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Sridhar Vembu slams Freshworks layoffs; says cash-rich company can't expect employee loyalty if it prioritises shareholder buyback

YourStoryYourStory · 8m ago
Sridhar Vembu slams Freshworks layoffs; says cash-rich company can't expect employee loyalty if it prioritises shareholder buyback
Medial

Zoho Corporation founder, Sridhar Vembu, criticized Freshworks for laying off employees while prioritizing shareholder buybacks. In a post, Vembu argued that a cash-rich company with $1 billion in cash and positive growth should not expect loyalty from employees when they are letting go of staff members and spending $400 million on stock buybacks. Although Vembu didn't explicitly mention Freshworks, his comments came shortly after the company announced a reduction in its workforce by around 13% and approved a stock repurchase program. He also expressed concern about US corporations prioritizing shareholder value over employee well-being.

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Indian startups raised $1.3 Bn in May, highest funding in 2024 so far

EntrackrEntrackr · 1y ago
Indian startups raised $1.3 Bn in May, highest funding in 2024 so far
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Investments in Indian startups reached a new height in May as the total funding influx crossed the $1.3 billion threshold. The surge can be attributed to Google-Flipkart’s $350 million deal, a couple of $100 million plus rounds, and several growth stage fundings. Indian startups mopped up $1.34 billion across 128 deals in May, according to data compiled by startup data intelligence platform TheKredible. This included 39 growth-stage deals worth $1.19 billion and 66 early-stage deals amounting to $154 million. There were 23 undisclosed rounds, primarily early-stage deals. The Indian startup ecosystem produced its last unicorn in March with Perfios entering the coveted club. Moreover, the total number of new unicorns in the ongoing calendar year stood at two with Bhavish Aggawal-led AI startup Krutrim being the first one. [Month-on-Month and Year-on-Year trend] The funding in May saw a nearly 29% month-on-month jump from a little over $1 billion in April. On a year-on-year basis, May 2024 also saw a 32% jump from $1.01 billion in May 2023. Since January, homegrown startups have raised over $5.1 billion which is likely to reach $12 billion by the year end. In 2023, the total funding in startups stood at $11.3 billion. [Top growth stage deals] E-commerce marketplace Flipkart raised $350 million in equity funding from Google and stood at the top followed by SaaS firm Atlan’s $105 million Series C round and healthtech startup NephroPlus’s $102 million Series F round. D2C performance wear brand TechnoSport and fast fashion brand Libas raised their maiden fundraise (Series A) worth $21 million and $18 million, respectively. However, both brands are more than a decade old and they are included in growth/late-stage deals. The top 10 list also includes NBFC startup Annapurna Finance, B2B e-commerce unicorn Infra.Market, EV startups Battery Smart, GreenCell Mobility, and Ather Energy, edtech firm K12 Techno, and fintech company Propelld. [Top early-stage deals] Agritech startup Superplum which raised $15 million in Series A was on top among early-stage deals followed by UnifyApps which scooped up $11 million in seed funding. Soleos Solar Energy, Vegapay, Turno, DiFacto, Celcius Logistics, Flam, CoverSure, and Fyllo made it to the top 10 list of early-stage deals. [City and segment-wise deals] City-wise, Bengaluru-based startups remained on the top with 52 deals, contributing around 60% of the overall funding in May. Delhi-NCR and Mumbai followed with 33 and 14 deals, respectively. The list further counts Hyderabad, Chennai, Ahmedabad, and Kolkata, among others. Segment-wise, e-commerce startups (including D2C brands) led the show followed by fintech with 25 and 20 deals, respectively. SaaS, agritech, and healthtech were next on the list. Visit TheKredible for more details. [Stage-wise deals] Series-wise, 47 startups raised funding in the Seed and pre-seed round followed by 19 Series A deals, 19 Pre-Series A, and 11 Series B deals. Debt-only funding contributed $155 million or 11.6% of the overall venture funding across deals. [Mergers and acquisitions] Indian startups saw eight mergers and acquisitions in May, a slight slump from nearly a dozen deals in April. While most of the deals were undisclosed, the acquisition of Device42 by Freshworks in a $230 million deal stayed on top of the list. UGRO Capital took over MyShubhLife in a $5.3 million deal. The notable list of M&A also includes the acquisition of LogiTax by Cashflo, SocialBoat by Noise, CosmoGenesis Labs by MamaEarth, and Zenifi by BharatX. [Layoffs and top-level exits] Unlike the past couple of months, there was a sharp fall in layoffs in May. Edtech company PrepLadder and fintech startup Simpl fired 145 and 100 employees, respectively. In April, nearly 1,500 employees were laid off. However, the recent trend of AI implementation is likely to drive mass firings in the upcoming months. As per media reports, Paytm and Ola Electric may join the list with mass firings. The top-level departures continued in May as a couple of CEOs including Freshworks’ Girish Mathrubootham and Caasha’s Kumar Gaurav left their post in the last month. The list also includes CFO, and CBO, among others. [ESOP buyback] April saw two employees’ stock (ESOP) buybacks against three in April and four in March. Home service marketplace Urban Company announced its fifth and highest ESOP buyback of 2024 worth $24.4 million. In March, Meesho announced a stock buyback program worth $24 million. Visit TheKredible to see series-wise deals along with amount breakup, complete details of fund launches, and more insights. [Conclusion] The strong revival in May might be attributed to a few large deals, but even these no doubt signal confidence in the market for many other investors, and serve as a good indicator of future direction in the market. Add to that possible delays from investors waiting for the election circus to be over, and it is safe to say, despite headwinds, the Indian startup ecosystem will look forward to a much better funds flow in the coming months.

Deepinder Goyal enters billionaire club as his holding in Zomato crosses $1 Bn worth

EntrackrEntrackr · 12m ago
Deepinder Goyal enters billionaire club as his holding in Zomato crosses $1 Bn worth
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Deepinder Goyal, founder and CEO of Zomato, has entered the billionaire dollar club as the value of his holdings in the foodtech firm surpassed Rs 8,400 crore. With this, Goyal joins the ranks of Sachin and Binny Bansal, Nikhil and Nitin Kamath, Vijay Shekhar Sharma, Byju’s Reveendran, and Ritesh Agarwal who hit a similar high at some point with their startups’ growth and valuation. As of March 31, 2024, Goyal owned a 4.19% stake in Zomato and had 36,94,71,500 shares. Since the Info Edge-backed firm recently hit its all time high share price ~Rs 232, the value of his personal holding crossed $1 billion. Zomato currently has a market capitalization of Rs 2,01,343 crore or $24.25 billion (as of 11.27 AM IST on July 15). With 36,94,71,500 equity shares, Deepinder Goyal’s holdings are valued at Rs 8,423 crore ($1.01 billion), as per Entrackr’s estimate. Food tech major also received shareholder approval to implement a new ESOP plan 2024 valued at $458 million. With the implementation of its new ESOP plan, the company’s total ESOP value surpassed $800 million. After Flipkart, Zomato seems to have the largest ESOP pool at the moment in the startup arena. In 2021, Oyo’s ESOP pool was worth close to $1 billion followed by Paytm, Nykaa and Policybazaar. However, value of Oyo and Paytm’s ESOP pool has nosedived since then in the wake of colossal loss in their valuations. While the holdings of bootstrapped startup’s founders such as Kamath brothers and Sridhar Vembu fortune are estimated to exceed $1 billion, Goyal has turned out to be the new entrant in the billionaire club from the VC-backed ecosystem. The good times for Zomato have continued on the stock exchange despite the company increasing its platform fees to Rs 6 in Delhi and Bengaluru. The company introduced a platform fee of Rs 2 in August last year, which was increased to Rs 5 in April, and now stands at Rs 6 per order as the firm looks to improve margin. Swiggy also spiked its platform fee to Rs 6 in the two cities. Zomato showed a robust growth in the last fiscal year (FY24) as its revenue from operations surged 71% year-on-year to Rs 12,114 crore in FY24 from Rs 7,079 crore in FY22. Moreover, the profits of the company stood at Rs 351 crore in FY24 as compared to a loss of Rs 971 crore in FY23.

Layoffs, departures continue as Indian startups raise $1 Bn in April: Report

EntrackrEntrackr · 1y ago
Layoffs, departures continue as Indian startups raise $1 Bn in April: Report
Medial

The year 2024 started on a good note for Indian startups: an average of $1 billion in monthly funding, which is a significant growth when compared to the previous year during which monthly funding went below $500 million three times. In April 2024, however, startups crossed the $1 billion threshold on the back of a couple of pre-IPO funding, a few late-stage rounds, and debt deals. Indian startups raked in more than $1 billion across 124 deals in April, according to data compiled by startup data intelligence platform TheKredible. This included 36 growth-stage deals worth $813 million and 65 early-stage deals amounting to $225.75 million. Moreover, there were 23 undisclosed rounds, primarily early-stage deals. During the recent Startup Mahakumbh festival, Peak XV Partners’ managing director Rajan Anandan said that Indian startups are expected to raise $8 billion to $12 billion this year. He also added that around $20 billion of private capital is lying uninvested and is committed to investment in private firms and startups in India. This estimate appears close considering the current rate of monthly funding. [Month-on-Month and Year-on-Year trend] In April 2024, there was a 14% year-on-year jump in funding from $912 million in the same month last year. Even on a monthly basis, April almost matched March’s $1.18 billion funding. Interestingly, only one startup i.e. PharmEasy managed to raise funding in three digits during the last month. Since January, homegrown startups have raised close to $4 billion, and at this rate, it may cross the $11 billion funding raised in 2023. [Top growth stage deals] Healthcare startup PharmEasy’s $216 million pre-IPO round stood at the top, though its valuation dropped nearly 90% from $5.6 billion to $710 million during the latest fundraise. Financial services firm Northern Arc also announced its $80 million Series C round while Ola Electric raised $50 million in debt even after filing draft IPO papers. Altum Credo, ProcMart, SingleInterface, Infinity Fincorp, CloudExtel, and LetsTransport also featured in the top 10 growth stage deals in April. [Top early-stage deals] Omnichannel fashion startup Lyskraft, founded by Zomato’s co-founder Mohit Gupta and Myntra and Cultfit’s co-founder Mukesh Bansal, scooped up $26 million in a seed funding round and was on the top of the list in early-stage deals in April. Gen AI startup Neysa bagged $20 million whereas spacetech company Dhruva Space and edtech firm Emversity (Beyond Odds) raised $15 million and $11 million, respectively. The rest of the early-stage startups in the top 10 list raised less than $10 million each. The list includes Traya, LightFury Games, GTM Buddy, FincFriends, and Accacia. [City and segment-wise deals] City-wise, expectedly, Bengaluru-based startups are on top with 42 deals, contributing around 26% of the overall funding in April. Delhi-NCR and Mumbai followed with 30 and 26 deals, respectively. However, Mumbai-based startups topped the list in terms of the total amount raised. The list further counts Kolkata, Hyderabad, Pune, and Ahmedabad among others. Segment-wise, e-commerce startups (including D2C brands) and fintech startups co-led the list with 19 deals each followed by healthtech (16), SaaS (15), EV (5), automotive tech (4), and foodtech (4) startups among others. Visit TheKredible for more details. [Stage-wise deals] Series-wise, 44 startups raised funding in the Seed round followed by 20 Series A deals, 13 Pre-Series A, 11 Series B deals, and 7 Pre-Seed deals. As many as 14 startups raised debt funding worth $199.2 million during the period. [Mergers and acquisitions] Indian startups saw nearly a dozen mergers and acquisitions in April of which most deals were undisclosed. Among the disclosed deals, National Investment and Infrastructure Fund (NIIF) acquired a majority stake in digital infrastructure solutions company iBUS for about $200 million. US-based Aurionpro Solutions also acquired Indian fintech company Arya.ai for $16.5 million. The notable list of M&A also includes the acquisition of Shy Tiger brands by Ghost Kitchens India, Orbit by Postman, Awign by MyNavi, and Magzter by Dailyhunt’s parent company VerSe Innovations. [Layoffs, top-level exits, and shutdown/s] The mass firing in startups continued in April as they laid off nearly 1,500 employees during the month. April surpassed the cumulative layoffs of 1,100 employees during the first quarter of 2024. Troubled edtech company Byju’s remained on top with 500 layoffs, followed by The Good Glamm Group, Healthify, and Scaler with 150 layoffs each. Check the full list here. April also saw high-profile exits from startups including five chief executives. Sujot Malhotra, CEO of Beardo, Surinder Chawla, CEO of Paytm Payments Bank, Arjun Mohan, CEO of Byju’s India, Sukhleen Aneja, CEO of The Good Glamm Group’s D2C Brands Division and Hemanth Bakshi, CEO of Ola Cabs, have quit this month. Besides layoffs and departures, Nintee, a digital health startup launched by Wingify founder Paras Chopra, announced shutting down its operations after a year of launch. During the first three months of 2024, six startups announced their shutting down operations in India. [ESOP buyback] Employees’ stock buyback also continued in April as three growth-stage companies – Pocket FM, XYXX, and The Sleep Company – announced their ESOP buyback program last month. Pocket FM bought back $8.3 million worth of stocks from employees while the rest two did not disclose the transaction details. The March quarter saw four ESOP buybacks including MyGate, Meesho, Classplus, and Imagekit. Visit TheKredible to see series-wise deals along with amount breakup, complete details of fund launches, and more insights. [Conclusion] While the trajectory of fund raising is positive, its quality might worry some, as it has gone to a firm that was clearly in distress and at a massive haircut (PharmEasy), besides the large, lumpy deal from NIIF. It might also be time to relook debt funding numbers as part of overall startup funding figures, as debt is usually taken by startups that are running operations sustainably from a financial perspective, or where founders do not want to dilute stakes any more. So it’s not quite the risk capital that equity funding is. With a host of IPOs being lined up, we expect the growth trajectory to sustain as pleased investors return to find the next big opportunity.

Startups rope in new CEOs amid cash crunch, layoffs, profitability and IPO plans

EntrackrEntrackr · 1y ago
Startups rope in new CEOs amid cash crunch, layoffs, profitability and IPO plans
Medial

Management rejig and layoffs at several prominent startups have continued to make headlines this year. For layoffs, startups have cited a familiar reason i.e. redundancies, efficiencies as well as getting a step closer to profitability. As far as management changes go, reasons and circumstances vary. For instance, DealShare’s CEO position was vacant for a long time. These changes, however, also bring a fresh wave of optimism in the ecosystem, which has of late faced a host of challenges, ranging from funding crunch to stringent regulatory actions. Data compiled by TheKredible shows that this year more than 10 Indian startups have appointed, elevated or are on the verge of naming their new chief executive officers (CEOs). The list includes the likes of DealShare, MyGate, Inshorts, Cult.fit, Third Wave Coffee, Byju’s, Ola, PhonePe, and Setu, among others. Interestingly, half of them have been elevated to the role of chief executive whereas some founders took charge as the operational leaders after the exit of the existing CEO. [Elevated CEOs] The year 2024 started with a new trend of appointing new CEOs and e-commerce platform DealShare was first when they elevated Kamaldeep Singh as the new chief executive of the company from being the president of their retail business. The firm faced several challenges during the second half of 2023 as its three co-founders left the firm in a short span of time and it also had to shut down its B2B vertical after a flat growth in FY23 with rise in losses. Community management app MyGate, news aggregator InShorts and fitness tech firm Cult.fit also elevated Abhishek Kumar, Deepit Purkayastha and Naresh Krishnaswamy, respectively, as their new chief executive officers. All previous CEOs of these three companies namely Vijay Arisetty, Azhar Iqubal and Mukesh Bansal have now taken the role of chairman. Iqubal recently joined Shark Tank India season III as a judge. Also, InShorts is pivoting from news aggregation to influencer led platform which could be the reason behind this reshuffle in leadership. Cult.fit also faced challenges early this year as it fired more than 150 employees. As per the company, it reduced some redundant positions with the aim of streamlining operations. Meanwhile, fintech unicorn BharatPe finalized Nalin Negi as its full time CEO. Negi, the former chief financial officer of the company, had been working as interim CEO since January last year. Freshworks also went through a reshuffle as the firm’s founder Girish Mathrubootham stepped down from the position of CEO after 14 years. Mathrubootham has transitioned into the role of executive chairman while the company’s president Dennis Woodside has been elevated as the new CEO. Freshworks went public in September 2021. It’s important to note that most of these companies in this list had losses until FY23. Though, a few of them managed to control losses during the fiscal year. For context, DealShare’s GMV remained flat but its losses jumped 14% to Rs 502 crore in FY23. InShorts posted flat scale with 33.6% jump in losses to Rs 310 crore in FY23. MyGate, Cult.fit and BharatPe also managed to control its losses. Check the graph below for more details. [New CEOs appointed in 2024] In January, PhonePe announced the appointment of Ritesh Pai as CEO of its International Payments business while Infibeam Avenues announced the appointment of Rajesh Kumar SA as CEO of its AI business venture Phronetic.AI. These appointments appeared to be a positive sign for both companies which are expanding their businesses. Third Wave Coffee’s co-founder and CEO Sushant Goel stepped down as the firm’s chief executive role and transitioned to a board member in March this year. The WestBridge-backed company named KFC India and Nepal CEO Rajat Luthra as Goel’s replacement. Before the exit of Goel, Third Wave Coffee also went through layoffs, firing more than 100 employees. In April, Aakash Educational Services, owned by edtech company Byju’s, appointed Deepak Mehrotra as its new managing director and chief executive officer. Mehrotra joined Aakash after the exit of its chief executive Abhishek Maheshwari. Recently, the firm raised money from Manipal Group’s Ranjan Pai to clear the debt raised from Davidson Kempner in May last year. Aakash has plans for a public listing this year. Last month, API infrastructure company Setu, owned by Pine Labs, named Anand Raisinghani as new CEO of the company. Raisinghani will succeed Sahil Kini, who is the erstwhile chief executive of Setu. Earlier this month, Paytm Money’s CEO Varun Sridhar also quit the position and Rakesh Singh has been appointed as the new chief executive of the stock trading platform. Before joining Paytm Money, Singh was the CEO of fintech company Fisdom. On Monday, Adda247 appointed Bimaljeet Singh as its chief executive for skilling and higher education business. Like several edtech firms, Adda247 also went through layoffs in the last quarter of 2023. It’s worth noting that Paytm Money and Phronetic.AI are owned by public companies One97 Communications and Infibeam, respectively. In terms of financial performance, Aakash reported profit in FY22 and expected to replicate same growth in FY23. Pine Labs reported more than Rs 1,600 crore revenue with control in its losses to Rs 227 crore in FY23. Third Wave Coffee reported a three fold jump in its revenue with same growth in losses to Rs 54 crore in FY23. During FY23, PhonePe as a group posted revenue of Rs 2,914 crore and Rs 1,755 crore loss. During the period, Adda247 reported Rs 115 crore revenue and Rs 110 crore loss. [Founders, executives took the charge after CEOs exit] Last month, Arjun Mohan, the CEO of Byju’s India operations, stepped down from his position seven months after joining the edtech firm. After his exit, the company’s founder Byju Raveendran returned as the operational leader to see day-to-day functioning. During the process, Byju’s also sacked more than 500 employees. It’s worth highlighting that Byju’s has been facing a cash crunch for a long time and failed to pay the salary of its employees on time. Recently, Ola Cabs’ CEO Hemant Bakshi left the firm after three months of joining. His departure came at a time when Ola is gearing up for an initial public offering (IPO). The company also fired 10% of its total workforce. In the interim, Ola founder Bhavish Aggarwal will oversee operations until a new executive is appointed. In January, Indus Appstore’s CEO Rakesh Deshmukh announced quitting the firm. Since then, the firm has been led by ⁠its CPO and co-founder Akash Dongre, and CBO Priya Meenakshi Narasimhan. The firm is yet to announce the name of the official CEO. As per a media report, Beardo’s CEO has gone on a year-long sabbatical from April this year. During his absence, CBO Siddharth Vaya, and Koteshwar LN, head of digital first business, are expected to lead the company. Beardo was acquired by Marico Group in June 2020. In the ongoing calendar year, Sukhleen Aneja, CEO of The Good Glamm D2C vertical and Subramanyam Reddy, CEO of upGrad’s Knowledgehut also announced their departure from the company. While Knowledgehut is yet to name the new CEO, The Good Glamm has decided not to appoint a new CEO for the D2C vertical. As per reports. Ketan Bhatia and Ankita Bhardwaj will lead the brand’s business operations. Last month, The Good Glamm Group resorted to layoffs and went through top level restructuring as it is gearing up for public listing. More recently, Paytm Payments Bank’s CEO and MD Surinder Chawla decided to hang up his boots. He will be relieved from his positions on June 26 while the firm is yet to announce his replacement. Public company Paytm laid off more than 1,000 employees in December 2023 in a cost cutting effort. As per reports, the firm also went through layoffs amid back to back departures of top level executives and the recent diktat by RBI. However, Paytm denied any fresh layoffs at the company. When it comes to financial performance, Byju’s and Ola are in deep losses and Beardo slipped into the red in FY23. Edtech unicorn upGrad reported close to Rs 1,200 crore revenue in FY23 with Rs 558 crore loss in FY23. Good Glamm Group is yet to file its annual financial report for FY23. [Conclusion] For those who have sniped at CEO salaries at startups, the last year should be a good indication of just why salaries refuse to moderate. Besides the high turnover, it is no secret that many investors and even founders have considered CEO’s as a horses for courses option, taking in people with specific skill sets when they were relevant for the organisation. Thus, be it fundraising, cost cutting, or all out for growth mindset, we have seen how different CEO’s bring their own competencies, which, unfortunately, have a use by date in most cases. Many of course can simply struggle to adapt to the startup culture and the unstructured challenges it throws up, which can be the worst outcome for a startup with little achieved during their tenures. Perhaps the toughest ask of a startup CEO is what she is expected to do in what seems like compressed time to most, making it most challenging to attract quality personnel at times. That is also one reason why we see investors take over the job of bringing in the CEO when they feel a founder needs to move on to a more strategic role or simply take a break from the intense pressure. Don’t expect the CEO churn to slow down anytime soon for these reasons.

Indian startups raise $1 Bn in July: Report

EntrackrEntrackr · 11m ago
Indian startups raise $1 Bn in July: Report
Medial

After closing the first half year on a promising note, Indian startups managed to cross the $1 billion monthly funding run rate in July too. Startups are also anticipating favorable market conditions with many set for their stock market debut in early August, be it Ola Electric or Infra.Market later in the year. Meanwhile, the Indian government has abolished angel tax which is seen as a positive for the entire ecosystem. As per data compiled by TheKredible, Indian startups raised over $1.03 billion across 126 deals in July. This consisted of 28 growth stage deals amounting to $725 million and 72 early stage deals worth $311.83 million. Meanwhile, there were 26 undisclosed transactions mainly in early-stage deals. [Y-o-Y and M-o-M trend] While the last month saw a sharp decline in funding from $1.93 billion in June, this is the highest funding for July in the past three years. The sudden jump in June was steered by Zepto’s $665 million megaround followed by Flipkart, PharmEasy and Lenskart. Indian startups have raked in $8 billion in the first seven months of 2024. If the trend continues, the overall funding is comfortably expected to cross the $11 billion milestone of 2023. To recall, Indian startups saw $38 billion and $25 billion funding in 2021 and 2022, respectively. [Top 10 growth stage deals] There were two $100 million plus deals in July with Purplle and Rapido raising $120 million each. Bike taxi firm Rapido also turned unicorn and became the third company to enter the billion dollar valuation club in 2024 so far. Hospitality firm Oyo’s $50 million came in third position followed by home service marketplace Urban Company, fintech company Navi, electric vehicle firm Matter, and wealthtech startup Dezerv, among others. It’s worth highlighting that Oyo saw a major haircut in its valuation while Urban Company raised the amount in secondary and Navi raised the sum in debt. [Top 10 early stage deals] As many as 72 early-stage startups raised $311.83 million funding last month. Manufacturer of high precision tooling for aero-engines and airframes, Unimech Aerospace led the list with a $30 million fundraise followed by renewable energy services company BluPine, electric vehicle and clean energy startup Simple Energy, gen-Z focused fast fashion D2C brand Newme, and wealthtech startup Stable Money which pocketed $28.8 million, $20 million, $18 million, and $15 million, respectively. Further, artificial intelligence startup UptimeAI, biotech firm Immuneel Therapeutics, community-led mobility app Namma Yatri, wedding service provider Meragi, and NBFC Seeds Fincap also raised funding among others. The list of early-stage startups also includes 26 startups that did not disclose their funding amount. For more information, visit here. [Mergers and Acquisitions] The month witnessed 17 acquisition deals. Gaming company Nazara Technologies acquired an additional 48.42% stake in Paper Boat Apps (PBA) from its promoters Anupam and Anshu Dhanuka for a sum of Rs 300 crore while its gaming arm Next Wave Multimedia acquired the intellectual property rights of Ultimate Teen Patti from Games24X7 for Rs 10 crore. The list further counts acquisition of Excelmax Technologies by IT giant Accenture, OneCare by Acko, Ekagrata by Adda247, Koral by Captain Fresh, Centcart by CASHe, BitOasis by CoinDCX, Galleri5 by Collective Artists Network, SiliConch Systems by L&T, and Munitalks by Melooha, among others. [City and segment-wise deals] City-wise, Bengaluru-based startups maintained the top position with 42 deals, contributing around 37% of the overall funding in July. Delhi-NCR and Mumbai followed with 33 and 24 deals, respectively. The list further counts Ahmedabad, Hyderabad, Jaipur, Chennai, Pune, and Kolkata, among others. Segment-wise, fintech startups led the show followed by e-commerce (including D2C brands) and SaaS with 15 and 10 deals, respectively. Healthtech, AI, and Agritech were next on the list. Visit TheKredible for more details. [Stage-wise deals] Series-wise, equivalent to 36 startups raised funding in the seed round followed by 27 Series A, 15 pre-Series A, 13 pre-Seed, and 4 Angel funding deals. Debt-only funding contributed $160.76 million or 15.5% of the overall venture funding across deals. [ESOP buyback] Adda247 and Swiggy announced ESOP buyback programs this month. Edtech platform Adda247 has initiated its first-ever ESOP buyback benefiting over 130 employees, following its acquisition of Ekagrata Eduserv. Meanwhile, food delivery giant Swiggy has rolled out its fifth ESOP liquidity program worth $65 million, providing an opportunity for employees to monetize their equity. These moves highlight the growing trend of startups rewarding employees through ESOP buybacks. [Layoffs, shutdowns and departures] Edtech major Unacademy laid off 250 employees as part of its cost-cutting measures. Similarly, agriculture supply chain firm Waycool underwent its third round of layoffs, affecting over 200 employees. In the content creation space, Pocket FM laid off nearly 200 contract writers based in the US. The startup ecosystem also saw three shutdowns. Vernacular microblogging platform Koo has ceased operations after failing to secure a buyer or sufficient funding. Apollo Tyres has also reportedly discontinued its doorstep car service, Trumigo, due to a lack of traction. In the edtech space, Bluelearn has shut down and will return a significant portion of its raised capital to investors. Edtech major Unacademy has seen the departure of its COO for offline centers, Jagnoor Singh. Similarly, Simplilearn’s Chief Product Officer, Anand Narayanan, stepped down after an eight-year tenure. Zoomcar’s global president has resigned amidst company restructuring while Medikabazaar’s co-founder Vivek Tiwari stepped down as CEO. Eight Roads Ventures’ Asia managing partner Raj Dugar also stepped down after 17 years with the investor, as per media reports. Visit TheKredible to see series-wise deals along with amount breakup, complete details of fund launches, and more insights. [Trends] It’s raining startup IPOs: This year quite a few internet companies such as TBO tech, Digit Insurance, Awfis and Ixigo have got listed on the Indian stock exchange, with all delivering spectacular returns post listing as well. Three more companies including Ola Electric, FirstCry and Unicommerce are all set to make their stock market debut. Moreover, Mobikwik, Swiggy and Avanse have been waiting for approval from the market regulator. Wealthtech on the rise: A clutch of wealthtech startups have managed to score decent funding in the ongoing calendar year. In July, Deserv and Stable Money raked in $32 million and $15 million respectively. As per reports, more wealthtech startups are on the verge of raising new rounds. Geographic expansion: Traditionally dominated by metros like Bengaluru, Delhi-NCR, and Mumbai, the landscape is now witnessing a surge in entrepreneurial activity from smaller cities. Startups hailing from Ankleshwar, Bareilly, Bicholim, Nashik, Rupnagar, and Udaipur have recently secured funding, underscoring the growing potential of these regions. Family offices spreading out: Wealthy families are diversifying their portfolios. Traditionally focused on real estate and fixed deposits, they’re now actively seeking new investment avenues. This shift has led to the creation of separate investment pools and a growing interest in equity markets. In the past month, seven family offices participated in funding rounds. These include the family offices of Sunil Singhania, Jyothi Pradhan (CEO of Kurlon), MS Dhoni, Dr. A Velumani, Vasavi Family Office, Desai Family Office, and a Tamil Nadu-based family office. [Conclusion] As we had predicted in 2023, and earlier this year, the markets are expected to pick up by H2 this year, and here we are. Perhaps the last piece in the puzzle would be an interest rate cut by the Fed, to catalyse a whole chain of events that could lead to a mini-boom yet again. While expecting the highs of 2021 might be too much to hope for ($38 billion), it is not unreasonable to expect the Indian market to attract at least $15 billion in funding in 2025. The strong record of IPOs that is building up will not hurt investor confidence at all. The only thing to watch out for might be a rotation from Fintech and E-commerce to newer and important segments like Healthcare and Climate tech. Both are areas where India has large domestic markets, multiple use cases, and the crying need for solutions that can make a difference. With the kind of huge targets the country has in front, and massive schemes to get close, expect some large deals in the renewables space soon.

Funding and acquisitions in Indian startups this week [26 Feb - 2 Mar]

EntrackrEntrackr · 1y ago
Funding and acquisitions in Indian startups this week [26 Feb - 2 Mar]
Medial

As many as 30 Indian startups raised funding amounting to nearly $384 million this week. These deals include nine growth-stage deals and 18 early-stage deals. The early-stage deals also include five startups that kept their transaction details undisclosed. Last week, about 25 early and growth-stage startups collectively raised over $125 million, including two undisclosed deals. [Growth-stage deals] Among the growth-stage deals, nine startups raised $310.7 million in funding this week. Logistics company Shadowfax spearheaded with its $100 million Series E funding round. Customer loyalty and engagement technology platform Capillary Technologies expanded its Series D round with a $95 million raise while D2C jewelry brand Kushal’s secured $34 million. Further, Omnichannel pharmacy platform Zeno Health, Fintech startup Mswipe, and D2C luggage brand Mokobara among others also raked in funding this week. [Early-stage deals] Equivalent to 18 early-stage startups scooped funding worth $73.46 million during the week. Blockchain startup Avail led the list followed by interview preparation platform Interview Kickstart, renewables EPC company InSolare, energy efficiency startup Smart Joules, cybersecurity provider Silence Labs, and nanotechnology startup Chiral. The list further includes Business process automation Zvolv, spacetech startup Digantara, business-to-business agri-food startup Farmtheory, and foodtech firm TWF Flour among others. For more information, visit TheKredible. The list of early-stage startups also includes five startups which kept the amount undisclosed. The startups are Knocksense, StepChange, Biggies Burger, Zactor Tech, and Local (Tui Bon Natural). [City and segment-wise deals] In terms of the city-wise number of funding deals, Bengaluru-based startups led with 18 deals amounting to 74% of the total fundraise during the week. This was followed by Mumbai, Delhi-NCR, Pune, Jaipur, and Lucknow. The complete breakdown of the city and segment can be found at TheKredible. [Series-wise deals] This week, eight startups raised funding in their seed round followed by five Series A deals. While pre-Series A, pre-seed, and Series C deals followed with 5, 5, and 3 deals, respectively. [Week-on-week funding trend] On a weekly basis, startup funding jumped 3X to $384.16 million as compared to $126 million in the previous week. The average funding in the last eight weeks stands at around $197 million with 27 deals per week. [Mergers & Acquisition] This week, online seafood firm Captain Fresh has acquired CenSea Inc., a US-based frozen fish and seafood importer and distributor. According to a report, Captain Fresh has fully acquired CenSea in a cash-and-stock deal, with 90% of the consideration paid in cash. [Fund launches] Asset management firm Rockstud Capital has marked the first close of its second alternative investment fund (AIF) at Rs 68 crore or $8.2 million. With a target corpus of Rs 300 crore ($36 million), Rockstud Capital Investment Fund II aims to help companies fund their bridge rounds, scale products and raise capital from institutional investors. The fund focuses on sectors, including digitalization, sustainability, financial inclusion, health & safety, and consumption. It invests between $0.5 and $1 million across startups at their Pre-Series A round. [Layoffs] WayCool Foods has reportedly fired at least 70 employees over the last month in what was the second layoff exercise at the agritech startup within a year. The startup, which houses subsidiaries such as WayCool Censa, WayCool BrandNext, also shut its warehouses over the last month. Surgery-focused hospital chain Pristyn Care has reduced its workforce by 7% as the firm eyes profitability and initial public offering in the next few years. Pristyn Care said that it is discontinuing three redundant categories and the move will impact less than 7% of the 1,700 employees, with the majority in entry-level and support functions. It has also decided to exit six cities that were not adding adequate value to the business. [Departures] Vijay Shekhar Sharma stepped down from his position as part-time non-executive chairman and board member of Paytm Payments Bank Limited (PPBL). The company also announced that it has reconstituted its board of directors with the appointment of former Central Bank of India chairman Srinivasan Sridhar, retired IAS officer Debendranath Sarangi, former executive director of Bank of Baroda Ashok Kumar Garg, and retired IAS Rajni Sekhri Sibal. Visit TheKredible to see series-wise deals and amount breakup, complete details of fund launches, and more insights. [New launches] ▪️ Mphasis launches AI intelligence platform for document processing ▪️ Bhavish Aggarwal-led Krutrim launches Its Chatbot ▪️ SaaS platform Zoho launches a new business division, Zakya ▪️ Juspay rolls out a new ride-hailing app Mana Yatri in Hyderabad [Financial results this week] ▪️ ApnaKlub’s gross revenue spikes 6X to Rs 278 Cr in FY23 ▪️ Razorpay posts Rs 2,279 Cr revenue in FY23; bottom line remains stagnant ▪️ Scaler’s revenue climbs 5X to over Rs 300 Cr in FY23, losses up by 90% ▪️ WeWork India posts Rs 1,314 Cr revenue in FY23; cuts losses by 77% ▪️ Bizongo’s scale doubles to Rs 167 Cr in FY23; loss nears Rs 300 Cr ▪️ RailYatri posts Rs 274 Cr revenue in FY23; losses shrink 58% [News flash this week] ▪️ Paytm terminates inter-company agreements with payments bank unit ▪️ Amazon Pay gets a payment aggregator license from RBI ▪️ Paytm Payments Bank slapped with Rs 5.49 Cr fine by FIU-IND ▪️ Zepto launches a membership programme, Zepto Pass. ▪️ Google delists select Indian apps over violations of Play Store policies [Entrackr’s analysis] The weekly funding rebounded after a three-week decline, experiencing a three-fold growth. However, the week also saw two significant layoffs at WayCool and Pristyn Care, affecting approximately 200 employees. Paytm has terminated inter-company agreements between One97 Communications and Paytm Payments Bank Limited (PPBL), following regulatory actions by the Reserve Bank of India (RBI). The RBI imposed business restrictions on Paytm Payments Bank due to non-compliance and regulatory concerns. Separately, the Financial Intelligence Unit-India (FIU-IND) fined Paytm Payments Bank Ltd Rs 5.49 crore. Additionally, Google delisted several popular Indian apps, including Kuku FM, TrulyMadly, QuackQuack, and Altt, from the Play Store. Apps from Shaadi and Matrimony.com, as well as InfoEdge’s job portal Naukri and real-estate platform 99 acres, were also removed. This action follows Google’s blog post outlining its new app store policies and warning of potential consequences for non-compliance, such as ‘delisting’.

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