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Tiger Global-backed Toplyne shuts down operations

EntrackrEntrackr · 9m ago
Tiger Global-backed Toplyne shuts down operations
Medial

Plug-and-play platform Toplyne is shutting down operations and returning capital to investors, according to sources who spoke to Entrackr. This decision comes as a surprise, given that Toplyne had raised funding from prominent investors like Peak XV and Tiger Global. “Despite securing sizable funding, the startup struggled with scaling beyond a certain point, leading the founding team to make the decision to wind down and reach out to investors to return remaining capital,” said one of the sources requesting anonymity. Toplyne is a plug-and-play platform designed to help sales teams at product-led growth companies increase conversion rates among freemium users. Founded by Rishen Kapoor, Ruchin Kulkarni, and Rohit Khanna, this three-and-a-half-year-old startup facilitated lead conversion by integrating actionable insights directly into products, enabling companies to turn potential leads into paying customers. “After 3.5 years of building Toplyne, we’ve made the tough decision to wind down operations and return capital to our investors. Despite our best efforts, we couldn’t reach the scale or product-market fit we aimed for,” said Rishen Kapoor in a LinkedIn post. Toplyne has raised over $17 million in total capital from investors including Peak XV, Tiger Global, Surge, Together Fund, and angel investors like Kunal Shah and Harshil Mathur. According to the startup data intelligence platform TheKredible, Toplyne was valued at approximately $80 million in its latest fundraising round. Sources indicate that one of the co-founders, Rohit Khanna, exited the firm sometime last year due to differences within the founding team. Queries sent to Kapoor and Peak XV didn’t elicit any immediate response. Toplyne joins a group of startups that have shut down operations in 2024 while returning partial capital to investors. Others on this unique list include Greenik, Fashinza, Virgio, Investmint, Bluelearn, Paras Chopra-led Nintee, and Karthik Gurumurthy-led Convenio.

Edtech startup Bluelearn shuts operations, to return 70% of capital

EntrackrEntrackr · 12m ago
Edtech startup Bluelearn shuts operations, to return 70% of capital
Medial

Social learning platform Bluelearn on Sunday announced that it has shut down its operations as the firm found it tough to grow fast. The three-year-old firm will return 70% of the capital it raised to its investors. The Bengaluru-based startup had raised nearly $4 million across two rounds from Elevation Capital, Lightspeed, Titan Capital, 2am VC. Angel investors including Vidit Aatrey and Sanjeev Barnwal, Awais Ahmed, Vivek Mohan and others also backed the community driven platform. “We realised that building a venture-scale business with Bluelearn was tough. We had been very conservative with capital, allowing us to return 70% of the capital we raised back to investors,” Bluelearn’s co-founder and CEO Harish Uthayakumar said on X. Founded by Uthayakumar and Shreyans Sancheti, Bluelearn started off as a telegram channel for students to help each other with common questions. At its peak, the startup claimed to have over 250,000 members from various colleges and startups across India and abroad. Since its inception, the company has helped thousands of students with internships, jobs and make friends through its online community. More than half a dozen startups operating in India shut down their operations in 2024 so far. The list counts Resso (India), Rario, OKX (India), Muvin, GoldPe, Koo and Nintee. However, a few of them have also announced to return a significant capital to their investors. For context, Paras Chopra-led digital health startup Nintee, which shut down its operations in April, said that it will return a majority of the capital raised from its investors. Similarly, trading app Investmint will return 25% of capital as it underwent insolvency proceedings. As per a media report, fashion startups Fashinza and Virgo will also return capital to their investors after a failed pivot. As per data compiled by TheKredible, more than 15 startups ceased their operations due to funding crunch and other challenges in 2023.

Startups refund investors in ethical move after shutdown and failed pivot

EntrackrEntrackr · 9m ago
Startups refund investors in ethical move after shutdown and failed pivot
Medial

The shutdown of SaaS startup Toplyne took many by surprise, as the San Francisco and Bengaluru-based company became one of the few from the well-funded segment to halt operations. Having raised over $17 million from investors like Tiger Global and Peak XV, the firm also garnered attention for its commitment to return the remaining capital to investors, highlighting the importance of ethical practices in the startup landscape. Not just Toplyne, but a bunch of startups that shut down or pivoted have returned capital to their investors after struggling to establish a sustainable revenue model. They also encountered challenges such as funding shortages, adverse market conditions, and cash flow issues. According to data from TheKredible, as many as 8 Indian startups have refunded investors after either ceasing operations or unsuccessful pivots as of October 12. This accounts for 50% of all shutdowns and pivots that have occurred in the current calendar year. Paras Chopra-led Nintee was the first to announce its shutdown and return capital to investors in April this year. It was backed by Peak XV and angels like Kunal Shah. Following this, several other startups joined the trend, including edtech firm Bluelearn and trading platform Investmint, as well as offline firm Convenio, launched by former Swiggy senior vice president Karthik Gurumurthy. Most recently, agritech startup Greenikk also announced that it would refund investors after ceasing operations. It’s worth noting that Gurumurthy had raised $3 million from Matrix Partners and others in stealth mode. Earlier this year, two fashion tech companies—Fashinza and Virgio—opted to return capital to their investors after struggling to find traction with their original business models. Virgio, led by former Myntra CEO Amar Nagaram, raised over $37 million from investors including Prosus Ventures, Alpha Wave Partners, and Accel Partners before its pivot. Fashinza, the highest-funded company on the list, secured $150 million in equity and working capital from notable backers such as Mars Growth Capital, Liquidity Group, Accel, Prosus, WestBridge, and Elevation Capital. In the current debate about the market savvy of Bengaluru startups compared to those in Delhi NCR, it’s interesting to observe that five startups on this exclusive list originate from Bengaluru, whereas only two are from NCR. Between 2022 and 2023, several startups, including Frontrow, Udayy, ConnectedH, and Anar, had returned capital to their investors after shutting down operations for various reasons. The return of capital should not be as big a deal as made out, but catches attention simply because of the times we live in. When fund raising is treated as a massive success in itself, returning those (or whatever remains) funds is certainly a call a founder would make after much agonising normally. Or after burning through most of those funds in trying to pivot, than accept failure. While strong founder ethics and a long term view on the reputational impact is one factor, we believe it is also increasingly a function of how closely investors work with them. And yes, while it will never be as acceptable as many would like, failure is a lot less damaging to future prospects for a founder today than even a decade back. Many investors today, as they work with younger founders especially, keep a very close eye on the day to day running of the business and metrics, giving them a much more deeper understanding of business direction. Thus, where a thesis has failed completely, decisions on shut downs are being taken faster now. Finally, in the rarefied world of fund raising, where access to the right networks matter, as more startups have been funded, we can see longer memory for the performance of the deal sourcing people as well. It would be no surprise if many of these have played an instrumental role in ensuring a return of funds to a VC where they hope to do more work in the future.

BAT VC announces $100 Mn fund to back Indo-US startups

EntrackrEntrackr · 2m ago
BAT VC announces $100 Mn fund to back Indo-US startups
Medial

Former X India head Manish Maheshwari’s venture capital (VC) firm, BAT VC, has made a foray into India with the announcement of a $100 Mn fund to back early-stage ventures in the country. According to BAT VC, its Fund II will focus on startups operating in both India and the US across sectors such as AI, fintech, and SaaS. The fund is co-founded by Manish Maheshwari, Aditya Mishra, and Ravi Metta, with Maheshwari leading the VC firm’s regional expansion in the country. The VC firm says that Fund II has already attracted interest from “top-tier” institutional limited partners (LPs), strategic investors, and family offices in both India and the US. BAT VC plans to invest in startups before product-market fit (PMF), de-risking the execution with active support and internal frameworks. It will help founders access customers, capital, and talent in both India and the US. The VC firm prioritizes startups that place AI at the center of their product and business model. BAT VC also eyes Indo-US dual-market startups, which raise more capital on average than single-geography peers, adding that SaaS companies with operations in both nations demonstrate 1.8X higher median revenue growth. Established in 2021, BAT VC is a cross-border VC firm that backs AI-first early-stage startups in sectors such as fintech and SaaS. The VC firm claims to help founders achieve PMF and scale globally. It has backed notable companies including StockGro, Uptiq AI, Nickelytics, Accern, and others. The New York-based VC firm launched its maiden fund in 2022, which claims to have clocked an internal rate of return (IRR) of 30% and a multiple on invested capital (MOIC) of 1.61X. It also claims that the portfolio startups in its inaugural fund have achieved an average revenue growth of 210% within 18 months.

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