[Weekly funding roundup June 29-July 5] VC inflows show modest increase

July started on a modest note as venture capital inflows into Indian startups hovered around the $200 million range on a weekly basis, revealing the challenges that the ecosystem continues to face in raising money.

The total VC funding for the first week came in at $257 million, cutting across 21 deals. In contrast, the previous week witnessed inflows of $106 million. This shows a sharp rise in funding, but it was largely driven by one single transaction—Purplle.

Venture capital funding on a weekly basis has been largely moving in the $100-200 million range throughout this year. This is along expected lines as investors remain cautious about writing large cheques. Now, all that remains to be seen is how the remaining six months pan out for the Indian startup ecosystem.

The month of June saw total VC funding of $1.7 billion. This was the second time this year that the amount has crossed $1 billion, the other being during the month of May at $1.3 billion. The total VC funding for the first six months of the year was $6.4 billion.

These indicate that funding into the Indian ecosystem is most likely to surpass $10.8 billion recorded for 2023, but this is not going to be a sharp increase.

The expectation is that the last quarter of the year might see a stronger inflow of venture capital, though one cannot be very certain that this will happen.

Key transactions

Beauty and personal care unicorn Purplle raised Rs 1,000 crore ($120 million approx.) from a subsidiary of the Abu Dhabi Investment Authority (ADIA) and other investors.

OYO raised Rs 416.85 crore ($50 million approx.) from InCred Wealth and Investment.

Premium apparel brand Rare Rabbit raised Rs 150 crore ($18 million approx.) from A91 Partners, NKSquared, Gruhas Proptech, Ravi Modi Family Trust, and Vedant Modi.