Funding and acquisitions in Indian startup this week [16 – 21 Sep]

During the week, 36 Indian startups raised around $628.24 million in funding. These deals count 14 growth-stage deals and 17 early-stage deals while 5 startups kept their transaction details undisclosed.

Last week, 24 early and growth-stage startups cumulatively raised over $228 million in funding.

[Growth-stage deals]

Among the growth-stage deals, 14 startups raised $566.44 million in funding this week. Edtech startup Physics Wallah spearheaded with a $210 million funding round. SaaS-based digital adoption solution provider Whatfix raised $100 million followed by, API infrastructure platform M2P Fintech, omnichannel diagnostics service provider Redcliffe, digital infrastructure company iBUS, and mobility startup Everest Fleet with $50 million, $42 million, $34 million, and $30 million in funding, respectively.

Swiggy continued to onboard big names under its investor list, including Madhuri Dixit, Ritesh Malik, and Moder Insulators in its pre-IPO funding.

[Early-stage deals]

Further, 17 early-stage startups secured funding worth $61.8 million during the week. Fintech startup Kaleidofin led the list followed by data intelligence platform e6data, luxury wellness clinic chain The Wellness Co (Rollins International), SaaS-enabled marketplace for metal manufacturers NowPurchase, and vacation home rentals platform ELIVAAS among others.

As many as 5 startups that did not disclose the funding amount raised are; Venttup, Kaatil, Salt Oral Care, Ticket9, and TraqCheck. 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 12 deals followed by Delhi-NCR, Mumbai, Chennai, Hyderabad, and more.

Segment-wise, E-commerce, SaaS, and Fintech startups are on the top spot with 5 deals each. Healthtech, HRtech, Foodtech, Proptech, Edtech, and Telecom startups followed this list among others.

[Series-wise deals]

During the week, seed funding deals are on top, with 10 deals followed by 7 Series A, 5 Series B, 3 Series C, and more.

[Week-on-week funding trend]

On a weekly basis, startup funding surged 174.59% to $628.24 million as compared to around $228.79 million raised during the previous week.

The average funding in the last eight weeks stands at around $393 million with 28 deals per week.

[Fund launches]

z21 Ventures announced the first close of its $40 million Fund II, with WestBridge Capital investing $20 million. Capital A launched its second fund, targeting a corpus of Rs 400 crore, focused on sectors such as manufacturing, deeptech, climate, and fintech. Shivalik Investment Fund secured 50% of its targeted corpus of Rs 150 crore for its inaugural fund, with plans to raise an additional Rs 150 crore.

[Key hirings and departures]

Bizongo reshuffled its management by onboarding Kiran Dev, Prahlad Krishnamurthi, Gaurav Singhania, and Amol Wanjari. While Amazon, Yum! Brands and ACT Fibernet hired Samir Kumar, Rohan Pewakar, and PVV Srinivas Rao, respectively.

Meanwhile, Nine months after joining Ola Consumer (Ola Cabs) as global chief business officer (CBO), Sidharth Shakdher quit the firm.

[Mergers and Acquisitions]

As many as five acquisition deals happened this week. Fintech startup Veefin acquired a 26% stake in EpikIndifi, infra solutions provider Acru by Stockal, influencer marketing brand OPA by Wondrlab, and computer vision firm AJA Vision Technologies by Marsh Harrier. Oyo also marked one of its largest acquisitions by snapping up G6 Hospitality, which operates Motel 6 and Studio 6 brands.

[Layoffs]

Byju’s-owned Aakash Educational Services Limited (AESL) laid off 80 to 100 employees over the past couple of months. Several long-time employees, some with over 4 years of service, were also laid off in the past few weeks.

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

[New launches and partnerships]

▪️ MobiKwik’s Zaakpay partners Meta to offer in-app payments on WhatsApp

▪️ GoMechanic gears up for EV workshop expansion

[Potential Deals]

▪️ Moglix to invest $50M in Credlix expansion to US, Mexico

▪️ D2C brand Kapiva to raise ~$40 Mn funding

▪️ Qure.ai eyes $60 Mn funding to expand operations

[Financial results this week]

▪️ Livspace revenue crosses Rs 1,200 Cr in FY24; losses shrink by 46%

▪️ KrazyBee 

▪️ ProcMart GMV zooms 3X to Rs 621 Cr in FY24; profit slips 56%

[News flash this week]

▪️ MensXP looks to break free from Mensa Brands

▪️ EY resigns as advisor to BYJU’S IRP amidst controversy: Report

▪️ Quick Commerce players under CCI scrutiny

▪️ PhonePe captures 50% of UPI market share by value in August 

▪️ Elara Capital sees a lower valuation for Swiggy compared to Zomato

▪️ Infibeam entering UPI payments with a new app RediffPay

▪️ Amazon selects 7 Indian startups for global accelerator program

▪️ Ola Electric can achieve EBITDA breakeven by FY27: Goldman Sachs

[Conclusion]

The weekly funding jumped around 175% to $628.24 million this week. The week also saw three startup-focused fund launches namely Z21 Ventures, Capital A, and Shivalik Investment Fund.

India Lifestyle Network (ILN), the parent company of MensXP, iDiva, and Hypp, is exploring a separation from its parent company, Mensa Brands. ILN founder Angad Bhatia is in talks with investors about acquiring Mensa’s stake and operating as an independent entity. The move is driven by differing growth priorities and Mensa’s inability to provide sufficient capital. Once separated, ILN plans to raise capital and expand its operations, including restarting its influencer-commerce business.

The insolvency proceedings of BYJU’S have taken another turn with the resignation of EY as advisor to the IRP, Pankaj Srivastava. This news comes amidst growing controversy surrounding Srivastava, who has been facing legal challenges from multiple creditors of the company. The resignation of EY further complicates the situation and raises questions about the future of BYJU’s restructuring process.

Elara Capital believes Swiggy will likely have a lower valuation than Zomato. This is primarily due to Zomato’s larger business size, faster growth rate, and stronger market position, particularly in the quick commerce segment. Zomato has also achieved profitability in certain segments, while Swiggy is still working towards that goal. Since its IPO, Zomato’s valuation has surged significantly, reaching a market capitalization of $28.55 billion. This suggests that investors have placed a higher premium on Zomato’s growth prospects and performance compared to Swiggy.

PhonePe solidified its position as the leading UPI player in India, capturing over 50% of the market share in August. This growth is attributed to its user-friendly interface, extensive network, and innovative features.

Infibeam Avenues Limited is taking a big leap into the competitive world of UPI payments. Their new app, RediffPay, aims to disrupt the market currently dominated by giants like PhonePe and Paytm. This move comes after Infibeam acquired a majority stake in Rediff.com, hinting at a bigger play in the consumer digital finance space. With RediffPay, Infibeam hopes to offer a comprehensive financial services platform, potentially including insurance, lending, and investment options.

The All India Consumer Products Distributors Federation (AICPDF) has filed a complaint against quick commerce players like Blinkit, Zepto, and Instamart, alleging predatory pricing and deep discounting practices. The Department for Promotion of Industry and Internal Trade (DPIIT) has referred the complaint to the Competition Commission of India (CCI) for investigation. The CCI will now examine the practices of these quick commerce companies to determine if they violate competition laws.