Qapita secures US$1.8M seed funding to help startups manage their cap tables, ESOPs digitally
Singapore-based Qapita Fintech, a digital equity management software company, has raised US$1.8 million in seed investment, led by Vulcan Capital.
Other investors who co-led the round include Alto Partners Multi Family Office, Atin Kukreja (CEO of Rippledot Capital), Koh Boon Hwee, K3 Ventures, KDV Holdings, Mission Holdings and several Northstar Group Partners, including Patrick Walujo.
The fresh funding will be used to strengthen and build Qapita’s team, accelerate product development and build its client base.
Qapita was founded in 2019 by Ravi Ravulaparthi (CEO), Lakshman Gupta (COO), and Vamsee Mohan (CTO) — who recognised the inefficiencies in private market ownership and transactions, coupled with the need to digitally disrupt this sector.
Its platform, QapMap, is designed to enable capitalisation table (cap tables) management, employee stock ownership plan (ESOP) management, and digital ESOP issuance with the aim of eventually enabling digital share issuance for companies across the region.
Through the platform, fast-growth private companies and startups can record and manage equity ownership and ESOPs “seamlessly and accurately”, which can then be accessed by different stakeholders — from investors and founders to employees.
CEO Ravulaparthi said: “We launched the company seeing the opportunity to tap into the rapid growth of startups, angel investments and employee ownership in Southeast Asia and India. Having worked alongside multiple founders and startups during their fundraising journeys, we recognised the huge gaps that exist in digitising ownership records.”
“If records are systematically digitised today, then transactions can be digitised in the future. We also believe the platform will encourage more employee equity ownership in startups. The ESOP value proposition should be as simple as a pay slip,” he added.
Qapita has offices in India and Singapore, and will initially serve customers based in Singapore, India and Indonesia before expanding into other markets.
The startup ecosystems in India and Southeast Asia are thriving and growing at a rapid pace, with capital increasingly being allocated to up-and-coming players. An increase in funding is significant, as more companies build on the opportunity to reach growth stages or become attractive acquisition targets.
While global venture funding dipped 17.5 per cent year-on-year in the second quarter of 2019, internet startups in Southeast Asian snagged US$7.6 billion in the first half of the year, up 7 per cent from the same period in 2018, according to the e-Conomy SEA 2019 report by Google, Temasek Holdings, and Bain & Company.
Almost US$37 billion was pumped into the region’s internet economy between 2015 and the first half of 2019, and it was close to hitting US$40 billion and US$50 billion in funding, the report noted.
2019 was a milestone year for the Indian venture capital industry, with US$10 billion in capital deployed, which is 55 per cent higher than 2018, and deal volume increased by 30 per cent, according to Bain & Company.
Tommy Teo of Vulcan Capital said: “The Qapita platform will empower all equity stakeholders to digitally manage their holdings in this region, where each country has its own unique regulatory landscape. With high growth companies remaining private for longer, we believe digital equity management and liquidity solutions to be a multi-billion dollar opportunity.”