This is Paytm’s moment of glory, the big win.
World’s richest investor, and Oracle of Omaha: Warren Buffett is all set to invest in Paytm, and pick a minority stake.
Although both Berkshire Hathaway (the company which Buffett owns, and uses for investments) and Paytm hasn’t responded to this news, sparks are already flying.
Here are three interesting facts you should be aware regarding this investment:
Expected Investment: Rs 2000-Rs 2500 Crore
As per Mint, Berkshire Hathaway, the investment company owned by Warren Buffett is expected to invest Rs 2000 crore to Rs 2500 crore in Paytm. ($300-350 million). This can buy him 3-4% stake in the company.
Todd Combs, one of the key fund managers at Berkshire Hathaway is leading the talks of this investment.
This investment will be done at an expected valuation of $10-12 billion, which is not a big deal, because in January itself, Paytm breached the $10 billion valuation mark.
However, it is the prestige which is involved here, which makes it a massive moment for both Paytm and Indian startup eco-system.
This investment shall be an endorsement of India’s technological breakthroughs, and foray into the Digital world.
And this brings us to interesting fact #2.
This Will Be Buffett’s 1st Investment in India!
In case Warren Buffett invests in Paytm (any amount!), it will be his and Berkshire Hathaway’s first investment in India.
This may sound highly unlikely, but Warren has never invested in any Indian firm earlier.
Although Ajit Jain, an Indian is the Vice Chairman of Insurance Operations for Berkshire Hathaway and a very likely candidate for becoming #2 in Berkshire Hathaway once Warren retires, but there has been no investment yet.
In various interviews, Buffett has admitted that India has massive potential, and that he will love to invest, but he had never done so.
In 2011, Berkshire Hathaway and Bajaj Allianz partnered to sell insurance, but later, Buffett cancelled the partnership.
If the talks between Paytm and Buffett is successful, then Paytm will soon become his first Indian investment.
Interestingly, talks between Buffett and Paytm has been going on since February.
Buffett’s 1st Investment in Privately Held Tech Company!
Warren Buffett is known for disliking technological companies, and he has avoided investing into them.
As per Buffett, he doesn’t invest in companies whose business model he doesn’t understand, and tech is one of them. However, he invested in IBM and Apple, and both are publicly listed firms.
He sold his shares of IBM, but he still owns Apple stock.
Now, if Warren invests in Paytm, then it will be the first instance when he has invested into a privately held company.