Bengaluru-based digital book-keeping app Khatabook has landed a USD 100 million check in its Series C round led by US-based investors Tribe Capital and Moore Strategic Ventures (MSV).

Alkeon Capital, B Capital Group, Sequoia, Tencent, Unilever Ventures, RTP Global, and Better Capital also participated in the deal, which values the company at USD 600 million, the company said in a statement on Tuesday. The funding round was a mix of a primary infusion and a secondary share sale by existing shareholders, including early investors and employees.

Khatabook is buying back USD 10 million worth of ESOPs (employee stock ownership plans) “to acknowledge and reward employees, ex-employees, and early investors who contributed to the company’s growth,” the company said, adding it has expanded its ESOP pool to USD 50 million.

With fresh funds in its kitty, the three-year-old startup plans to diversify its business by rolling out financial services for small businesses.

“The first phase of our journey was enabling digital transformation by building a tech ecosystem for Indian MSMEs (micro, small, and medium enterprises),” Ravish Naresh, CEO and co-founder of Khatabook, said in a statement. “The next step will be digitally-enabled financial services for small businesses.”

The financial services that it plans to offer, in partnership with stakeholders in the fintech space, “will digitally foster lending, payment, and deposits related efficiencies in the ecosystem,” the company noted, without divulging any more details.

“This round will accelerate the growth of technology products with which Khatabook’s customers can better serve Indian consumers,” said James McIntyre, senior managing director and COO of MSV. “Additionally, this round enables the launch of a next-generation financial services platform to escalate the growth of those same customers.”

In addition to building financial services, the company will use the funding to strengthen its talent base. Khatabook, which currently employs over 200 people, said it will accelerate hiring primarily across engineering, product, design, analytics, and data science functions.

Started by Ravish Naresh, Jaideep Poonia, Dhanesh Kumar, and Ashish Sonone, Khatabook works with millions of small and medium businesses (SMBs) to digitize their accounting books. The majority of Indian small and medium businesses keep physical ledger books, in which they note down their creditor’s name and the amount they owe every day. Khatabook’s mobile app allows them to digitize this process and claims to make it more streamlined and accessible. It also enables them to send periodic reminders to creditors and collect payments through the app.

Y Combinator-backed Khatabook was part of Sequoia’s early-stage accelerator program Surge. Within a year of rolling out its app in December 2018, it amassed five million merchants from more than 3,000 cities. Currently, Khatabook claims to have over 10 million monthly active merchants on its platform and supports 11 local languages.

Aside from its flagship ledger application, Khatabook also operates Pagarkhata for staff management, Cashbook for expense management, and recently acquired Biz Analyst for insight-driven decision-making and business management for Tally ERP9 user base. According to the company, it has experienced 150% year-on-year growth in the financial year ended March 2021.

Arjun Sethi, co-founder and partner at Tribe Capital, said in a statement that while Khatabook has successfully enabled MSME businesses to move from paper to digital platforms, “the company is still early in its path to power the segment.”