Startup Deep Dive : GrayQuest — revenue up 37% to Rs 24.6 crore, loss still Rs 35 crore

GrayQuest turns a school’s biggest cash-flow headache into a monthly habit: parents pay annual fees in up to 12 no-cost EMIs, while the institution collects the full amount upfront. The pitch is deceptively simple, and it has pulled more than 6,500 schools, colleges and universities onto the platform, as per the company and reported by Entrackr.

Yet the economics tell a harder story. GrayQuest booked ₹24.6 crore ($2.6 million) in revenue in FY25, up 37.0% on the year, and lost ₹35.0 crore doing it, according to filings summarised by Inc42. Revenue is compounding fast; losses are compounding faster. This piece traces how a fee-payment idea became a venture-funded lending business, and why the path to profit still runs through other people’s balance sheets.

Quick facts

What GrayQuest does

GrayQuest sells one product to two customers at once. To parents, it offers the ability to convert a lump-sum annual or term fee into up to 12 monthly instalments at no extra cost. To the school, college or university, it hands over the full fee upfront and takes on the collection work. It is a business-to-business-to-consumer (B2B2C) model: GrayQuest signs the institution, then reaches the parent through that institution’s fee flow. The company describes its platform as powering fee payments for more than 6,500 institutions across India, a figure repeated in Entrackr’s reporting.

The scale claims are institution-led. Alongside the 6,500-plus partner institutions, GrayQuest has said its platform has helped enable education access for more than 250,000 children (company-stated, via Tracxn). Distribution runs through the institution rather than direct-to-parent marketing: once a school integrates GrayQuest into its fee collection, the monthly-instalment option is offered to every parent at the point of payment, which is why the partner count, not an advertising budget, is the growth lever the company emphasises.

The origin

Rishab Sumer Mehta founded GrayQuest in 2017. Before this, he worked in business development at the Refex Group and studied at Babson College, per his public profiles on YourStory and The Org. The founding insight was narrow and specific: education fees in India are large, annual and rigid, but household income is monthly. A parent can comfortably budget a monthly outgo yet struggle with a single ₹1 lakh cheque in April. Schools, meanwhile, want the whole fee on time and do not want to run a credit desk. GrayQuest sat in that gap, promising the parent flexibility and the institution certainty, and monetising the spread between the two.

Crucially, the parent pays no interest. The cost is borne by the institution, which accepts a small fee in exchange for receiving cash upfront and outsourcing collections. That design decision, no-cost EMI for the parent, is what made the product easy to distribute inside schools, because it looked like a convenience rather than a loan.

The struggle years

GrayQuest was not an overnight venture story. For its first three years it operated with little outside capital: the first disclosed institutional cheque, a pre-Series A of $1.2 million, did not arrive until August 2020, more than three years after incorporation, and was led by Foundation Holdings, as reported by YourStory. Building a lending-adjacent business without a large balance sheet meant leaning on partners for the actual money, and on schools for distribution, one institution at a time.

The deeper struggle is structural and still visible in the accounts. Facilitating fee payments at zero cost to the parent is expensive to run: GrayQuest carries collection, technology, credit and customer-acquisition costs while its take on each transaction is thin. The result has been sustained losses even as revenue grows. Total expenses were ₹54.7 crore in FY24 against revenue of ₹17.92 crore, per filings summarised by TheKredible, and rose again to ₹59.6 crore in FY25 against ₹24.6 crore of revenue (Inc42). The company has spent, in each of the last two years, well over twice what it earned.

The turning point

The clearest inflection is FY24. Revenue roughly doubled, rising 97% from ₹9.09 crore in FY23 to ₹17.92 crore in FY24, as per filings reported by TheKredible. That growth is what let GrayQuest raise a priced Series B months later. But the same year’s loss widened from ₹26.30 crore in FY23 to ₹36.80 crore in FY24, a figure confirmed by both TheKredible and The Founder Media. The turning point, then, cuts two ways: the top line proved the demand, and the bottom line proved that scale alone was not fixing the unit economics. The next act, on the evidence of FY25, has been to grow revenue more slowly (up 37.0%) while trying to hold the loss roughly flat at ₹35.0 crore.

The money behind it

GrayQuest has raised about $17.5 million across three disclosed rounds, per Entrackr’s round-by-round breakdown. The shape:

• Pre-Series A, August 2020: $1.2 million led by Foundation Holdings (YourStory).
• Series A, closed around March 2023: $7 million (about ₹56 crore) led by Pravega Ventures, with participation reported from the Weizmann Group, Telama Family Office and Apurva Parekh (Startup Story; Entrackr).
• Series B, September 2024 first close: ₹53.57 crore ($6 million) co-led by Pravega Ventures and IIFL Fintech Fund, each investing ₹21.50 crore, at a post-money valuation of ₹530 crore (about $64 million), with the founder participating for ₹10.56 crore in partly paid shares (Entrackr).
• Series B, full round announced January 2025: extended to ₹80 crore ($9.3 million) with Claypond Capital, the family office of Ranjan Pai, joining Pravega Ventures and IIFL Fintech Fund (The Founder Media; Entrackr).

What each backer changed: Foundation Holdings supplied the first institutional validation; Pravega Ventures (backed by the Pidilite family office) has anchored both priced rounds and now holds 10.94%; IIFL Fintech Fund brought a lending-sector investor to the cap table at 4.07%; and Claypond Capital added a marquee family-office name for the growth phase. The founder retained a controlling-sized stake of 38.59% after the September 2024 close, per Entrackr.

How it makes money

GrayQuest’s revenue is narrower than its marketing suggests. Based on MCA filings summarised by TheKredible, operating revenue in FY24 came from two lines:

• Facilitation fees: 93.1% of operating revenue (FY24). This is the fee earned for processing fee payments and enabling instalments through the platform, the core engine.
• Subvention income: 6.8% of operating revenue (FY24). This is income tied to the discount an institution accepts for receiving fees upfront.

The mechanics people get wrong: GrayQuest does not primarily lend from its own book. It sits between the parent, the institution and a stack of banks and non-banking financial companies (NBFCs) that provide the underlying capital. Announced partners include Mirae Asset Financial Services and SBM Bank India (Indian Startup News; SBM Bank press coverage). GrayQuest’s margin therefore sits in the spread and fees it captures for originating, underwriting and servicing, not in a large interest book of its own. That keeps its balance sheet lighter, but it also caps how much of each transaction’s value it can keep, because the lending partners take their share of the economics.

The numbers

Three years of results, in ₹ crore, from MCA filings as summarised by TheKredible (FY23, FY24) and Inc42 (FY25):

Reading the table:

• Revenue trajectory: ₹9.09 crore to ₹17.92 crore to ₹24.6 crore, growth of 97% (FY24) then 37.0% (FY25) as per the same filings.
• Loss trajectory: the loss widened sharply in FY24 (to ₹36.80 crore) then edged down in FY25 (to ₹35.0 crore), the first sign of discipline.
• Cost base: total expenses of ₹54.7 crore in FY24 and ₹59.6 crore in FY25 remain far above revenue, so the business is still funding its growth from investor capital, not operations.

Where the money comes from

The revenue mix is the surprise. Despite a public image built around parent-facing “no-cost EMIs,” the money GrayQuest actually books is overwhelmingly institutional and transactional rather than interest income from consumers:

• Facilitation fees dominate at 93.1% of operating revenue in FY24 (TheKredible), meaning the platform earns mostly by moving fee payments and enabling instalments, not by lending on its own account.
• Subvention income is a minor line at 6.8% in FY24, so the discount schools accept for upfront cash is not, on the filed numbers, the main earner.
• Distribution is institutional: the reach comes from 6,500-plus partner institutions (company-stated, via Entrackr), and the funding for parent instalments comes from bank and NBFC partners such as Mirae Asset Financial Services and SBM Bank India rather than GrayQuest’s own capital.

The takeaway from the split: GrayQuest is best read as a payments-and-origination platform sitting on top of other lenders, not as a balance-sheet lender itself.

The risks

• Persistent losses versus a thin take rate. With expenses of ₹59.6 crore against ₹24.6 crore of revenue in FY25 (Inc42), the company still spends more than twice what it earns. Because most revenue is facilitation fees on a no-cost-to-parent product, GrayQuest’s take on each transaction is thin, so the route to profit depends on very large volumes without a matching rise in cost, a balance it has not yet struck.
• Dependence on lending partners. GrayQuest relies on banks and NBFCs to fund parent instalments. If a key partner such as Mirae Asset Financial Services or SBM Bank India tightens credit, reprices, or exits, GrayQuest’s ability to offer instalments and the economics it keeps can both shrink, since it does not control the underlying capital.
• Regulatory and concentration exposure. As a fintech intermediating consumer credit for education, GrayQuest is exposed to shifts in India’s digital-lending rules and to concentration in a single spend category. Fee payments are seasonal and tied to academic calendars, and any move to reclassify or restrict subvention or no-cost-EMI structures would strike the core product directly.

The takeaway

GrayQuest’s lesson is about where you choose to sit in a value chain. By refusing to be a lender and instead becoming the layer that connects parents, institutions and capital providers, it built distribution fast and kept its balance sheet light. The cost of that choice is written in the accounts: a thin take rate that has, so far, made scale and profit pull in opposite directions. The transferable point is that a lighter model is not automatically a cheaper one, an intermediary still has to earn enough on each transaction to cover the real cost of trust, collections and credit, or growth simply enlarges the loss.

Frequently asked questions

What does GrayQuest do?

GrayQuest runs an education fee-payment platform. Parents can split annual or term fees into up to 12 monthly instalments at no extra cost, while the partner school or college receives the full fee upfront and hands over collection to GrayQuest.

Who founded GrayQuest and when?

It was founded by Rishab Sumer Mehta in 2017. The legal entity, GrayQuest Education Finance Private Limited, was incorporated on 27 March 2017 in Maharashtra, as per MCA records.

How much money has GrayQuest raised?

About $17.5 million across three disclosed rounds, per Entrackr: a $1.2 million pre-Series A (August 2020), a $7 million Series A (around March 2023), and a Series B that reached ₹80 crore ($9.3 million) by its January 2025 announcement.

Is GrayQuest profitable?

No. It reported a net loss of ₹35.0 crore in FY25 on revenue of ₹24.6 crore, and a loss of ₹36.80 crore in FY24 on revenue of ₹17.92 crore, according to filings summarised by Inc42 and TheKredible.

How does GrayQuest make money if parents pay no interest?

Most of its revenue is facilitation fees, 93.1% of operating revenue in FY24 per TheKredible, earned for processing payments and enabling instalments, plus a smaller subvention line. The actual instalment funding comes from bank and NBFC partners, not GrayQuest’s own book.

Sources

Figures are as of September 2026. Currency converted at $1 ≈ ₹96.0 as of 18 September 2026 (Trading Economics).

• Entrackr, “Pravega and IIFL invest in GrayQuest’s Series B” — September 2024; and “GrayQuest raises $9.3 Mn from IIFL Fintech Fund, Claypond and Pravega” — January 2025.
• TheKredible, “GrayQuest doubles revenue to Rs 17.92 crore in FY24, losses widen” — 2024 (FY23 and FY24 revenue, loss and revenue split).
• Inc42, GrayQuest company financials page — September 2026 (FY25 revenue ₹24.6 crore, net loss ₹35.0 crore, total expenses ₹59.6 crore).
• The Founder Media, “GrayQuest secures Rs 80 crore in Series B” — January 2025.
• YourStory, “GrayQuest raises $1.2M in pre-Series A led by Foundation Holdings” — August 2020; and Rishab Mehta profile.
• Startup Story, “GrayQuest raises $3.75 Mn in Series A led by Pravega Ventures” — 2022/2023.
• TheCompanyCheck, GrayQuest Education Finance Private Limited (CIN U65999MH2017PTC293038) — MCA registration data, 2026.
• Indian Startup News, “Mirae Asset Financial Services partners with GrayQuest” — 2024; SBM Bank India press coverage — partnership disclosure.
• The Org / ASU GSV Summit — Rishab Sumer Mehta profile and background.

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