[Weekly Funding Roundup] Startups raise $560 million; unicorns like BYJU's and Zomato top the list
The week saw a strong reaffirmation of Indian startups, with funding crossing more than half-a-billion-dollars, setting the stage for a more positive outcome for the rest of the year.
The second week of January 2020 provided the much-needed thrust to the funding momentum for the Indian startup ecosystem. The period between January 4 and 10 saw investments cut across various kinds of companies, a new unicorn emerging, and an existing one striking higher valuation.
This week, startups raised $560 million spread across 24 deals. Unicorns like BYJU's and Zomato raised a fresh round of funding, while upcoming startups like Bounce and Mamaearth showed why they were the favourites of the investors.
HighRadius, a US-based SaaS startup with strong India connection has become the first entrant into the unicorn club this year.
Fourteen early and growth-stage deals reported $38 million in funding, while four late-stage deals were signed worth $516 million. The week also witnessed three venture debt deals worth $6.5 million.
Deals of the week
The week belonged to BYJU's, the unicorn edtech startup which raised $200 million at a valuation of $8 billion, making it the third most valuable company in the Indian startup ecosystem. Importantly, it was the famed investor Tiger Global which made its entry into BYJU's and gave this edtech startup the heft to expand its operations rapidly.
On the other hand, online food delivery unicorn Zomato also received a vote of confidence from its existing investor Ant Financial in a $150 million funding. This comes at a crucial point when Zomato is engaged in an intense market battle with its main competitor Swiggy.
Bounce, the two-wheeler bike-sharing startup raised $97 million from investors such as Facebook Co-founder Eduardo Saverin’s B Capital, Accel, Chiratae Ventures, Sequoia Capital along with Omidyar Network, and Qualcomm Ventures. This startup has claimed the leadership position in the market with 60,000 rides in Bengaluru alone.
Fusion Microfinance, a micro-lender raised $70 million from global private equity major Warburg Pincus and impact investor Creation Investments. Following this funding, this Delhi-headquartered company is looking to expand its distribution footprint beyond the present 18 states and invest in technological tools.
Gurugram-based Mamaearth has raised $18 million in a funding round led by Sequoia India with participation from existing investors Fireside Ventures, Stellaris Venture Partners, and Sharp Ventures. The funds will be used to continue its growth — building it into a Rs 500 crore brand by acquiring five million new consumers in the next three years. It will also be utilised to launch more brands under the Honasa umbrella.
Edtech startup Testbook, founded in 2014 by a team of IIT graduates, which helps students prepare for recruitment exams of government jobs raised $8 million as part of its Series B round of funding led by Iron Pillar. It also saw the participation of existing investor Matrix Partners India along with Better Capital, AngelList India, and Vikas Choudhury (President, Reliance Jio).
Axio Biosolutions, a pharmaceutical startup raised $5.2 million in Series B-1 round of funding led by Omidyar Network India, along with participation from existing investors Accel, University of California, Ratan Tata’s UC-RNT Fund, and Chiratae Ventures. The Bengaluru-based startup, with its manufacturing plant in Ahmedabad, plans to use the latest funding to expand its footprint, especially in the USA and Western Europe, while continuing to develop novel surgical and wound care products.
Rheo TV, an online e-sports streaming and community platform raised $2 million in seed funding led by Sequoia Capital India's rapid scale-up programme, Surge, Lightspeed, and marquee angels. Through this funding, this startup is looking at product and content development besides hiring new talent. The platform aims to build an entertaining ecosystem for mobile gamers, where fans can engage over gaming content, build communities, and chat with each other.
Mumbai-based pharmaceutical startup, Generico raised Rs 10 crore ($1.4 million) venture debt from Alteria Capital as part of the $14 million that it had raised in September 2019. The startup has raised $16 million funding, and it now plans to increase its footprint to 150 outlets by 2021.
UnoLigo, a customer transmigration platform raised $1 million from angel investor and venture capitalist Kapil Khandelwal-run early-stage investment fund, EquNev Capital. UnoLigo Solutions is founded by Jehangir Abdulla, a Carnegie Mellon computational finance specialist and a Wall Street algo expert.
Chennai-based tea retail chain, Chai Kings raised $1 million in funding from an angel investment group, The Chennai Angels (TCA). The round also saw participation from Hyderabad Angels and TiE India Angels. Founded in 2016, at present, Chai Kings operates 40 stores in India. It is now targeting to reach 100 stores in five years.
Interior design startup, Super Surfaces raised $500,000 as part of its seed round led by NRI investor Vishnu Reddy. Super Surface is looking to scale up and grow its brand, while looking to achieve a delivery capacity of 10 lakh square feet per month by March 2023.
Trustmore Technologies-owned Escrowffrr, an escrow services-focussed digital payments platform raised $150,000 in a Pre-series investment round led by Inflection Point Ventures. The startup will look to utilise this capital to grow its escrow business beyond real estate as a category.
Edtech startup Tech Shiksha has raised Rs 1.3 crore from 24 investors of the Mumbai Angels Network. It will use the funds to expand its business and reach out to more students. Tech Shiksha, through its product - Witblox, provides gamified robotics-based teaching for children in the age group between eight and 16 through plug-and-play hardware toolkits in the STEM fields (science, technology, engineering, and mathematics).
Seven other startups – Skilancer Solar, Ripplr, Rage Coffee, PayMart India, Incubate Hub, Harappa Education, and BuildPan – also raised undisclosed amount of funding this week.
Naspers-backed fintech firm, PayU is merging its consumer lending business LazyPay with Mumbai-based consumer lending startup PaySense.
Sachin Bansal-led Navi Technologies will acquire DHFL General Insurance Ltd (DHFLGI) for an undisclosed amount. DHFLGI, Wadhawan Global Capital Ltd, and Navi Technologies had entered into a share purchase agreement on January 2, 2020.
(Edited by Suman Singh)