Power2SME, an online buying club for small and medium enterprises, has raised a fresh round of funding led by Infosys co-founder Nandan Nilekani. The round of funding also saw participation from existing investors Accel Partners, Kalaari Capital and Inventus Capital. An Economic Times report pegged the size of the investment at $20 million.
Power2SME will use the funds to broaden its product portfolio, strengthen vendor relationships and engage with SMEs through out India. The company will also strengthen its technology platform and mobile app offering.
Power2SME works by buying raw materials directly from the manufacturers in bulk and selling it to the SMEs, thereby eliminating the need for wholesalers and distributors. The company aggregates the orders received from various SMEs and collectively places them to get an optimal price from suppliers. It offers raw materials across various categories like chemical additives, commodity polymers, engineering polymers, inks, steel and paints to its clients.
The company has 30,000 SMEs on the platform and is currently focused on SME hubs of Gujarat, Maharashtra, West Bengal, Tamil Nadu and Delhi-NCR. It sources raw material from large vendors such as SAIL, Tata Steel, Essar Steel, GAIL, JSW , Haldia Petrochemicals, DuPont, Posco Steel and Apollo Pipes.
In September 2014 , the company raised Rs 42 crore in Series C funding from Inventus Capital, Kalaari Capital and Accel Partners. Prior to this, Power2SME had raised $6 million from Accel Partners in April last year. It had also secured undisclosed amount of Series A investment from Kalaari Capital in December 2012 and Rs 10 crore investment from Inventus Capital Partners in September 2012.