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Leap Finance is currently in discussions to secure $100 million in funding, aiming for a valuation exceeding $1 billion.

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Leap Finance, a fintech platform designed for Indian students pursuing higher education abroad, is in discussions to secure $70-100 million in a new funding round, as per two sources familiar with the situation. The company is seeking new investment more than two years after its Series D round.

“Leap has been performing well over the past two years, attracting interest from several investors, including existing ones,” said one source, who requested anonymity due to the private nature of the talks. “The company is in negotiations with at least three new investors to raise up to $100 million in its Series E round.” Sources suggest that this round could elevate Leap to unicorn status.

Leap, incorporated in San Francisco, last raised $75 million in its Series D round led by Owl Ventures, with contributions from Steadview, Paramark Ventures, Jungle Ventures, and Peak XV, in June 2022, at a valuation range of $850-900 million. The exact valuation, shareholding, and revenue details remain unclear as the parent entity is not registered in India.

“The terms of the deal are being negotiated with two of the three new investors, and Leap is expected to finalize the lead investor for the new round in a few weeks,” said another source, also wishing to remain unnamed. “The company is seeking a valuation of $1 to 1.2 billion in the Series E round.”

Sources claim Leap has experienced substantial growth since its Series D round. The firm facilitates educational loans for students aiming to study at overseas universities, offering test prep apps for IELTS, TOEFL, SAT, admissions, and visa counseling, as well as financial services through LeapScholar, LeapFinance, and Yocke. It also provides assistance with international bank accounts, credit cards, and money remittance.

“The new round will comprise both primary and secondary capital, with some early investors, including angel investors, potentially taking partial or full exits,” the source added.

Leap declined to comment on the story, and queries sent to Owl Ventures, Jungle Ventures, Steadview, and Peak XV received no response before publication.

Founded five years ago, Leap has raised $175 million up to its Series D round and claims to have funded more than 3,000 students since 2021, primarily focusing on institutions in the US, Canada, UK, and Australia.

While edtech startups have struggled to raise funds in recent years, overseas education-focused finance platforms have secured substantial funding during this period. According to data from TheKredible, Leap and its competitors such as Auxilo, Avanse Financial, Financepeer, Propelld, Grayquest, and Eduvanz have collectively raised around $500 million in the past 24 months.

The strong preference for studying abroad to gain superior exposure is a significant growth driver for companies like Leap, Leverage Edu, and CollegeDekho. InCred, a notable player in the overseas educational loan sector, reported that such loans accounted for 21% of its total disbursement in FY24. According to InCred’s founder, Bhupinder Singh, growth prospects and increasing awareness in this segment have contributed to its rapid expansion.

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