[Weekly funding roundup April 26-May 2] VC inflow continues to remain downcast
Venture capital funding into Indian startups remained subdued as investors remained cautious given the uncertain macro environment.
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The Indian startup ecosystem continues to face the challenge of lower inflow of venture capital (VC) as uncertainty in the macroeconomic environment has made investors wary of making those big bets.
The total funding at the start of May month came in at $104 million across 19 deals. In contrast, the comparable previous week saw a total amount of $112 million. The total VC funding has moved in the narrow range of around $100 million over the last three weeks.
This actually shows how Indian startups are struggling to raise capital and there is clearly the absence of large deals. For example, this week the highest funding deal was by Kalki Fashion at $26 million. Since March 15, VC funding on a weekly basis has barely crossed $200 million.
Given these developments it is also unlikely that there would be any change in the VC inflow into Indian startups. The biggest overhang is the external environment where the prevailing uncertainty due to economic and political factors has led to the overall slowdown.
It remains to be seen when there could be any turnaround from the current situation and given the current circumstances, the startups will need to remain more judicious about their spending.
One key development from the Indian startup ecosystem during this week was the successful closing of IPO bids for EV maker Ather, though it did not receive an overwhelming response.
Key transactions
Apparel brand KALKI Fashion raised Rs 225 crore ($26 million approx.) from Lighthouse Funds.
Beauty tech platform Kult raised $20 million from the M3M Family Office and Venture Catalysts.
Solar financing platform Metafin raised $10 million from Vertex Ventures, Prime Venture Partners, Varanium Capital, Northern Arc and AU Small Finance Bank.
Tech startup QNu Labs raised Rs 60 crore ($7.1 million approx.) from National Quantum Mission, Lucky Investment, Speciale Invest, Tenacity Ventures and HDFC Fund.
Fintech startup Kaleidofin raised $5.3 million from IDH Farmfit.
Edited by Jyoti Narayan