India’s largest mortgage lender HDFC is investing in the $5-million Series B round in Tyfone Inc, a mobile payments solutions company. HDFC Holdings Ltd, Polaris Software Lab, a strategic manufacturing partner, and existing investor Ojas Venture Partners have backed the six-year-old firm.
Last month, financial technology services firm Polaris Software Lab Ltd said its unit is investing $500,000 for 2.5% minority stake in Portland and Bangalore-based Tyfone, which may peg the valuation at $20 million.
Tyfone is producing a technology which brings contactless payments onto a MicroSD memory card. While other technologies use the MicroSD form factor, only Tyfone’s maintains the use of the memory card and allows updates to account information to be made wirelessly, the firm said in a statement.
Industry analysts are predicting that the near field communications (NFC) technology, used to enable contactless payments, will be available in as many as 90 million phones by 2014. But today there are more than 1 billion mobile phones that have MicroSD slots, and the vast majority of phones being manufacturered today include these memory slots. Therefore Tyfone’s contactless payments technology stands to leap past the initiatives of manufacturers such as Nokia and others, it added. Tyfone’s solution is neutral between mobile operators, financial institutions and retailers and the firm also has patents on their technology.
Earlier this year, the firm tied up with US-based payment processing major First Data Corporation to provide MicroSD memory cards equipped with Tyfone’s patented technologies.
Tyfone will use the funds to accelerate production of SideTap™ MicroSD memory cards for mobile contactless transactions and scale its software centric business including mobile banking, couponing and loyalty solutions.
Tyfone’s Asia-Pacific headquarters are located in Bangalore. Tyfone has manufacturing relationships in Taiwan and component partners in Israel, Germany, and Singapore. The firm was founded in 2004.
“Now that our core technology has been developed, patented and is in production, this new funding allows Tyfone the ability to bring our solutions to new markets and build a broader ecosystem. The investors who participated in our Series B financing round bring unique expertise within financial services and we’ll benefit from their knowledge beyond the value of their financial investment in Tyfone,” said Tom Spitzer, CEO of Tyfone.
“The market for mobile financial services is nascent but significant. HDFC Holdings was impressed with the team, the technology, and patents that Tyfone possesses and we recognize that Tyfone is in a unique position to leverage a global market opportunity,” said V Srinivasa Rangan, director of HDFC Holdings, Ltd and executive director, HDFC.
“We have been impressed with the company’s prudence, determination and its critical accomplishments in building a unique and global product line, patents and partnerships. Our continued participation will assist Tyfone in building a strong international team, attract quality technology partners and secure significant commercial wins,” said Rajesh Srivathsa, managing partner of Ojas Venture Partners.