Funding and acquisitions in Indian startups this week [20-25 May]

During the week, 24 Indian startups raised around $444 million in funding. These deals include 5 growth-stage deals and 14 early-stage deals. Meanwhile, two early-stage startups did not disclose the amount raised.

Last week, about 26 early and growth-stage startups collectively raised around $240 million capital.

[Growth-stage deals]

Among the growth-stage deals, 5 startups raised $394.21 million in funding this week. Horizontal e-commerce major Flipkart led the list with $350 million infusion by Google. The list followed by financial services platform Navi which scooped $18 million in debt.

Managed accommodation provider Stanza Living, rural financial services company Save Solution, and NBFC operating in remote rural parts, Dvara KGFS, also raised funding during the week.

[Early-stage deals]

Subsequently, 14 early-stage startups scooped funding worth $49.6 million during the week. SaaS startup UnifyApps spearheaded the list followed by solar energy platform Soleos Solar Energy, NBFC Varthana, and producer of high-quality Single-Walled Carbon Nanotubes (SWCNTs) NoPo Nanotechnologies.

The list of early-stage startups also includes five startups that kept the funding amount undisclosed: Collective Artists Network, 8chili, Agrilectric, Fix My Curls, and Infinx. 

For more information, visit TheKredible.

[City and segment-wise deals]

In terms of the city-wise number of funding deals, Bengaluru-based startups led with 14 deals followed by Delhi-NCR, Mumbai, Hyderabad, Ahmedabad, Ludhiana, and Chennai.

Segment-wise, e-commerce and fintech startups grabbed the top spot with five deals each followed by healthtech startups. The list further counts Agritech, AI, Biotech and Décor startups among others.

[Series-wise deals]

During the week, Seed funding deals led the list with 7 deals followed by 6 Series A deals while Debt, Pre-Series A, and Pre-Seed are next on the list among others.

[Week-on-week funding trend]

On a weekly basis, startup funding surged 85% to $444 million as compared to around $239.7 million raised during the previous week.

The average funding in the last eight weeks stands at around $262 million with 27 deals per week.

[Key hirings and departure]

Among key hirings, Mathew George has been appointed as CFO by Captain Fresh, CarDekho appointed Neelesh Talathi as CFO, while Anuj Rathi and Pratyusha Aggarwal have been appointed as the CEOs by ClearTrip and Flipkart's Shopsy, respectively.

Meanwhile, Rahul Chaudhary, Investor of Matrix Partners, has resigned from his position to start his own venture. Additionally, Rajnish Kumar and T V Mohan Das Pai are set to leave the advisory council of BYJU’s.

[Fund launches]

IVY Growth Associates has launched Arigato Capital, a SEBI-registered Category I AIF VC fund, targeting a corpus of Rs 250 crore. Finvolve has closed two maiden angel funds with a total corpus of Rs 100 crore, aiming to back 25-35 startups with an average investment of Rs25 lakh per startup. ThinKuvate has launched ThinKuvate India Fund – I with a total corpus of Rs 100 crore, focusing on tech startups with an initial investment of up to Rs 3 crore per startup. Databricks Ventures has launched Databricks AI Fund, focusing on AI startups. Caret Capital has launched Caret360 Accelerator Programme, offering selected startups up to Rs 3 crore in investment and mentoring.

[M&A]

CashFlo, a finance automation and payments platform, is set to acquire LogiTax, a tax compliance management solution provider. Meanwhile, Noise, backed by Bose, has acquired SocialBoat to develop AI for wearables.

[ESOPs]

Urban Company has announced its largest employee stock secondary sale worth Rs 203 crore, with 446 employees participating. The beneficiaries are between 23 and 56 years old, with 28% being women. Dharana Capital, Vy Capital, and Prosus will purchase these shares from former and current staff. This sale allows employees to liquidate their vested stocks, with around 784 employees having participated in five buybacks, liquidating ESOPs worth Rs 306 crore.

Visit TheKredible to see series-wise deals along with amount breakup, complete details of fund launches, and more insights.

[New launches]

▪️ Upstox forays into insurance distribution

[Financial results this week]

▪️ MamEarth-parent Honasa posts Rs 1,920 Cr revenue, Rs 110 Cr PAT in FY24

▪️ Nykaa posts Rs 6,386 Cr revenue and Rs 40 Cr PAT in FY24

▪️ Paytm revenue grows 25% and nears Rs 10,000 Cr in FY24

▪️ Tracxn posts flat scale in FY24; profit declines 80%

[News flash this week]

▪️ Ixigo gets SEBI nod for IPO; Oyo withdraws listing plans

▪️ Pine Labs receives Singapore Court nod to shift base to India

▪️ Go Digit makes entry into public market at 5% premium

▪️ MamaEarth’s parent Honasa is the top ad violator of FY24

▪️ Dunzo’s key investor, Lightbox steps down from the board

▪️ Paytm to halt postpaid loans, pauses small personal loans biz

[Conclusion]

The weekly funding surged 85% to $444 million majorly driven by Flipkart’s $350 million funding in its ongoing $1 billion fundraise. The week saw five new fund launches namely IVY Growth, Finvolve, ThinKuvate, Databricks Ventures, and Caret Capital.

Paytm has announced a pause on its small personal loans business, including its Postpaid portfolio, due to a decline in asset quality across the industry. Paytm Postpaid, initially a buy-now-pay-later product, was transitioned to personal loans in December 2023.

Dunzo’s key investor, Lightbox, has stepped down from its board seat amid ongoing financial struggles. Lightbox was the third-largest shareholder in the company with 11% stake. The move leaves Dunzo without representation from any primary investors. Previous board exits in 2023 included representatives from Reliance Retail, Lightrock, and co-founders Dalvir Suri and Mukund Jha. The current board consists of cofounder and CEO Kabeer Biswas and STIC Investments’ Hongjim Kim.

According to the Advertising Standards Council of India’s annual report for FY24, MamaEarth parent Honasa has emerged as the biggest advertising violator with 187 instances. Honasa’s other brands, including Dr. Sheth’s Skin and Hair Clinic, Aqualogica, The Derma Co., and Ayuga, also made the list. Other notable violators include unicorns like 1 MG's HealthKart, FirstCry, Lenskart, Flipkart, and Myntra, as well as listed companies such as Nykaa, Zomato, Zoomcar, Netflix India, and Apple India.

Le Travenues Technology Limited, operator of ixigo, has received SEBI approval for its IPO, aiming to raise Rs 120 crore through fresh issues and offering up to 66.7 million shares for sale. Go Digit received a modest market debut. The insurance tech company’s shares were listed at Rs 286 per share on NSE, a 5.1% premium over the issue price of INR 272. Meanwhile, Oyo withdrew its IPO plans and is now seeking $80-90 million funding at an 80% haircut in valuation.

Additionally, Pine Labs has received approval from a Singapore court to move its domicile to India.