[Weekly funding roundup Sept 2-8] Venture capital funding bounces back

The second week of September turned marginally positive for the Indian startup ecosystem with a rise in venture capital funding as certain startups managed to raise relatively larger capital given the current macroeconomic environment.

The total venture funding during the week stood at $165 million cutting across 15 deals. In comparison, the amount raised during the previous week was a mere $50 million.

During the week, companies such as Ather Energy, Pepperfry, and Capital Fresh topped the list in terms of fundraising. The amounts raised were in the range of $20-100 million, which is on the higher end of capital raise given the sluggish capital inflow during the funding winter.

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Some reports suggested that Ola Electric raised $140 million led by Temasek, even as the EV company gears for an initial public offering.

The venture capital funding raised on a weekly basis has been below the $100 million level over the last eight weeks, except for the last week of August when Zepto raised $200 million and became this year's first startup unicorn to emerge out of India.

This is likely to be the trend for the rest of the year as the entire startup ecosystem is undergoing a reset. The cautiousness of the investor community is very visible as they are unwilling to release larger amounts till startups show improvement on benchmarks like profitability or cutting down expenses.

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Meanwhile, startups walk on a tightrope as their core focus will be the ability to conserve capital in order to get through the funding winter.

The only positive during this week was that venture capital firms like Soonicorn Ventures, Anicut Capital, and Unicorn India Ventures either raised capital or announced plans to do so. However, the capital release will be delayed.

Key transactions

Electric mobility startup Ather Energy raised Rs 900 crore via a rights issue from its existing shareholders—Hero MotoCorp and Singapore's GIC.

Online furniture seller Pepperfry raised $23 million in a fresh round from existing investors, institutions, and family offices.

B2B fish and seafood startup Captain Fresh raised $20 million as part of an extended Series C round led by Japan-based SBI Investment and Evolvence Capital.