Funding Galore: From FarEye To FanCode— $553 Mn Raised By Indian Startups [May 24-29]

We bring to you the latest edition of Funding Galore: Indian Startup Funding Of The Week

Serial entrepreneur Bhavin Turakhia-led Zeta, which helps banks and other fintech startups launch their products, is the latest unicorn in the Indian startup ecosystem. The fintech startup has raised $250 Mn in its Series C funding round led by Japanese conglomerate SoftBank, with participation from existing investor Sodexo, at a valuation of $1.45 Bn.

Notably, the company’s valuation has jumped 4.8X from its previous funding round in July 2019, where it had raised funds from Sodexo Benefits and Rewards (BRS) at a valuation of $300 Mn. Zeta offers a cloud-native neobanking platform for the issuance of credit, debit and prepaid products that enable companies to launch engaging retail and corporate products, besides offering digitised solutions to enterprises such as automated cafeteria billing and more. Its solutions are available in India, Italy, Spain, Brazil, Vietnam and Philippines.

Paytm, PharmEasy Prepare For IPOs

Vijay Shekhar Sharma-led digital payments giant Paytm is preparing itself to raise $3 Bn (INR 21,800 Cr) in an initial public offering (IPO) by November this year. The company is targeting a valuation of $25-$30 Bn, denoting a 56%-87% spike from the current $16 Bn valuation. This could be the largest IPO debut in India.

Meanwhile, PharmEasy is planning to raise $400 Mn to $500 Mn (INR 3,000 Cr to INR INR 3,700 Cr), at a valuation of $3 Bn (INR 21,800 Cr). The share sale proposal will include both primacy as well as secondary share component, where some of the early backers of the company will take a partial exit.

Zerodha Plans ESOPs BuyBack At $2 Bn

Stock-trading platform Zerodha is planning another buyback for employee stock ownership plan (ESOPs) in 2021, at a valuation of $2 Bn (INR 14,503 Cr). The company’s CEO and cofounder Nithin Kamath announced the development on Twitter May 28. Zerodha had carried out an ESOPs buyback drive last year, where it bought shares worth about $8.9 Mn (INR 65 Cr) at a valuation of $1 Bn (INR 7,251 Cr).

In the recent tweet thread, Kamath said, “Everyone holds ESOPs & continuously gets new options too. We ran a buyback last year at $1 Bn valuation and we will this year at $2 Bn. Maybe conservative valuations, but our business risks are high. Personally, the proudest moment in this journey.”

Top Indian Startup Funding Deals This Week

Overall, $553 Mn was invested in Indian startups across 22 deals this week.

Note: This funding report is based on startups that disclosed funding amounts

Acquisitions This Week

InfraMarket Acquires Equiphunt

B2B marketplace unicorn Infra.Market has acquired a majority stake in Equiphunt, which is run by Social Equipment Solutions Private Limited.

Equiphunt was founded in 2016 by Shashank Dangayach, who will continue to lead the team post-acquisition, and has expanded in presence in over 25 Indian cities so far. The company offers construction equipment rental and maintenance services as well as auctions. It leverages an in-house IoT/Telematics platform for improved utilisation of machinery and enhancing scalability in operations.

Dangayach said, “As a part of the existing InfraMarket ecosystem, we would be able to build stronger consumer connect and accelerate our journey. Equipment management is a pain point for today’s construction companies and our journey to digitize and solve the pain points in the construction equipment value chain will continue.”

BigBasket Board Approves Acquisition By Tata Group

Tata Digital Limited, a 100% subsidiary of Tata Sons Private Limited, has acquired a majority stake in BigBasket. The online grocery unicorn’s board has approved the sale of a majority stake to the Tata Group, almost a month after competition watchdog Competition Commission of India (CCI) approved the deal.

Commenting on the same, Tata Digital’s CEO Pratik Pal said, “Grocery is one of the largest components of an individual’s consumption basket in India, and bigbasket as India’s largest e-grocery player, fits in perfectly with our vision of creating a large consumer digital ecosystem. We are delighted to welcome BigBasket as a part of Tata Digital.”

The acquisition of BigBasket ties into Tata Digital’s super app ambitions, which will link a range of consumer services —  food and grocery ordering, fashion and lifestyle, consumer electronics and consumer durables, insurance and financial services, education, healthcare and bill payments.

upGrad Acquires Impartus

Online higher education company upGrad has acquired Bengaluru-based video-enabled learning solution platform Impartus, which will now be rebranded as upGrad Campus and integrated into upGrad as a wholly owned subsidiary. The edtech giant has committed an amount of INR 150 Cr for acquisition and growth of Impartus.

Impartus Innovations is into video-based educational services, and was founded in 2013 by three IIT Delhi graduates Amit Mahensaria, Manish Kumar and Alok Choudhary with an aim to provide recorded interactive lectures. It currently develops solutions for virtual classrooms and has 280 higher educational institutions, 50K teachers and 6 Lakh learners on board.

PharmEasy Finally Confirms Merger With MedLife

Epharmacy unicorn firm PharmEasy has finally announced merger with fellow online pharmacy Medlife, almost eight months after receiving Competition Commision of India’s (CCI) approval. This is the largest consolidation deal in India’s online pharmacy sector.

With this acquisition, Medlife would discontinue its operations and would be merged into PharmEasy’s platform from May 25 onwards. PharmEasy would also absorb Medlife’s current customer base. Medlife customers just need to login to the PharmEasy app to start using their Medlife account via the same mobile number. All their digitised prescriptions and saved addresses dating back to a year will be available on the app, PharmEasy said in a blog post.

Lithium Urban Acquires Smartcommute

Bengaluru-based electric vehicle (EV) fleet provider Lithium Urban Technologies has acquired end-to-end employee transport software provider SmartCommute in a bid to increase its mobility offering. With the integration of SmartCommute into its platform, Lithium will be equipped to expand further into the transportation segment with freight and rapid bus transit offerings,  among others. Further, Lithium will also cater to both electric and non-electric vehicles, making it a one-stop solution for smart transportation services across different form factors.

SmartCommute was founded in 2014 by Ajit Patil and Gajanan Sakhare. It provides a software-as-a-service (SaaS)-based platform to help corporations with their employee transportation needs. The company offers automated rostering, back-to-back cab routing, trip allocations, real-time tracking features, risk management, personal safety management, automated billing and data analytics.

Pre-pandemic, the company was enabling commuting for about 30K employees through 3K vehicles on a daily basis across Bengaluru, Mumbai, Pune, Kolkata, New Delhi, and Hyderabad. The company’s client portfolio included Capgemini, L&T Infotech, KPIT, TCS and more.

Zscaler Acquires Cybersecurity Startup Smokescreen Technologies

Mumbai-based cybersecurity company Smokescreen Technologies has been acquired by US-based cloud-securities company Zscaler. Though the size of the deal was not revealed and the deal is expected to be closed by July 2021. This would help Zscaler augment its capabilities in detecting “targeted attacks, ransomware, and lateral movement attempts. Additionally, Smokescreen will help provide rich threat intelligence and telemetry for the Zscaler team to proactively hunt for emerging adversary tactics and techniques.”

New Funds Announcement

• Delhi-based venture debt firm Stride Ventures has announced the launch of its Fund II to invest up to $9.6 Mn (INR 70 Cr) in late stage startups. The target corpus of Stride Ventures’ Fund II is $137 Mn (INR 1,000 Cr) with a greenshoe option of $120 Mn (INR 875 Cr). The investment firm is looking at the first close of Fund II within the next three months, August 2021.
• IIM-A and BITS Pilani graduates Abhishek Sethi and Prateek Behera have launched gradCapital, a $1 Mn fund to support and invest in startups founded by college students. The microVc fund will invest $25,000 each in 20 startups in a year. Bengaluru-based gradCapital said it has opened the application process for its first cohort of startups.