India Deals Barometer Report: Big-ticket deals push startup funding to $4.6b in October

Riding high on several big-ticket deals, Indian startups raised $4.65 billion across 162 private equity and venture capital transactions in October, according to proprietary data compiled by DealStreetAsia. This is a jump of about 37% in value over September when startups had collectively raked in $3.4 billion from risk capital investors.

Deal volume, however, was down 16% from 193 in September owing to a drop in early-stage deals. Of the total transactions in the month, the value of 22 deals was undisclosed, the data showed.

October alone saw six startups enter the unicorn club (startups value at $1 billion and above). They included meat startup Licious, crypto exchange platform CoinSwitch Kuber, digital insurance company Acko, online portal for new and used cars CarDekho, digital payments firm MobiKwik, and internet restaurant company Rebel Foods.

India has already produced 34 unicorns so far this year. An earlier Nasscom report had stated that India will have 50 unicorns by the end of this year.

There were about 16 mega deals (that were worth $100 million or more) in the month, which accounted for about 70% of the total deal value.

Startup	Headquarter	Investment Size (USD)	Investment Stage	Lead Investor(s)	Industry	Verticals
PharmEasy	Mumbai	350,000,000	Undisclosed	Amansa Capital, Sanne Group	Pharmaceuticals	E-commerce
Byju’s	Bengaluru	296,000,000	Series F	Oxshott Venture Fund	Education/Training	EdTech
CoinSwitch Kuber	Bengaluru	260,000,000	Series C	Andreessen Horowitz (a16z), Coinbase Ventures	Financial Services	Blockchain
Cred	Bengaluru	251,000,000	Series E	Tiger Global Management, Falcon Edge Capital	Financial Services	Fintech
Groww	Bengaluru	251,000,000	Series E	ICONIQ Growth	Financial Services	Fintech
CarDekho	Jaipur	250,000,000	Series E	LeapFrog Investments	Automobiles Other Vehicles & Parts	E-commerce
Acko General Insurance Ltd	Mumbai	225,000,000	Series D	General Atlantic, Multiples Private Equity	Insurance	Insuretech
OfBusiness	Gurugram	200,000,000	Series F	Tiger Global Management	Financial Services	Fintech
Rebel Foods	Mumbai	175,000,000	Series F	Qatar Investment Authority	Food	Restaurant Tech
Drip Capital	Mumbai	175,000,000	Series C	TI Platform	Financial Services	Fintech Lending
Dhani Services Ltd	Mumbai	160,000,000	Equity	General Catalyst, Sameer Gehlaut	Financial Services	Fintech
Twin Health	Chennai	140,000,000	Series C	Undisclosed	Healthcare Specialist	HealthTech
Hubilo	Ahemdabad	125,000,000	Series B	Alkeon Capital	Internet	SaaS
DeHaat	Patna	115,000,000	Series D	Sofina, Lightrock India	Agribusiness	AgTech
Open	Bengaluru	100,000,000	Series C	Temasek	Financial Services	Digibank
Porter	Bengaluru	100,000,000	Series E	Tiger Global Management, Vitruvian Partners	Logistics/Distribution	SaaS

In the month’s biggest deal, online pharmacy PharmEasy closed a funding round worth nearly $350 million ahead of its initial public offering (IPO). Of that, around $204 million reportedly came in through primary infusion from Amansa Capital, ApaH Capital, Janus Henderson, OrbiMed, Steadview Capital, Abu Dhabi’s sovereign wealth fund ADQ, Neuberger Berman and Sanne Group. The company raised another $130-140 million via secondary share sale, The Economic Times reported.

In another big deal, Byju’s raised an additional funding of around Rs2,200 crore led by New York-based Oxshott Venture Fund. Other investors in the round included Edelweiss’s Crossover Opportunities Fund, IIFL, Verition Multi-Strategy Master Fund, and XN Exponent Holdings.

Financial services grabs top spot

Tech investments in India have been on the rise since the onset of the pandemic, particularly in the financial services space. Startups within financial services raised a whopping $1.8 billion across 41 transactions in October, accounting for about 39% of the total deal value in the month.

Within financial services, CoinSwitch Kuber raised the largest round of $260 million in Series C funding round from a clutch of investors at a valuation of $1.9 billion.

Pharmaceuticals industry moved up to the second spot led by PharmEasy fundraise and garnered $423 million in total funding across three transactions. Online pharmacies have emerged as one of the biggest beneficiaries of the pandemic-induced lockdown in India. India’s online pharmacy market is estimated to grow to $2.7 billion by 2023 from about $360 million currently, according to a report by EY last year.

Education was the third most funded industry with a total of $421 million in its kitty.

Together, the three industries – financial services, pharmaceuticals and education – accounted for about 59% of the total deal value.

Within verticals, fintech startups grabbed the lion’s share at $1 billion in total funding while e-commerce followed with $991.3 million.

Growth-stage deals account for bulk share

In terms of value, growth-stage startups led fundraising in October. Companies in Series B or post-Series B rounds collected an aggregate of $3.4 billion through 34 investments as against $2.45 billion through 36 investments in September. This comes to about 70% of the total deal value in the month.

Deal volumes were led by early-stage transactions in October but saw a dip over September. The month saw 48 deals worth $81.4 million as against 77 transactions worth $93.6 million in September.

Startups in pre-Series A and Series A stages raked in about $228.6 million across 39 transactions as against $343.8 million across 46 transactions in the previous month.

Most active investors

Venture Catalysts, along with its early-stage startup fund 9Unicorns, was the top investor in October with at least 20 investments compared to 14 in September. Their investments included AI-driven SaaS platform Toch.ai, silk-tech startup ReshaMandi, direct-to-consumer jewellery brand Melorra, vehicle interface solution provider Numadic, content startup Instoried, and pregnancy and parenting app Healofy, among others.

Sequoia Capital India occupied the second spot with at least 10 investments including those in intra-city logistics company Porter, fintech platform Groww, online beauty store Purplle, trade finance company Drip Capital, agritech startup DeHaat, and financing solutions startup Progcap.

Tiger Global made at least eight investments in October while Titan Capital made six investments. Accel, Blacksoil, Inflection Point Ventures and LetsVenture made at least five investments each.