Sequoia Capital hits a jackpot with Pine Labs

Pine Labs is perhaps one of the best bets made by Sequoia Capital in the Indian startup space. The VC firm which invested in Pine Labs for the first time in 2009 has managed to cash in nearly $181 million via multiple secondary transactions over the last several years.

Pine Labs is being valued worth of $1.5 billion in the ongoing Series H round. Mastercard Asia Pacific infused $70 million via primary stake acquisition while the rest $30 million came via secondary transactions where Sequoia and 33 individual shareholders diluted their stake.

Sequoia took home around $26.8 million in this transaction. And this was not the first partial exit for the American VC.

Sequoia’s last investment tranche in Pine Labs was made through ‘Sequoia Pine Investments Holdings.’ when it infused $3 million in December 2015. Apart from Sequoia, many stakeholders including founding members and senior employees of Pine Labs have also made some significant fortune through secondary events.

Around 85 different employees across levels made money during secondary transactions in the last five years.

Unlike many in the PoS business, Pine Labs has been a real one, and this could be sense from its financial performance in FY19. The acquisition of QwikSilver proved to be a masterstroke.

Pine Perks, the gifting platform floated by PineLabs after the purchase of the Amazon-backed firm, accounted for 76.5% sale of products, generating Rs 98.2 crore revenue during FY19. It was about a three-fold jump from the sales of Rs 33.08 crore in FY18.

Qwikcilver’s co-founder and director Kumar Sudarsan currently holds a stake worth around $8 million in Pine Labs after selling shares worth half a million USD to Mastercard.

The partial exit of its prime-backer Sequoia and top-rung from Pine Labs is a demonstration of believing in a goal together with a long haul view. That said, since the PoS business has come to a standstill over the past two-and-a-half months due to Covid-19 crisis, Pine Labs along with others in the sector will have to face severe damage in the ongoing fiscal.