India’s 10 Best Startup Deals This Fall

India’s 10 Best Startup Deals This Fall

Signage for the Bombay Stock Exchange (BSE) is displayed next to a bronze bull statue at the entrance to the BSE building in Mumbai, India. Photographer: Dhiraj Singh/Bloomberg

As the year progresses into the latter half, the Indian startup ecosystem has witnessed more than 50 funding deals in the fall of 2017. More than 50% of these deals have taken place in the consumer internet sector followed by e-commerce and technology sectors respectively.  Even though the deals in education sector were few in number, it has recorded the biggest deal by raising $50 million from the likes of the Chan Zuckerberg Initiative. To give a more holistic picture – the coveted list of the 10 most valuable deals in India this fall includes:

1. Byju’s (Education Sector): It has raised $50 million from the Chan Zuckerberg Initiative, Times Internet Ltd, Sequoia Capital, Sofina and Lightspeed Ventures. An education technology company, it has plans to expand its user base in India, and for the launch of its mobile app-based learning platform in overseas markets. While the deal marks the first investment from Mark Zuckerberg’s and Priscilla Chan’s investment arm The Chan Zuckerberg Initiative (CZI) in Asia Vivian Wu, who will join Byju’s board has stated: “Education can give young people and their families a path to a better future, and families in India work hard to give their children that chance. Byju’s represents an opportunity to help even more students develop a love for learning and unlock their potential.”

2. Aptus Value Housing (Finance Sector): This startup has received $40 million in funding from Westbridge Capital and Caspian Impact Investment Adviser. The deal has come through at a time when housing finance space has caught the eye of private equity firms with global funds like Baring Asia and TPG Capital in the race to acquire ICICI Home Finance. The Chennai-based firm has around 76 branches, predominantly in Tamil Nadu, and plans to increase the number of branches to 100 by March, 2017. M Anandan, MD, Aptus Value, which caters to affordable housing segment has stated, “With this deal, our valuation jumps to Rs 1,350 crore. We will be using the funds to expand to new markets in Karnataka, Kerala and Andhra Pradesh. Our focus will continue to be Tier  2 and Tier 3 cities.”

3. Pepperfry (E-commerce Sector): It has successfully pitched $31.3 millionfrom Goldman Sachs Group, Zodius Technology Fund, Norwest Venture Partners and Bertelsmann India. The latest Series-D funding round expands Pepperfry’s lead over Urban Ladder, the next most-funded startup in the furniture e-tailing segment. The funding will help furniture e-tailer Pepperfry compete with not only direct rivals such as Urban Ladder but also with horizontal e-commerce players such as Flipkart and Amazon, which have been ramping up their furniture business. These funds are likely to be used to open more distribution centres in an attempt to expand Pepperfry’s reach in small cities and towns and strengthen its logistics network. Also as part of the deal, representatives from Goldman Sachs and Zodius are stated to join the company’s board.

4. Swiggy (Consumer Internet Sector): The startup has raised $15 million from Bessemer Ventures. This Series D funding round will help Swiggy to compete with other established market leaders such as Zomato Media Pvt. Ltd, Foodpanda India and Runnr. It can be seen as the first indication of returning normalcy in India’s food tech sector that saw multiple shutdowns and a funding drought over the past 12 months. According to the company’s statement these funds will fuel the seven city startup’s next phase of growth, with technology upgrades, a wider spread of restaurants to choose from and better delivery efficiency.

5. Nykaa (E-Commerce Sector): It has received $12.3 million in funding from Sunil Munjal and Mariwala family. The deal comes after October last year, when Nykaa had raised its Series C round from investors including TVS Capital, Marico founder Harsh Mariwala, Hexaware founder Atul Nishar, and Dalip Pathak, former India and Europe head of Warburg Pincus, and Michael Carlos, former president of Swiss fragrance maker Givaudan. Earlier this year this online luxury beauty retailer had reported net revenue of Rs 250-crore and claimed to offer 400 brands and 35,000 products across various categories on its website. It plans to use the funds from this round to significantly expand its operations and add more brands under its label. The company is also preparing to open more retail stores besides its core online market strategy.

6. Lenskart (Consumer Internet Sector): This eyewear retailer has mopped up$9.8 million from Premji Invest; this funding comes three months after raising Rs 400 Crore from International Finance Corporation in May this year. In order to expand to higher number of stores the funding round is stated to help the online eyewear retailer gain advantage from Premji Invest’s extensive experience across retail brands. While recollecting his thoughts on this deal CEO and Founder Peyush Bansal said, “It will also help us in our road map to go public in the next four to five years.”

7. Zilingo (E-Commerce Sector): It has raised $8 million from Venturra Capital, Sequoia India, Susquehanna International Group, Wavemaker Partners, Beenext, Beenos and Digital Garage. The Bengaluru/Bangkok based startup targets the long-tail of vendors, otherwise seen as too small for larger e-commerce companies; the kind that exhibit and sell offline within markets and malls across Southeast Asia. For the mid-2015 founded startup the success of this Series A funding round has brought a rare spotlight on this fashion focused e-commerce enterprise that is known to keep a low profile. While keeping an eye out for expansion its co-founder Ankiti Bose has pointed out that Zilingo will be using the funds for growth in South East Asia, particularly Indonesia.

8. Mihup (Technology Sector): It has drawn $6.7 million from Accel Partners. The deal marks a watershed moment in the investor’s history, as Mihup has become the first startup where Accel has invested in research and development stage. The deal has been struck at a time when these funds are stated to be used to develop the software and hardware of Mihup’s speech recognition system and man-machine interface with the final product stated to be rolled out after Diwali this year.

9. Capillary Technologies and Simplilearn (Technology and Education Sector): The startups have raised $6 million from InnoVen Capital India in the form of venture-debt funds; this funding round comes after Capillary successfully closed Series C funding from Warburg Pincus and Simplilearn raised an undisclosed sum from Brand Capital, earlier this year. As stated by its co-founder Aneesh Reddy, Capillary – which provides customer relationship management software and marketing analytics for retailers – has plans to use these funds to develop innovations for the retail markets. While on the other hand simplilearn, an online education and training platform, would utilize the raised capital to develop courses that focus on its Asian markets, according to its CEO Krishna Kumar.

10. Gadgetwood (Consumer Internet Sector):  It has successfully raised $6 million from Carpediem Capital. Gadgetwood provides repair and other support services for mobiles and tablets. It repairs in excess of 10,000 devices every month and is an authorized service provider for a leading mobile manufacturer. Its CEO, Jayant Jha has stated: “We intend to establish a presence in 10 cities across the country over the next year, and broaden the scope of our repairs capabilities to include laptops, wearable tech, LED TVs, etc.” The Series A funding round has been completed at a time when Gadgetwood is attempting to gain a foothold in a market that is highly fragmented and unorganized and plans to utilize this round of funding towards geographical expansion, creating a nationwide network for servicing mobile devices and selling refurbished products.

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