A myriad of online businesses, from e-commerce to a bus aggregator to a business-to-business (B2B) marketplace, dominated startup funding activity in a week that saw 15 startups raise a total of $612 million. As many as eight online businesses, including e-commerce, scored greenbacks from investors in a startup funding market that showed no signs of slowing down.
The Big Deal
Bengaluru-based grocery e-tailer BigBasket broke a 14-month funding drought this week to raise $150 million (about Rs 1,040 crore) led by South Korean asset management firm Mirae Asset. The round put the company’s post-money valuation at $2-2.3 billion, by TechCircle’s estimates.
BigBasket, which became India’s first unicorn -- startups valued privately at $1 billion or more -- in the online grocery segment in February last year, has raised the latest funding round at a critical juncture. Rival Grofers, which raised $60 million last month, is backed by Japanese internet and media conglomerate SoftBank Group Corp., which has nearly inexhaustible resources at its disposal to snuff out the competition.
Then there are the horizontal e-commerce giants, Walmart-Flipkart and Amazon Inc., breathing down BigBasket’s neck. Both are aggressively expanding their online grocery businesses.
For BigBasket, which also has a deep-pocketed investor in Chinese e-commerce giant Alibaba, capital, as much as its first-mover advantage, will be a key differentiator going forward.
Ecommerce funding steps away from conventional models
BigBasket aside, funding activity in the ecommerce stepped away from conventional business models.
Earlier in the week, maternity and childcare social networking platform Healofy raised $8 million in a funding round led by Hong Kong-based BabyTree Group and BAce Capital, a fund anchored by Alibaba affiliate Ant Financial Services. The company plans to use the funds to foray into e-commerce.
Then, social e-commerce app Bulbulshop bagged $2.03 million (Rs 14.05 crore) led by Sequoia Capital India. The app sells clothes, kitchen appliances, accessories and cosmetics. The interface offers short videos wherein influencers market products, just as home shopping networks do on television. Social commerce has worked particularly well for Alibaba-owned Taobao, which live-streams social media-driven e-commerce for direct merchant-to-consumer sales.
Other online businesses
Other kinds of online businesses, too, found investors during the week.
- Zetwerk, a B2B marketplace for manufacturing services, raised $9 million from Sequoia Capital India, Accel and KAE Capital.
- Venue-booking platform VenueLook secured an undisclosed sum from a clutch of angel investors.
- Bus-aggregation platform Shuttl raised fresh capital from Sequoia Capital, Lightspeed Venture Partners and Times Internet.
- Property Share, a real estate investment platform that enables fractional ownership of property, raised a Series A funding round led by Lightspeed Venture Partners.
- eShiksha, a startup that helps educational institutions manage their digital operations, raised an undisclosed amount from Mumbai-based Mentor Capital as part of an extended seed funding round.
Big bucks for logistics from SoftBank
Gurugram-based logistics company Delhivery Pvt. Ltd picked up a big cheque worth $413 million from an investor consortium led by SoftBank Vision Fund.
The deal catapulted Delhivery into the unicorn club. It also marks SoftBank’s entry into the technology-driven logistics sector, which should spell trouble for other players in the segment. Delhivery is already one of the most-funded logistics players in the market and SoftBank’s backing undoubtedly gives it a big edge over its rivals.
From co-working to co-living
After co-working spaces, co-living spaces are next on investors’ radars.
Delhi-based student accommodation platform Stanza Living raised $4.4 million in venture debt from Alteria Capital. The startup makes standardised, affordable accommodations available to students, particularly those moving to a new city. Students can avail of managed, shared and fully furnished accommodations. It also has partnerships with restaurants, fitness centres and other such institutions, through which it provides its residents rewards.
The other co-living startup that raised money this week was OxfordCaps. The Singapore-based startup, which also has a presence here, raised $8 million led by Times Internet.
Microlending startup RedCarpet Tech Pvt. Ltd secured $3.89 million in a fresh round of funding led by existing investor Lightspeed India Partners.
RedCarpet primarily caters to college-going students. Users can make purchases based on a credit limit sanctioned by RedCarpet after assessing the individual’s credit-worthiness. The purchase is then converted into EMIs (equated monthly instalments) spread over three to 12 months.
RedCarpet was among the six startups selected by Google for its Launchpad accelerator programme in May 2016. As part of the initiative, it received up to $50,000 in equity-free seed funding. The startup was also part of Y Combinator’s 2015 summer batch.
Apart from funding, the startup market also saw some consolidation.
Early in the week, micro-delivery startup Milkbasket announced that it had acquired Noida-based online grocery venture Veggie India for an undisclosed amount. As part of the transaction, the entire Veggie India team including founders Jainendra Upadhyay and Shailendra Upadhyay will join Gurugram-based Milkbasket.
Another acquisition was in the online pharmacy segment: NetMeds bought health-tech startup KiViHealth in a cash-and-stock transaction. NetMeds didn't disclose the deal value but said it will invest about $10 million to grow the healthcare business of KiViHealth.
The week ended with some buzz around Reliance Industries Ltd’s possible acquisition of artificial intelligence-based conversational platform Haptik Inc. as the Mukesh Ambani-led conglomerate looks to continue its technology-startup shopping spree.