Indian Startup Ecosystem Flooding with IPOs, along with M&A activity; Venture Investments Slackening | Swastika Blog - Share Market Updates, Latest News and Expert's Tips | Swastika Investmart Ltd (Swastika Investmart) Swastika
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Indian Startup Ecosystem Flooding with IPOs, along with M&A activity; Venture Investments Slackening

Investors marked a heavy decline in venture funding especially in the 3rd week of July. This is because the week saw other activities such as SME IPO launching, M&A acquisition and global companies that were seeking interest in other major companies.

The 3rd week of July saw a major decline in venture capital funding as the total cost of funding went up to $209 million across 29 deals while in the previous week, the VC funding amounted to $ 847 million.

Also, the startup ecosystem has witnessed many renowned companies that are quite famous among Indian citizens. Here, we are talking about the much-awaited food tech Zomato’s IPO.

Other companies that the investors are witnessing are global logistic giant FedEx which has recently invested in Delhivery while Google; a search engine giant also invested in Slang labs. Oyo Rooms also raised $ 600 million in debt.

In this year, 21 Indian startups entered the unicorn club in 2021. Apart from food tech giant Zomato, there are other startups too who witnessed the first healthcare, social commerce, crypto and pharmacy unicorn this year.

Moreover, there are eight startups are also in line which entered the unicorn club in April 2021. These are Fintech Startup CRED, Sharechat, Social media Startup Meesho, Wealth management company Groww, messaging platform Gupshup.

Key Highlights

News aggregator app Inshorts raised $60 million in funding with participation from existing investors.

Online storytelling app Pratilipi also witnessed that it raised $ 48 million in funding led by Krafton Inc, a South Korean gaming company.

Social e-commerce platform Trell also raised a capital of $ 45 million which is led by MIRAE Asset, LB investment and H&M Group.

Real estate startup Square Yards raised $25 million in growth financing from ADM capital.

Company Investors Total Amount Raised
News Aggregator Inshorts $ 60 Million
Online Storytelling Pratilipi $ 48 Million
Social E-commerce Trell $ 45 Million
Real Estate Square Yards $ 25 Million

Other Transactions

Tech Startup One code raised $ 5 million led by Sequoia Capital India’s surge and Nexus Venture Partners.

Aquaconnect, the fisheries focussed startup, raised $ 4 million from Rebright Partners and Flourish Ventures.

Ati Motors, an all-electric autonomous industrial vehicle maker, raised $3.5 million from Exfinity Venture Partners.

Pankhuri, a women social community platform, raised $ 3.2 million from Taurus Ventures.

Edtech Startup Oliveboard raised a whopping amount of Rs 23 Crore from Yukti Securities, Education Catalyst Fund.

Spacetech startup Dirgantara raised $2.5 million as part of its seed funding from Kalaari Capital.

Financial Education Startup Kredent Infoedge raised Rs 10 Crore capital from Kotak Securities.

Blockchain Startup Archana Network raised $ 375000 in a seed round from a group of angel investors.

LDU (Lets Dress Up) raised $ 300000 from Titan Capital and other groups of investors.

Education Technology Startup Little Leap raised $ 3,60,000 by Ah Ventures, First Cheque VC.

Data Technology Startup Sapio Analytics raised $ 15,0000 from Parthiv Group of Companies.

WorkSpace Startup BHyve raised a whooping capital of $ 300000 from JITO Angel Network, LETS Venture etc.

In addition to this, The Ayurveda Company, SMOOR, UrbanKisaan and Indienergy raised an undisclosed amount of funding last month.

India Connect

M Power Financing raised $100 million through venture capital. The company provides education loans for the students who study in North America.

Bookee, a SAAS startup, raised undisclosed capital from angel investors. The company primarily focuses on the fitness industry.

Multiplier, an HR tech startup raised $4 million in funding led by India’s Surge and other investors.

AI Startup Netradyne raised capital of $ 150 million from the Softbank Vision Fund and other investors.

M&A (Merger & Acquisition)

Edtech unicorn Vedantu also seeks to acquire a majority of stakes in Pedagogy; an e-learning platform.

Trentar acquired a 75% stake in GarudaUAV; a Noida based drone service provider.

Entry Valuation

Last month Elevation and Sequoia raised a capital of $38 million in Fampay, a banking startup for youngsters primarily teenagers. It was considered as one of the largest startups in India’s startup history whose company valuation services went up to $150-170 million for a company that has yet to make any revenue.

Now the question arises: Was the whole deal expensive? Yes, of course. Despite knowing all the risks, Elevation invested in Fampay because they think that the founders are two years ahead of anyone else in the market.

If at an early stage, you are predicting a multi-billion dollar outcome, the entry valuation costs hardly matter, said a person close to the firm.

On 25 December 2020, numerous VCs, founders etc went on a break after the arrival of COVID 1st wave.

During those panic times, partners at Accel and Sequoia have kept their operations of finalizing terms to invest in Powerplay.

They need not have shown that type of hustle in the normal market. They know the market is quite volatile where you have to keep yourself super fast said one of the top VCs.

Angel Investments

An angel investor is an individual who gives capital to a start-up, and in return, they expect convertible debt or ownership equity. Angel investors generally provide support for the startups that are at their initial stages and when most investors are not prepared to back them.

Nowadays, a small but increasing number of angel investors invest online through trading crowdfunding as well as to provide advice to their portfolio companies.

VC firms are also enquiring about their portfolio founders’ angel investors which are made in early-stage startups. They keep an eye on all the startups as VCs don’t want to see a single company.

The speed of making deals has increased as the founders and investors made many calls to the investors during the pandemic.

Before the initial phase of Covid 19, physical meetings were the norm and because both the start-up members and other people wanted the comfort of in-person discussions that take time to set up and the whole discussion.

Earlier, investors used to do three calls with a founder before issuing a term sheet. However, they still do three calls but in a shorter period.

Takeaway

Startup companies who want expansion for their business growth often go for IPO launching. It is a better opportunity for companies to get recognised on equity trading platforms.

Evaluation of a company is essentially important for business owners to assess both opportunity and opportunity costs as it helps them to identify the strength and weaknesses of the reviewed company.

For IPO launching and company valuation services, go for Swastika Investmart.

A renowned stock broker offers outstanding stock trading services along with company valuation, merchant banking, investment banking and more.

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