Pledged My Shares to Fund Paytm When SoftBank Money Went to Snapdeal: Vijay Shekhar Sharma

Paytm founder Vijay Shekhar Sharma had to run the fintech company by pledging his personal shares in December 2014. The crisis emerged after investor Masayoshi Son decided to fund Snapdeal instead of Paytm, Sharma revealed on Friday while speaking at a session during TIE’s India Internet Day event in Gurugram.

“So 2014 was the time when it was decided in the country that whoever has money will survive. Before us, Masa had announced funding to Snapdeal. There was some confusion back then. They (Snapdeal) were in commerce, we were in payments but commerce was a use case for us also. So the Masa deal went to Snapdeal,” Sharma recalled.

He further added, “In those days, everybody who could fund a large check was already with somebody. In other words, either Flipkart or Snapdeal had them. So ultimately, in December 2014, I pledged all my shares, took Rs 60 crore from HDFC. So for some time I ran the company from my personal shares.”

Sharma said that now India has solved the challenge of startup funding and it is not a big problem. He said securing funding earlier was one of the challenges that startups had to tackle and a founder should not give up on an idea if they truly believe in it.

He said that during the funding crisis, even Paytm’s board members denied him the budget and questioned the utility of the company but he was committed to the idea of starting Paytm, that was to digitalise payment in the country.

“Others said that people want to keep using cash but I was able to see that that was not the case,” he said.

Speaking of the time when Paytm was looking for funding, Sharma recalled that getting funding back then was like “crossing flyovers in Delhi’s Outer Ring Road”.

“The first flyover you cross is of angel funding. For the second flyover, there is no series A funding because all are tourist VCs… At that time, VCs were opening a few bases in India. Now Outer Ring Road has all the flyovers now. I think, funding in India is not that big of a problem. Now investors will value you if you are building for India in India,” Sharma said.

Sharma said that currently people consider AI as their agent or co-pilot but soon we will turn into the agents of this technology.

“So it is my reading that currently we consider AI as an agent, saathi or agent for us. I started using it for so many deep insights to take from it. Actually, after days we will be the agents to AI. It will not be an agent to us,”