OfBusiness plans to invest in profitable SMEs

New Delhi, 21 Dec (KNN) OfBusiness is a technology-enabled platform that facilitates raw material procurement and credit in the business-to-business (B2B) markets, focusing on the manufacturing and infrastructure sectors. It enables B2B commerce on its platform to help customers get better products at competitive prices through online and offline support.

OfBusiness has raised USD 325 million at a valuation of USD 5 billion, as reported by mint.

According to co-founder Nitin Jain, OfBusiness plans to use the funds to diversify its business, secure a foothold in the export markets, boost its financial services and credit businesses, and enter the manufacturing segment.

With the latest fundraising, the company will also explore investing in profitable small and medium enterprises (SMEs) that manufacture industrial goods to optimize their asset usage and strengthen its supply-chain operations.

“We noticed that SMEs run only on 50% capacity and lack resources to scale their output. Hence, through partnering and investing in them, we realized that we could help them increase their profitability through a jump in utilization while ensuring they grow multifold. Through investments, we will look at backward integration, help SMEs utilize their dead assets for goods that we also sell and distribute," added Jain.

Newer categories, including raw materials for agriculture, food processing and garment industries, are contributing roughly 25% of the firm’s monthly gross merchandise value as reported by mint.

The company is looking to add newer products and stock units for the chemicals and steel industries in the coming months. It has an active base of 2,500 suppliers and reaches over 80 cities in India.

The company will also look to diversify itself from credit and offer newer financial products for its supplier base. Currently, the company provides unsecured and secured loans to its supplier base through its NBFC arm.