P Fintech in 2020 was based on its belief in the company’s vision to create a global banking-as-a-service (BaaS) platform.
At the time of the initial investment, M2P Fintech was valued at approximately $9 million. Today, the startup’s valuation has soared to around $600 million, allowing 8i Ventures to generate an internal rate of return (IRR) of 131%, turning the initial investment into a substantial payout.
Chachra highlighted how M2P Fintech has evolved from a card issuing platform to a broader BaaS provider, serving not only neo-banks but also small finance banks in India.
The fintech now offers services ranging from core banking to loan origination and card issuance, which have played a key role in increasing its value.
Partial release in 2022, full release in 2024
8i Ventures previously conducted a partial exit from M2P Fintech in April 2022. The latest exit marks the company’s complete exit from the company, making it one of the most successful investments in 8i Ventures’ portfolio.
The company’s first fund, Fund I, used only 10% of its Rs 100 crore corpus for M2P investment, but the outflow generated 1.27 times of the fund’s total corpus.
This exit contributes to the strong overall performance of Fund I, which grew 2.5x with an IRR of 37%. Other investments in this fund include startups such as Slice, Easebuzz and Blue Tokai.
M2P Fintech CEO and Co-Founder Madhusudanan R. praised 8i Ventures for its support throughout the company’s growth phases, saying, “8i was the first venture capital fund to believe in vision of M2P Fintech… They have supported us through every funding round, from seed to Series B. To us, they feel more like co-founders than investors.