Oxyzo

Oxyzo Foundation Story

Vision and Early Days

Oxyzo Financial Services was founded in 2016 as a subsidiary of OfBusiness, with a vision to transform the landscape of SME financing in India. The company was conceptualized by Asish Mohapatra, Ruchi Kalra, Vasant Sridhar, Bhuvan Gupta, and Nitin Jain, who recognized the significant gap in access to working capital for small and medium enterprises (SMEs) in traditional sectors of the Indian economy.

Initially, Oxyzo started as the financing arm of OfBusiness, providing cash flow-matched working capital financing for SMEs to purchase raw materials. However, the founders had a broader vision from the outset. As Ruchi Kalra, CEO of Oxyzo, explained to YourStory, "By the time they (banks and NBFCs) gave us a limit for credit, we would have lost the purchase order. So, we decided to do it on our own and that is how Oxyzo was born."

Founding Team Background

The founding team of Oxyzo brought a wealth of experience and diverse expertise to the table:

• Ruchi Kalra: CEO of Oxyzo, former Partner at McKinsey & Company
• Asish Mohapatra: Former investor at Matrix Partners
• Vasant Sridhar: Expertise in finance and operations
• Bhuvan Gupta: Former CTO at Snapdeal, bringing technological expertise
• Nitin Jain: Experience in finance and operations

This combination of skills in technology, finance, and operations was crucial in building Oxyzo into a leading fintech platform. The founders took significant personal risks, with Mohapatra and Kalra leaving their high-profile jobs and relocating from Mumbai to Delhi with their newborn to set up the business.

Oxyzo Business Evolution

From OfBusiness Financing Arm to Independent Fintech Powerhouse

Oxyzo's evolution has been remarkable. What started as a financing arm for OfBusiness has grown into a comprehensive financial services provider for SMEs. According to The Economic Times, Ruchi Kalra stated, "We have operated Oxyzo as a separate unit as part of the OfBusiness group with its own team and now the business has reached a point where it could raise capital on its own. For example, 70% of lending from Oxyzo is outside the OfBusiness suppliers."

This evolution involved expanding beyond purchase financing to offer a full stack of financial services, including:

• Working capital loans
• Supply chain financing
• Fixed income products for SMEs
• Debt capital markets services
• Securities business

Key Growth Milestones

• 2016: Founded as a subsidiary of OfBusiness
• 2018: Launched as an independent NBFC
• 2022: Raised $200 million in Series A funding, achieving unicorn status
• 2023: Expanded into micro-enterprise lending through investment in ZIEL Financial Technologies
• 2024: Reported 47% increase in net profit, reaching INR 290 Cr

Product Portfolio Expansion

Oxyzo has continuously expanded its product offerings to become a comprehensive financial services platform for SMEs. Key additions include:

• Purchase Finance: Tailored for SMEs in manufacturing and contracting sectors
• Special Situations Funding: Including acquisition finance, promoter financing, and cash flow financing
• Supply Chain Marketplace: Connecting SMEs with lenders and suppliers
• Fixed Income Products: Catering to the unique needs of SMEs
• Debt Capital Markets Services: Helping SMEs access capital markets

As stated on the Oxyzo website, these diverse offerings position Oxyzo as a one-stop financial solution for SMEs, driving both growth and financial inclusion.

Oxyzo Technology Infrastructure

Digital Lending Platform

Oxyzo's technology infrastructure is built to handle complex financial transactions efficiently and securely. The company utilizes advanced algorithms and data analytics to provide personalized financing solutions to SMEs.

At the core of Oxyzo's platform is its proprietary underwriting engine, which leverages data from multiple sources to assess creditworthiness and make quick lending decisions. This technology enables Oxyzo to offer faster loan approvals and more competitive rates compared to traditional lenders.

Security and Compliance Framework

Given the sensitive nature of financial data, Oxyzo places a strong emphasis on security and regulatory compliance. The company's security measures include:

• End-to-end encryption for data transmission
• Multi-factor authentication for account access
• Regular security audits and penetration testing
• Compliance with RBI regulations for NBFCs
• Strict data protection policies in line with Indian data protection laws

As stated on the Oxyzo Fraud Prevention page, the company is committed to maintaining the highest standards of data security and privacy for its users.

Innovation in Financial Technology

Oxyzo continues to innovate in the fintech space. Some of its recent innovations include:

• AI-powered credit scoring models for more accurate risk assessment
• Blockchain technology for secure and transparent transactions
• API integrations for seamless connectivity with other financial systems
• Mobile-first approach for easy access to financial services

These technological advancements have helped Oxyzo streamline the lending process and improve the overall customer experience for SMEs.

Oxyzo Market Impact

Disrupting Traditional SME Financing

Oxyzo has played a significant role in disrupting the traditional SME financing model in India. By providing a digital-first platform for quick and easy access to credit, the company has increased transparency and accessibility in the SME lending market.

According to YourStory, Oxyzo has leveraged the upward swing in India's manufacturing sector to grow its business. Ruchi Kalra stated, "Government spending on infrastructure has increased significantly mostly because that provides for more jobs, opportunities and so on…that has been a big boost for us at Oxyzo."

Growth in Assets Under Management (AUM)

Oxyzo has experienced substantial growth in its AUM over the years. Key figures include:

• FY2020: AUM of Rs 900 crore
• FY2022: AUM grew to Rs 2,600 crore, a 2.8X increase in two years
• FY2024: Reported AUM of $360 million (approximately Rs 2,700 crore)

This growth has been achieved while maintaining a low gross non-performing assets (GNPA) ratio of around 1.2%.

Financial Inclusion Initiatives

Oxyzo has been instrumental in promoting financial inclusion for SMEs in India. The company's initiatives include:

• Providing access to credit for underserved SMEs in traditional sectors
• Offering flexible loan terms tailored to SME cash flows
• Expanding into micro-enterprise lending through strategic investments
• Educating SMEs about financial products and best practices

These efforts have contributed to increasing formal credit penetration in the SME sector, particularly in underserved segments of the economy.

Oxyzo Financial Journey

Revenue Growth and Profitability

Oxyzo has shown strong revenue growth and consistent profitability since its inception. According to the company's financial statements, as reported by Inc42:

• FY2024:
  • Operating revenue: INR 903.3 Cr (59% YoY growth)
  • Net profit: INR 290 Cr (47% YoY growth)
• FY2023:
  • Operating revenue: INR 569.9 Cr
  • Net profit: INR 197.5 Cr

The company has maintained a pre-tax Return on Assets (RoA) of around 5.5%, demonstrating its operational efficiency and strong financial management.

Funding Rounds and Valuations

Oxyzo's journey to unicorn status has been marked by a single, significant funding round:

• March 2022: $200 million Series A round
  • Led by Alpha Wave Global and Tiger Global
  • Participation from Norwest Venture Partners, Matrix Partners, and Creation Investments
  • Valuation: $1 billion, achieving unicorn status

This funding round was notable for being one of the largest Series A rounds in Indian startup history, as reported by The Economic Times.

Path to IPO

While Oxyzo itself has not announced specific IPO plans, its parent company OfBusiness has indicated intentions to go public. According to reports, OfBusiness is planning an IPO for December 2024-January 2025, with Oxyzo's potential listing expected to follow a year later.

In preparation for these potential public offerings, both companies are focusing on strengthening their financial performance, enhancing corporate governance structures, and refining business strategies for sustainable growth.

Oxyzo Strategic Partnerships

Banking Collaborations

Oxyzo has forged strategic partnerships with several banks and financial institutions to enhance its lending capabilities and expand its reach. These collaborations enable Oxyzo to:

• Access a wider pool of capital for lending
• Offer co-lending products to SMEs
• Leverage the expertise and infrastructure of established financial institutions

Merchant Partnerships

Oxyzo has established a vast network of merchant partnerships, which has been crucial to its growth. The company's merchant network includes:

• Manufacturing units
• Suppliers and distributors
• Service providers in various industries

These partnerships have enabled Oxyzo to offer its financing solutions across a wide range of sectors, increasing the utility of its services for SMEs.

Technology Alliances

To stay at the forefront of fintech innovation, Oxyzo has formed technology alliances with various partners. These include:

• Collaboration with data analytics firms to enhance credit scoring models
• Partnerships with cybersecurity companies to strengthen platform security
• Alliances with blockchain and AI startups to explore cutting-edge technologies

These technology partnerships have helped Oxyzo continually improve its platform and offer innovative solutions to its SME clients.

Oxyzo Future Roadmap

Expansion Plans

Oxyzo has ambitious plans for future expansion. According to statements from the company's leadership, key focus areas include:

• Expanding the supply chain marketplace to include more lenders and suppliers
• Scaling up the micro-enterprise lending segment
• Enhancing the fixed income and securities business line
• Exploring inorganic growth opportunities through strategic acquisitions

The company aims to become a comprehensive financial services provider for SMEs across India, addressing various aspects of their financial needs.

Innovation Pipeline

Oxyzo continues to focus on innovation to maintain its competitive edge. The company's innovation pipeline includes:

• Further development of AI-powered financial advisory services for SMEs
• Exploration of blockchain technology for secure and transparent transactions
• Enhancement of the digital supply chain and embedded finance marketplace
• Development of new credit products tailored for different SME segments

These innovations are aimed at improving user experience, expanding service offerings, and maintaining Oxyzo's position as a leading fintech platform for SMEs in India.

In conclusion, Oxyzo's journey from a financing arm of OfBusiness to an independent unicorn in the fintech space is a testament to its innovative approach to SME financing, strong technology infrastructure, and strategic vision. As the company continues to expand its product offerings and reach, it is well-positioned to play a significant role in transforming the landscape of SME financing in India.