Mumbai-based Unilever Ventures, the PE vertical of Unilever and Amazon Internet Services Pvt. Ltd. (AISPL), has invested $10 Mn (INR 65 Cr) into IDG Venture India Fund.
The raised funds will be used by IDG Ventures India Fund to invest in consumer-technology, innovation, and digital startups. “The company helps early and growth-stage startups receive equity investment and operational support from Unilever. Unilever Ventures is evaluating startups as part of the Innovation Programme and even otherwise for direct investments,” said a Hindustan Unilever spokesperson.
IDG Ventures launched the 2017 Innovation Program (IDGVI) in association with Unilever Ventures in June 2017. The move was in line with Hindustan Unilever’s global initiative, Unilever Foundry launched in October 2015 in India. The consumer goods maker, under this initiative, partnered with technology-focused startups as a business imperative to reinvent itself and be relevant in a market where disruptive technologies are challenging businesses overnight.
With this programme, IDG Ventures aims to support tech startups belonging to sectors such as consumer tech, software, healthtech, and fintech. The programme will fund startups from Seed stage to Series A, pouring between $0.5 Mn to $5 Mn. The upper limit on the average funding size has been increased to $5 Mn from $3 Mn last year.
IDG Ventures India Fund currently has a portfolio of more than 65 companies, including the likes of Flipkart, Yatra, FirstCry, Newgen, Lenskart, Manthan, NestAway, Unbxd, and Uniphore. Its average ticket size ranges somewhere between $500K and $10 Mn.
In May 2016, it was reported that the firm had closed a $150 Mn (INR 1000 Cr) India focussed investment fund. IDG’s third India Fund is comparatively larger than the two other funds raised earlier, which had a corpus of $100 Mn, each. IDG Ventures also counts Ratan Tata and Infosys co-founder Kris Gopalakrishnan as advisers.
As per Inc42 Data Labs, in H1 2017, Seed funding witnessed a 26% fall in deals and a 68% fall in deal amount, as compared to H1 2016. The total number of deals was 259, raising $159 Mn in H1 2017, while a total of 637 startups grossed $853 Mn in Seed funding in 2016.
Early stage or Seed funding will always be the most important funding round for startups since it helps a startup in boosting its initial journey. On the other hand, it’s also the most critical stage where most startups die. After the funding winter of 2016, the investors have again gained their trust in early-stage entrepreneurs. In 2017, many VC firms have come up with early stage focused funds such as Equanimity Investments-Sanctum Wealth Management, IvyCap Ventures, HoneyWell Ventures, 35North Ventures and more.
So far, IDG Ventures has invested quite actively in the Indian startup ecosystem. Moving ahead, with the recent funding from Unilever Ventures, which segment will be able to pull in major funding from the VC firm, will be worth watching.
(The development was reported by ET.)