Tag: M&A

Mamaearth’s Oversubscribed IPO Sets Stage for a Promising Market Debut

November 5, 2023

Mamaearth, a frontrunner in the realm of natural and sustainable beauty and personal care products, has recently captured the market’s attention with its highly anticipated Initial Public Offering (IPO), signaling a pivotal milestone in the brand’s evolutionary journey. With an IPO valued at a substantial Rs 1,701.00 crores, Mamaearth has underscored its growing influence and prominence within the consumer goods sector, solidifying its position as a trailblazer in the industry.

As the IPO subscription period unfolded, Mamaearth experienced a good response from investors, surpassing expectations with an impressive 7.61 times oversubscription. This robust demand is a testament to the brand’s unwavering commitment to sustainable and eco-friendly practices, resonating deeply with investors seeking ethical and environmentally conscious investment opportunities as discussed here.

Since its inception, Mamaearth has embarked on a mission to redefine traditional beauty standards, catering to the evolving consumer preferences for organic and environmentally friendly alternatives. With a diverse product portfolio encompassing skincare, hair care, and baby care, the brand has fostered a loyal customer base drawn to its ethical and transparent manufacturing processes.

The brand’s strength lies in its transparent communication and unwavering dedication to ingredient safety and efficacy as highlighted in the article of Mantraa Advisory,, a stance that has resonated with a growing community of conscious consumers. Mamaearth’s commitment to sustainability, coupled with its innovative product formulations catering to diverse skincare needs, has solidified its position as a frontrunner in the competitive beauty landscape.

Despite its notable success, Mamaearth has not been immune to the challenges prevalent in the consumer goods industry. Mantraa Advisory has highlighted potential obstacles, including the need to navigate the complexities of supply chain management, maintain competitive pricing in the face of market fluctuations, and sustain consistent product innovation to meet evolving consumer demands. Additionally, the brand faces the ongoing challenge of balancing its sustainability goals with the necessity of scaling operations to meet the burgeoning market demand.

Amidst these challenges as mentioned here,, Mamaearth continues to fortify its presence through strategic collaborations, innovative marketing campaigns, and a continued focus on fostering consumer trust through transparency and product quality. With a strong emphasis on sustainability, wellness, and innovation, Mamaearth remains poised to navigate the dynamic beauty landscape while continuing to champion its commitment to promoting a healthier, greener, and more conscious approach to personal care.

                                                                  Startup Funding Summary

Mamaearth’s, Gurugram-based beauty & personal care brand, has raised $91 Mn in a funding from Smallcap World Fund, Fidelity Funds, Abu Dhabi Investment Authority, Government Pension Fund Global, Caisee De Depot ET Placement, FSSA India Suncontinent Fund, Carmignac Portfolio, Goldman Sachs, Fundpartner Solutions and Hornbill Orchid India Fund – Read More

Aequs, Karnataka-based aerospace & defense contract manufacturer, has raised $54 Mn in a funding from Amansa Capital, Steadview Capital, Catamaran, Family office of N R Narayana Murthy, Sparta Group LLC, Sparta Group LLC and other HNIs – Read More

Skyroot Aerospace, Hyderabad-based spacetech startup, has raised $27 Mn in Pre-Series C funding from Temasek –  Read More

Vridhi Home, Bengaluru-based housing finance company, has raised $18 Mn in a Series A funding from Elevation Capital – Read More

Sugar.fit, Bengaluru-based health-tech startup, has raised $11 Mn in Series A funding from MassMutual Ventures, Cult.fit, Tanglin Venture Partners, Endiya Partners and other HNIs – Read More

M&A Snippets

Gurugram-based eyewear brand Lenskart has acquired Chennai-based AI computer vision startup TangoEye for an undisclosed amount – Read More

Bengaluru-based cloud kitchen company CureFoods has acquired Mumbai-based foodtech startup Yumlane for an undisclosed amount – Read More

 

Ixigo’s Incredible Rollercoaster Ride to IPO

October 29, 2023

Today, we will be walking you through the story of ixigo and what goes into making of a great company. In 2006, Aloke Bajpai, an IIT Kanpur alumnus, and his colleague Rajnish Kumar decided to return to India and start Ixigo, investing a modest 6 lakh rupees. Despite initial skepticism from investors, the duo’s relentless efforts resulted in a $10,000 monthly revenue within 6 months of launch.

However, the 2008 financial crisis hit Ixigo hard, resulting in withdrawal of an almost-closed $5M funding round which led to a significant workforce reduction. The team took a voluntary pay cut to weather the storm, focusing on customer-centric product development.

By 2010, Ixigo launched its mobile app, rapidly expanding its user base. It strategically partnered with major travel businesses, offering exclusive discounts and deals. Over the years, it diversified its offerings, from intra-city cabs to inter-city travel guides, leveraging its understanding of travelers’ pain points.

The company’s real turning point came when it focused on the railways sector, launching a railway app that attracted 60 million travelers by 2016, capturing 70% of the market share. Ixigo’s revenue model evolved, transforming the platform into a full-fledged online travel agency (OTA).

Despite the challenges posed by the pandemic, Ixigo demonstrated exceptional resilience, providing customer-centric solutions such as proactive refunds and introducing the ‘assured’ feature for flight bookings. It acquired ConfirmTkt and AbhiBus, consolidating its position in the OTA space.

In 2021, Ixigo separated from its investor-partner MakeMyTrip, filing for a Rs. 1,600 crore IPO. The company’s focus on user retention, frugal operations, and innovative offerings resulted in impressive financials, with an estimated revenue of over Rs. 500 crores in FY23.

With plans to double its yearly bookings and a growing user base of 50 million, Ixigo’s journey to becoming one of India’s leading OTAs is a testament to perseverance and consumer-centric business practices.

Ixigo’s journey from being a startup grappling with financial challenges to becoming a market leader and a potential IPO candidate embodies the spirit of perseverance and innovation in the face of adversity. Source – ajuniorvc

Startup Funding Summary

Ola Electric, Bangalore-based EV manufacturer, has raised $384 Mn in a funding from Temasek and State Bank of India – Read More

PMI Electro Mobility, Dharuhera-based electric bus manufacturer, has raised $30 Mn in a funding from Piramal Alternatives – Read More

Inc.5 shoes, Mumbai-based footwear brand, has raised $10 Mn in Series A funding from Carpediem Capital, Param Capital and P3 Venture Fund – Read More

Blubirch, Bangalore-based reverse logistics service provider, has raised $6 Mn in Series A funding from Cornerstone Ventures and Capital2B – Read More

Mokobara, Bangalore-based D2C luggage brand, has raised $4 Mn in a funding from Saama Capital, Sauce VC and Alteria Capital – Read More

M&A Snippets

UAE-based logistics management platform Shipsy has acquired Bangalore-based inventory management platform Stockone for an undisclosed amount – Read More

 

India’s Digital Credit Landscape: Thriving Leaders and Evolving Challengers

October 22, 2023

The Indian financial ecosystem is undergoing a seismic transformation, primarily driven by the rapid proliferation of digital credit platforms. With an estimated surge in digital payment users, surpassing key global economies, India is at the forefront of a digital credit revolution. As the digital consumer lending sector is projected to reach a staggering $720 billion by 2030, the stage is set for a fierce battle among key players to dominate this burgeoning market.

The digital consumer lending landscape has undergone a significant transformation, revolutionizing the way individuals access financial services. Consumer lending space can be segmented into four sub-categories: Personal Loan, BNPL, Gold Loans, Retail Cards.

1. Personal Loans have gained substantial traction, providing consumers with flexible financing for diverse needs such as medical emergencies, home renovations, or education expenses. For instance, platforms like Credible and SoFi have emerged as prominent examples, offering convenient and streamlined personal loan services.

2. Additionally, the ‘Buy Now, Pay Later’ (BNPL) concept has swiftly gained popularity, allowing consumers to make purchases and pay for them in installments. Companies such as Afterpay and Klarna have become frontrunners in the BNPL sector, catering to the growing demand for flexible payment options.

3. Moreover, Gold Loans have continued to serve as a reliable source of quick financing, with institutions like Muthoot Finance and Manappuram Finance leading the way in providing secure and accessible gold-backed lending solutions.

4. Furthermore, Retail Cards have become increasingly prevalent, empowering consumers with convenient credit options for their everyday shopping needs. Notably, the SBI Card and HDFC Bank’s EasyEMI are among the prominent retail card examples, offering users tailored benefits and rewards for their spending.

In this era of dynamic digital transformation, building a customer-centric organization has become a non-negotiable prerequisite for businesses in India. As consumer preferences evolve and technology continues to revolutionize various industries, companies must swiftly adapt to customer-centric strategies to maintain their competitive edge. Embracing customer data, implementing omni-channel strategies, personalizing experiences, prioritizing superior customer service, nurturing a customer-centric culture, and adopting agile methodologies have emerged as key pillars for organizations striving to be customer-centric in the digital age.

The rapidly evolving digital credit landscape in India presents both remarkable opportunities and intense competition. As the nation embarks on a journey of financial digitization, the key to success lies in understanding and catering to the ever-evolving needs of the Indian digital consumer, while simultaneously fostering a customer-centric ethos across all organizational levels.

Startup Funding Summary

Zetwerk, Bangalore-based B2B ecommerce company, has raised $120 Mn in Series F funding from Avenir Growth Capital, Footpath Ventures, Greenoaks Capital, Steadview Capital, D1 Capital and Lightspeed – Read More

Neo, Mumbai-based wealth & asset management startup, has raised $35 Mn in a funding from Peak XV Partners – Read More

Vastu Housing Finance, Mumbai-based fintech company, has raised $30 Mn in a funding from Faering Capital – Read More

Agnikul Cosmos, Chennai-based spacetech startup, has raised $27 Mn in Series B funding from Celesta Capital, Rocketship.vc, Artha Venture Fund, Artha Select Fund, Mayfield India, Pi Ventures and Speciale Invest – Read More

Apex Kidney Care, Mumbai-based healthcare startup, has raised $10 Mn in a funding from Tata Capital Healthcare Fund II – Read More

M&A Snippets

Mumbai-based video editing platform VideoVerse has acquired LosAngeles-based AI-based audience enhancement Optikka for an undisclosed amount – Read More

Emerging Market Innovators Redefining Global Tech Landscape

October 15, 2023

In a world characterized by rapid technological advancements, the landscape of global innovation is experiencing a transformative shift led by pioneering companies from emerging markets. These companies, often operating under the radar, are rewriting the rules of the game, outmaneuvering Silicon Valley’s giants and setting new benchmarks for global dominance. While tech behemoths in the West have long been the face of innovation, a new wave of businesses is challenging this narrative, showcasing unparalleled adaptability and foresight.

In the realm of Money, companies like PhonePe in India, M-Pesa in Kenya, and NPCI are revolutionizing financial services, empowering millions with seamless transactional experiences and driving financial inclusion. These firms have not only leveraged cutting-edge technologies but have also tailored their offerings to cater to the specific needs and preferences of their local communities, setting new standards for user-friendly financial solutions.

When it comes to Mobility, companies such as Grab in Singapore and Careem in the UAE have redefined transportation services by understanding and addressing the unique requirements of their respective regions. By integrating localized features such as cash payment options and tailored navigation solutions, they have transformed the way people move, providing convenient and accessible mobility solutions to millions.

In the realm of Communication, companies like Naver in South Korea, Tencent in China, and Zalo in Vietnam have developed messaging platforms that not only resonate with local users but also foster a sense of community and inclusivity. By offering culturally relevant features and prioritizing user engagement, these platforms have become indispensable tools for seamless global communication, transcending geographical boundaries.

Meanwhile, in the sphere of Modern Lifestyle, companies like DJI in China and Showmax in South Africa are reimagining everyday experiences through their innovative products and services. These companies have embraced a user-centric approach, catering to the evolving needs and preferences of a global audience. By combining cutting-edge technology with a deep understanding of modern lifestyles, they are shaping the future of how people live, work, and engage with the world around them.

As these companies continue to thrive and set new benchmarks for innovation, they not only inspire a new generation of startups and entrepreneurs across emerging markets but also redefine the future of global technology experiences. The success of these trailblazing companies is a testament to the power of innovation and adaptation, demonstrating that the next era of technological evolution is not confined to the West but is being shaped by diverse, forward-thinking companies from every corner of the globe.

To read more about these dynamic companies and their impact on the global market, refer to this interesting article from the ‘rest of world’ publication.

I am sure there will be many more additions from India in times to come.

Startup Funding Summary

InsuranceDekho, Bangalore-based Insurtech startup, has raised $60 Mn in Series B funding from Mitsubishi UFJ Financial Group, BNP Paribas Cardif, Beams Fintech Fund, TVS Capital, Goldman Sachs Asset Management and Avataar Ventures – Read More

Bizongo, Mumbai-based packaging company, has raised $50 Mn in Series E funding from Schroder Adveq, British International Investment, International Finance Corp, Chiratae Ventures and B Capital – Read More

Onsurity, Bangalore-based Insurtech startup, has raised $24 Mn in a funding from International Finance Corporation, Nexus Venture Partners, Quona Capital and other HNIs – Read More

Shiprocket, Delhi-based logistics platform, has raised $11 Mn in Series E funding from McKinsey – Read More

Bagzone Lifestyles, Mumbai-based fashion and lifestyle brand, has raised $9 Mn in a funding from First Bridge India Growth Fund – Read More

M&A Snippets

Mumbai-based carbon black supplier Birla Carbon has acquired Belgium-based carbon nanotubes manufacturer Nanocyl for an undisclosed amount – Read More

Chennai-based healthcare revenue cycle management service provider Access Healthcare has acquired Virginia-based patient engagement service provider Envera Health for $32 Mn – Read More

Mumbai-based technology solution company Aurionpro has acquired kolkata-based loan management system Omnifin for $10 Mn – Read More

Can Ola’s Parcel Delivery Service Revolutionize Logistics in India?

October 8, 2023

In a rapidly evolving world of on-demand services, Ola, the Indian ride-hailing giant, has ventured into the logistics sector with its new offering – Ola Parcel. The recent launch of this service in Bengaluru marks a significant step towards creating an all-electric, two-wheeler logistics ecosystem in India. But can Ola make it work in a highly competitive market already dominated by players like Swiggy Genie, Dunzo, Porter, and Uber Connect?

Ola Parcel’s distinguishing feature is its reliance on electric scooters for deliveries. This move aligns with the global trend of transitioning to electric vehicles for a more sustainable future. Electric two-wheelers are not only environmentally friendly but also cost-effective, making them well-suited for intra-city deliveries.

One of the notable aspects of Ola Parcel is its pricing strategy. With rates starting as low as ₹25 for a 5km delivery, it offers affordability and convenience. Charges incrementally increase for longer distances, with a maximum cap of ₹100 for 20km. This competitive pricing may entice both individual users and businesses looking for cost-effective delivery solutions.

While Ola Parcel currently operates in Bengaluru, the company has ambitious plans for expansion. Founder and CEO Bhavish Aggarwal announced the intent to take this service nationwide soon. This nationwide presence could give Ola Parcel a considerable edge over competitors and potentially revolutionize logistics across the country.

Users can access Ola Parcel through the Ola app, where they can create an account and select the ‘Parcel’ option. The app prompts users to input pickup and drop-off locations, as well as parcel dimensions and weight. Ola then calculates an estimated fare for the delivery. Upon confirmation, a driver is assigned to pick up and deliver the parcel. The real-time tracking feature, multiple payment options, and 24/7 customer support further enhance the user experience.

Ola Parcel is set to compete with established players like Uber Connect, Swiggy Genie, and Dunzo. These companies have already established their presence in India’s logistics landscape. Ola’s success will depend on its ability to differentiate itself, expand rapidly, and offer a compelling value proposition to users. Further, it needs to be seen if Ola can maintain its pricing and make unit economics work at scale as other players are burning money despite charging more than Ola.

The launch of Ola Parcel has been met with enthusiasm on social media, with users expressing excitement over its eco-friendly approach and affordability. Many believe that it will boost small businesses and contribute to a pollution-free India.

Ola Parcel’s entry into the Indian logistics sector appears promising, thanks to its focus on electric vehicles, competitive pricing, and ambitious expansion plans. Whether it can compete effectively against established players remains to be seen. However, Ola’s reputation as a tech disruptor in the transportation industry suggests that it may well succeed in revolutionizing parcel deliveries in India.

Startup Funding Summary

Mensa Brands, Bangalore-based e-commerce company, has raised $40 Mn in a funding from EvolutionX – Read More

Bolt.Earth, Bangalore-based EV infrastructure and software company, has raised $20 Mn in a funding from Union Square Ventures, Prime Venture Partners, ITIGO Funds and other HNIs – Read More

Quick Smart Wash, Jaipur-based linen management startup, has raised $5 Mn in Series B funding from Elan Corporation – Read More

DPDzero, Bangalore-based fintech startup, has raised $3 Mn in Seed funding from Blume Ventures, IndiaQuotient, Sunil Gulati and Nikhil Kumar – Read More

ClearFeed, Bangalore-based chatbot platform, has raised $3 Mn in Seed funding from Peak XVs Surge, 8VC and other HNIs – Read More

M&A Snippets

Mumbai-based fantasy gaming platform Dream11 has acquired Delhi-based fantasy cricket stocks platform Sixer for an undisclosed amount – Read More

Sweden-based contact verification tool Truecaller has acquired Bangalore-based fraud prevention service provider TrustCheckr for an undisclosed amount – Read More

Navigating Startup Exits: Art or Science?

October 1, 2023

A startup exit refers to the moment when founders, investors, or stakeholders decide to exit their involvement with the startup, often with the goal of realizing a return on their investment or efforts. The key challenge in start-up exits is the valuation of a company and whether it’s the right time to exit, given the valuation you are getting. Startup exits take various forms, each with its implications:

  • Being acquired by a larger company is a common exit strategy, often leveraging the acquiring company’s resources and customer base.
  • Taking the startup public through an IPO involves listing its shares on a stock exchange, allowing public investment, which is very rare as it requires minimum investment amounts for it to be a viable option.
  • Merging with another company provides growth opportunities and synergies while maintaining ownership in the combined entity. It generally doesn’t give cash exit to investors but shares in another company which is not preferred by investors.
  • The startup’s management, possibly with external financing, buys the company from existing owners, ensuring continuity and autonomy. It’s not tax efficient and hence rarely used.
  • A bigger investor (VC or a PE) buys angel investors to get a larger share in the company.

    Factors Influencing Startup Exits:     
  • The timing of the exit is critical, influenced by market conditions, the startup’s performance, and the economic landscape.
  • Broader economic and industry-specific trends affect the feasibility of specific exit options.
  • The terms of contracts and agreements, including equity agreements and investor rights, affect exit options and returns.

We as Ecosystem Ventures have also successfully completed a recent Exit for our Investors who have initially invested at INR 16 Crore Valuation and exited at INR 32 Crore Valuation in Navigene Genetic Science Pvt Ltd, through a Third Party Strategic Buyer.

We have been associated with Navigene since 2020. The Company strives for early and accurate prediction/diagnosis of disorders and ailments, through Preventive Genetic Screening solution for newborns, children and adults.

The Company is keen to penetrate the Government segment and has applied for ICMR approvals for the technology. The Strategic Buyer will be a resourceful aid to Navigene for achieving the same.

The buyer believes that Navigene is at an advantageous position and will get lot of Government orders thereby valuing the start relatively higher whereas we believe that Government contracts are very unpredictable and can result in delayed revenues and hence we valued the company conservatively.

The difference in perceptions play a critical role in valuing a company and hence it becomes more of an art than science to arrive at valuation of a company. We got a 26% IRR on our investment and it was a decent exit for us given that it will take much longer to realize the expected growth in valuation.

Startup Funding Summary

Third Wave Coffee, Bangalore-based QSR brand, has raised $35 Mn in Series C funding from Creaegis, Eight Roads Ventures and F-Prime Capital – Read More

Pilgrim, Mumbai-based personal care brand, has raised $20 Mn in Series B funding from Vertex Ventures Southeast Asia & India, Fireside Ventures and Narotam Sekhsaria Family Office – Read More

Legistify, Gurugram-based legaltech startup, has raised $4 Mn in Series A funding from Indiamart, Titan VC, GSF, Cathexis Ventures, Justin Hamilton and Enrission group – Read More

Raptee, Chennai-based EV startup, has raised $3 Mn in Pre-Series A funding from Bluehill Capital, Eugene Mayne, Lakshmi Narayanan, Ramesh Kannan, Kaynes Technology, Chandu Nair, Shankara Building Products and other HNIs – Read More

Clinikally, Gurugram-based healthtech platform, has raised $3 Mn in funding from Y Combinator, Tribe Capital, Goodwater Capital, Sequoia Scout Fund, Rebel Fund, Arash Ferdowsi, Kunal Shah, Austen Allred, Qasar Younis, Alagu Periyannan, Tanay Tandon, Deepika Bodapati and James Beshara – Read More

M&A Snippets

Bangalore-based fashion & lifestyle brand Styched has acquired Bangalore-based performance wear brand Zymrat for an undisclosed amount – Read More

Dunzo’s Quick Commerce Struggles: Challenges and Solutions

September 24, 2023

Dunzo, the Bengaluru-based quick commerce player, has encountered significant challenges since launching Dunzo Daily in 2021. Competing with industry giants like Swiggy’s Instamart, Zomato’s Blinkit, and Zepto, Dunzo’s pivot to ultra-fast grocery delivery has faced hurdles, prompting strategic adjustments.

The signs of Dunzo’s struggles began to emerge in 2021 when it became apparent that the unit economics for their 19-minute grocery delivery promise were unsustainable. The company recognized the need to adapt and started tweaking its business model, signaling that all was not well in the quick commerce space.

One of the critical challenges Dunzo faced was investor sentiment. The market had become cautious about backing startups, especially those in the capital-intensive quick commerce sector. In response, Dunzo made the difficult decision to halt its expansion plans for Dunzo Daily and Dunzo Merchant Services (DMS). This pause in expansion did provide some respite but was far from a complete solution.

Unlike some of its competitors, Dunzo had limited financial resources and needed more funding to fuel its growth ambitions. The company raised venture debt funds for working capital needs while hoping for a savior to acquire or invest in the company. CEO Kabeer Biswas made several attempts to secure funding, even offering convertible notes linked to the company’s performance. Unfortunately, these efforts yielded no positive results.

A deeper analysis of the unit economics in the quick commerce sector revealed a harsh reality. Profitability remained elusive as long as the average order value hovered around Rs 400-450, a range that Dunzo and its competitors struggled to surpass. This perpetuated losses across the industry and placed Dunzo in a precarious financial situation.

Dunzo faced other challenges as well. Despite its best efforts, it failed to establish itself as a market leader in Bengaluru, its home city. Additionally, the company realized, albeit belatedly, that it had over-hired across various departments, which added to its financial strain. Even at the peak of its funding cycle, Dunzo Daily failed to make a significant dent in its competitors’ market share.

As funding remained elusive, Dunzo resorted to drastic cost-cutting measures. However, these steps didn’t yield the expected results. Despite securing $45 million from two of its largest investors, the company was still $30 million short of its targeted $75 million. The situation worsened as Dunzo further delayed salary payments and announced another round of job cuts, further disheartening its employees.

While Dunzo faced numerous setbacks, there are whispers of improved unit economics on a smaller scale. The company’s future in the quick commerce sector remains uncertain, but its journey underscores the importance of sustainable business models and financial prudence.

Startup Funding Summary

FlexiLoans, Mumbai-based digital lending platform, has raised $90 Mn in Series B funding from Maj Invest, Fasanara Capital, Harry Banga, Yogesh Mahansaria and Sanjay Nayar – Read More

KukuFM, Mumbai-based audio content platform, has raised $25 Mn in Series C funding from The Fundamentum Partnership, International Finance Corporation(IFC) and Vertex Ventures – Read More

Eloelo, Bangalore-based gaming and live streaming platform, has raised $22 Mn in Pre-Series B funding from Courtside Ventures, Griffin Gaming Partners, MIXI Inc, Kalaari Capital, Convivialite Ventures, Rocket Capital, Waterbridge Ventures and Lumikai Fund – Read More

Ergos, Bangalore-based agritech startup, has raised $10 Mn in Series B funding from Abler Nordic, Aavishkaar Capital, Chiratae Ventures and Trifecta Venture Debt Fund – Read More

Flash, Bangalore-based digital identity creator, has raised $7 Mn in Pre-Series A funding from Blume Ventures, PeerCapital, White Venture Capital and Emphasis Ventures – Read More

M&A Snippets

Bangalore-based fintech startup Perfios has acquired Chennai-based open finance platform Fego.ai for an undisclosed amount – Read More

How Ambitious Indian Startups are Charting a Course to the USA

September 17, 2023

The Indian startup ecosystem has been thriving in recent years, with ambitious entrepreneurs and innovative ideas making waves globally. Two significant events that exemplify this growth and ambition are SaaSBOOMi and SaaSTR.

One of the standout sectors within the Indian startup landscape is Software as a Service (SaaS). Indian SaaS companies have gained recognition for their innovation, cost-effectiveness, and ability to serve both domestic and international markets. Companies like Freshworks, Zoho, and Postman have become global leaders in their respective niches, demonstrating the immense potential of Indian startups.

SaaSBOOMi is an annual conference that brings together SaaS enthusiasts, entrepreneurs, investors, and thought leaders. Hosted in Chennai, it has quickly gained recognition as a premier event for SaaS startups in India. SaaSBOOMii provides a platform for founders to network, learn from industry experts, and showcase their products.

One of the notable aspects of SaaSBOOMi is its focus on connecting Indian startups with the global SaaS community. This international perspective is crucial for startups looking to expand their horizons, particularly in the USA, which is the world’s largest SaaS market.

SaaSTR, on the other hand, is a renowned global event series focused on SaaS businesses. While it is based in the USA, it attracts startups and investors from all over the world. For Indian startups eyeing the American market, SaaStr serves as a vital bridge.

The event provides startups with the opportunity to pitch their ideas, network with investors, and gain insights from successful entrepreneurs who have successfully scaled their SaaS companies in the United States. It’s not just about connecting with potential customers; it’s also about understanding the cultural nuances, regulatory requirements, and market dynamics of the USA.

Indian startups have set their sights on the United States for several reasons. The USA offers a vast market with diverse consumer preferences, access to abundant capital, and a mature ecosystem for tech companies. Many Indian SaaS startups see the USA as a natural progression for their growth.

SaaSBOOMi and SaaSTR are symbolic of the ambitious Indian startups that are setting their sights on the USA.

As the journey from India to the USA becomes smoother and more accessible, we can expect to see more Indian startups succeeding on the world stage and contributing to the global tech landscape.

Startup Funding Summary

Perfios, Bangalore-based fintech startup, has raised $229 Mn in Series D funding from Kedaara Capital – Read More

Ivy Health and Life Sciences, Mohali-based health care company, has raised $63 Mn in a funding from India Resurgence Fund – Read More

Leads Connect, Noida-based agritech startup, has raised $60 Mn in a funding from BL Agro Industries – Read More

Kale Logistics, Mumbai-based SaaS logistics startup, has raised $30 Mn in Series B funding from Creaegis Advisors – Read More

Seeds Fincap, Gurugram-based lending company, has raised $6 Mn in Series A funding from Lok Capital – Read More

M&A Snippets

Delhi-based fintech company Razorpay has acquired Mumbai-based digital invoicing and customer engagement startup Billme for an undisclosed amount – Read More

Gurugram-based food delivery platform JustMyRoots has acquired Mumbai-based foodtech startup The State Plate for an undisclosed amount – Read More

UK-based sportswear and athleisure solutions platform Agilitas Sports has acquired Dehradun-based sports footwear manufacturer Mochiko Shoes for an undisclosed amount – Read More

Jio Financial Services Ltd: The $19 Billion Valuation Puzzle

September 10, 2023

Reliance Industries Ltd. recently spun off its financial services segment into a separate company, Jio Financial Services Ltd. This move, intended to safeguard the company’s inclusion in major global indices, resulted in an eye-catching valuation of over $19 billion. However, the market’s exuberance in assigning such a high valuation to a company shrouded in mystery raises several questions. In this article, we delve into the reasons behind Jio Financial Services Ltd.’s lofty valuation and explore whether the market is putting the cart before the horse.

One of the most puzzling aspects of Jio Financial Services Ltd.’s valuation is the lack of transparency regarding its business operations. The company’s information memorandum filed with stock exchanges provides little insight into the nature of its activities. Despite this opacity, every brokerage seems to agree on a substantial valuation ranging from $19 billion to $22 billion, based primarily on its perceived future potential. This optimism stems from the strong backing of Reliance Industries Ltd. and a well-established board and management team, led by the renowned financial expert, KV Kamath, former Chairman of ICICI Bank Ltd.

Jio Financial Services Ltd.’s subsidiaries hint at a diverse range of financial services it plans to enter. These include retail lending, asset management in collaboration with BlackRock, insurance (both life and non-life), and digital payments. However, the lack of a clear roadmap and detailed business plans leaves both investors and analysts in the dark.

Entering the financial services sector, especially lending and insurance, is not without its challenges. Jio Financial Services Ltd. is expected to commence operations with consumer durable and merchant lending, working capital, and small-ticket business loans for SMEs. Scaling up in this space can be arduous, as SMEs often require a wide array of services, from bank guarantees to overdrafts. Moreover, the company’s current size and employee count are minuscule compared to its competitors in the industry. While it boasts a substantial consolidated net worth, a significant portion is tied up in its stake in Reliance Industries Ltd., limiting its lending capacity.

In its asset management venture, Jio Financial Services Ltd. and BlackRock have pledged to invest $150 million each. However, the mutual fund business is fiercely competitive, and building a distribution network is no walk in the park. The payment bank partnership with SBI and account aggregator business face challenges too, with regulatory restrictions and a lack of a clear business model.

The insurance sector is a long-term play that typically takes at least a decade to achieve meaningful scale. Unless Jio Financial Services Ltd. acquires an existing insurer, it will face an uphill battle in this space. Insurance brokerage is highly competitive, especially with bancassurance channels holding an edge. The question that looms large is whether the market’s eagerness to assign such a high valuation to Jio Financial Services Ltd. is justified. The lack of transparency regarding the company’s business operations and strategy is a red flag. Investors and analysts are left to speculate about the company’s future prospects, which is far from ideal. While the Reliance pedigree and strong leadership are undeniable assets, they cannot compensate for the absence of a clear business plan.

In conclusion, the $19-22 billion valuation of Jio Financial Services Ltd. appears to be a bet on its potential rather than its current reality. As the company gradually reveals its plans and executes its strategy, the market will have a clearer picture of whether this valuation is justified or if it’s indeed putting the cart before the horse. Transparency and communication from the company’s management will be key to reassuring investors and justifying the market’s high expectations.

Startup Funding Summary

IndoSpace, Mumbai-based logistics company, has raised $150 Mn in a funding from Qatar Investment Authority and Grosvenor’s Diversified Property Investments – Read More

Ola Electric, Bangalore-based electric mobility startup, has raised $140 Mn in a funding from Temasek – Read More

Ather Energy, Bangalore-based electric mobility startup, has raised $108 Mn in a funding from Hero MotoCorp and GIC – Read More

Pepperfry, Mumbai-based furniture marketplace, has raised $23 Mn in a funding from HNIs – Read More

Captain Fresh, Bangalore-based seafood supplier, has raised $20 Mn in Series C funding from SBI Investment, Evolvence Capital, Accel, Matrix Partners India, Prosus Ventures and Tiger Global – Read More

M&A Snippets

Delhi-based F & B company Good To Go has acquired Chennai-based F & B startup TenderCuts for an undisclosed amount – Read More

Empowering Credit Access: RBI’s Public Tech Platform Redefines Lending

September 4, 2023

As of August 17, 2023, the Reserve Bank of India (RBI) initiated a transformative pilot project. Through the launch of a Public Tech Platform, the lending landscape may undergo a paradigm shift. This new approach may streamline credit access, promising efficiency and accessibility for borrowers and lenders alike.

The Public Tech Platform, meticulously crafted by the RBI’s Innovation Hub, is an all-encompassing digital ecosystem. This platform, designed with an open architecture and universal APIs, invited participation from financial institutions across the spectrum. Traditional banks and innovative fintech companies could seamlessly integrate through a ‘plug and play’ model, bolstered by the potential of open APIs.

Mr. Souparno Bagchi, COO of Balancehero India, lauded the platform’s prowess. Open APIs facilitate the integration of essential financial data, enhancing operational efficiency. By centralizing borrower data on a unified platform, the credit evaluation process can be streamlined. A collaborative effort involving banks, NBFCs, fintech entities, and startups, this alignment is likely to foster seamless credit solutions, promoting innovation, cost reduction, and heightened efficiency.

The complex web of data required for credit approval posed a significant challenge in lending. Gathering information from diverse sources led to delays and inefficiencies. The RBI responded with the Public Tech Platform, offering instant digital access to requisite information. By consolidating data sources, the platform aimed to expedite loan processing and underwriting, enabling enhanced credit accessibility across segments.

A core impact of the Public Tech Platform was the potential to reduce operational costs and expedite loan processing times. Centralized data exchange promised lowered lending costs and faster approvals, reshaping the credit landscape and extending accessibility to a wider audience. Initial pilot products encompassed Kisan Credit Card loans, dairy loans, uncollateralized MSME loans, personal loans, and home loans through partnering banks.

Beyond loan processing, the platform aimed for comprehensive integration. It facilitated Aadhaar e-KYC, state government land records, satellite data, PAN validation, transliteration, and more. This holistic approach forged a financial ecosystem.

The RBI showcased the platform’s potential at the G20 meet, highlighting the Digital Kisan Credit Card and Digital Dairy Loan journeys. These examples illuminated how digitized data expedited loan approvals, minimizing physical branch visits.

Leading institutions, including Axis Bank, embraced the platform’s potential. Axis Bank’s pilot initiative introduced Kisan Credit Cards in Madhya Pradesh and unsecured MSME loans nationwide. The platform enabled efficient credit services, driven by authenticated data sources, indicating a future of expedited and improved credit access.

The pilot phase signaled a transformative future. The Public Tech Platform’s reach will broaden, revolutionizing India’s credit landscape. A testament to RBI’s commitment to innovation and inclusive financial services, the platform embodies efficiency and accessibility for all.

Startup Funding Summary

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SatSure, Bangalore-based spacetech startup, has raised $15 Mn in Series A funding from Baring Private Equity Partners India, Promus Ventures, Force Ventures, Luckbox Ventures and IndigoEdge Advisors – Read More

CredRight, Hyderabad-based fintech startup, has raised $10 Mn in a funding from Michael & Susan Dell Foundation, YourNest, Spearhead Capital, 9Unicorns, Accion Venture Lab, Blacksoil, Caspian Debt, RevX Capital and Westen Capital – Read More

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M&A Snippets

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