Razorpay acquires majority stake in Malaysian fintech startup Curlec

Razorpay has acquired a majority stake in Malaysian fintech firm Curlec as it looks to gain a foothold in South East Asia, a market it holds key to its overall growth narrative. The acquisition marks Razorpay’s first international expansion. The company did not disclose the specifics of the deal. Addressing a virtual press conference on Tuesday, CEO & co-founder Harshil Mathur, however, said that the deal values Curlec at about $19-20 million. Razorpay will eventually acquire the full company and the process is expected to close in the next 12-18 months, Mathur said.

Kuala Lumpur-based Curlec builds solutions for recurring payments for modern businesses of all sizes. Founded by Zac Liew and Steve Kucia in 2018, the company’s annual revenues are said to have been growing at nearly five times since its launch. “This acquisition will allow us to significantly ramp up and start scaling in South East Asia as a market,” says Mathur.

The rationale behind foraying into South East Asia is the similarity the region shares with India in terms of the pace of digital adoption, market challenges and other related nuances, explained Mathur.

The idea will be to tap into the experience the fintech startup gathers from its launch in Malaysia and then expand into other regions like Vietnam, Thailand, Indonesia and Philippines. Razorpay will make additional investments into Curlec to build and grow the business. Besides, Razorpay also plans to introduce some of its India-based solutions and products in Malaysia and other South East Asian markets. “With this acquisition, we will bring a lot of products and services that we have built in India to these (South-East Asia) markets. Our core payment product will be the first to launch in some of these markets,” said Mathur.

“Today, South-East Asia is a digital payment powerhouse, having witnessed significant financial transformation over the last few years, driven by changing consumer and retail trends and more inclusive payment options. And while e-commerce is already booming in Malaysia with an estimated market size of $21 billion in 2021, an industry report said it is estimated to grow further to over $35 billion by 2025, fuelled by the emergence of new mobile payment methods,” Razorpay said in a statement.

Curlec marks Razorpay’s fourth acquisition since its inception in 2014. Prior to this, the startup had acquired TERA Finlabs, an AI-based risk tech SaaS platform, Opfin, a payroll and HR management solution and fraud analytics AI-platform Thirdwatch.

Valued at over $7.5 billion, Razorpay today serves over eight million businesses including Ola, Zomato, Swiggy and Cred. The startup claims to have achieved $60 billion in total payment volume (TPV) as of early December 2021. The company said that it plans to achieve $90 billion TPV by the end of 2022. Backed by a spate of investors including Sequoia Capital, Tiger Global Management, GIC and Ribbit Capital, Razorpay has raised about $741 million in funding so far.