Tag: M&A

Ecosystem Weekly | 04th Sep’22

September 4, 2022

I hope you have had a joyous Ganesh Chaturthi celebration. May the lord be kind and shower you and your team with prosperity in times to come.

This week, it appears, Ganesh ji has been a bit reticent to facilitate the flow of funds in the overall startup ecosystem. Total funding reported has been ~$ 199 Mn, a decline of around 23 % from the previous week inflow of ~$260 Mn.

The biggest newsmakers have been Early Salary (an instant cash loans fintech) and Skyroot Aerospace (a small-satellite launch services startup). Early Salary has raised $110 Mn in Series D round at a valuation of $300 Mn whereas Skyroot Aerospace has raised $51 Mn in Series B round. Regular readers of our newsletter would recall, we had shared a brief note on challenges & opportunities for Fintechs and we made a comment on the immense possibilities of the Aerospace sector.

There’s never a dull moment in the startup ecosystem. Let us look forward to next week, as to what it has in store for us?

Startup Funding Summary

EarlySalary, a Pune-based fintech startup, has raised $110 Mn in Series D funding from TPG’s The Rise Fund, Norwest Venture Partners, Piramal Capital and Housing Finance Limited – Read More

Skyroot Aerospace, a Hyderabad-based spacetech startup, has raised $51 Mn in Series B funding from GIC, Mukesh Bansal, Anil Chalamalasetty, Mahesh Kolli, Sherpalo Ventures, Neeraj Arora, Solar Industries, Wami Capital and other HNIs – Read More

Bike Bazaar, a Pune-based two-wheeler services provider, has raised $21 Mn in Series D funding from Women’s World Banking Asset Management, Elevar Equity and Faering Capital – Read More

4B Networks, a Mumbai-based broker network platform, has raised $11 Mn in a funding from Info Edge – Read More

Metalbook, a Delhi-based digital supply chain platform, has raised $5 Mn in a funding from Axilor Ventures, Foundamental, RTP Global, Stride Ventures and other HNIs – Read More

M&A Snippets

US-based talent solutions platform Hudson Global has acquired Chennai-based HR services company Hunt & Badge Consulting for an undisclosed amount – Read More

Mumbai-based packaging and containers manufacturer Ansapack has acquired Kolkata-based packaging and Containers manufacturer Teximco Group for an undisclosed amount – Read More

Ecosystem Weekly | 28th Aug’22

August 28, 2022

It has been an eventful week in the startup ecosystem. The total funding reported is of $260 Mn across 24 deals, around an increase of ~192% from $135 Mn in the previous week. The uptick is attributed to the fact there were three deals of over $50 Mn.

The biggest deal of the week, $65 Mn in an ongoing Series D round, has been of Servify, which brands itself as the World’s smartest device ownership and service management platform. As per the news reports, the investing firm, Singularity pegs the addressable market of after sales device protection to be over $ 100 Bn. The company is poised to be profitable and is at an ARR of $130 Mn, as per the quoted statement of Servify’s founder.

Those numbers, if true, are impressive which would most likely make Servify a unicorn in near future. A report here estimates the company’s valuation to be over $800 Mn and is suggestive of an IPO in the next 18-25 months. But beyond numbers why would Servify claim to be the world’s smartest device ownership & service management platform?

Over 75 OEMs, nearly all of the top mobile phone brands, have partnered with Servify. The key differentiator has to be the automated decision making tool which the company has developed. The automated claim agent instantaneously approves or denies a consumer claim based on ‘sentiment & system + fault AI’ derived from device intelligence. This also leads to targeting and acquiring right customers and rewarding honest consumers. Thereby, the company claims to significantly drive down the operational costs for OEMs.

Whether Servify is the smartest platform is a redundant question. I would rather pick another phrase from their website which sounds more apt and the regular readers of our newsletter would find convincing – ‘Redefining service experience at scale.’

Startup Funding Summary

Servify, a Mumbai-based product lifecycle management startup, has raised $65 Mn in Series D funding from Singularity Growth Opportunity Fund, AmTrust, Pidilite, Iron Pillar, BEENEXT, Blume Ventures and DMI Sparkle Fund – Read More

Hector Beverages, a Bengaluru-based food & beverages company, has raised $50 Mn in a funding from GIC Special Investments – Read More

Mojocare, a Bengaluru -based health and wellness startup, has raised $20 Mn in Series A funding from B Capital, Chiratae Ventures, Sequoia India’s Surge, Better Capital, Vineet Jain, Kunal Shah, Ankit Nagori, Adrian Auon, Sajid Rahman, Ravi Bhushan and Vivekananda HR – Read More

Awign, a Bengaluru-based HR tech startup, has raised $15 Mn in Series B funding from Bertelsmann India, Amicus Capital Partners, Mynavi Corporation, Michael & Susan Dell Foundation, Client Associates and Unitus Ventures – Read More

XYXX, a Surat-based apparel brand, has raised $11 Mn in Series B funding from Singularity Growth Opportunities Fund, Trifecta Capital, DSG Consumer Partners and Sauce Venture – Read More

M&A Snippets

Mumbai-based furniture marketplace Pepperfry has acquired Mumbai-based interior solutions company Brandmakerr for an undisclosed amount – Read More

Ecosystem Weekly | 21st Aug’22

August 21, 2022

I hope you had an enjoyable Raksha Bandhan followed by an inspiring 75th independence day celebration last week,

Though the total funding raised this week ( $135 Mn) was subdued by around 45% as compared to the previous week, on account of the lesser average ticket size of the deals. The highlight of the week has been the minting of a new unicorn – Shiprocket – which has raised $ 32.6 Mn at a valuation of $1 Bn.

Shiprocket, founded in 2017, is a logistics aggregator platform. This news follows a trend in the logistics industry, starting with the biggest player Delhivery acquiring unicorn status as early as 2020 and finally being listed in May 2022. Another major player in the space ExpressBee became a unicorn in Feb 2022 when it had raised $300 Mn. In another development, Amazon is in talks to acquire a majority stake in Ecom Express, to strengthen its own logistics arm, which would most likely lead to Ecom Express valuation over $1 Bn. Here is a good infographic on the logistics space.

The likely reasons for favorable investor sentiments on logistics sector are – the ecommerce space as a fraction of total commerce is still in nascent stage, the existing digital commerce has been dominated by the horizontal platforms like Amazon & flipkart, there has been an observable trend that D2C companies are aiming to increase their ecommerce share and shorten the delivery time for their brands, the ONDC may open up new avenues for smaller players in ecommerce.

All of these factors contribute to the growth of the logistics sector and Shiprocket is making the bets in accordance with it. It would be interesting to watch the developments in the coming months.

For the benefit of our new readers, I would end by sharing about one of our portfolio companies, a last mile logistics intelligence startup, which we have invested in, last year.

Startup Funding Summary

Sunstone Eduversity, a Gurgaon-based edtech platform, has raised $35 Mn in Series C funding from WestBridge Capital and Alteria Capital – Read More

Shiprocket, a Delhi-based logistics enablement platform, has raised $33 Mn in Series E2 funding from Lightrock India Fund, Temasek Holdings, Bertelsmann, Moore Strategic Ventures, March Venture Capital, Huddle Collective and Paypal – Read More

Exponent Energy, a Bangalore-based EV rapid charging startup, has raised $13 Mn in Series A funding from Lightspeed, YourNest VC, 3one4 Capital and AdvantEdge VC – Read More

Rusk Media, a Delhi-based digital entertainment company, has raised $10 Mn in Series A funding from DAOL Investment, Audacity Ventures, InfoEdge Ventures , Mistry Ventures and Survam Partners – Read More

Prolance, a Bangalore-based interior design companies, has raised $2 Mn in Pre-Series A funding from Foundamental, Axilor, Arali Ventures and Force Ventures – Read More

M&A Snippets

Bangalore-based payment solutions provider Razorpay will acquire Bangalore-based payment solutions provider Ezetap Mobile Solutions for $126Mn – Read More

Delhi-based edtech platform PhysicsWallah has acquired Agra-based edtech startup FreeCo for an undisclosed amount – Read More

Ecosystem Weekly | 14th Aug’22

August 14, 2022

As India celebrates Azadi ka Amrit Mahotsav, the Indian startup ecosystem continues to be fuelled by innovation, enthusiasm and entrepreneurial spirit. In its 75 years’ rich legacy, transformations have put India on par with leading economies.

One can view India’s Independence as the birth of a startup too. The people of the country, who adopted a problem-solving approach to gain independence have set the premise for the national culture to initiate, be self-reliant and help the country flourish.

Since its Independence, India has shown stellar growth in various sectors. Today, the country holds the world’s highest rate of recognition start-ups per day, out of which, around 12% cater to IT services, 9% to Healthcare and Life Sciences, 7% to education, 5% to professional and commercial services, and 5% to agriculture.

Currently, there are 75,000 start-ups in the country, where, India reported its 100th unicorn in May this year. According to the ‘Decoding India’s 100 unicorns’ report, the 100 Indian unicorns have raised over $90 billion collectively, and have a combined valuation of about $333 billion. A milestone that coincides with the 75th year of Independence.

Technology leaders from across verticals have shared their views on the progress made so far and their vision for the next 25 years.

Ecosystem Ventures This Week

Key Highlights – Clients

We are pleased to inform you that Mr. Prateek Bhargava founder of one of our Edtech portfolio companies Mindler, has received BW Education 40 under 40 Award!

Many congratulations to Prateek and Mindler team! We wish them success in their journey of adding immense value to the career coaching industry.

Startup Funding Summary

upGrad, a Mumbai-based edtech platform, has raised $210 Mn in a funding from ETS Global, Bodhi Tree, Singapore’s Kaizen Management Advisors, Bharti Airtel, Narotam Sekhsaria, Artian Investments, Temasek, IFC and IIFL – Read More

SquadStack, a Noida-based talent marketplace, has raised $18 Mn in Series B funding from Bertelsmann India Investments, Chiratae Ventures and Blume Ventures – Read More

Jodo, a Bangalore-based fintech startup, has raised $15 Mn in Series A funding from Tiger Global, Elevation Capital and Matrix Partners – Read More

Lenskart, a Bangalore-based eyewear brand, has raised $13 Mn in a funding from Ravi Modi Family Trust – Read More

Lysto, a Bangalore-based gaming platform, has raised $12 Mn in Pre-Series A funding from Square Peg, BEENEXT, Hashed, Tiger Global, Better Capital, Balaji Srinivasan, Paul Veradittakit, Binny Bansal, Bobby Ong, TM Lee and other HNIs – Read More

M&A Snippets

Mumbai-based electric supply company JSW Neo Energy will acquire Hyderabad-based renewable energy company Mytrah Energy for $1 Bn – Read More

Bangalore-based healthtech startup Orange Health has acquired Gurugram-based diagnostic lab Rapidx for an undisclosed amount – Read More

Bangalore-based retail aggregator William Penn has acquired America-based consumer goods company Sheaffer for an undisclosed amount – Read More

Ecosystem Weekly | 07th Aug’22

August 7, 2022

Ideal startups are tech-driven scalable businesses poised to achieve exponential growth. The building block of such an endeavor in the internet economy is – Data.

‘Data being the new oil’ would rank among the most cliched phrases, used by corporations, business leaders & governments alike.

On Wednesday, the union government announced the withdrawal of the ‘Data Protection Bill 2019’ (DPC 19) which it had introduced in the parliament two years ago. This decision turns the clock back to four years when serious public discourse on data & privacy began to emerge in India.

Let’s use the ‘data is the new oil’ corollary to examine this event. A century ago, when oil extraction would have become mainstream, with its commercial and personal applications transforming human habits or lifestyles, no one bothered to care about the CO2 emission levels. The reason being there was no knowledge of climate change. It was only in the early 90s, after decades of research on global climate models, and observable climate change patterns were noted, that the nations were alarmed about the bleak future. A global consensus emerged, a framework was evolved, and environmental legislations were passed. Thereby, some steps, however inadequate, were taken in the right direction.

All public policies — indeed, all actions by humans — have two kinds of effects: the effects that are intended, and visible; and unintended consequences, which are invisible.

Climate change is a classic example of an invisible effect of the oil. An unseen effect can be accounted for as a substantial long-term cost in the future. Data is at a similar cusp to oil. It has transformed human habits & lifestyles. With every passing minute, data generation & consumption is increasing manifold. But with the absence of a regulatory framework, we enhance the probability of incurring long-term costs.

The government would do well to bring a comprehensive data protection framework at the earliest. Here is a credible source to understand the regulatory nuances of the ‘new oil’, which are bound to impact businesses and personal lives in times to come

Startup Funding Summary

Dezerv, a Mumbai-based wealth management platform, has raised $20 Mn in Series A funding from Accel Partners, Elevation Capital, Matrix Partners, Whiteboard Capital and GTM Ventures – Read More

WebEngage, a Mumbai-based adtech startup, has raised $20 Mn in Series B funding from Singularity Growth Opportunities Fund, SWC Global, India Quotient, IAN Fund, Blume Ventures, Unmaj Corporation, NB Ventures, Shashwat Nakrani, Gopal Srinivasan and other HNIs – Read More

Twid, a Bangalore-based fintech startup, has raised $12 Mn in Series A funding from Rakuten Capital, Google, ICMG Partners, JAFCO Asia, January Capital, Surge, BEENEXT and Reddy Futures Fund – Read More

River, a Bangalore-based EV startup, has raised $11 Mn in Series A funding from Lowercarbon Capital and Toyota Ventures – Read More

Jify, a Mumbai-based fintech startup, has raised $10 Mn in Series A funding from Accel and Nexus Venture Partners – Read More

M&A Snippets

Mumbai-based banking firm Axis bank will acquire minority stake in Mumbai-based fintech platform CredAble for ~$7 Mn – Read More

Mumbai-based edtech startup upGrad has acquired Noida-based edtech startup Exampur for an undisclosed amount – Read More

Mumbai-based online beauty and personal care retailer Nykaa will acquire New Delhi-based lifestyle discovery platform Little Black Book for an undisclosed amount – Read More

                                                                                                                                       

Ecosystem Weekly | 31st July’22

July 31, 2022

One of the biggest funding news of the week is of Jai Kisan raising $50 Mn as part of the first tranche of its ongoing Series B round. The startup aims to be a full fledged solution for rural financing requirements.

The company’s flagship app is Bharat Khata, available in 9 regional languages, which the company claims is used by over 100,000 rural businesses. The company claims to possess unique insights to over $1Bn worth of rural commerce and 5 Mn individuals.
No one would disagree that there exists a lot of opportunities to unlock growth in rural India. Reams of analysis, articles, posts are written every month, on how to go about bringing a transformation in rural hinterlands.
Often the prescriptions tend to be top-down, laden with a patronizing bureaucratic overhang. The government, and the companies, focused on the rural economy, should do well to avoid the predictable trap. The biggest example being – the unceremonious repeal of the hurriedly imposed farm laws. The government, policy experts, and the corporate sector, were not able to communicate the perceived advantages of the said laws to a substantial set of stakeholders whose livelihood depended on it.
In that context, the fact that Bharat Khata app is already present in 9 vernacular languages, would be a step in the right direction. But only a step, as it would need to be in 20 more dialects, to be truly available to the end user.
Out of curiosity, I downloaded the app and selected the Hindi language. Rather than native Hindi words, it appears the app has transliterated the English interface in the devanagari script. For example, the phrases “To collect”, “Stock Value”, “Overdue” are written as टू कलेक्ट … rather than the appropriate equivalent.
This might be a small UI related observation but it reveals a scope of empathy in designing for the user base quite different from the conventional one.
At Ecosystem Ventures, we tend to maximize empathetic conversations with our consulting & investing clients, fitting ourselves in their shoes, to deepen the quality of our shared insights
Ecosystem Ventures This Week
Key Highlights – Clients

We are pleased to share that one of our healthtech portfolio companies – Navigene – India’s first diagnostic venture focused on Non-invasive Preventive Testing through Proprietary Technology, has shown growth of 91% in Q1 of FY23 as compared to Q1 of FY22 with 220+ total hospitals onboarded. It has processed 16000+ samples in the last 12 months.

With transforming preventive diagnostics by Identifying 5x more bio-markers, 40% lower cost and 80% simpler logistics it has also started associating with the Government for projects of testing Sickle Cell disease and other diseases that are now beginning to reflect in the revenues.

With both Government and private businesses growing, they are looking to grow 2.5x in monthly revenues in the next 3 months.

We wish them All the best in future endeavors.

Startup Funding Summary

Jai Kisan, a Mumbai-based rural fintech startup, has raised $50 Mn in Series B funding from GMO Venture Partners, Yara Growth Ventures, DG Daiwa Ventures, Blume Ventures, Arkam Ventures, Mirae Asset, Snow Leopard Ventures, Northern Arc, Alteria and MAS Financial – Read More

SuperShare, a Bangalore-based content sharing app, has raised $7 Mn in Series A funding from Lachy Groom, Accel India, Lightspeed, Tanmay Bhat, MythPat and other HNIs – Read More

ChattyBao Technologies, a Delhi-based e-commerce startup, has raised $5 Mn in Seed funding from Vertex Ventures, Info Edge Ventures, 7Square Ventures and other HNIs – Read More

Threado, a Gurugram-based community management platform, has raised $3 Mn in Seed funding from Vertex Ventures, Gemba Capital, Speciale Invest, PointOne Capital, Deepinder Goyal, Pankaj Chaddah, Krish Subramanian, Rajaraman Santhanam, Abhishek Goyal, Aneesh Reddy, Tonmoy Shingal, Archana Priyadarshini and Sri Rajan – Read More

Wify, a Mumbai-based tech platform, has raised $2 Mn in Pre-Series A funding from Blume Founders Fund, Unitus Ventures, Singularity Ventures and HePo NL – Read More

M&A Snippets

Bangalore-based digital payments platform PhonePe has acquired New York-based software development OSLabs for ~$60 Mn – Read More

Mumbai-based financial services company InCred has merged with America-based private equity firm KKR, for an undisclosed amount – Read More

Ecosystem Weekly | 24th July’22

July 24, 2022

One of the news of the week has been the acquisition of professional up-skilling platform Harappa by the Higher-ed unicorn UpGrad for INR 300 Cr.

 
Upgrad’s founder, Ronnie Screwvala had commented last month – “Global edtech consolidation is on the cards and we’ll build a $30 to $40 billion higher-ed company. We plan to have an IPO in about two years — for solidly built companies, there’s no good or bad time for an IPO.”
 
In June, it was reported that Upgrad had raised ~ $ 225 Mn at an expected valuation of $ 2.25 Bn. The investment was led by billionaire James Murdoch’s Lupa Systems LLC and Educational Testing Service (ETS), which conducts TOEFL & GRE in the US.
 
Lupa Systems LLC had reportedly taken a majority stake in Harappa in early 2020, as their first major bet in India. Harappa Education had been functioning bootstrapped till then.
 
Analysts were quick to point to the development, as one of many deals, in the inevitable consolidation of the Indian Ed-tech market.
 
Unlike its contemporaries, there has been no news of layoffs at UpGrad. The exception, though not directly linked to UpGrad is one of the companies promoted by Ronnie Screwwala – LIDO learning – abruptly closed operations on Feb 22 after raising $ 10 Mn as part of Series C round on Sep 21.
 
On the other hand, the reported losses of Harappa stood at ~37 Cr against revenue of ~ 4 Cr in FY21 from ~ INR 6.5 Cr in FY 20. The financials for FY 22 are unavailable.
 
UpGrad, primarily a D2C brand, aims to leverage Harappa’s strong presence in the B2B & Enterprise learning space. How would this acquisition pan out? Only time will tell. 
 
Please feel free to share your thoughts on the emerging trends in the ed-tech space.

Ecosystem Ventures This Week

Welcome – Himanshu Sachdev

We welcome Mr. Himanshu Sachdev as a Sr. Business Analyst at Ecosystem Ventures.
Prior to joining us, he worked with Anplify Services Pvt. Ltd. as Financial Analyst and has also served as a Teaching Faculty at Maheshwari Institute, Indore.
He is a qualified CFA and has pursued BMS from Mumbai. He has certification in Equity Research and Financial Modeling.
LinkedIn

 

Startup Funding Summary

Niyo, a Bangalore-based fintech startup, has raised $30 Mn in a funding from Multiples Alternate Asset Management – Read More

Eka Care, a Chennai-based healthtech startup, has raised $15 Mn in Series A funding from Hummingbird Ventures, Mirae Assets, Verlinvest, Aditya Birla Ventures, Binny Bansal, Rohit MA, 3one4 Capital and other HNIs – Read More

Fitterfly, a Mumbai-based healthtech startup, has raised $12 Mn in Series A funding from Amazon Smbhav Venture Fund, Fireside Ventures, 9 Unicorns, Venture Catalysts, Nihar Parikh and Sriram Natarajan – Read More

Creative Galileo, a Mumbai-based edtech startup, has raised $8 Mn in Series A funding from Kalaari Capital, Affirma Capital, East Ventures, Valiant Employee Investment Fund and other HNIs – Read More

Lal10, a Noida-based wholesale marketplace, has raised $6 Mn in Pre-Series A funding from Yuj Ventures, Beyond Capital Ventures, Spiral Ventures, Singularity Ventures, Asymmetry Ventures, Blacksoil, Panthera Peak, Pegasus FinInvest, Nitish Mittersain, Bikky Khosla, Ashok Gudibandla, Kishore Ganji, Suprajit FO, Bob Noyen, Reasoned Ventures and Insaan Group – Read More

M&A Snippets

Mumbai-based edtech startup upGrad has acquired New Delhi-based edtech startup Harappa Education for $38 Mn – Read More

New Delhi-based logistics startup Shiprocket has acquired Ahmedabad-based SaaS platform Arvind for $25 Mn – Read More

Telangana-based unified commerce platform Hesa has acquired Bangalore-based sales intelligence startup Flinkhub for an undisclosed amount – Read More

Ecosystem Weekly | 17th July’22

July 18, 2022

11 investments, ~₹100 Cr. of total fund-raise by portfolio companies, 4.5x annualized returns with Zero Venture failures and 10x team growth. What a journey it has been!
Ecosystem Ventures started with a mission to ensure startup growth and success by bringing multitude of capabilities back in July 2020. In the past 24 months, we have gone above and beyond to help startups become successful, and generate multi-fold returns for investors. What started with 2 co-founders and a small team has now grown to house 6 senior Partners, all with 18+ years of experience and from Top Pedigree, and a dedicated team of 25+ Analysts, Associates and Leaders.
This wouldn’t have been possible without the continuous support of our Advisors, Industry Experts, Angel Investors, Family Offices, Funds and the Rockstar Founders we’ve worked with.
Thank you so much for being a part!

 

A word from our Co-Founders

Abhishek Sanghvi

Co-Founder

It has been an exhilarating journey to help ‘build’ ventures beyond just investing in them. Working closely with exceptional founders as their strategy team has allowed us to create deep impact in multiple ventures. I’m committed to unlocking the power of our ecosystem to help 5x more companies in the coming quarters

Abhijeet Bhandari

Co-founder

It has been quite an exciting journey to help entrepreneurs in their path of rapid scaling. It gives me great pleasure that our entrepreneurs and investors find a lot of value in what we do and appreciate our work. We are continuously striving to improve ourselves and would be great to hear your feedback.

Startup Funding Summary

Detect Technologies, a Chennai-based AI startup, has raised $28 million in Series B funding from Prosus Ventures, Accel, Elevation Capital, Shell Ventures, Bharat Innovation Fund and Bluehill Capital – Read More

Vegrow, a Hyderabad-based B2B agritech startup, has raised $25 Mn in Series B funding from Prosus Ventures, Matrix Partners India, Elevation Capital, Lightspeed India and Ankur Capital  – Read More

Wysa, a Bangalore-based AI-powered mental health platform, has raised $20 Mn in Series B funding from HealthQuad, British International Investment, W Health Ventures, Kae Capital, Google Assistant Investments and pi Ventures – Read More

String Bio, a Bangalore-based food tech startup, has raised $20 Mn in Series B funding from Ankur Capital, Dare Ventures, Redstart, Zenfold Ventures and Woodside Energy  – Read More

Wheelocity, a Chennai-based fruits & vegetable supply chain startup, has raised $12 Mn in Series A funding from Lightspeed India Partners and Anicut Capital – Read More

M&A Snippets

Bangalore-based digital healthcare platform MediBuddy has acquired Hyderabad-based online doctor consultation startup Clinix, for an undisclosed amount – Read More

Mumbai-based edtech unicorn upGrad has acquired Bangalore-based recruitment and staffing firm WOLVES for an undisclosed amount  – Read More

Ecosystem Weekly | 10th July’22

July 10, 2022

Human civilization is contingent on transactions. Since the dawn of commerce, markets are the avenues for facilitating transactions between buyers and sellers. For centuries, offline markets have dominated commerce, but they are limited by geographical proximity and space constraints of the two transacting parties. Online markets are not restricted in the same way. Hence they are scalable. But how do merchants receive payments from the customers in the online world?

Banks through their net banking was the obvious first answer. But in the last decade numerous fintech companies, such as Razorpay, PayTM, have emerged to simplify purchases for the online merchants. Banks in their traditional sense are not designed for processing payments. They are meant to take deposits and deploy credit where it is needed.

These intermediaries facilitating transactions between merchants and customers would now be referred to as licensed ‘Payment Aggregators (PA)’. In simple terms, there are two components in facilitating a transaction – managing funds & enabling technology to talk to different machines (servers) to debit and credit the right amount of funds from the correct set of accounts.

Reserve Bank of India, in Mar 2020, had mandated that only those companies who have acquired ‘Payment Aggregator’ (PA) license through them are eligible to provide payment services.

To ensure credibility, resist monopolies, and evolve an emerging market framework, RBI stipulated mandatory capital requirements. The PAs need a minimum net worth of Rs 15 Cr by the end FY 21, which would increase to, and be maintained at Rs 25 Cr after the end of March 2023.

The guidelines further strengthen the KYC norms, merchant creditworthiness & onboarding norms, account settlement processes, fraud prevention & risk management framework, customer grievance redressal mechanism.

Consequently, close to 165 NBFCs had applied for the PA licenses. The day before, it was reported that RBI has in-principle approved applications of Pine labs and Razorpay.

Although the full list of approved PAs is awaited, it appears RBI is stringent with the norms, as this report suggests central bank declining a large number of applications. Non issuance is being attributed to scrutiny for KYC-related issues, past participation with cryptocurrency exchanges and gaming apps, as well as non-compliance with the net worth criteria mentioned before.

With global success of the UPI, the latest directive emphasizing on account aggregator framework for public sector banks and the evolving ONDC protocol, the Indian fintech and ecommerce ecosystem is as vibrant as ever.

Ecosystem Ventures This Week

Key Highlights – Clients

We are happy to onboard a Bangalore-based pharmaceutical manufacturing company.

It focuses on development and manufacturing of IP-led niche finished dosage formulations. It is also among the world’s largest manufacturers of soft gelatin capsules. The Company has a dedicated R&D facility in India with global filing capabilities and a strong footprint across 100 countries.

We look forward to working with them and wish them all the best for a bright future.

Startup Funding Summary

Innoviti Payment, a Bengaluru-based fintech startup, has raised $15 Mn in Series D funding from Panthera Growth Partners, Alumni Ventures, Patni Family Office, FMO and Bessemer Venture Partners – Read More

MarketWolf, Mumbai-based fintech startup, has raised $10 Mn in series A funding from Jungle Ventures, Dream Capital, iSeed, 9Unicorns, Crescent and Riverwal – Read More

AntWalk, a Bengaluru-based edtech startup, has raised $8 Mn in Series A funding from GSV, Y Combinator and Matrix Partners India – Read More

Acefour Accessories, a Mumbai-based D2C travel accessories provider, has raised $7 Mn in Pre-Series A funding from Sixth Sense Ventures and Volrado Venture Partners – Read More

Ensuredit, a Bengaluru-based insurtech firm, has raised $4 Mn in pre-series A funding from Cover Genius, 9Unicorns, NexStep Discovery, CP Ventures, Venture Catalysts and IPV – Read More

M&A Snippets

Bengaluru-based natural colors supplier Oterra has acquired Kerala-based natural ingredients manufacturer Akay Group for an undisclosed amount – Read More

Mumbai-based warehousing and fulfilment services provider Emiza Supply Chain Services has acquired Gurugram-based shipping solutions provider Shippigo for an undisclosed amount  – Read More

 

Ecosystem Weekly | 3rd July’22

July 3, 2022

Ecosystem Ventures This Week

We welcome Ms. Soniya Shivhare as an Associate at Ecosystem Ventures.

Prior to joining us, she has worked with TresVista Financial Services and Visible Alpha Solutions. She is a B.Com graduate and MBA (Finance) from DAVV, Indore.

She likes travelling, hiking, painting or cooking.

LinkedIn

Startup Funding Summary

Arzooo, a Bangalore-based B2B retail tech platform, has raised $70 Mn in Series B funding from SBI Investment, Trifecta Leaders Fund and Tony Xu – Read More

PropShare, a Bangalore-based real estate investment platform, has raised $47 Mn in Series B funding from WestBridge Capital and Pravega Ventures – Read More

Progcap, a New Delhi-based fintech company, has raised $40 Mn in Series C funding from Creation Investments, Tiger Global and Sequoia Capital – Read More

Solv, a Bangalore-based digital marketplace for MSMEs, has raised $40 Mn in Series A funding from SBI Holdings and SC Ventures – Read More

GetVantage, a Mumbai-based revenue-financing platform, has raised $36 Mn in Series A funding from Varanium Nexgen Fintech Fund, DMI Sparkle Fund, Chiratae Ventures, Dream Incubator Japan, Sony Innovation Fund, InCred Capital and Haldiram’s Family Office – Read More

M&A Snippets

New Delhi-based eyewear provider Lenskart has acquired Japan-based D2C eyewear brand Owndays for an undisclosed amount – Read More

US-based global private equity firm Carlyle has acquired Indore-based tiles and bathware maker Varmora Granito for an undisclosed amount – Read More

Pune-based digital lending platform Lentra AI has acquired Bangalore-based AI solutions provider TheDataTeam for an undisclosed amount – Read More

Belgium-based chemical manufacturing firm Azelis has acquired Mumbai-based chemical distributor Ashapura Aromas for an undisclosed amount – Read More

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