Perfios: From Losses to IPO As FY23 Profits Soar

perifos startup

In a financial feat, Perfios, the Fintech SaaS startup founded in 2008 by VR Govindarajan and Debasish Chakraborty, has scripted a remarkable success story in the fiscal year 2022-23 (FY23). The company not only turned the tables but also catapulted into profitability, boasting a consolidated net profit of INR 7.8 Cr. This marks a monumental shift from the INR 16.8 Cr net loss reported in the preceding fiscal year (FY22). The FY23 journey has been nothing short of extraordinary for Perfios, with its operating revenue experiencing an astonishing 200% YoY surge, reaching a formidable INR 406.8 Cr.

Riding the Waves of Revenue:

Perfios, a stalwart in providing software solutions to financial institutions, witnessed a revenue revolution, with India taking center stage in its success narrative. In FY23, the startup’s domestic revenue soared by an impressive 211%, totaling INR 382 Cr, up from INR 122.6 Cr in the previous fiscal year. Simultaneously, international ventures contributed INR 24.7 Cr, a notable increase from INR 13.8 Cr in FY22.

The heartbeat of Perfios’ revenue machine lies in its diverse income streams. Software support for loan processing emerged as the hero, contributing INR 198.5 Cr and experiencing a robust 90% YoY growth. Service income, a formidable contender, surged over 28X YoY to INR 166.5 Cr, securing its position as the second-highest contributor to sales revenue. Perfios also reaped rewards from software coding and maintenance services, license fees, and subscription charges.

team perfios

Expenses in the Limelight:

With great revenue comes great responsibility, and Perfios, true to form, saw its total expenses more than double to INR 386.4 Cr in FY23 from INR 155.9 Cr in the prior year. Employee benefit expenses took center stage, devouring over 55% of the total spending. Employee costs skyrocketed to INR 213.5 Cr in FY23 from INR 99.7 Cr in the prior fiscal, with a significant chunk devoted to salaries and wages. Additionally, INR 7.1 Cr was allocated to employee share-based payments.

Other major expenses witnessed notable surges as well. Depreciation, depletion, and amortization expenses rose by over 200% to INR 32 Cr. Legal professional charges surged by 80% to INR 41.1 Cr, and miscellaneous expenses ballooned to INR 70 Cr from INR 13.5 Cr in FY22.

Strategic Moves and Investments:

Perfios’ journey to success is punctuated with strategic moves and investments. A pivotal moment came in September when the company inked a significant agreement with Kedaara Capital, securing a substantial investment of $229 Mn in its Series D funding round. This financial boost follows other strategic initiatives, including the acquisition of Chennai-based open finance platform and a noteworthy ESOP buyback of shares worth INR 154 Cr.

The acquisition trail continued with Perfios acquiring fintech startup Karza Technologies, and the INR 600 crore investment seems to have paid off handsomely. Karza alone contributed INR 168 crore in revenue and INR 51 crore in profit after tax in FY23, playing a vital role in Perfios’ consolidated profitability.

Looking Towards the Future:

As Perfios revels in its FY23 triumphs, the company is gearing up for another milestone – an Initial Public Offering (IPO) within the next 18-24 months. The leadership team witnessed reinforcements with Sumit Nigam joining as Chief Technology Officer (CTO) and Anu Mathew taking on the role of Chief People Officer (CPO), signaling a strategic move towards IPO readiness.

Perfios’ financial resurgence is not just in numbers but also in the sheer scale of its operations. Processing a staggering 1.7 billion transactions annually and managing assets worth $36 billion, Perfios stands as a testament to resilience, innovation, and strategic foresight in the ever-evolving landscape of financial technology.

In conclusion, Perfios’ transformation from a startup facing challenges to a profitable Fintech SaaS unicorn is a beacon of inspiration. The FY23 success story reflects not only financial acumen but also a commitment to excellence and growth, setting a compelling precedent for the future of the financial technology sector.

What do you think?

Written by Rajeev

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