It’s not often that a company uses its YouTube channel to talk about a major corporate restructuring decision. That’s what PhonePe did when its CEO Sameer Nigam spoke to CTO Rahul Chari in January this year.

The subject of their discussion: PhonePe’s decision to redomicile to India. Nigam, the cofounder and CEO, said that as many as 20 unicorns were willing to shift their bases to India if regulations were eased.

However, the company’s investors had to cough up INR 8,000 Cr ($966 Mn+) in taxes for PhonePe to redomicile to India. While it was manageable for a mammoth like Walmart-backed PhonePe — and the blow softened by subsequent fundraises — not every startup based outside of the country has the means or resources to relocate to India.

In PhonePe’s case, the costly move back was for its IPO plans, another reason why this is an exception.

U-turns such as PhonePe’s are rare due to India’s stiff laws and regulations related to startups coming back to India. The tax bill is one thing, but there are many compliance headwinds.

But PhonePe’s move has prompted the likes of Razorpay, Meesho and Groww to also consider the same. These are also large startups that have the deep pockets for such a move, but the same cannot be said for smaller, early-stage ventures.

Here, too, the sparks to ignite the spirit of ‘Desh Wapsi’ are now visible, but questions about how they can come back to India persist. Could the answer come from the GIFT IFSC?

A GIFT For Indian Startups

Envisioned as a virtual offshore destination for startups and investors, GIFT IFSC could be key to bringing back startups to India. That’s why a 10-member expert committee on ‘Onshoring Innovations To GIFT IFSC’ was set up in March this year, which has submitted its report, identifying key areas that will help Indian startups settled abroad to reverse flip to India.

Set up by India’s International Financial Services Central Authority (IFSCA), the expert committee is chaired by the RBI’s former executive director G Padmanabhan. Further, the GIFT IFSC’s expert committee counts Dipesh Shah, executive director, IFSCA; Sumeet Jarangal, director, DPIIT; Nishith Desai, founder, Nishith Desai Associates; Siddarth Pai, founding partner and CFO, 3one4 Capital; Nikhil Kamath, cofounder, Zerodha; Lalit Keshre, cofounder and CEO, Groww; Anjani Sharma, CA; Anjali Bansal, founding partner, Avaana Capital, and Sandip Shah, GM, GIFT City, as its members.

Speaking with Inc42, committee chairman Padmanabhan said, “This is one of the most important committees I have chaired in my career spanning over three and a half decades. The issue has far-reaching implications for the country looking to be the innovation hub of the world. It is a travesty that companies owned and controlled by Indians, employing Indians, and doing most of the work from India have holding companies set up and domiciled overseas on paper. This issue gets the attention of the Government of India, leading to IFSCA setting up this committee. In my view, it is a very timely step.”

He added that the committee has looked at the problem areas holistically, made recommendations and floated incentives to help companies reverse flip to India.

“I hope these recommendations are accepted for implementation, and we achieve what we have set out to achieve for the GIFT city — Onshoring the Offshore,” Padmanabhan said.

Understanding Why Startups Flip

The Indian startup ecosystem has witnessed remarkable growth over the years, evolving through different waves of innovation and entrepreneurship. However, a concerning trend emerged, which is the increasing prevalence of startups flipping or essentially registering a holding company abroad with an Indian subsidiary.

This trend involves Indian startups moving their holding companies to foreign jurisdictions, potentially leading to significant economic and intellectual capital loss for India. This could also be understood by the fact that out of 111 unicorns, more than 20% are registered outside India.

3one4 Capital’s Pai said that when the committee began delving into the root causes that trigger the phenomenon of startup flipping, it found that the trend is predominantly driven by investor demands.

In particular, global early-stage programmes have made demands that startups shift their bases to specific geographies to avoid compliance issues in India. This investor demand is rooted in the familiarity with the legal frameworks of those specific jurisdictions, which are more often than not the US or Singapore.

“Pushing Indian startups to flip provides investors with a more convenient recourse in case of legal matters. For instance, jurisdictions like Delaware offer a robust corporate law framework that has gained significant traction due to its comprehensive and extensively practised business regulations. This familiarity makes it more convenient for investors to navigate legal complexities. Adding to the complexity of the issue, a significant portion of funding, approximately 85%, received by Indian startups originates from foreign sources,” Pai told Inc42.

Further, from an income tax standpoint, the tax rate on capital gains for non-residents is only half of what residents pay. This significant disparity creates a clear economic incentive for startups to consider moving their domicile overseas.

Alongside these tax considerations, operational challenges further complicate the situation. Many startups with global, recurring billing, such as SaaS companies, often do not generate traditional physical invoices. Instead, the billing process is typically directed towards their respective platforms or may involve direct debit mechanisms.

Unfortunately, as these are payments from non-residents, the current system requires these digital transactions to be processed through physical forms submitted to the bank in order to credit the foreign revenue to their account.

This operational hurdle adds an extra layer of complexity, adding more friction to the process, Pai noted.

Challenges Of Startups Shifting Their Headquarters Abroad:

• Brain Drain & Talent Flight: A direct consequence of startup flipping is the migration of founders and key talent to foreign countries. This results in a significant loss of entrepreneurial expertise and innovative capabilities within India, hampering its growth potential.
• Wealth Erosion: When holding companies are moved abroad, the wealth generated by Indian startups is often concentrated outside the country, benefiting foreign economies. This wealth erosion can impact domestic investments and economic stability.
• Intellectual Property Loss: Many Indian startups externalise due to stronger intellectual property protection laws in foreign jurisdictions. This leads to the loss of valuable intellectual property and technology that could otherwise contribute to India’s innovation landscape.
• Reduced Tax Revenue: Externalisation can result when Indian startups have an option to pay lower corporate taxes in foreign countries. However, due to this the Indian government loses revenue, which otherwise could have been used to spur development.
• Impact On The Nation’s Image: Startup flipping weakens India’s global position, especially concerning digital diplomacy and cross-border financial inclusion initiatives. It diminishes India’s ability to advocate for digital financial services and inclusive finance agendas worldwide.

Luckily, taking cognisance of this, the executive committee has tabled recommendations in key areas like building a competitive tax regime, the need for enhanced IP protection, ESOP taxation reforms, access to domestic capital supporting companies’ global expansion plans and more government-startup collaborations, which will likely encourage startups to reverse flip.

Here’s a sneak peek into the recommendations made by the 10-member executive panel to boost reverse flipping among Indian startups.

Will GIFT IFSC Push Startups Towards ‘Desh Wapsi’? 

The Indian government’s efforts to integrate the country’s economy with the global financial system have led to the establishment of the Gujarat International Finance Tech City (GIFT City) or GIFT IFSC.

This initiative aims to create a global financial hub within India to attract international businesses and capital. The IFSCA was established to regulate and develop IFSCs in India, assuming the powers of several domestic sector regulators. The GIFT IFSC has experienced substantial growth across various financial sectors, with over 530 registered entities as of June 2023, showcasing the remarkable progress of the initiative.

Speaking at Inc42’s MoneyX in July, Dipesh Shah, executive director (development), IFSCA, said that GIFT has triggered reverse flipping and countries like Singapore and Mauritius are asking private equity (PE) investors what needs to be done to stop them from moving to the IFSC.

“We have structured the GIFT IFSC to stop the trend of entrepreneurs moving abroad in search of better opportunities and simpler regulations. Whatever tax and other benefits PE investors would get (there), we are offering similar facilities here,” Shah had then said.

Meanwhile, a significant aspect of the GIFT IFSC’s development is its focus on fostering a world-class fintech ecosystem. The convergence of finance and technology has been a critical consideration since the inception of the GIFT City. The IFSCA also has the IFSCA FinTech Entity Framework in place for fintech activities.

Various sandboxes are also being established to encourage innovation and collaboration, with over 40 fintech companies approved under the framework. Further, the IFSCA’s FinTech Incentive Scheme supports fintech activities by offering grants and financial support to eligible entities.

The collapse of prominent US banks, including Silicon Valley Bank, in March 2023 had a direct impact on Indian startups that had deposits in these banks. This situation highlighted the GIFT IFSC’s potential to provide a secure alternative for these startups, given its offshore status, favourable regulatory framework, and competitive tax regime.

The crisis also underlined the GIFT IFSC’s role in positioning itself as a preferred jurisdiction for global and Indian startups, offering them stability and a conducive business environment.

The GIFT IFSC’s positioning as an ideal destination for reverse flipping Indian startups is rooted in its offshore jurisdiction within India, ease of doing business, competitive tax regime, access to a vibrant private equity and venture capital ecosystem, its status as a global fintech hub, and other key enablers like a skilled talent pool and advanced technological infrastructure.

The Reverse Flipping Road 

According to an analysis conducted by Inc42, approximately 65% (or 13) of Indian unicorns with headquarters abroad operate in the enterprise tech (SaaS) sector. The remaining unicorns originate from diverse sectors, including ecommerce, media and entertainment, travel tech, and clean energy.

Last year, Inc42 reported that more than half a dozen Indian crypto startups had shifted their operations to destinations such as Dubai, Delaware, and the British Virgin Islands (BVI).

This shift can be attributed to several factors, including the challenges posed by the crypto winter, the Indian government’s introduction of TDS for crypto transactions, and an increasingly stringent regulatory environment within India. The rapidly evolving regulations in India have adversely affected not only crypto startups but also the broader fintech landscape.

According to 3one4 Capital’s Pai, the report acknowledges the reasons for flipping as taxation disparity, operational hurdles, tax issues, legal frameworks, etc. and makes suggestions based on market feedback on what is needed to allow such flipped startups to redomicile to India.

The report also hopes to drive dialogue and discussion on the matter and serve as a resource for easing the conditions that prompted such flips.

Even as the winds of change are yet to embrace startups settled abroad, the recommendations by the 10-member expert panel seem a move in the right direction.

The challenge now lies in getting the government to adopt these recommendations and present them to startups as a viable solution.

[Edited by Shishir Parasher]

The post Igniting The Spirit Of ‘Desh Wapsi’: How The GIFT IFSC 10-Member Panel Wants To Clip The Startup Flip appeared first on Inc42 Media.

At a time when the Indian online gaming sector is crying havoc due to the new 28% GST regime, which does not differentiate between games of skill and games of chance, top industry sources have revealed that the Centre’s decision has triggered a consolidation wave in the industry.

After the introduction of the GST, several gaming startups, including unicorns and soonicorns, wrote to the central government seeking some modifications in the 28% GST regime for the greater good of the industry.

In the aftermath, Inc42 has learnt that more than 20-25% of these companies are now in the market for sale or are looking for acquihire opportunities. According to sources, a gaming giant alone may have spoken to at least 100 Indian small online gaming firms in August for acquisitions.

 A top investor, who did not wish to be named, said that a Series A gaming startup, which has acquired lakhs of customers, is profitable and offers various real money gaming options, is looking to get acquired at a valuation loss of 50-60%.

 “We are talking to at least 2 to 3 companies daily that are up for sale. It is a distressed market and hence the buyouts are the only option. We can say that the Indian gaming industry will see a lot of consolidations happening in the next few quarters,” the investor said.

 Another industry veteran said that it is a very opportune time for companies that have enough capital to acquihire, acquire and merge with smaller peers. This will not only help them to expand their capabilities but also save many from getting perished.

“Companies are selling for pennies as against dollars,” the analyst said.

It is pertinent to note that many gaming startups have been severely impacted by the Centre’s decision to levy a 28% GST on the sector. As a result, while some startups have been forced to shut their shops, others have resorted to slashing headcount to cut costs.

Gaming unicorn, MPL was one of the first industry players to announce layoffs after 28% GST rule. The company fired 350 employees. This was followed by the online poker platform, Spartan Poker.

Who Is Looking For A Potential Sell-Off?

According to the sectoral experts we spoke with, real money gaming platforms, which promote games like rummy, poker, ludo, etc., may look at selling off their assets due to the prevailing market conditions.

 The CEO of gaming firm 1Verse, Prashanth Joshua, said that the skilled gaming platforms on which players play individually will be severely impacted compared to fantasy gaming platforms that engage players in groups.

 “Every RMG company is supposed to pay 28% of their deposit money as GST, however, the companies that focus on individual gamers and are in the annual revenue range of INR 1 Cr to INR 100 Cr will find it unsustainable to run operations in this environment and would be looking to merge,” he added.

Joshua added that gaming companies with conventional focus like card games and the ones that are popular among various Indian communities, may not be up for sale.

“As against the notion that online gaming is a new concept in India, the reality is that various games are very much a part of our country’s culture and are played on festivals and involve real money. Eventually, the same games are played in online groups or social media platforms. Now, the platforms that built the technology for these gamers have a strong userbase and would not necessarily merge with others,” Joshua said.

However, as per him, companies with a huge user base may merge with the ones that have a strong tech interface.

“The product, consumer experience and user retention are some of the metrics that the investors or large firms will be keen to look at when it comes to acquisitions of smaller RMG companies. The companies that are strong in any of these propositions would be a good buyout opportunity,” he explained.

 Echoing the sentiment, Pearl Agarwal, the managing director of a gaming-focussed fund, Eximius Ventures, said that real money gaming companies, which offer both — the games of chance like betting, lottery, and opinion trading and skill-based casual gaming platforms such as rummy, poker, ludo, and chess — will be looking to get acquired.

 She pointed out that larger gaming firms would look to re-strategise their revenue, and valuation expectations and accept the new normal, which directs them to pay a 28% GST on overall deposits.

“The important aspect to look out for both small and big companies would be user retention. That is because the new GST rule applies to the deposits made by any user with the gaming platform. However, if the same user again deposits his winnings or more money with the platform, the GST may not be even applicable on the recurring deposits. Hence, retaining users will be key to avoiding the tax burden,” Agarwal explains.

Meanwhile, E Paul Micheal, the former CEO of India Plays and a gaming consultant, anticipates that the real money gaming industry would see the entry of fewer players due to the new tax regime. However, the sector is all set to witness a wave of consolidations in the next few quarters, paving the way for innovation, promotional offers, and more liquidity for users.

“This is true for any industry going through distress. Some shutdowns and a lot of M&As to sustain the changed regulatory environment and work around a process that is in line with the rules. However, to say that the industry will shut down or major players will move their bases out of the country would be an exaggeration. The truth is that the online gaming sector is a highly regulated sector globally. There are tax provisions for the industry even outside India,” he added.

Funding Focus On Non-RMG Platforms?

Even as the real money games contribute more than 70% of the revenues to the online gaming industry, there are VC funds like Kalaari Capital, Matrix Partners, Lumikai, Exumius, KRAFTON’s VC arm that are now looking to invest actively in non-RMG gaming companies.

For non-RMG gaming firms, monetisation avenues are mainly advertisements and platform fees. However, they will have to add value proposition to the users beyond entertainment to attract funding.

Some firms like Krafton and Lumikai have announced new funds to focus on online/mobile gaming in India, and it would be interesting to see how the capital is deployed across the gaming industry.

In June this year, Lumikai announced its fund II with a corpus of $50 Mn to be invested across 15-20 interactive media and gaming startups.

“Over the course of the last 3 years, we have seen 1,400+ deals and seen the industry attract investor interest, deepen founder quality and achieve liquidity events. We continue to remain bullish on the long-term potential of the India interactive market and this is our opportunity to build on the foundation we have laid,” Lumikai’s founding partner Salone Sehgal had then said.

Earlier in August, Battleground Mobile India (BGMI) maker KRAFTON announced to invest $150 Mn in India’s gaming and entertainment startups to nurture local talent, foster innovation and propel India to the forefront of the gaming industry.

In February, online gaming startup WinZO’s backer Courtside Ventures announced the launch of its third VC fund with an outlay of $100 Mn. Fund III will invest in across segments of startups including sports, online gaming and lifestyle. Besides WinZo, Courtside Ventures has backed gamified fintech startup Filo and NFT startup FanCraze.

A top marketing communications consultant who works with various gaming companies in India said that the global gaming venture funds are on an active lookout for India-based gaming startups because of the country’s massive gamer base of 450 Mn.

“We understand that the new regulations are in place, but instead of being bogged down in the rules, startups will have to find a way around and work with the government. At least now we can say that there is more clarity in place. We are actively seeing interest from global as well as domestic VCs when it comes to India’s gaming market,” she added.

According to experts, India will see a lot of interest from investors in segments like Generative AI, web3, NFTs, and gaming infrastructure.

With much at stake right now, it remains to be seen whether the gaming industry will survive the regulatory jolt and emerge stronger than ever on the back of quality consolidations or will continue to backslide and eventually die down.

[Edited by Shishir Parasher]

The post On The Brink: Small Indian Gaming Startups Mull Sale Amid 28% GST Chaos appeared first on Inc42 Media.

Just a few weeks ago, we wrote, “PhonePe Wants To Be Paytm”. Lo and behold, the fintech unicorn has gone ahead and launched a separate stock broking app called Share.Market this past week.

As we said then, many fintech apps are following Paytm’s ‘super app’ lead, which has been around for several years yet never completely accepted by everyone as the right approach. Well, it turns out Paytm might have been ahead of the curve when it launched Paytm Money in 2018.

When it comes to PhonePe, the question is will Share.Market actually turn out to be the Paytm Money equivalent. And can it actually stand up to larger players like Zerodha, Groww, INDMoney, and is it the right time given the upcoming multibillion-dollar Jio Financial Services play?

We’ll try to take a stab at that question today, but after these top stories from our newsroom:

• The Ola Prime Plus Question: Ola’s answer to ride cancellations and driver concerns is Prime Plus, but is it actually a solution to the problems in ride-hailing?
• Shakeup At Omuni: The Shiprocket-owned retail SaaS platform has let go of 35% of its workforce, including founder and CEO Mukul Bafna. Read this Inc42 exclusive
• Ultraviolette Ready For Primetime: With its high-performance EV bike ready to take on giants in the market, a deep dive into Ultraviolette’s six-year journey to the starting line

Keep reading to see the highlights from the fourth edition of Inc42’s The D2C Summit

PhonePe Takes On Zerodha & Co

PhonePe has ventured into stock broking with the launch of Share.Market, under its subsidiary PhonePe Wealth Broking (registered in April 2021). It will be a separate app to PhonePe, which is built around payments, insurance, ecommerce, and B2B lending.

To begin with Share.Market allows retail investors to trade and invest in stocks, mutual funds, exchange-traded funds (ETFs) and WealthBaskets.

WealthBaskets are similar to Smallcase’s curated collections, where a bouquet of stocks or investment products are recommended by SEBI-registered intermediaries that focus on particular trending themes or sectors, enabling active equity portfolio building.

The launch of the stock broking app has been in the works for more than a year. PhonePe acquired Mumbai-based WealthDesk, a marketplace for investment bundles, and OpenQ, a registered investment advisory (RIA) firm for $75 Mn in May 2022.

This has allowed the Walmart-owned fintech giant to offer the WealthBaskets product as an add-on to the stock broking experience.

In many ways, this is not a classical super app. The separate apps are necessitated by the fact that Share.Market requires a stock broking licence and having operational separation means any potential regulatory action will not affect the larger PhonePe operations.

This is also why Paytm has separated Paytm Money from the core app. Of course, for all intents and purposes, the larger PhonePe app will remain a key piece of the funnel, bringing users to Share.Market through cross-promotions.

With Share.Market, PhonePe claimed it’s looking to attract on-the-fence retail investors as well as reactivate those users who have a Demat account but are not actively trading. As per NSE data, the active investor count is roughly around 35 Mn in July 2023, while India has over 123 Mn Demat accounts as per July 2023 numbers, with 3 Mn accounts opened in the month.

That’s a new record as per the two depositories, CDSL and NSDL, which explains the bullishness of PhonePe and indeed another new player on the horizon, Jio Financial Services.

Missing The Big Piece

Jio’s investment tech product is yet to hit the markets, but PhonePe is several steps behind JFS in one regard, despite starting out earlier.

Stock broking is a one part of the investment tech stack — the real revenue potential comes from the asset management company licence, that Jio holds thanks to its JV with BlackRock.

Zerodha and Groww are two investment tech platforms that do have an AMC licence. In the case of Zerodha, the licence came in August 2023 thanks to a joint venture with smallcase. Groww acquired IndiaBull’s AMC business which was completed only in May this year despite the acquisition being in the works since 2021 when it was first announced.

Other startups in this space do not yet have an AMC licence and therefore are restricted to earning commissions as brokerages rather than a bigger chunk of the revenue from investments in mutual funds. An AMC licence is key for anyone eyeing a slice of India’s $540 Bn mutual fund industry, dominated by the likes of SBI, ICICI, and HDFC.

In August 2021, PhonePe had received approval from its board to set up an AMC or mutual fund business and soon after had approached SEBI for approval. The regulator has yet to approve PhonePe’s application for an MF licence.

AMCs typically charge a management fee based on the asset percentage, while brokerages generally charge per trade or offer flat-fee accounts. PhonePe will need to acquire the AMC licence if it wants to unlock the full revenue potential in this space.

PhonePe Vs Paytm: Super App Stakes

Stock broking is just one of the many new things that are in the PhonePe pipeline. The company has already raised over $750 Mn since the start of 2023 as part of a massive $1 Bn round.

The plan is to use the capital to enter and scale up new businesses such as insurance, wealth management and stock broking, lending (B2B and consumer), ONDC-based shopping (Pincode) and account aggregator services.

Earlier this year, PhonePe received a payments aggregator licence. And with Share.Market, there’s little doubt that PhonePe is looking to become the everything app for fintech and commerce.

Indeed the trajectory is very similar to Paytm, and the market timing is somewhat right. The super app approach has long been believed to have some potential, but the Indian market is only now reaching some maturity in 2023. The most active and habituated fintech customers have become familiar with digital-first financial services.

The super app strategy seems to have worked for Paytm, which nearly halved its losses on a YoY basis in Q1 FY24.

But this improvement has largely come on the back of lending products. PhonePe will need to back its investment tech play with highly efficient lending to match Paytm’s pace. Here, PhonePe is behind Paytm and only has a B2B lending marketplace right now.

So how does PhonePe stack up to Paytm on some key metrics?

For PhonePe, UPI payments and the potential to convert this user base into active investors is a huge competitive edge that even Paytm might not be able to boast of right now. PhonePe has a huge lead in the UPI space — the app processed nearly 4.8 Bn transactions in July 2023 compared to Paytm’s 1.2 Bn.

Paytm has 92 Mn monthly active users, while last year, PhonePe claimed to have over 150 Mn monthly active users. So besides UPI, that’s a massive user base to capitalise on.

In terms of the revenue base, Paytm touched INR 4,974 Cr in revenue for FY22, the last full year for which PhonePe’s revenue figures are available. In comparison, the Walmart-owned company reported INR 1,692 Cr for FY22.

The disparity in revenue scale begs the question: How quickly can PhonePe catch up to Paytm’s lead before the likes of Jio and others jump into the fray?

The Best Of The D2C Summit 

The Souled Store’s D2C Roots: 10 years after inception, the fashion brand continues to garner over 90% of its revenue from its native channels, said cofounder Vedang Patel

Digital-First Before Omnichannel: TMRW CEO Prashanth Aluru believes that early brands need to get the digital strategy right before even thinking about omnichannel presence

CaratLane’s Data Gems: CEO Avnish Anand on how the Tata-acquired jewellery ecommerce leverages data to make the most of the festive season rush

Myntra’s Mantras: Myntra CEO Nandita Sinha on the D2C strategy and how it’s capitalising on the demand for international brands from Tier 2 markets and beyond

Homecoming For boAt: From a brand that imported from China to bulking up the Made-In-India quotient — cofounder Aman Gupta on the big shift for boAt in the past year

Sunday Roundup: Startup Funding, Tech Stocks & More 

• Weekly Funding Down: The weekly startup funding tally fell after a brief gain earlier in August, with just $52 Mn raised across 12 deals this past week, making hardly any dent in the overall tally for 2023
• Zomato Rally: Zomato saw a big bump on the stock markets this week after SoftBank Vision Fund sold 10 Cr equity shares in the food delivery giant
• Nazara Sees New High: Nazara Technologies’ share price touched a 52-week high before settling as the company looks to raise fresh capital through an equity issue

• ONDC’s New Landmark: In what could be a threat to Zomato and Swiggy, ONDC has claimed that it now has 50,000+ restaurants on its platform

That’s all for this week. We will see you next Sunday with another weekly roundup, and till then, you can follow Inc42 on Instagram, X/Twitter and LinkedIn for the latest news as it happens.

The post PhonePe, Share.Market & Fintech Super Apps appeared first on Inc42 Media.

As the Indian startup ecosystem continues to face a funding winter, the number of equity deals has significantly declined since last year. Consequently, many entrepreneurs are compelled to turn to debt as an alternative funding option.

According to Inc42’s Startup Investor Landscape Report 2023, debt funding investment deals grew by 16% between 2017 and 2022. Today, there are over 50 venture debt funds in India, and more than 200 startups have raised debt funding since 2015. In addition, Inc42’s H1 2023 Startup Funding Report found that between January and June 2023, Indian startups raised a total of $260.7 Mn in debt funding. 

During the first half of the 2023, debt funding accounted for almost 4.81% of the total $5.4 Bn raised by the Indian startups, against only 1.48% during the second half of 2022. 

With such numbers it will not be wrong to say that the Indian venture debt funding landscape looks quite promising. 

It is to be noted that many investors find debt funding to be financially beneficial and secured as there is a regular inflow of the repayment until the predetermined amount is paid off. Such benefits and prevailing funding crunch paved the way for the debt lenders to nurture their businesses, leading to the increase in numbers. 

In this article, Inc42 presents a list of some of the most prominent venture debt funds in India. This is not an exhaustive list or ranking of any kind and we have arranged the funds in an alphabetical order. We will keep adding more names to this list. 

Alteria Capital

The fund was started in 2017 by Ajay Hattangdi and Vinod Murali, who served Silicon Valley Bank India on various leadership positions. 

Headquartered in Mumbai, the venture debt fund claims to have funded 90 startups. Some of the notable startups it backed are BharatPe, Cars24, Spinny, Dunzo, Dealshare, Lendingkart, Stanza Living and more. 

It participates in funding rounds between Series A to Series D, while the ticket size ranges between $100K to $15 Mn, and for the debt recovery, it allows a period of 12 to 36 months. 

A stage agnostic fund, in March this year, extended debt to Bengaluru-based Jumbotail that operates in food and ecommerce B2B business, to help the startup build deep sourcing capabilities and AI-driven technologies to drive higher customer wallet share to grow its net revenue by 100%.

Grand Anicut Fund 

Founded in 2016 by Ashvin Chadha and IAS Balamurugan, the fund participates in both equity and debt funding rounds. Grand Anicut focuses on investing in Indian startups operating in sectors other than infrastructure, real estate, and media.

Based out of Chennai, the fund counts startups like ASG Eye Hospitals, Azure Hospitality, SUGAR Cosmetics, Milky Mist, WOW Momo, Lendingkart, and many more under its structured debt portfolio. 

With an Asset Under Management (AUM) of INR 1,600 Cr, it claims to have made 39 investments across 16 sectors and made 15 exits so far. 

BlackSoil

Founded by Mohinder Pal Bansal, BlackSoil claims to be an alternative debt platform that majorly sources funds from HNIs and family offices. It supports the growing startups, which are underserved for their debt requirements by traditional banks and financial institutions.

Since its inception in 2016, it has served as a sector agnostic fund but segregates the portfolio into growth companies, financial institutions and supply chain partners. In each of these sectors, it has invested over INR 1,500 Cr, INR 450 Cr and INR 950 Cr, respectively, to date.

Its portfolio comprises startups like TVF, Yatra, Dunzo, Blusmart Mobility, MobiKwik, Infra.Market, and DeHaat, among others. 

In April this year, BlackSoil raised $25 Mn in funding from multiple banks, family offices, corporate treasuries, and high-net-worth individuals.

EvolutionX

Founded in 2021, EvolutionX is led by Rahul Shah, Serene Kee, Daphne Wong, Sakshi Shah, and Saurabh Jain. It is a growth stage debt financing platform, which has been jointly set up by DBS Bank and Singapore’s sovereign wealth fund Temasek.

The Singapore-based debt financing firm offers financial support to tech startups across Asia, with a focus on regions such as China, India, and Southeast Asia. A sector-agnostic firm, EvolutionX supports startups hailing from consumer, education, fintech, healthcare, logistics, industrial development, among others. 

EvolutionX announced its maiden investment in November 2022 as it backed API Holdings which owns healthtech startup PharmEasy. Its latest investment came in June this year when it invested INR 200 Cr in Lendingkart. 

Over the next two years, the debt financing platform aims to offer term debt facilities with ticket sizes in the range of $20 Mn to $50 Mn, along with warrants or convertible instruments.

Innoven Capital India

Started in 2008, the fund operates out of Mumbai. Led by a number of industry experts, the fund claims to have invested over $800 Mn in 200-plus startups.

It backs early and growth stage startups in the technology business. Other than India, it also operates in China and some parts of South East Asia.

Through the 12 years of investing business, it has garnered 35 unicorns, including Myntra, OYO, BYJU’S, PharmEasy, and many more. 

Other than these unicorns, it has also supported startups like Faasos, Chaayos, Dailyhunt, mSwipe, etc. 

Lighthouse Canton

Founded in 2014 by Shilpi Chowdhary, Lighthouse Canton operates as a wealth manager across the Asia Pacific region. It launched its India business and offices in New Delhi and Bengaluru in 2020. 

Headquartered in Singapore, the fund aims to deliver systematic, resilient, and diversified strategies to help investors grow, manage and protect their wealth. According to the founder, Lighthouse is “a new-age global investment group with the ecosystem of a technology startup and the culture of a seasoned financial institution”.

Lighthouse focuses on SMEs, growth and early stage startups, and real estate businesses. However, it also offers wealth management services to corporates, ultra-high net worth individuals, family offices, and founders. 

Earlier this year, it led a debt funding round of INR 24 Cr in lendingtech startup LoanTap. 

Northern Arc

Founded by Kshama Fernandes in 2008, the debt fund claims to have a base of over 400 investors. According to its website, the fund has enabled a funding of about $15 Bn since its inception. 

It analyses data and technology to offer credit services to emerging startups and small businesses across multiple geographies and segments. It claims to  be present across 657 districts in 28 states and 7 Union Territories in India. To date, it has disbursed over 6 Mn loans to retail customers across individuals, households and small businesses through its partners.

In April this year, it participated in a debt funding round of cloud kitchen startup Rebel Foods. 

Nuvama Asset Management

Nuvama Asset Management came into being after Edelweiss Financial Services spun off its wealth management business as a separate entity under the name Nuvama.

Formerly called the Edelweiss Crossover Yield Opportunities Fund, Nuvama Asset Management is one of the many companies under the umbrella of Nuvama Group (erstwhile Edelweiss Wealth Management).

Nuvama AMC has been capitalising on the growing traction seen in the venture debt space as big-ticket Indian startups continue to face a capital drought. As per London-based investment data firm Preqin, Nuvama Asset Management was one of the four major funds launched in 2023 that is rapidly inching towards interim closure.

So far, the company claims to have assets under management (AUM) worth nearly INR 6,000 Cr.

Stride Ventures

Launched in 2019 by Ishpreet Gandhi, Stride Ventures is headquartered in New Delhi and claims to have made 100 investments till date. 

Stride Ventures has raised a total of $314.1 Mn across three funds. In May, it announced the first close of its third fund at $100 Mn. The fund, which has a target corpus of $200 Mn, has received backing from several institutional investors, including banks, insurance companies, and family offices.

Stride Ventures counts HomeLane, MyGlamm, Spinny, Infra.Market, Blusmart Mobility, and Tender Cuts among its portfolio startups. 

Trifecta Capital

Founded in 2015 by Nilesh Kothari and Rahul Khanna, Trifecta provides equity as well as debt funding to startups. In addition, it also offers financial advisory services to its portfolio startups. 

Trifecta focuses on startups from industries like consumer services, consumer brands, ecommerce, mobility, edtech, agritech, among others. 

Startups like Atomberg, BharatPe, Aqua Connect, BigBasket, and Biryani By Kilo are part of its credit portfolio. 

Varanium Capital Advisors

Varanium primarily advises high-net-worth individuals (HNIs) on investment solutions. Varanium made a big splash in the venture debt space in July 2023 as it announced the first close of its maiden debt fund with a target corpus of INR 250 Cr and a greenshoe option of INR 50 Cr.

The venture debt platform is led by Nawal Bachhuka, principal of the venture fund at Varanium, whose prior experience includes Aditya Birla Finance. 

The debt financier claims to manage $1 Bn in assets across multiple asset classes. It aims to back around 100 startups in India through revenue-based financing and traditional venture debt.

The primary focus of Varanium is to back startups from the D2C, SaaS, B2B ecommerce and fintech industries. 

This is not an exhaustive list or ranking of any kind and we have arranged the funds in an alphabetical order. We will keep adding more names to this list. 

We have removed mentions of two companies from this list. Apologies for the error.

The post Most Active Venture Debt Funds For Indian Startups appeared first on Inc42 Media.

The financial year 2023 proved to be a challenging period for Indian startups in the context of securing funding. Despite having substantial dry powder reserves of over $18 Bn as of December 2022, investors adopted a cautious approach.

Not to mention, the impact of bearish investor sentiments has seeped into financial year 2024 as well, leading to a significant 15% month-on-month decline in funding, with only $337 Mn raised in August 2023.

According to Inc42’s ‘Indian Tech Startup Funding Report Q1 2023’, 84% of Indian VCs surveyed said that growth-stage startups faced difficulty in raising funds.

However, despite the funding gloom embracing 2023 too, VC, angel and PE investors have announced 52 funds worth more than $3.8 Bn so far this year to support Indian startups at various stages.

According to Inc42, 38% (or 20 funds) of the total funds announced this year focus solely on early-stage startups.

While about $3.8 Bn worth of capital is meant specifically for India, there are funds such as B Capital and Nexus, which consider India as one of their investment markets. (We have not included them in $3.8 Bn).

In our effort to provide startups with up-to-date information on funding resources, we will continuously update this article with latest venture funds, their sizes, sectors of focus, and other relevant details.

For now, here’s a list of 52 funds, comprising details on their fund size, sectors in focus and more, which have been launched so far this year.

Editor’s Note: All funds have been placed in alphabetical order.

List Of Startup Focussed Investment Funds, Plans Announced By VCs, Investors And More

3one4 Capital (Fund IV)

Bengaluru-based venture capital (VC) startup 3one4 Capital closed its fourth early-stage investment fund, Fund IV, at $200 Mn in May 2023. 3one4 Capital will invest in early-stage startups (from pre-seed to Series A) with cheque sizes between $0.5 Mn to $5 Mn. 

Founded in 2015 by Pranav Pai and Siddarth Pai, 3one4 Capital is an early-stage venture capital firm based in Bangalore, India.

The VC firm said it would focus on sectors such as consumer internet, SaaS and fintech while increasing investments in newer areas such as health tech, climate tech and more.

AdvantEdge (Fund III)

Early-stage venture capital (VC) fund AdvantEdge unveiled its third fund to invest $80-$100 Mn in mobility solutions companies.

Founded in 2015 by Kunal Khattar, AdvantEdge is an early stage tech fund investing across consumer sectors with a focus on mobility.

The new fund focusses on investing in the electric vehicle (EV) ecosystem with eyes on startups that make EVs affordable. The fund also plans to invest in startups that lease out

Aeravti Ventures

Early stage venture capital (VC) firm Aeravti Ventures announced the first close of its maiden INR 100 Cr fund on May 30,2023. 

Led by General Partners Rishabh Singh and Shubham Jhuria, and supported by over 25 Entrepreneur Partners (EPs), Aeravti Ventures is focussed on investing in new-age technologies and emerging tech startups.

For its maiden fund, Bengaluru-based firm said the fund will invest in pre-seed to Pre-Series A funding rounds of startups in sectors like deeptech, biosciences, agritech, climate, and enterprise tech in the next two to two-and-a-half years. 

Agri-Focused Accelerator Fund

During the union budget speech 2023-24 in February, India’s finance minister (FM) Nirmala Sitharaman announced an agriculture-focused accelerator fund to shore up domestic agritech startups working in rural areas of the nation.

The FM said that the fund targets building innovative and effective agritech solutions for agriculture farmers, in turn, helping them improve access to market linkages and yields. The move is part of this year’s seven-fold approach which aims to give a major push to the Indian economy amid a global slowdown.

Targeted at farmers, the project will support the growth of the agritech industry and startups. It is also envisaged to improve access to farm inputs, shore up credit and insurance, and increase access to market intelligence.

Airavat Global Technology Fund R

Public equities investment firm Airavat Capital announced the launch of a global technology fund, Airavat Global Technology Fund R (AGTF R) in June.

The tech fund has already received interest worth over $40 Mn from investors, including existing stakeholders of Airavat Capital, other VC investors, technology founders/CTOs, and family offices.

Airavat Capital is an investment management firm that is focussed on listed technology-enabled businesses across growing sectors such as consumer, financial services, technology and pharma. It is pertinent to note that it is the first-ever global technology fund to be based out of GIFT City.

Arkam Ventures

Early stage VC firm Arkam Ventures launched its second fund with a target corpus of $180 Mn in June 2023. The fund is nearly double the size of its previous fund, which the VC firm closed last year at $106 Mn.

With its new fund, the VC firm would look to write larger early stage checks to secure a bigger stake in early stage startups.

Typically, Arkam Ventures steps in at the Pre-Series A to Series B stage, with cheque sizes ranging between INR 10-20 Cr.

Arkam Ventures has made 18 investments so far, including names like smallcase, KreditBee, Jar, Smartstaff, Jai Kisan, Signzy, SpotDraft, Wint Wealth, Invact, Mudrex, BestDoc, and Jumbotail.

Avaana Capital

Climate-focussed venture capital firm Avaana Capital raised $70 Mn, announcing the first close of its Avaana Climate and Sustainability Fund in June. The VC firm is targeting a total corpus of $100-125 Mn for the fund.

The fund will focus investments in three sectors, including energy transition and resource management, mobility and supply chains, sustainable agriculture and food systems.

Led by Anjali Bansal, Swapna Gupta, and Shruti Srivastava, Avaana Climate and Sustainability Fund focusses on tech-driven and innovative climate solutions, looking to solve climate risk mitigation, adaptation and resilience building.

B Capital (Growth Fund III)

US-based investment firm B Capital closed its third venture growth fund and allied companion funds, Growth Fund III at $2.1 Bn in January this year. The fund will invest between $40 Mn and $50 Mn in startups across the US and Asia, including India, working in enterprisetech, fintech, healthtech, SaaS and cybersecurity segments.

Founded in 2015 by Howard Morgan, Sheila Patel, Eduardo Saverin and Raj Ganguly, B Capital invests in seed to late-stage startups. It manages nearly $6.3 Bn worth of assets under management (AUM).

The fund will emphasise on value-added investing, accelerating business development and growth of portfolio companies, according to the VC firm.

B Capital (Healthcare Fund I)

VC firm B Capital also closed a Healthcare Fund I at over $500 Mn. The healthcare-focused fund would invest in startups working in digital health and biotech segments. 

Its healthcare portfolio includes more than 20 early and late-stage startups based in the US, Asia and Europe. Its portfolio spans the healthtech, digital health, biotech and medtech segments.

Some of its portfolio companies are Bounce, BYJU’S, Khatabook, Meesho, PharmEasy, Yubi and Dailyhunt.

Blume Continuity Fund

Venture capital (VC) firm Blume Ventures announced the first close of its new opportunity-cum-continuity fund, Fund 1Y, in June. This is the VC firm’s third growth fund.

Blume said in a statement that it already raised INR 200 Cr of the INR 400 Cr target corpus for the round.

The VC firm also added that it would invest a part of the capital raised to buy out strong startups such as IntrCity, Cashify, Carbon Clean and Zopper from its Fund 1 and related investment vehicles and use the remaining to invest in startups from other funds.

Blume also raised similar-sized opportunity funds in 2018, 2021 and 2022 to invest in startups such as Exotel, Grey Orange Robotics, Smallcase, slice, Unacademy and WebEngage.

BoldCap Fund

Indian venture capital firm BoldCap announced a $25 Mn second fund in April 2023 to make investments in 15-20 early-stage SaaS startups in the country in the next 24-36 months.

The fund bets on Indian startup founders having global ambitions. The fund aims to build more SaaS-based companies in India for the world.

Founded in 2021 by Nellore, BoldCap largely invests in pre-seed and seed-stage B2B SaaS startups in India. The VC firm primarily backs pre-seed and seed-stage B2B SaaS startups, which are based out of India.

From its $5 Mn maiden fund, it has backed 10 startups to date, including Spendflo, TestSigma and Spotdraf.

CapFort Ventures

CapFort Ventures, a Micro VC fund, has recently unveiled its new India-focussed tech fund, amounting to INR 200 Cr. Over the next two years, the fund aims to invest in approximately 40  startups.

The firm has a diversified investment strategy, targeting startups from various sectors, including deeptech, cleantech, B2B tech, logistics, healthtech, and other impact-oriented sectors.

As a category II alternative investment fund (AIF), CapFort Ventures will be seeking opportunities to invest in startups with valuations within the range of INR 100 Cr. The ticket size for individual investments is expected to vary between INR 2 Cr and INR 6 Cr, with the average falling around INR 3 Cr to INR 3.5 Cr.

The first close of the fund is anticipated to take place by the end of this year, with further provisions for additional investments through a green shoe option of INR 100 Cr, which will be available if there is considerable interest from potential investors.

The micro VC firm is looking to source a majority of the capital from domestic investors, with participation from institutional investors, family offices, and ultra HNIs. 

Capria Ventures

Global venture capital firm Capria Ventures marked the first close of its $100 Mn fund in April 2023. The VC firm said it will focus on investing in 20-25 tech startups across India, Southeast Asia, Latin America, the Middle East and Africa via its new fund. 

It will focus on startups harnessing the potential of Generative AI to grow across multiple sectors as well as climate startups, the VC firm said. The fund has been anchored by LPs such as OIP Investment Trust and Gates Ventures as well as foundations, individuals and family offices.

Capria’s family of funds collectively manage assets exceeding $200 Mn.

CarTrade Ventures

Auto marketplace CarTrade launched its VC arm, CarTrade Ventures, in February this year to make investments and acquisitions in the Indian automotive space. The new venture will deploy up to INR 750 Cr (around $94 Mn) over the next five years to strengthen its auto-tech play. 

At the fund’s launch, CarTrade said the move will enable it to acquire and invest in companies that offer differentiated services and technology in the automotive space.

CarTrade said it was actively scouting to invest in companies across auto sub-segments, including auto finance, leasing, insurance, servicing, car ownership, electric vehicles and clean energy, along with new-age tech startups in domains such as augmented reality (AR), artificial intelligence (AI) and visualisation, to digitise the auto buying journey.

Chanakya (Opportunities Fund I)

Chanakya Fund Trust launched its maiden INR 100 Cr ($12.5 Mn) sector-agnostic fund in April 2023 to invest in startups and SMEs. The SEBI-registered Category-II alternative investment fund, Chanakya Opportunities Fund I, will also have a greenshoe option of INR 100 Cr. 

The fund will invest about INR 2 Cr-INR 10 Cr each in about 25 companies, raising capital from resident and non-resident Indians, high-net-worth individuals, banks, accredited investors, corporates and trusts.

“Chanakya Opportunities Fund I is our first offering. We are planning to raise INR 100 Cr in the first year. This is a close-ended fund, and we will be accepting subscriptions for the tenure of five years from the first close with a maximum of two extensions of one year each,” said, Kresha Gupta, the founder and fund manager of Chanakya Fund Trust.

Chiratae Ventures (Growth Fund I)

Early stage venture capital (VC) firm Chiratae Ventures announced the final close of its Growth Fund I at INR 1,001 Cr. The fund saw its first close in November 2022, when the VC firm first closed the growth fund at INR 759 Cr.

Founded in 2006, Chiratae Ventures currently manages assets worth $1.1 Bn and is known for backing early stage startups. It has backed 130-plus startups across SaaS, consumer tech, health tech, deeptech, agritech, fintech and other domains.

Chiratae Growth Fund I is a sector-agnostic fund that has been set up to invest in the growth rounds of startups. 

Courtside Ventures (Fund III)

VC firm Courtside Ventures rolled out a $100 Mn fund, the third from the firm, to make investments in startups operating in sports, online gaming and lifestyle segments. 

According to Deepen Parikh, partner at Courtside Ventures, with the fund, the VC firm will continue to invest with conviction in great founders and disruptive ideas in crucial verticals of sports, fitness, collectables and gaming.

The VC firm said that it would onboard a slew of professional sports team owners, athletes and industry executives as limited partners of the fund. So far, it has invested in about 80 startups, including The Athletic, WinZO and FanCraze, across eight countries.

Dallas Venture Capital

VC firm Dallas Venture Capital announced the first close of its INR 350 Cr fund at INR 100 Cr in January this year. The fund will invest between $2 Mn and $5 Mn in 15 to 18 enterprisetech startups over four years.

Speaking with Inc42, Fund Partner at DVC Kiran Kalluri said that the fund was so far operating in stealth mode but has invested in many startups. 

Dallas said that the fund would be largely focused on growth-stage startups earning revenue over $500K. The fund is backed by India and US-based HNIs and institutional investor IIFL. It has backed five Indian startups to date, including Disprz, IntelleWings, VuNet, BluSapphire and Hippo Video.

Early Spring

Early Spring, set up by Spring Marketing Capital, received a commitment of INR 100 Cr from Godrej Consumer Products (GCPL) this April. The new fund has a corpus of INR 300 Cr and will make investments between INR 5 Cr and INR 20 Cr in seed and Pre-Series A funding rounds.

Founded by Raja Ganapathy, Arun Iyer and Vineet Gupta, Spring Marketing Capital closed its first close at INR 150 Cr and continues to invest in companies at the Series A level and beyond.

It has invested in Purplle, Bewakoof, Juicy Chemistry, Smiles.ai and Mosiac Wellness since its inception.

Elev8 Venture Partners

In August 2023, Bengaluru-based growth venture capital firm Elev8 Venture Partners announced the first close of Elev8-Capital Fund 1 at $67 Mn. Family offices and high-net-worth individuals (HNIs) from India, the Middle East, and Asia participated in the first close of the fund.

Elev8 Venture Partners began its operations in early 2023 after receiving AIF category II licence from SEBI late last year.

The VC firm plans to invest in 12-14 startups, with valuations ranging from $100 Mn to $500 Mn. It will be participating in Series B and Series C funding rounds (typically in the range of $10 Mn to $15 Mn) of startups in sectors such as consumer tech, enterprise software, fintech, and healthtech.

Epiq Capital (Fund II)

In June 2023, Mumbai-based growth and late stage tech investment firm Epiq Capital announced the final close of Epiq Capital II at $225 Mn.

Established in April 2016 by former Matrix Partners India managing director Rishi Navani. Epiq Capital’s current portfolio includes eyewear unicorn Lenskart, local language content platform Dailyhunt, and fitness startup Curefit, among others

The fund II will invest in the next Tech Nifty 50 companies, which means, the fund intends to support startups that have the potential to be worth $50 Bn in the next ten years.

The fund II is looking at investing in around ten companies with an average cheque size of $20-25 Mn each.

Grayscale Ventures

Grayscale Ventures made the first closure at $10 Mn of its $20 Mn micro-fund in February 2023, targeting pre-seed startups across sectors such as AI, vertical SaaS and Dev-Infra (development infrastructure).

The VC firm, which was founded by Nikhil Kapur and Siddharth Verma, has limited partners (LPs) from Japan, India and the US. These LPs are operators and founders of Slack, Zendesk, Hasura, GlobalWay, Nexus, STRIVE, Apollo Munich, and UOB, among others.

The micro-VC fund would make investments between $200K and $1 Mn in 15-20 pre-seed startups over four years. It is expected to see a final closure by Q3 2023. Further, the fund will target about 10% ownership in the invested startups, preferring to lead the fundraising rounds or co-lead them with other specialised funds.

GrowthCap Ventures

Pratekk Agarwaal, the former chief business officer at BharatPe, launched GrowthCap Ventures in August 2023. The SEBI-registered Category II alternative investment fund (AIF) plans to invest in 12-15 startups within the next two years.

Agarwaal is looking to raise INR 50 Cr for the fund to fund early stage Indian startups.

GrowthCap Ventures will look at seed to pre-Series A rounds, with a focus on fintech, SaaS and deeptech. The fund, which will invest $250K to $750K in each startup, is expected to mark its first close in the next two months.

Iron Pillar (Fund II)

VC firm Iron Pillar closed a $129 Mn fund in April, which will invest in Series B and Series C stage SaaS startups operating in India. The fund is part of the ‘Iron Pillar Fund II series’ of funds.

Founded in 2016, Iron Pillar offers growth capital and assistance to enterprisetech and consumertech startups to expand globally. It mainly leads Series B and C funding rounds and later doubles down on the breakout businesses with 5X to 10X of its initial investment. 

Its portfolio companies include Uniphore, Servify, FreshToHome, BlueStone, Skill-Lync and Curefoods, among others. The VC firm also claims to be managing $500 Mn in assets under management (AUM).

Lighthouse Canton

Investment firm Lighthouse Canton made the first close at INR 155.4 Cr ($20 Mn) of its INR 550 Cr ($69 Mn) venture debt fund in January 2023. The fund will invest in 35-40 Indian startups over the next two years.

Speaking with Inc42, Lighthouse Canton’s global head of asset management Sanket Sinha said that the fund saw participation from onshore and offshore institutions, family offices and other ultra-high-net-worth individuals (UHNIs). The fund would largely extend debt capital to Indian technology-enabled startups with ‘sound business models and viable unit economics’.

Lighthouse made its wealth management foray into India in 2020 while its India-focussed venture debt vertical was unveiled in 2022. Lighthouse also offers solutions ranging from funding solutions for startups to closely working with the founders on business structuring.

Lumikai

Gaming-focused venture capital (VC) firm Lumikai announced the launch of its second fund in June with a total corpus of $50 Mn. 

The fund raised $25 Mn of the total corpus at the time of the announcement and looks at a closure by the end of the year. 

Founded in 2019 by Justin Shriram Keeling and Salone Sehgal, Lumikai is a VC firm that focuses solely on the Indian gaming ecosystem and largely targets seed stage ventures. 

The fund will be deployed to invest in 18-20 early stage companies over the course of next few years.

MIXI

In August 2023, Japanese mobile entertainment company MIXI announced the launch of a $50 Mn (about INR 414 Cr) corporate venture capital (CVC) fund in India to invest in early stage entertainment and consumer services startups.

The CVC fund will invest in seed to Pre-Series B startups in the country, with a particular focus on Series A and Pre-Series A investments.

Founded in 1997, MIXI has created several communication services since its inception. The company’s investment arm claims to have invested around $492 Mn between FY19 and FY22.

MIXI has an existing CVC fund in Japan and is now looking to expand to markets outside the country. MIXI is one of the limited partners (LPs) in India’s gaming and interactive media venture fund Lumikai.

Multiples PE (Fund IV)

Mumbai-based private equity (PE) firm Multiples Alternate Asset Management announced the first close of its Fund IV in May with a subscription of over $640 Mn.

The fund saw investment from investors such as the Canada Pension Plan Investment Board (CPPIB) and International Finance Corporation (IFC), among others.

Founded in 2009 by Renuka Ramnath, Multiples PE invests in mid-sized companies and growth to late stage startups. A typical Multiples cheque is worth between $15 Mn and $50 Mn. 

Multiples Fund IV is one of the largest funds launched in India so far this year, ‘behind B Capital’s $2.1 Bn Growth Fund III and Nexus Ventures’ $700 Mn Nexus Ventures VII.

Nexus Ventures (Nexus Ventures VII)

VC firm Nexus Venture closed a $700 Mn fund, the Nexus Ventures VII earlier in March this year, to back startups working in AI, SaaS, fintech and commerce in India and the US.

The VC firm said it follows a ‘one fund one team’ approach and will help entrepreneurs build product-first companies in the US and India. 

Founded in 2006, Nexus counts global pension funds, family office and endowment funds as its investors.

It largely invests in tech-enabled startups based in the US and India. Its backers include global pension funds, family office and endowment funds. Some of its portfolio companies are Delhivery, Unacademy, Druva, PubMatic, PostMan, Covvalent, Intello, and Investment.

Omnivore (Fund III)

Mumbai-headquartered venture fund Omnivore announced the first close of its third fund, the Omnivore Agritech & Climate Sustainability Fund, at $150 Mn in June 2023. 

The fund will focus on startups developing breakthrough technologies for agriculture, food, climate, and the rural economy. The fund would make 25-30 new investments in seed to Series A rounds, with initial cheque sizes ranging between $1 Mn and $5 Mn.

Founded in 2011 by Mark Kahn and Jinesh Shah, Omnivore funds Indian startups in agritech and food systems. The VC firm has backed more than 40 startups, including DeHaat, Arya, Stellapps, Reshamandi, Ecozen, Aquaconnect and Pixxel.

Prath Ventures Fund

VC firm Prath Ventures made the first closure at INR 50 Cr ($6.25 Mn) of its INR 225 Cr (around $28 Mn) fund in January 2023. The fund will invest between INR 5 Cr and INR 6 Cr in about 20 startups and will also reserve a portion of funds for follow-on investments.

Set up in May 2022 by Piyush Goenka and Harmanpreet Singh, the VC firm has invested in more than 20 seed and growth-stage consumer brands. As per its website, some of its portfolio companies include PVR Cinemas, MyGlamm, Sanfe, ManMatters, and Vastu, among others.

The VC firm shared that the fund will focus on businesses offering products and services directly to end consumers. It will back consumer-focused startups as valuations are at reasonable levels and companies are now looking at building sustainable ventures.

PeerCapital (Fund I)

VC firm PeerCapital announced the first closure at $37.5 Mn of its $75 Mn maiden fund in February this year. The fund would write off cheques of about $2 Mn in seed and series A-stage funding rounds. PeerCapital aims to back startup founders that are building innovation for India and the world.

The Bengaluru-based VC firm is also an early-stage investor in the likes of investment platform Jar and social media platform Koo. Other than that, the VC firm has also invested in the social commerce platform Furrl, virtual and secondary phone numbers services provider Doosra and cloud-based workplace management software UrSpayce.

The fund will focus on startups operating in fintech, healthtech, enterprisetech, climate tech and consumer tech segments. It is expected to make a final closure by September 2023.

Physis Capital

Venture capital (VC) firm Physis Capital announced the first close of its maiden Category II Alternative Investment Fund (AIF) in May at $7 Mn. The VC firm said the fund’s total corpus was capped at $50 Mn and it targets to close the fund in 2024.

Angel investment platform Inflection Point Ventures (IPV) launched its new $50 Mn fund, Physis Capital, last year to promote startups raising early capital.

Physis Capital is looking to build a portfolio of 15-20 startups with an average ticket size of $2.5 Mn via the sector-agnostic fund.

Pi Ventures

Early-stage VC firm Pi Ventures announced the final close of its second fund with a total commitment of INR 702 Cr ($85 Mn) in August against its base target of INR 565 Cr.

Founded in 2016 by Manish Singhal, Pi Ventures closed an INR 225 Cr first fund (Fund I) in 2018. With its first fund, it backed 15 deeptech startups, including Niramai, Pixis, Wysa, Agnikul, and Locus, just to name a few.

The VC firm’s second fund, which was launched in 2021, has received investments from BII, Nippon India Digital Innovation AIF, Flipkart founder Binny Bansal, Mamaearth founder Varun Alagh, Info Edge CEO Hitesh Oberoi, MakeMyTrip founder Deep Kalra, Accel, and other high-net-worth individuals and family offices.

Piper Serica Advisors (Angel Fund)

Portfolio management firm Piper Serica secured INR 75 Cr for its INR 100 Cr angel fund in January this year. The fund, which was launched last year, focuses on early-stage tech startups. In a statement, the company said that it expects to raise the remaining INR 25 Cr shortly to invest in startups with ‘exponential growth models’.

Piper Serica said it was using its proprietary AI, ML-based tool, Yoda.ai, to screen investment opportunities. It informed that it would back a supply chain management startup, a CRM tech startup, a cybersecurity company, and a learning management solution company.

So far, the fund has backed ALT Mobility, Crediwatch, ZFW Dark Stores, Driffle and Oditly.

Rockstud Capital (Investment Fund II)

In March 2023, asset management firm Rockstud Capital rolled out an INR 300 Cr ($36.4 Mn) second fund, the Rockstud Capital Investment Fund II, to make investments in 25 Indian startups operating in the digitalisation, sustainability, financial inclusion, consumption and health sectors.

The parent firm Rockstud Capital, which was founded in 2017, has backed multiple companies so far, including Everest Fleet, BigHaat, Instoried, Smartvizx, Fabheads, and NOTO.

The fund will make investments between INR 1 Cr and INR 10 Cr in Pre-Series A and Series A funding rounds.

RTP Global

Early stage venture capital (VC) firm RTP Global announced its RTP IV fund in June 2023 with a corpus of $1 Bn to invest in startups across the US, Europe and Asia.

The $1 Bn fund will be split into two parts – while $660 Mn will be earmarked for its early stage investments, $340 Mn will be infused in RTP IV’s ‘breakout’ portfolio companies.

RTP Global will reserve one-third of the corpus for investing in startups in India and Southeast Asia. RTP Global has so far invested in over 30 Indian startups and counts Indian startups like CRED, Rebel Foods, and MPL its portfolio company.

Speciale Invest (Growth Fund I)

VC firm Speciale Invest launched its INR 200 Cr growth fund, Speciale Invest Growth Fund I, in April 2023,  with an additional up to INR 100 Cr in greenshoe. The VC firm said it would close the fund in the coming months.

The VC firm will use the capital to fund portfolio companies working in spacetech, green hydrogen, robotics, green mobility, quantum tech and AI-led platforms, among others. Speciale has backed 18 companies via its first fund and plans to invest in 20-22 early-stage companies with its second fund.

Founded in 2017, Speciale Invest largely invests in early-stage startups from emerging areas such as deeptech, AI-led SaaS, robotics, micro-electronics, and spacetech.

Stride Ventures (Fund III)

Venture debt firm Stride Ventures announced the first close of its third venture debt fund in May at $100 Mn. It is aiming for the final closure of the fund at over $200 Mn.

Stride Ventures said the fund will make investments in fast-growing startups that exhibit robust business models, strong unit economics, and skilled management teams.

Set up in 2019, Delhi-based Stride Ventures is led by Ishpreet Gandhi and Abhinav Suri. So far, the fund has invested in over 100 startups across sectors such as consumer internet, SaaS, fintech, and B2B platforms. 

The Neon Fund

The hosts of the 100x Entrepreneur podcast (now called The Neon Show), Siddhartha Ahluwalia and Nansi Mishra launched a $25 Mn fund, Neon, in July.

Neon fund will focus on early stage B2B SaaS companies and aims to help them to scale to more than $10 Mn in annual revenue within five years.

Ahluwalia and Mishra’s previous $10 Mn fund, 100x Entrepreneur, invested in over 40 B2B SaaS startups, including Airmeet, Astra Security, CloudSek, InFeedo, KNOW app, Profit.co, Phyllo, and SpotDraft.

Together Fund II

In late July, Bengaluru-based Together Fund announced the first close of its $150 Mn second early stage fund, Together Fund II, which is focussed on SaaS and AI startups.

Together Fund II will invest $1 Mn-$5 Mn in seed and Series A rounds of startups.

The VC firm was launched by Girish Mathrubootham, the founder and CEO of Freshworks, Eka Software’s founder and CEO Garg, ex-Matrix Partner Shubham Gupta, and Avinash Raghava, an ex-Accel executive. Kula, Privado, Revenue Hero, Spendflo, Spry, and Toplyne are among the portfolio startups of Together Fun.

Unitus Ventures (Opportunity Fund)

VC firm Unitus Ventures marked the first closure of its $40 Mn Opportunity Fund in February this year. The fund will largely back early-stage startups from its portfolio of other two funds viz. Unitus Ventures Fund I and Unitus Ventures Fund II.

The investment firm would also set aside 20% of the fund amount for deals outside of its existing portfolio to focus on Series A startups working in AI and climate tech segments. It also plans to do a final closure of the fund by the end of this year. 

So far, the fund has pumped money into five startups, including HRtech platform BetterPlace, edtech startup Cuemath, lendingtech platform Eduvanz, gig worker platform Awign and upskilling company Masai.

V3 Ventures

Early-stage VC firm V3 Ventures shared plans of investing about INR 900 Cr in startups operating in India, Europe and the US in April. 

The fund, which is backed by international investment company Verlinvest, will focus on early-stage digital and consumer businesses across new-age brands, technology, enablers and platforms at seed and Series A stages. 

Founded in 2021 by Arjun Vaidya and Lopo Champalimaud, V3 Ventures can leverage the global investment company’s network of partner companies, teams and advisors. So far, V3 Ventures has backed the audio content platform Kuku FM and digital healthcare app Eka Care in the country.

Varanium Capital 

Mumbai-based asset management company Varanium Capital announced the first close of its maiden venture debt fund in July 2023, which has a target corpus of INR 250 Cr, with a greenshoe option of INR 50 Cr.

Varanium Capital has secured the backing of domestic and global LPs, along with an anchor investor for the venture debt fund.

The firm said it will back around 100 startups in India via revenue-based financing and traditional venture debt.

Veda VC

Bengaluru-based early stage venture capital (VC) fund Veda VC announced the first close of its INR 250 Cr fund in August 2023, led by family offices and startup CXOs.

Founded in 2020 by Vasant Rao, Avijeet Alagathi, Venus Dhuria and Ashis Nayak, Veda VC claims to be one of the first operator VCs in India. Besides capital, the team at Veda brings domain knowledge, ecosystem network, execution skills and craft to help portfolio companies reach PMF, scale faster and raise follow-on capital.

The SEBI registered Category 1 AIF fund plans to invest between $250K to $1.25 Mn in technology and tech-enabled startups in India.

Vertex Master Fund III

Vertex Ventures, the venture capital arm of Singapore’s state investor Temasek, marked the first close of its latest fund, Vertex Master Fund III, at around $900 Mn. Set up in 2021, Vertex Master Fund III closed its first round at the end of June 2023.

The VC firm, which has invested in 71 startups so far, has backed big Indian startups like Licious, Firstcry, XpressBees, Grab, Kissht, and Kuku FM.

Vertex debuted in India in 2010 with India and Southeast Asia Fund. Over the last decade, it has dedicated four funds to investing in the region. 

ValueQuest Investment Advisors (VQ Scale Fund)

Private equity (PE) firm ValueQuest Investment Advisors rolled out a $121 Mn fund (VQ Scale Fund) to back late-stage startups in March this year. Through its new fund, ValueQuest will invest primarily in late-stage opportunities. 

The fund will have a target size of INR 700 Cr. There is also a green shoe option of INR 300 Cr, which would potentially take the total fund size to INR 1,000 Cr. 

The VQ Scale Fund was sponsored by ValueQuest founder and CIO Ravi Dharamshi, while Dharamshi’s family office anchored it with an investment of INR 100 Cr. It also received commitments from Indian family offices.

WinZO (Game Developer Fund IV)

Gaming startup WinZO rolled out the fourth edition of ‘Game Developer Fund’ in March this year. The $50 Mn fund would make investments of up to $10 Mn in a gaming startup. It further plans to invest as much as $10 Mn in US-based gaming startups.

Founded by Nanda and Saumya Singh in 2018, WinZO is an online skill-based gaming startup that associates with third-party developers to host games on its mobile-based application.

In 2021, WinZO launched the third edition of the gaming-focused fund, having a corpus of $20 Mn. Under these funds, WinZO has backed several gaming companies to date, including the likes of Upskillz, IndiGG and Bombay Play, among others.

Women Entrepreneurs Early Growth Fund

Early stage venture fund AWE Funds revealed the first close of its maiden fund in India, the Achieving Women Entrepreneurs Early Growth Fund I, at $15 Mn in June this year.

AWE Funds is targeting a corpus of $45 Mn for the fund, with a greenshoe option of $15 Mn. The early stage venture fund typically invests in Pre-Series A and Series A rounds, mostly post-revenue companies

The fund aims to invest in scalable innovations in sectors such as climate tech, agritech, healthtech, edtech and fintech while promoting gender equity and climate action as a strategy.

Z3Partners

VC firm Z3Partners marked the final closure at INR 550 Cr (around $69 Mn) of its fund in January 2023. The fund was backed by institutional investors like HDFC Life and SIDBI.

Founded in 2019 by Gautam Patel, the VC firm will invest between INR 50 Cr and INR 80 Cr in 8-10 early and growth-stage tech startups working in SaaS, fintech, ecommerce, B2B commerce, agritech, big data, consumer tech and tech-enabled segments. 

Back in 2021, Z3Partners raised INR 100 Cr, marking the first close of its maiden fund with a target corpus of INR 730 Cr ($100 Mn) targeting high-growth startups across consumer and enterprise sectors.

Zero To One

Investment firm Zero To One (ZTO) has announced an INR 300 Cr (about $48 Mn) fund in January 2023 to make investments in Pre-Seed and Series A funding rounds. The fund focuses on Indian startups operating in edtech, healthtech, agritech, medtech and cleantech segments. 

Founded in May 2022 by Praveen Kaushik and Rahul Massey, ZTO claims to have a network of more than 500 angel investors, HNIs and VCs across India, Singapore, Dubai, the US and the UK.

The VC firm said its screening mechanism assists in identifying startups for investments. It also provides investors with a syndicated platform to share their risks and diversifies their portfolios to get maximised returns.

(Last updated on August 31)

The post Funds Worth $3.8 Bn+ Announced For Startups In 2023; Here’s The Full List appeared first on Inc42 Media.

The narrative of ride-hailing and mobility in India so far revolves around the duopoly of Ola and Uber, similar to Flipkart and Amazon in the ecommerce segment, and even Zomato and Swiggy in the food delivery space. Despite ruling the space, the duopoly has done little to revamp the ride-hailing segment in the country.

As of 2022, data sourced from Statista indicates that Ola commanded a 41% market share, closely trailed by Uber at 37%, leaving little room for other players. But this stranglehold on the ride-hailing segment and the disruption of legacy cab and ride-hailing players has largely come on the back of steep incentives and discounts.

While one cannot deny that technology and the platform model of connecting drivers and commuters totally changed the mobility market, the extensive market share can be primarily attributed to substantial discounts offered to riders and incentives extended to drivers in the early years.

For the initial years till early 2016, both platforms claimed driver earnings exceeding INR 1 Lakh per month, which enticed a segment of the lower and lower-middle-class individuals to ply their vehicles for Ola and Uber. Numerous auto-rickshaw operators also sold their vehicles to join the growing trend.

On the consumer side, the growth came on the back of heavily subsidised rides and VC-funded discounts.

But the times have changed drastically since then.

Over the past few years, the euphoria surrounding Ola and Uber has given way to disillusionment for a significant portion of commuters due to recurrent ride cancellations by drivers, while drivers complain about lower earnings, as both platforms have looked to maximise their margins.

Today, drivers find themselves grappling with rising aggregator commissions, diminishing per-ride margins and increasing fuel costs.

Consequently, we are witnessing a number of challenges such as ride cancellations, demands of cash payments, dirty cabs, damaged seats, and lack of basic hygiene. The ride-hailing sector is also marred by many instances of drivers outrightly refusing to turn on air conditioning during rides, unless commuters shell out more.

For every INR 100 received by drivers, 20%-25% of the total fare goes into paying the platform commission, INR 5 towards GST and then there is fuel and maintenance cost, leaving drivers with very little to take home.

The predicament is exacerbated for drivers saddled with car loans, where equated monthly instalments (EMIs) are another source of distress.

Various state governments have raised concerns about surge charging and other pricing issues, while drivers have gone on strike to protest against their falling earnings.

So, what’s the solution?

At least for Ola, the answer came in the form of Prime Plus, a premium-tier service that addresses the concerns of commuters such as cancellations and promises drivers consistent earnings for drivers.

Launched in May 2023 in Bengaluru, Ola Prime Plus comes with a minimum business guarantee (MBG) scheme which ranges from INR 1,815 and INR 7,700 on a daily basis for drivers in Bengaluru.

For instance, according to various Prime Plus drivers operating in Bengaluru, completing six rides entitles a driver to earn INR 1,815, while 11 rides lead to INR 3,300, 18 rides to INR 4,900, and 28 rides to INR 7,700 (approximately).

In fact, Ola makes up for any difference between the actual earnings of the drivers and the promised MBG. If a driver completes 11 rides and only earns INR 2,500 through these rides, Ola adds an additional INR 792 (INR 800 – 1% TDS) as the incentive to uphold the MBG terms.

The MBG offered by Prime Plus is notably higher than that of regular Ola rides, according to some Prime Plus drivers that Inc42 spoke with.

Having piloted the model in Bengaluru, Ola has expanded the Prime Plus service to Mumbai, Pune, and Hyderabad. However, the specific MBG differs from city to city.

In Delhi, for instance, the MBG for 11 completed bookings will reportedly be set at INR 2,800, while Pune and Hyderabad have an even lower MBG threshold.

Is Ola Prime Plus The Answer To Ride-Hailing Problems? 

At first glance, Prime Plus seems to have solved two of the biggest problems in the ride-hailing sector, but analysts are sceptical about the long-term viability of the solution.

The Indian market is highly price-sensitive, and Prime Plus charges commuters a premium of 20%-30% above the standard fare. Remarkably, the fare for Prime Plus even surpasses that of Uber Premier, the highest tier of service on rival Uber.

An analyst from Deloitte expressed reservations about this approach. He argued that by presenting higher prices under the guise of addressing basic issues, Ola has essentially inflated the cost of access to service.

While Prime Plus might initially seem appealing to commuters and has experienced some success in the short term, its long-term feasibility is questionable. Drawing a parallel to Uber and its attempts to break up the services into Uber Premier, Uber Black, and Uber Lux based on the cost to the commuter, the analyst asked why commuters would pay a premium for basic services such as a ride guarantee.

Ola too has discontinued its premier services like Ola Select (launched in 2015) and Ola Play.

The disparity in pricing becomes especially pronounced during peak hours when standard services are already subject to 2-3X surges and Prime Plus imposes an additional premium over this, making a simple cab ride significantly more expensive than otherwise.

Analysts argue that this approach might not be economically sound in the long run.

Moreover, when considering the core offerings of Prime Plus — assured rides and well-maintained cabs — critics argue that if a service provider is unable to deliver these essentials, it’s an issue on the provider’s end, rather than a consumer problem. Charging extra for such basic assurances seems unjustifiable at this point in time.

Girish Kumar Agrawal, the founder of 3 Cube Analytics and Strategy Solutions, raises concerns about Prime Plus’ requirement for drivers to commit to rides without cancellations. He notes that enforcing such contracts with drivers has historically proven nearly impossible.

Over the past decade, numerous schemes have been attempted but none remained successful. Agrawal contended that unless a feasible breakeven point is achieved for all participants — riders, drivers and the platform — the model is prone to failure.

Does Ola Prime Plus Address Driver Concerns?

There are other concerns when it comes to Ola Prime Plus.

According to Tanveer Pasha, the president of the Ola and Uber Drivers’ Association, which represents over 36K cab drivers in Bengaluru, the service does not adequately address issues of lower earnings and unfair working conditions for drivers.

Currently, the number of cab drivers in Bengaluru has decreased from over 1 Lakh in 2019 to approximately 45K-50K drivers in 2023. The driver enrolment numbers for Ola and Uber fluctuate daily, with drivers choosing the platform offering the better deal at the time, said Pasha.

“In Bengaluru, Ola and Uber charge a 25% commission. Our demand is to reduce this commission to a maximum of 10-15%,” Pasha emphasises.

On a typical day, for normal Ola rides, drivers complete around 12-18 rides and achieve a net income of INR 800 to INR 1,000 at most. When considering maintenance costs for the cab, the actual earnings come down to INR 500. Given Bengaluru’s high cost of living, this level of income is insufficient to make ends meet.

Pasha has engaged in numerous discussions with Karnataka Transport Minister Ramalinga Reddy and CM Siddaramaiah. The aim is to either compel ride-hailing platforms to reduce their commission rates or establish a new platform like “Namma Yatri” with reduced commission rates tailored for cab drivers.

This is another chapter in the ongoing struggle of drivers seeking sustainable earning opportunities and improved working conditions through ride-hailing platforms.

“Ola Prime Plus does not give us the freedom to choose our destination. As a result, most of the time, we have to drive even 30 Km without any ride while returning home at night,” an Ola driver told Inc42.

Moreover, there is a fear that Ola might completely change the MBG terms as it has done in the past. Drivers claim that often the company changes terms without any explanation and this means earnings are extremely inconsistent.

Ola’s Deeper Issues

Ola has been sidestepping core issues for a while, and Prime Plus seems to be part of that pattern. This strategy is unlikely to bring Ola closer to achieving financial sustainability. To genuinely achieve breakeven, Ola needs to address its fundamental challenges by integrating the principles of Prime Plus into its regular services.

The company finds itself grappling with a staggering increase in year-on-year losses. Additionally, with its valuation plummeting by over 50% in the books of its investors, Ola’s readiness for an IPO seems questionable at best.

Recently, Vanguard, the US-based investment advisor with about $7.7 Tn in global assets under management, which previously invested $51.7 Mn in Ola, has devalued its Ola shares to $25 Mn. As a result, Ola’s valuation has plummeted from $7.3 Bn to $3.5 Bn in the investor’s books.

What’s intriguing here is that Ola has garnered over $3.9 Bn in funding over the last 12 years. Given the state of its financials and the mega losses in ride-hailing, securing additional funds for the company appears to be an uphill battle. Indeed, the focus of Bhavish Aggarwal is squarely on Ola Electric, which the CEO claims will go public before Ola Cabs.

Notably, a considerable portion of the Ola Cabs app is dedicated to promoting Ola Electric vehicles. This emphasis on electric vehicles indicates a bigger focus on this vertical, rather than cab-hailing.

Revenue generation is a significant hurdle for the company. Analysts believe that execution challenges will require substantial rectification rather than surface-level interventions like Prime Plus.

Any model based on big incentives on a daily basis is not going to last long. Further, the Deloitte analyst quoted earlier, underscored the necessity for a refocussed approach. Ola’s current trajectory hardly addresses the fundamental issues at hand. Perhaps the starting point is in genuinely listening to the concerns voiced by both consumers and drivers.

In this regard, Ola’s customer and driver support systems leave much to be desired. The accessibility of Ola’s support number is severely limited for both drivers and consumers. This is in stark contrast to the principles of operating a company in the Indian context, where attentiveness to customer and employee needs is deeply ingrained, the analyst added.

This disparity between operational practices and customer expectations underscores the need for a comprehensive transformation within the company’s operations.

Disrupting The Disruptors

Unlike Ola, Uber has announced plans to go all-electric by 2040. A senior Uber employee told Inc42 that Uber has already acquired a significant number of electric cars from Tata Motors which is being rolled out under the Uber Green brand. Having signed an MoU with Tata, the plan is to acquire 25K electric cars in the next one year from Tata.

With EVs, the fuel cost could be minimised by 10x, and this is where a breakeven could be achieved for the company as well as for drivers.

However, electric cabs, too, have their own issues, including charging infrastructure and high ownership costs. An electric car is usually INR 3 Lakh to INR 4 Lakh more expensive than ICE vehicles.

While Ola, too, plans to acquire 10K electric cabs, no timeline has been assigned by the company. Meanwhile, Ola Electric plans to launch affordable electric cars by 2030, a distant dream as of now.

The emergence of local ride-hailing platforms in various cities poses more significant challenges for giants like Ola and Uber.

For instance, Bengaluru-based Namma Yatri has rapidly onboarded over 89K auto drivers, establishing itself as the largest auto platform in the city.

In contrast to Uber and Ola, which charge a hefty commission, Namma Yatri has operated as a zero-commission platform thus far. However, Namma Yatri is now considering to charge a subscription fee to cover platform maintenance, development, and operational costs.

The Ola and Uber Drivers Association of Bengaluru has even urged the Karnataka government to launch a state-led platform as a countermeasure against Ola and Uber, which is currently being deliberated.

Besides Namma Yatri, Bengaluru-based Rapido is another rival of Uber and Ola in the auto and bike rental segment. Smaller competitors such as Redtaxi have gained immense popularity in Tamil Nadu cities such as Coimbatore, Trichy, Madurai, and Salem.

Another rival InDrive has captured a significant market share in multiple cities. Interestingly, InDrive is known to onboard drivers that have been blacklisted by Ola and Uber, offering rides at a comparatively lower cost.

The biggest new challenger to Ola and Uber is Gurugram-based Blu Smart Mobility, which has positioned itself as an all-electric service and offers the zero cancellation feature that Prime Plus is banking on. The platform offers well-maintained cars, and good drivers as part of their basic services, unlike Ola

Naturally, analysts and observers have questioned whether Ola is adequately addressing the existential challenges marring its platforms, given that rivals are ready to jump in to fill the gap.

So, even as Ola has launched Prime Plus as a way to temporarily plug the service quality gap, this only serves to deflect attention from the core issues and it’s unlikely to be a lasting solution to the many problems that plague ride-hailing.

The post Ola Prime Plus: A Much-Needed Overhaul Or Just Old Wine In New Bottle? appeared first on Inc42 Media.

The global cross-border ecommerce market is projected to surpass $2.1 Tn in sales by 2023 and cross the $7.9 Tn mark by 2030, and it is this thriving growth opportunity that the country’s direct-to-consumer (D2C) brands wish to capture.

India is now home to 50K+ digital-first brands — a mix of new-age startups and legacy retail giants going D2C with four unicorns – boAt, Mamaearth, Licious, Lenskart and several deep-pocketed players like Pepperfry, Wakefit, Sugar, Country Delight, and Bluestone, just to count a few.

Admittedly, this explosion of brands and D2C brands has created a feeling that this segment is hitting a saturation point of sorts. As a result, the country’s D2C sector, supported by more than 650 investors, is poised to expand internationally.

According to Zaiba Sarang, the founder of iThink Logistics, the sector will get a significant boost from homegrown brands exporting their products.

The Indian D2C landscape has further evolved with the introduction of dropshipping, effectively lowering entry barriers in foreign markets. Sellers can now send shipments worth up to $800 to the US without incurring taxes or duties.

The implementation of the National Logistics Policy, along with initiatives by marketplaces like Amazon, Flipkart, and Walmart, led India’s merchandise exports to achieve a record-high value of $40.38 Bn in March 2022, a 14.53% YoY jump from $35.26 Bn.

This success has motivated numerous players to explore international markets. According to Inc42’s Q2 2023 ecommerce report, over 20 notable Indian D2C brands have already established their footprints in Gulf Cooperation Council (GCC) countries, the US, the UK, Canada, and Europe. Companies like Bombay Shaving Company, Mamaearth, FreshToHome, Paper Boat, boAt, and Wakefit are some of the examples that have now crossed the Indian borders.

Industry interactions have revealed that the top three product categories Indian D2C players excel in within the aforementioned markets are artificial and fashion jewellery, beauty and personal care products, and handicrafts.

As Akshay Ghulati, the cofounder, Strategy and Global Expansion Shiprocket highlights, GCC countries are the preferred destination of many Indian D2C players, largely due to the Indian diaspora there. While the US holds greater demand, it’s notably competitive, especially in areas like beauty and personal care.

“Additionally, although ethnic fashion wear enjoys popularity, the differing sizes between India and the US pose a challenge for brands aiming to develop products solely for the US market,” he added.

Cross-Border Ecommerce Challenges

Despite securing a significant market share within India, numerous D2C brands witness hurdles while planning their international expansion.

When D2C brands venture into global markets, they encounter challenges like adhering to local regulations, managing payments, handling delivery logistics, inventory management, dealing with returns, effective marketing, and localising their offerings.

Here’s an overview of a typical cross-border ecommerce value chain:

Take the case of FreshToHome, for instance. The D2C brand’s founder Shan Kadavil took more than two years to establish a footprint in the UAE against their projections of six months.

Similarly, the founder of Bombay Shaving Company, Deepak Gupta, took 18 months to establish their presence in markets of Nepal, the UAE, Singapore, Malaysia, and Bangladesh. Each of these markets demanded a distinct strategy to navigate their unique operational intricacies.

“Obstacles like the unfamiliarity with local regulations in various countries – including packaging requirements and market-approved ingredients – coupled with the search for suitable partners capable of managing distribution and comprehending consumer preferences, have the potential to significantly delay the international debut of a D2C brand by several months,” Gupta said.

Here are some crucial challenges encountered by D2C brands:

• Opting between a marketplace strategy and establishing independent operations.
• Weighing the merits of an exclusive online presence versus venturing into omnichannel endeavours.
• Pinpointing the optimal market and ascertaining the flagship products to launch under the brand’s banner.

However, today, D2C brands benefit from a growing ecosystem of technology facilitators in India and worldwide. Here is a quick look at the cross-border enablers that are empowering startups to seamlessly manage their Indian and global operations through unified dashboards and a single point of contact.

While speaking with several D2C brands and enablers, we learned that opting for marketplaces is the easiest and most favoured strategy among D2C players. It serves as a platform for gauging consumer preferences and generating brand buzz. Similarly, it’s advised that D2C brands should venture into offline operations once they’ve built brand recall and generated demand in the region.

However, the most pressing challenges lie in logistics and payments for D2C brands, highlighting the crucial role of the growing cross-border ecommerce enablers ecosystem in addressing these issues.

Cross-Border Logistics Challenges

Two critical challenges for D2C brands in cross-border ecommerce are rapid and affordable deliveries and managing returns.

Traditional players like India Post usually take 15-20 days to deliver to the US. For a small 50 grammes packet, India Post charges INR 139. On the other hand, established courier services like DHL and FedEx may take 5-7 days, but they require a minimum package size of 500 grammes and could charge 10X more than India Post to deliver the same product.

New-generation players like Locus, iThink Logistics, and Shiprocket are bridging this gap while tackling other logistics challenges for D2C brands.

For example, iThink Logistics allows shipments starting at 50 grammes, delivering products to the US in under 7 days at competitive pricing. Shiprocket, on the other hand, may ship 50 grammes to the US at a cost of approximately INR 300 in 8 to 10 days.

Another challenge is that, Presently, many D2C platforms are struggling to provide cross-border returns due to high import duties. Sometimes, sellers refund customers to maintain relationships, yet this results in a loss for the seller. Furthermore, most D2C players are hesitant to store inventory at foreign locations due to uncertain sales projections. Consequently, products are shipped directly from India upon order.

As Shiprocket’s Ghulati points out, setting up warehouses is a pivotal strategy to address these challenges. Shiprocket, for instance, operates a warehouse in the US. In the case of returns, products are directed to the warehouse, enabling swift delivery to other customers within 2-3 days without import duties.

Cross Border Payment Challenges

Just like in the realm of logistics, D2C brands encounter three pivotal challenges in the payments domain when going cross border. These challenges are transaction speed, payment gateway costs, and compliance requirements for international transactions.

In earlier times, players such as PayPal held an advantage in cross-border payment transactions due to their global network and ability to facilitate seamless foreign currency exchange.

Nonetheless, recent years have witnessed a surge in digitalisation and the emergence of numerous fintech startups from India like Cashfree, Razorpay, and PhonePe, among others. These players have been offering an array of features and facilities at affordable rates to support cross-border ecommerce.

“Today, nearly 15% of our overall revenues, and likewise, 15% of our businesses, rely on cross-border payment services. As pioneers in domestic payment services with a substantial network of connected merchants, we’ve come to understand and address a multitude of challenges that merchants face when opting for cross-border sales of goods,” shared Reeju Datta, the cofounder of Cashfree.

Here are key initiatives within the payment ecosystem to alleviate cross-border payment challenges for D2C brands:

Joining Hands With Local Payment Providers: The primary task is to maximise the availability of payment methods even before considering costs. This cultivates global acceptance and reduces payment decline rates. Moreover, ensuring seamless interoperability among payment partners enables merchants to view payments on a single dashboard, irrespective of the chosen payment platform by the customer. Various regions have their own local payment methods that tend to be more cost-effective compared to cards or PayPal.

Reducing Costs: Cost sensitivity is paramount for Indian businesses. While India’s merchant discount rate (MDR) ranges around 1-2% for domestic payments, it could be nearly three times as much or even higher in international markets. Digital payment evolution has also alleviated costs. For instance, earlier wire transfers from the US to Indian banks incurred $30-$40 per transaction. While global players might charge around 10-12% per transaction, Indian payment providers have optimised costs to 7%-8%. ACH transfers are 75%-80% cheaper, and card transactions are around 30%-50% cheaper.

Compliance Solution: International transactions necessitate a foreign remittance advice or certificate for reporting, compliance, and tax purposes. Payment platforms like Cashfree have integrated this into the payment flow, offering real-time foreign remittance advice. Streamlining compliance around the Foreign Contribution Regulation Act (FCRA), documentation, and GST is also a priority. Automation has transformed what used to take months into a process that happens within seconds.

Merchant Safeguarding: Cross-border transactions entail risks like fraudulent activities and currency fluctuations that can severely impact D2C sellers, especially concerning refunds. International transactions often see higher levels of fraud and disputes than domestic ones. Payment platforms like Razorpay have developed sophisticated tools and controls to mitigate these risks and safeguard merchants’ interests.

“As we scale up and expand to a larger audience, managing risks on both ends – consumer and merchants – is crucial,” said Rahul Kothari, chief business officer, Razorpay.

The Global Road Ahead For D2C Brands

The emergence of the cross-border tech enablers ecosystem has facilitated the global expansion of even small-scale companies.

“What was previously achievable only by a handful of large companies has now been democratised, enabling even small businesses to engage. This transformation is primarily driven by automation and a customer service mindset,” Kothari of Razorpay pointed out.

Nonetheless, challenges persist. Shiprocket’s Ghulati underscores that the Indian government could enhance the establishment of bilateral trade corridors to alleviate dropshipping and import duties.

The payment ecosystem is concurrently working on reducing transaction costs, minimising decline rates, and simplifying regulatory complexities. Also, noteworthy fintech brands have an advantage in their respective regions. Building a mutual sense of trust represents a pivotal challenge as we venture into new territories.

Nevertheless, Indian D2C brands have already embarked on their cross-border journeys. With the growing demand for Indian products and technology enablers propelling D2C brands, the trajectory of cross-border ecommerce is poised for growth that will know no bounds.

The post How Indian D2C Brands Can Fix Cross-Border Pains Points To Enter Uncharted Territories  appeared first on Inc42 Media.

Governments and businesses around the world are stepping up their efforts to promote electric vehicles (EVs) to reduce transport-related emissions and combat climate change, and India is no exception. The country has made significant strides in EV adoption, particularly in the two-wheeler segment.

In May 2023, electric two-wheeler registrations crossed the 1 Lakh mark for the first time, despite the government’s decision to slash subsidies under its FAME II (Faster Adoption and Manufacturing of Hybrid and Electric Vehicles) scheme.  

Although some saw this move as a blow to the EV industry, many opined that it would hardly derail the government’s ambitious plan to make 80% of the country’s two and three-wheelers electric by 2030. 

While the country is investing heavily in EV infrastructure, including charging stations and battery swapping stations, private players, too, have boosted their endeavour to innovate and ramp up R&D in the space so that these vehicles could be made more affordable for the masses.  

However, there is a dire need for the government and private players to be on the same page for the larger good of the country and the world at large.

According to the cofounder and CEO of EV manufacturer HOP Electric Mobility, Ketan Mehta, the active collaboration between policymakers and private players has the potential to put the country’s EV industry and adoption on a high-growth trajectory. 

However, the CEO believes that the government has done its bit by providing the necessary launch-pad to private players, and it’s time for the industry to gradually reduce its reliance on government subsidies.

Founded by engineers Mehta, Nikhil Bhatia and Rahil Gupta in 2019, the Jaipur-based startup manufactures electric two-wheelers (motorcycles and scooters). 

In an interaction with Inc42, Mehta talked about the growth drivers, challenges the future outlook of India’s EV market. 

Here are the edited excerpts

Inc42: Tell us how EV makers, like yourself, are helping the government achieve its target to electrify all two-wheelers by 2030.

Ketan Mehta: In line with the government’s push for sustainable mobility, prominent EV players are actively engaged in developing in-house technologies, conducting R&D to improve EV performance and exploring technologies that enhance the vehicle experience with applications like AI, IoT and telematics.  

EV players are also working towards establishing an extensive network of charging infrastructure across the country, which happens to be one of the most significant challenges for the EV industry. 

At HOP, we are developing a first-of-its-kind decentralised network of smart batteries, home chargers and charging & swapping stations called the HOP Infinity Energy Network. We have already launched a pilot with five swapping stations and 50 batteries in Jaipur and are now aiming to expand to more cities and states.

I believe that collaborative efforts are nurturing the growth of the domestic EV industry and will definitely contribute towards India’s sustainable future. 

Inc42: The FAME II subsidy cut has garnered mixed responses, with some arguing that it could make EVs more expensive for consumers. What are your thoughts on this?

Ketan Mehta: From price-sensitive customers to mid-segment and luxury aspirants, all types of consumers are becoming increasingly aware of the benefits of owning an EV. 

I feel the government has done its bit by providing the necessary launch-pad to private players, and it’s time that we gradually reduce our reliance on subsidies.

Consumers don’t buy a vehicle just for the sake of commuting. They look for new-age features such as biometric-recognition systems and other solutions that enhance their driving experience. Hence, a well-packaged product that offers sustainability and performance is a must to hold the interest of potential customers.

Right-value products for the masses will definitely shape the EV segment going forward. From manufacturing at scale to providing easier ownership options, we are taking many initiatives to accelerate the adoption of EVs. 

Inc42: Speaking of price-sensitive customers, what initiatives are EV stakeholders taking to ensure affordability? Tell us how this could unlock India’s EV potential.

Ketan Mehta: There is a remarkable transformation in the lending space and financial institutions now weigh environmental factors into their decision making. 

This allows them to offer special rates to individuals purchasing EVs, thus encouraging the adoption of sustainable transportation. So, you can say that easy financing options have become the catalyst for the cause.

Meanwhile, OEMs can make vehicles more affordable by pricing them competitively and developing them with specific target audiences in mind. It’s a well-known fact that EVs are costlier than ICE (internal combustion engine) vehicles as the battery cost increases the price of vehicles.

 In such a scenario, offering a Battery-as-a-Service option sweetens the deal! This helps separate the battery cost from the vehicle purchase price and customers pay a fee depending on the usage of batteries. 

Inc42: One of the biggest challenges for the domestic EV industry is its over-dependence on the imports of EV cells. How can indigenous EV battery manufacturing fuel EV adoption in such a scenario?

Ketan Mehta: The vision of ‘Atmanirbhar Bharat’ aims at self-reliance across sectors and the country seems to be on the right track. 

In July this year, India joined the coveted Mineral Security Partnership (MSP), a US-led collaboration of 14 countries, which is aimed at catalysing public and private investments in critical mineral supply chains. Interestingly, India is the only developing nation among the 14 nations under MSP. This gives us some strategic advantage in securing crucial resources to increase the production of indigenous EVs. 

Further, the recent discovery of lithium reserves in Rajasthan’s Degana, after Jammu & Kashmir, will only strengthen India’s position in the EV market. 

I think the commitment towards localising the EV supply chain is vital if we want to achieve self-reliance. Both public and private sectors should focus on developing a robust ecosystem of domestic suppliers for raw materials, components and spare parts used in EV manufacturing. This move will curtail dependence on overseas sourcing, strengthen local manufacturing and enhance India’s self-sufficiency in the EV space.

Inc42: Do you think that the growing demand for sustainable mobility is driving investment in EV startups?

Ketan Mehta: In an era where connected, digital and sustainable mobility is the need of the hour, there is a need for investment and a conducive regulatory framework. 

According to the Economic Survey 2022-23, the domestic EV market is expected to touch 1 Cr units in annual sales by 2030. Such aspirational numbers require capital for vehicle production and charging infrastructure.

In terms of institutional funding, the EV startup ecosystem raised a record $1.66 Bn in funding in 2022, up 117% YoY. And this is just the tip of the iceberg! I am confident that the sector will continue to attract investor interest with the same spirit.

Last year, we closed a strategic round of $2.6 Mn, as part of our ongoing $10 Mn pre-Series A fundraiser. Our strategic investor, a listed company, has previously supported us in becoming a successful mandate holder of the government’s ambitious Production Linked Incentive (PLI) scheme. We remain committed to investing more than INR 2,000 Cr in new products and charging infrastructure over the next five years.

Inc42: Could you shed some light on how you are utilising these funds? Also, tell us how you are creating a holistic EV network to boost EV adoption.

Ketan Mehta: We have taken a platform-based approach to our product development strategy. We are working on four platforms and will be launching 12 new products on these platforms in the next five years. 

• Platform Nimbus: This is a utility-based platform to develop vehicles in both B2B and B2C spaces. These vehicles will be equipped with multi-battery architecture swap support and we are targeting Indian and African markets with these vehicles
  
• Platform Alpha: This is a B2B-focussed platform for B2B applications, such as hyperlocal deliveries, food deliveries and last-mile deliveries, in the ecommerce sector.
• Entry-Level Scooter Platform: We are designing scooters for new or first-time buyers (typically those who are looking for affordable and easy-to-use modes of personal transportation).
  
• Platform OXO: Through this platform, we will be launching different motorcycles both in the commuter and sports segments.

The post Indigenous R&D And Cell Manufacturing Key For Faster EV Adoption: HOP Electric Mobility’s Ketan Mehta appeared first on Inc42 Media.

As expected, Reliance (RIL) chairman Mukesh Ambani outlined the grand plan for Jio Financial Services at the conglomerate’s 46th annual general meeting. From payments to insurance to investment tech, JFS is set to disrupt several key fintech segments and pose a significant threat to existing players — both startups as well as legacy BFSI companies.

Jio Financial Services was demerged from RIL in July and became a publicly listed entity in late August. However, it has not had the best of starts as a public company, hitting the lower circuit for five straight sessions before gaining at the end of last week (August 25, 2023).

Interestingly, hours before the AGM, JFS stock saw a brief rally, but the stock fell below its opening price at the end of the trading on Monday (August 28, 2023). Currently, JFS shares are trading at INR 211.65 apiece, with the company’s market cap settling at INR 1.34 Lakh Cr.

Despite the initial hiccups on the stock market, Ambani claimed that JFS has become the world’s highest capitalised financial services platform at inception, and called this financial safety net as one of the key potential success factors for JFS.

All this makes ominous reading for India’s fintech startups, which have so far banked on Reliance Jio’s internet services as a growth ladder. But now, startups not only have to solve the revenue puzzle that has plagued fintech for long, but also compete with a giant such as JFS, backed by Reliance’s technological prowess, retail network and significant reach in the Indian market.

Jio boasts of over 439 Mn subscribers, while Reliance Retail has close to 250 Mn registered customers and 3 Mn merchants, according to the company’s FY23 annual report. These will be the anchors for scaling up Jio Financial Services over the next few quarters.

We know that JFS has already had an impact on the competition, even without any depth of operations right now. Soon after the public listing, shares of fintech giant Paytm saw a dip despite gaining for several weeks.

BFSI is a highly competitive space for retail investors and as such the entry of JFS is likely to eat into the potential investments in the likes of Paytm, Policybazaar (PB Fintech), Fino Payments Bank and others.

For fintech startups, the next few months will involve plenty of rethinking and many of them are likely to push on with product plans that have been sitting idle. Given that JFS will most likely lean on the twin pillars of Reliance Retail and Jio for growth and scale, fintech startups have their work cut out.

JFS Takes On Zerodha & Co

Reliance’s plans in the asset management space have received the most clarity in the early days of Jio Financial Services.

The company has signed a joint venture with the world’s largest asset manager BlackRock to take a bet on India’s $540 Bn mutual fund industry, dominated by the likes of SBI, ICICI, and HDFC.

BlackRock CEO Larry Fink was on hand at the AGM to talk about how Jio-BlackRock is poised to disrupt the AMC space. Fink pointed out that BlackRock has built extensive capabilities in the Indian market and the JV with Jio will unlock several more investment opportunities for millions of Indians.

Jio-BlackRock is also expected to pose a significant threat to startups such as Zerodha, Paytm Money, INDMoney and Groww in the investment tech space.

Indeed many of these startups do not have an AMC licence (Zerodha, Groww being exceptions) and therefore are restricted to earning commissions as brokerages rather than a bigger chunk of the revenue from investments in mutual funds. AMCs typically charge a management fee based on the asset percentage, while brokerages generally charge per trade or offer flat-fee accounts.

Will Jio Finally Crack Payments Game? 

Besides the investment tech space, Ambani also pointed out that Jio Financial Services would be offering payments services for consumers and merchants, and also claimed that Jio would deploy blockchain solutions to make payments more secure and would also foray into services built around Central Bank Digital Currency (CBDC).

“In payments, JFS will consolidate its payment infrastructure, with a ubiquitous offering for both consumers and merchants further driving digital adoption for India. JFS products will not just compete with current industry benchmarks, but also explore path breaking features such as blockchain-based platforms and CBDC,” the chairman said.

While Ambani did not reveal much more about the payments business under JFS, we know that this will centre around Jio UPI and Jio Payments Bank, along with payments aggregator and payments gateway services.

Reliance is also reportedly testing a soundbox payment system which will be central to its plans to compete with payments apps. JFS’ payments business will directly take on a host of fintech companies in India — from PhonePe and Paytm to Google Pay and Amazon Pay, as well as the likes of CRED, WhatsApp Pay and others.

Despite launching UPI services in 2020, Jio has not made much dent in the market share so far. Jio’s app and the payments bank processed 1.34 Mn transactions in July 2023, with a total value of INR 114.12 Cr. Currently, Jio’s UPI services are available through the MyJio app as well as Jio Payments Bank portals. The company is likely to launch a dedicated app to push its payments services wider.

Jio’s payments volume pale in comparison to the likes of PhonePe, Google Pay and Paytm, the three largest UPI apps. For context, PhonePe processed 4743.66 Mn transactions in July 2023, with a total volume of over INR 7.6 Lakh Cr. So Jio has a long way to go before it can directly take on these UPI apps.

With 249 Mn+ Reliance Retail consumers, the JFS payment layer will allow Reliance to scale up rapidly and gives the company a goldmine of data to build features and allied services.

A Major Threat For Insurtech Players

On the insurance side, as speculated, Jio FInancial Services will launch products in the general insurance, health insurance, and life insurance space, partnering with global players, Ambani claimed. Ambani emphasised that the insurance platform will be digital in nature, but did not reveal much more about what consumers or businesses can expect.

As per recent reports, JFS is also planning to offer full-fledged insurance services starting 2024. Jio Financial is readying plans to approach the Insurance Regulatory and Development Authority of India (IRDAI) to apply for a licence.

The conglomerate has reportedly set aside a capital of INR 1,000 Cr for each of these insurance segments. Apart from traditional players such as Life Insurance Corporation of India (LIC), HDFC, ICICI Group and a host of other bank-led insurance plays, Jio Financial Services would also be rivalling digital-first insurance startups such as IPO-bound Go Digit, Acko, InsuranceDekho, and Navi Insurance, as well as aggregators (Policybazaar et al).

As per a report, the life insurance penetration in the country stood at a mere nearly 3% while non-life insurance penetration was much lower at 1% in financial year 2021-22 (FY22). The under-penetration of insurance offers an attractive proposition for Jio Financial Services, which could leverage Jio’s digital infrastructure, Reliance Retail’s business and partner network as well as Reliance’s healthcare plays to dominate the segment.

JFS To Eat Fintech Lending Pie?

The fintech sector is already besieged with high competition and low revenue potential in the payments segment and almost all players are only seeing revenue traction from lending operations.

Consumer durable lending, merchant lending, buy-now-pay-later (BNPL) are likely to be the key focus areas for JFS at the outset, according to a Bank Of America report. Consumer durable lending could be the initial focus for the company, as it has a captive user base that is availing credit for buying from Reliance Retail’s electronics store chain Reliance Digital.

On the other hand, BofA also stated that Jio Financial Services is likely to take time to scale up its lending play and doesn’t have the cheapest access to capital. However, the opportunity is undeniable. Beyond the top 10% merchants, not many are well-serviced by banks, digital lenders or traditional companies, which opens up a major opportunity for Jio Financial Services.

“We think there is a huge opportunity in wholesale lending to retailers/vendors, etc., as it is working capital heavy and many of these companies are cash flow constrained,” BofA said in its note in July about Jio Financial Services.

Will Jio Financial Services Go The M&A Route?

In the past, we have seen Reliance look to dominate new verticals with a mix of capital-led growth and inorganic acquisitions. The acquisitions of Urban Ladder, MilkBasket, Zivame, JustDial, NetMeds and other startups allowed Reliance Retail to grow rapidly in various verticals.

With the exception of some unicorns and listed giants, many startups are struggling with revenue growth and JFS could use its deep pockets to acquire some of these ailing startups.  Startups have faced regulatory headwinds, a funding winter (save for the likes of PhonePe) and Reliance’s mega entry will only deepen the wounds of the sector. Of course, these are still early days for JFS, but the threat to fintech startups cannot be understated.

The post Decoding Jio Financial Services: How Reliance Can Shake Up India’s Fintech Landscape appeared first on Inc42 Media.

Come Monday and all eyes and ears will turn to Reliance and the Ambani family, as the conglomerate’s annual general meeting will more or less give us a peek at what 2023 and 2024 might hold for India’s digital economy.

Reliance Retail and Jio Platforms have taken on a new dimension in the past 18 months, with forays into several new verticals. While Jio 4G catalysed the internet ecosystem and startups at large, the launch of 5G has coincided with Reliance’s biggest push into the digital economy. Of course, at this very moment, the full attention is on Jio Financial Services, which threatens to disrupt the fintech sector.

So much so that Reliance is essentially big tech now and for that reason alone, its moves will not just dictate the direction of the conglomerate but also could be game-changing for startups (not in a good way) and the digital economy.

We take a look at what the Reliance 2023 AGM is likely to have in store, but after these top stories from our newsroom:

• Spacetech’s Chandrayaan-3 Moment: What does ISRO’s historic Chandrayaan-3 success story mean for India’s spacetech ecosystem? Here’s what the overjoyed sector has to say
• Finally, 1st Unicorn Of 2023: Mumbai-based Zepto became India’s 111th unicorn and the first in nearly a year after raising $200 Mn in its Series E funding round at a $1.4 Bn valuation
• Move Over, IITs: Unicorn founders are no longer only hailing from IITs and IIMs and the rise of non-IIT talent shows that tech talent is going through democratisation

Reliance’s Big Day

In a matter of hours, Reliance chairman Mukesh Ambani, Reliance Jio chairman Akash Ambani and Reliance Retail head Isha Ambani will take the stage to reveal the big plan for the months to come. The AGM track record indicates that Reliance will announce new partnerships and the roadmap for key businesses.

For instance, in 2020, RIL proclaimed some major investments in its new energy business. It was also the year when RIL announced Google’s massive investment of $4.5 Bn in Jio Platforms. In 2021, Alphabet CEO Sundar Pichai made an appearance to announce a 4G-enabled smartphone called JioNext and Google Cloud’s partnership with Jio for 5G.

Of course, last year was all about 5G, the foray into the FMCG business and a bigger push into electronics manufacturing. What’s in store in 2023?

Jio Vs Fintech Startups

The biggest expectation from the AGM is around Jio Financial Services (JFS), which is definitely set to give fintech players some sleepless nights. So far, Jio’s telecom disruption has been lauded as a major catalyst for consumer and B2B fintech, but Jio is now stepping directly into the arena posing a threat to many startups.

JFS was demerged from RIL in July and listed earlier this month. JFS also tied up with the world’s largest asset manager BlackRock to take a bet on India’s $540 Bn mutual fund industry dominated by the likes of SBI, ICICI, and HDFC along with startups such as Zerodha, and Groww.

But Ambani is likely to lay down the plans for the B2B credit business, which is expected to come out first, followed by consumer lending. The big plan is to use lending as a funnel to venture into insurance, digital broking and asset management, pretty much like most other fintech startups.

In the past, Mukesh Ambani has said that the financial services play will leverage the technological capabilities that Reliance has built up since before its 4G launch.

Fintech analysts told Inc42 that JFS will be the biggest disruption in the fintech space because no other company can match the breadth and depth of services that Reliance has to rely on.

“Startups only have fintech, but Reliance has first-party data for retail transactions and ecommerce. It also has the data from its telecom business and now also first-party mobile devices. Plus it has the weight of Reliance behind the operations,” says the founder of a Bengaluru-based neobanking startup.

JFS has already had an impact on the competition, even without much depth of operations right now. Soon after the public listing, shares of fintech giant Paytm witnessed some weakness in between a rally.

So far, JFS has not had the best of starts in the share markets. The stock’s price rose on Friday last week, after hitting the lower circuit earlier for five sessions. It will be interesting to see how the market reacts to the big reveals.

For fintech startups, it will be a nervous watch, given that JFS can also lean on the twin pillars of Reliance Retail and Jio, which have also evolved quite a lot in the past year or so.

Reliance Retail IPO Incoming?

Another important story to watch out for during the AGM would be the timeline for the listing of Reliance Retail Ventures Limited (RRVL). It looks like the groundwork for the IPO is already laid as Qatar Investment Authority bought a 1% stake in RRVL for INR 8,278 Cr ($1 Bn) at a valuation of $100 Bn.

Reliance Retail is expected to sell up to 10% more stake in the run-up to the IPO to dilute the promoter stake. Experts believe that RRVL’s IPO size will be too big for the Indian stock markets at its current valuation of $100 Bn.

It will be interesting to see how Reliance Retail continues unlocking the value in the company as it looks to navigate the bearish market. The company operates an omnichannel retail and ecommerce network of more than 18,500 stores combined with ecommerce platforms for grocery, consumer electronics, fashion and lifestyle, and pharma segments.

Digital and new commerce businesses contributed 18% to the total revenue of Reliance Retail in Q1 FY24, with a net profit of INR 2,448 Cr. While the retail arm’s grocery business grew 59% year-on-year (YoY), its consumer brands vertical saw an 8X jump in revenue YoY.

With the fundraise, RRVL will go all-in on the consumer brands business and enter new product categories as it did in the past year with the ‘Independent’ brand.

The Rise Of JioCinema

As for Jio Platforms, the road to IPO is less certain. The company is likely to wait and give more attention to JFS and Reliance Retail, even as it deepens the 5G network.

Market observers believe that the biggest game changer could come in the form of Jio AirFiber, the company’s fixed wireless access device for retail consumers, where it is targeting an install base of 100 Mn homes. This is expected to bring Jio on par with Airtel and also boost the company’s ARPU, which has long suffered from slow growth as the telco prioritised scale over revenue.

The telecom market leader has also bet big on 5G mobile devices, with two smartphones said to be in the pipeline. The company is likely to bundle 5G at aggressive prices with these phones.

Eyes will also be on how Jio’s digital services and products have grown in the past year. We expect a lot of attention on JioCinema, which skyrocketed in popularity after the IPL deal earlier this year and the FIFA World Cup last year.

Since then, JioCinema has added the largest original slate in the Indian OTT space, outproducing the likes of Netflix, Amazon Prime and others. Besides making the IPL free, the platform is the official partner for HBO and NBCUniversal in India.

JioCinema’s parent company Viacom18 has roped in Google’s Kiran Mani as the CEO for the digital business according to reports, besides former Disney exec Kevin Vaz as CEO of TV and digital (regional entertainment). Another Disney alumni Alok Jain is overseeing regional content on digital platforms, with Anil Jayaraj, ex sales head of Star Sports, as CEO of the sports vertical.

The AGM is likely to highlight just how JioCinema has grown in the past eight months. Today, JioCinema charges INR 999 a year for the premium service and in the long run, the OTT business could become a big bulwark for Reliance’s sprawling media business.

Reliance As ‘Big Tech’

All in all, come Monday, a lot more will become clear about how Reliance plans to tackle the rest of FY24. It’s clear that after laying the foundation for the internet economy with the Jio telecom disruption, the company is now eyeing a bigger piece of the market.

For many startups, Reliance was the enabler, but now it’s a rival. Take the likes of Myntra or Nykaa in the beauty and fashion ecommerce space, or Tata-owned BigBasket and others from the JioMart POV.

Now, the time has come for fintech startups to brace for a rivalry with Reliance, and even the global streaming giants.

These are the times of Reliance as a Big Tech company and pretty much no other tech giant in the world has its hands in as many businesses as Reliance. Based on what we expect to see at the 2023 AGM, this reputation is only going to get stronger.

Startup Spotlight: Gen AI Startup Looks To Ease UI Development

Having seen the pains of UI development for early stage product and services startups, former Mindtickle executives Dipanjan Dey and Abhijit Bhole decided to leverage the power of generative AI to fix this major headache.

The duo want to change how frontend developers approach UI design with Kombai. Generative AI has opened up a whole range of new models, and the startup’s product is claimed to interpret visual design cues like humans and has the ability to write code accurately for frontend development.

Dey and Bhole set up Kombai in 2022 and since then it has been a 16-month journey to develop the right frameworks for the product’s generative AI model, from scratch. As the founders claimed, they wanted to ‘bring fun back to frontend development’.

Read The Kombai Story

Sunday Roundup: Startup Funding, Tech Stocks & More

• Funding Rebound? With Zepto’s massive $200 Mn unicorn round, the weekly startup funding saw an uptick — a total of $231 Mn was raised across 16 deals.
• Profit-Booking? SoftBank is looking to sell Zomato shares through block deals as the stock has seen a rally in recent weeks, and same is the case with AntFin, which is looking to sell 3.6% of its stake in Paytm

• Bengaluru & AI: Karnataka IT minister Priyank Kharge has claimed that Bengaluru has turned into a global AI hub thanks to the state’s investments and push for AI startups
• Bringing Unicorns Back Home: More than 20 out of 111 unicorns in India currently have their headquarters outside India. What will it take to bring these value-creators back home?
• D2C Summit Is Almost Here: Join Inc42’s D2C Summit later this week to network and learn from the likes of boAt’s Aman Gupta, Nykaa’s Adwaita Nayar; Curefoods’ Ankit Nagori, Miyntra’s Nandita Sinha and others

That’s all for this week. We will see you next Sunday with another weekly roundup, and till then, you can follow Inc42 on Instagram, X/Twitter and LinkedIn for the latest news as it happens.

The post Reliance‘s Grand Stage Is Set appeared first on Inc42 Media.

With an aim to have 500 startups in its portfolio in the next 2-3 years, homegrown early stage venture capital firm 100X.VC has its eyes set on signing 100 startup funding deals this year, Ninad Karpe told Inc42 in an exclusive interaction on the sidelines of the MoneyX conference that was held last month.

100X.VC, a sector-agnostic VC investment firm, typically invests in early stage ventures and writes small cheques on the lines of the US-based startup accelerator, Y Combinator.

The investment in early stage startups is converted into equity when they raise Pre-Series A or Series A funding. The funding happens through an instrument called iSAFE (Safe Agreement for Future Equity) notes.

Karpe credits his firm for introducing this concept to the Indian startup ecosystem and is not pioneering the show. The instrument has now been adopted by many early stage venture capital firms. According to Karpe, this investment process usually restricts investors from having a seat on the board and curbs the time of the deals that take months to close, like in the case of conventional startup funding.

Founded in 2019, 100X.VC is a SEBI-registered fund, which is led by angel investor Sanjay Mehta’s family office, Mehta Ventures.

Speaking on a range of topics, from funding winter to corporate governance issues plaguing the world’s third-largest startup economy, Karpe outlined that neither there is a dearth of deals nor investors looking to place their bets. However, founders today need to get their act together in striking a balance between dos and don’ts while sitting on heaps of investor capital.

Edited excerpts…

Inc42: What impact has the ongoing funding winter had on 100X.VC’s investment strategy?

Ninad Karpe: Funding winter is a big word. It is all-encompassing, but, if you come down the ladder and slice and dice, there is no winter in some cases.

As early stage investors, we get 25,000 to 30,000 pitch decks every year. While, on the one hand, there is no dearth of deal flow, on the other hand, there is no shortage of interest from angel investors to invest in the early stage.

Also, we are witnessing greater interest from a lot of individuals who are willing to take high risks with small ticket sizes, which is a good sign. Another positive development is that we are seeing a lot of founders emerging from Tier II and Tier III cities, which has only added to the deal flow.

So, when we talk about the funding winter, the pressure is more at later stages, Series C, D, E, and so forth. However, we provide bigger VCs a solid pipeline of startups to invest in for the next 3-5 years, and by then we believe any remaining traces of the funding winter will subside.

Inc42: So, according to you there is no funding winter right now?

Ninad Karpe: I think the exuberance is gone and reality has struck, and this is both from the perspective of founders and VCs.

I think we are at the fag end of the funding winter. In the next couple of months, we should start seeing more and more funds where people are more realistic about everything, sans the blind chase for startups or ideas.

The Indian VC ecosystem is still nascent compared to the West. There is a lot more headroom for a country of our size, and we can easily grow a hundred times from where we stand today.

Inc42: How many number of deals have you closed this year?

Ninad Karpe: While we have already closed 47 deals so far this year, we intend to do 100 deals in 2023. As of now, we aim to close 30-40 deals, however, the range could vary between 80 and 110 deals. Notably, these will be the startups from the 30,000 pitch decks that we have received this year alone.

Inc42: Is there any corpus that 100X.VC has built to invest in startups?

Ninad Karpe: So, we want to keep investing. We are the first institutional cheque writers, and we want to continue with this philosophy. Within the ecosystem, founders know that 100X.VC signs the first institutional cheque by deploying founder-friendly, agile funding instrument iSAFE notes, which we have pioneered in India. So, we want to continue doing this.

Inc42: Are you looking at any specific industry vertical to invest in this year?

Ninad Karpe: Given that we are sector agnostic, we look at groundbreaking ideas, which don’t get funded by anyone else.

Inc42: What is 100X.VC’s exit strategy? Is there any timeline that you set?  

Ninad Karpe: Since we are the first cheque writers, we take a more patient approach. Realistically speaking, I don’t think that we will get an exit within five years from our investments. Given that our fund is only four years old, we haven’t had any major exit yet. However, we expect some good news in the next 1-2 years.

During the pandemic, our investment slowed down, but we are back with a bang, and we want to invest in a hundred startups every year. Hopefully, we will have 500 startups in our portfolio in the next 2-3 years.

Inc42: How have the recent issues around corporate governance that cropped up at several big Indian startups impacted your strategy or relations with your portfolio companies?

Ninad Karpe: Corporate governance is an issue that needs to be fixed. It has happened in some cases due to various reasons.

At 100X.VC, we don’t take any board seats as a VC, however, we have now started including a separate session on corporate governance and its importance before investing.

Corporate governance issues that have recently cropped up among Indian startups could be a lesson for many founders on what should not be done.

Also, founders should be aware that if they mess up, it is pretty much over for them. The situation of bad actors in the ecosystem can be kept at bay if the guilty are easily let off the hook.

Inc42: What, according to you, should young startup founders learn from recent corporate governance issues?

Ninad Karpe: Founders today need to understand that if they have the requisite capital, it is unnecessary to spend it all, just because they can.

In the Indian startup space, a root cause of the evils that have recently emerged is the flow of excessive capital, and hardly restriction on spendthrift founders.

I don’t think this will work anymore. However, this also does not mean that investors do not want founders to scale their businesses. What is important is to understand the nuances to strike a balance between dos and don’ts.

We need to understand that young founders come with a lot of enthusiasm to make a difference. They’ve quit jobs or they’ve not gone for jobs and come to the startup ecosystem where the success rate, at best, is just 10%.

When capital was flowing freely, many failed to spend it consciously. However, this will be history now, and the Indian startup ecosystem is going to see a lot of disciplined founders emerge not too far in the future.

The post What Funding Winter! Have Set Eyes On 100 Startups This Year: 100X.VC’s Ninad Karpe appeared first on Inc42 Media.

New-age tech startups have largely staggered to stay abreast of their projections post their initial public offering (IPO) journey. While late-stage firms like BYJU’S, BharatPe, and GoMechanic are struggling with corporate governance issues, there’s a noticeable scarcity of high-quality deals in the world’s third-largest startup economy.

Unfortunately, these are just a few of the many factors due to which Indian startups have experienced a more than 70% year-over-year decline in funding.

According to data compiled by Inc42, the Indian startup ecosystem raised $42 Bn in 2021 and minted 45 unicorns that very year. Further, in 2022, which is infamous for hosting the funding winter that now has overstayed its welcome for all the wrong reasons, funding plummeted 40% YoY. Despite this, Indian startups raised $25 Bn and the country entered 22 startups into the coveted unicorn club.

However, it has been a downward spiral since then, as Indian startups only managed to raise $5.4 Bn, sans even a single unicorn, in the first half of 2023

“This is because there is a scarcity of high-quality startup deals,” said Madhu Shalini Iyer, managing partner, Rocketship.vc.

Having invested in startups like Yulu, Moglix, and Nobroker, Silicon Valley-based Rocketship.vc is an early-stage fund with a focus on the global market. Interestingly, unlike many Indian VCs, Rocketship.vc is a 100% outbound fund.

What’s even more fascinating is the fact that the VC firm leverages its extensive data sets to identify high-potential startups. The investment firm employs computational algorithms to meticulously select the most promising ones from a vast pool of ventures.

So, how has the data-driven company selection approach worked out for the VC so far?
In a candid conversation with Inc42, Madhu Shalini Iyer tried to answer everything — ranging from VCs’ current investment sentiments to factors that are impacting late stage funding in the country.

However, before we delve deeper, it is pertinent to mention that the VC has readied a war chest of $125 Mn Fund III to be deployed in 2023.

Here are the edited excerpts…

Inc42: Since Rocketship.vc is 100% outbound, how does it shortlist startups?

Madhu Shalini Iyer: Rocketship’s approach to investments distinguishes itself from conventional methods. We possess an extensive dataset comprising petabytes of both static and dynamic information about numerous startups. This dataset encompasses essential details such as founder identities, investor profiles, founding dates, and locations, along with dynamic information like web data, signals from platforms like LinkedIn and Twitter, and any web mentions.

This intricate dataset is applied to a single company among a staggering count of 50 Mn global contenders. Our expertise extends to crafting sophisticated algorithms that leverage this data. Through our investment journey, we’ve realised that a larger denominator of data points contributes to improved predictive accuracy and higher betting odds. Essentially, precision is enhanced when dealing with a larger scope of factors.

In essence, our methodology revolves around employing computational algorithms to meticulously select the most promising companies from a vast pool.

Inc42: But, at the early stage, online data on startups may not be that adequate. What are your thoughts?

Madhu Shalini Iyer: That’s true. Our focus lies primarily on Series A investments, as we’ve identified it to be the optimal sweet spot. We allocate a significant portion of our investments to Series A rounds, especially when there’s a substantial amount of data available, and the valuations are not overly inflated. It’s important to note that we don’t compete directly with growth-stage funds and our strategy centres around Series A and occasionally Series B investments.

Series A presents an opportune stage because it allows for the accumulation of sufficient data. However, it’s crucial to recognise that this approach is still directional, distinct from the strategies employed by public hedge funds. Data-driven public hedge funds often make calculated decisions solely based on available data, sometimes without even engaging in direct communication. Due diligence may not be as crucial for them, given the data landscape.

In our case, the process diverges. From a pool of 150 shortlisted companies each month, we initiate outbound communications. This proactive approach constitutes our deal flow, and we entirely avoid inbound inquiries. Guided by our data analysis, we reach out to the companies we’ve already developed strong convictions about. Subsequently, we aim to bolster these initial convictions through further interactions and information-gathering.

Inc42: How many startups have you planned to invest in via Fund III? Since it’s a global fund, is there any particular focus on Indian startups? Is there any change in the Fund III strategy when it comes to investing in Indian startups? 

Madhu Shalini Iyer: We are going to stick to pretty much what we did during the allocation of Fund II, which is investing in 20 to 25 startups across the globe picked by algorithms.

Fund II was about 60% emerging markets, of which approximately 50% was India. Fund III could be more or less similar to Fund I, where 40% of investments were towards emerging markets like India.

For the Fund III India Investments, the corpus has already been given. Therefore, we are more excited than ever and are following the directional signal from our algorithms, finding Indian companies.

It is pertinent to mention that we invest more than $3 Mn in Series A deals, but we are flexible. We also engage in follow-on rounds with companies that we partner with.

Inc42: Indian startup funding has witnessed a more than 75% decline since 2021. Has there been a change in your funding strategy? How do you look at the funding winter? 

Madhu Shalini Iyer: Our data has been telling us that certain sectors are doing better than others. Some of these sectors are deeptech, climate tech, predictive AI, EVs, and spacetech. So, yes, there has been a certain shift.

Other factors that indicate a robust ecosystem in the longer run are the emergence of founders from tier II and II cities of India, the macroeconomic landscape and the country’s GDP.

The fact that there’s a dearth of funding cannot be denied. The funding winter has also been triggered in the absence of investor exits. We are now looking forward to some of the IPOs next year.

Inc42: Despite sitting on massive amounts of dry powder reserves, investors are shying away from deploying capital. How do you see this? 

Madhu Shalini Iyer:

I’ll be frank here. The reality is that the quality of startups isn’t yet meeting our expectations. While we are actively engaging with numerous promising startups, not all of them make it through our pipelines successfully.

It’s a variable situation — sometimes the alignment is there and sometimes not. Our eagerness to invest remains intact, but we maintain a high threshold for what we consider investable quality.

Presently, a lot is happening in the early-stage space, yet we’re not encountering an abundance of truly exceptional companies.

Undoubtedly, there are a few standout companies, but we haven’t executed any investment decisions as of now. Our approach remains cautious, and we’re adopting a watchful stance. The situation might gain more clarity once the IPO landscape stabilises. The companies emerging during this period will be particularly intriguing to observe.

Meanwhile, we’re consistently in conversations with potential investment candidates, thoroughly examining each opportunity before making any moves.

Inc42: Has the funding winter slowed down your investments?

Madhu Shalini Iyer: Yes. This sentiment is similar across the VC landscape, and every VC would concur. I say this with complete candour and transparency. Our stringent criteria for investments contribute to this acknowledgement.

Are we enthusiastic about the prospects? Absolutely. Allow me to clarify — our engagement isn’t merely an exercise in gauging the market environment, we’re driven by a genuine desire to invest.

Our interactions with potential investment candidates are guided by a strong intention to allocate funds. We actively consider every company that emerges as a strong contender within our pipelines. Our goal is to forge partnerships with these companies, grounded in our commitment to making impactful investments.

Inc42: You spoke about IPOs. But, Indian tech startups have performed poorly in the post-IPO phase. Who according to you was not ready — startups or the market?

Madhu Shalini Iyer: I believe that there’s a need for further action, and it’s always encouraging to witness the government’s proactive efforts in streamlining these aspects. Rigorous regulatory adjustments hold considerable importance in ensuring a healthy ecosystem.

Regarding the startups’ readiness, the ongoing situation has prompted startups to engage in a reflective process and absorb crucial insights. The market has undergone a period of reckoning, leading to a rapid learning curve. Startups have absorbed valuable lessons about the essential metrics to focus on and what requires prudent attention.

This phase can indeed be regarded as a valuable learning experience. Conversations with founders highlight a newfound awareness about the importance of measured progression rather than haste, ensuring a solid foundation before moving forward.

The value of these lessons transcends theoretical teaching. While it’s too early to definitively predict if past mistakes might resurface, the crucial point is that this chapter has likely imparted lasting insights.

Whether these lessons are internalised or not remains to be seen, but the general trajectory is toward continuous improvement. Ultimately, there’s a sense of dedication to personal and collective growth. Frankly, that’s the best course of action moving forward – to constantly strive for enhancement and refinement.

Inc42: The issue of corporate governance has also impacted the late-stage Indian startup ecosystem. What’s your observation? 

Madhu Shalini Iyer: Certainly. However, this isn’t a challenge confined to startups but rather an issue encompassing the entire ecosystem. To lay the blame solely on startups would be a hasty judgment. This challenge extends its reach to VCs too. It’s incumbent upon all of us to take responsibility, learn from the experiences, and collectively evolve.

Participation at the board level plays a pivotal role in addressing these concerns. As someone who is actively engaged in several boards, I can attest that being a part of these discussions and providing constructive feedback is of paramount importance. It’s crucial to acknowledge that perception isn’t the sole consideration, and the focus should be on doing what is ethical. Overcoming adversities, including challenges like layoffs, should not deter the commitment to building and rebuilding companies as needed.

Moreover, India grapples with the issue of perception. There’s an undue concern about external opinions or judgment, which can hinder progress. This mindset needs to change, and a more assertive approach is required.

As far as early-stage startups are concerned, the emphasis often isn’t on perfection but on the process of building and evolving. This is where course corrections become pivotal.

In essence, this is a collective journey of growth and learning, encompassing startups, VCs, and the entire ecosystem. Acknowledging the challenges, embracing feedback, and having the resilience to overcome obstacles are key elements in steering this ecosystem towards a more robust and sustainable future.

Inc42: What’s been the success ratio for Rocketship.vc?

Madhu Shalini Iyer: It would be too early to evaluate Fund II. However, out of our Fund I, which was more of an experimental fund, we have seven unicorns.

The post How Rocketship.vc’s Data-Driven Approach Helps It Secure Quality Startup Deals Even During Slowdowns appeared first on Inc42 Media.

The Indian D2C model is not just about having a native ecommerce store and focussing all energies on that store. Despite the name, direct to consumer remains a distant notion, at least as far as the shopping journey is concerned.  Over the years, new-age D2C brands have seen that going omnichannel (blending marketplaces, native stores and retail presence) is key to maximising reach in the Indian market. So brands cannot go the whole distance on their own and each channel brings in new complexities. 

Mumbai-based Emiza is looking to solve at least one major headache for Indian D2C brands. The disparate and disconnected experience of logistics and deliveries across these channels. 

“Brands have to deal with multiple platforms and service providers right from the checkout process to post last-mile delivery (incase of an RTO). They require interoperability to overcome the challenges they face while dealing with multiple platforms,” Emiza founder and CEO Ajay Rao told Inc42. 

The logistics tech startup is looking to streamline access to these disparate services with its single platform, hoping to ease the life of online sellers, retailers as well as brands selling online natively. The idea is to not give them multiple logistics service providers that handle the user journey from checkout to communication. 

Emiza’s end-to-end platform called Unify was launched in June this year and it brings clear visibility to the logistics and distribution journey as well as analytics to help brands save costs directly and indirectly. 

Unify allows D2C and new-age brands to manage several processes on a single dashboard. Firstly, it enables consumer products businesses to cut the costs that they would otherwise incur by managing multiple logistics platforms/services. 

The analytics help brands monitor drop rate, conversion, sales, fulfilment, inventory, returns, and cancellations, while ‘Address & Order Confirmation’ or ACOC tackles returns by studying the intent of the buyers. 

Emiza’s partnerships with Delhivery, Xpressbees, Blue Dart and other delivery partners mean that it has extensive coverage. This has allowed it to work with FMCG brands and conglomerates such as Marico, Mamaearth, Clovia and The Souled Store. 

The startup claims that its warehousing and fulfilment solutions mean brands will see at least a 10% reduction in RTOs, 25% lower cart abandonment rates and 15% faster checkout times, which boosts conversions. 

To date, the startup claims to have brought 200 startups on board and has a presence found in Tier 2 cities and regions such as Indore, Lucknow and Patna, among other regions where brands typically have to deal with delivery hurdles.

This, in turn, helped Emiza grow in revenue by 65% YoY in FY23. Rao said the company aims to clock INR 140 Cr in FY24 and to achieve this it’s focussing a lot on omnichannel solutions.

A Deep-Dive In To Unify 

While it may be well known that D2C brands have to rely on marketplaces such as Amazon and Flipkart for online growth, they cannot afford to ignore retail or physical stores. Nykaa, SUGAR Cosmetics, Mamaearth, Lenskart, Damensch, BlueStone, and The Souled Store all have a wide presence in the retail space and this reliance is only about to grow as offline stores help create a clearer brand recall among consumers. 

Rao said that Unify with its single platform allows brands to manage orders from marketplaces, native stores and offline stores with ease. Brands leverage some of their offline stores to fulfil ecommerce orders for  B2C, D2C and offline businesses, as mentioned earlier. 

This is a clear USP that allows brands to enhance the post-checkout experience and match the likes of Amazon, Flipkart and others. 

This is critical for retaining users, fulfilling repeat orders faster and getting visibility on which sales channel is lagging in terms of the customer experience. “Unify brings together technology, network, and proven operation capabilities to create a complete experience for both brands and their customers,” said Rao.

The founder claimed that Unify enables a smoother customer journey, right from checkout to delivery by offering estimated delivery dates, multiple shipping and payment options through a unified communication. This will result in a positive shopping experience. 

As for brands, they will be able to manage actions such as checkout management, order management, warehouse management, shipping, and customer communication through a single window. 

The lack of a unified dashboard, for instance, can potentially lead to confusion for customer service teams, as agents have to switch between multiple panels to hunt down the order and its status. The delay is typically seen in newer brands that don’t have the best tools to streamline such operations. And naturally, it hampers the customer experience. 

Emiza’s Unify brings the relevant logistics and order information on a single dashboard. The startup charges a base fee of INR 75 for 500 gms of shipment delivering pan India. The charges includes checkout, storage, order processing and last mile delivery. These charges may vary based on the weight of the shipment and level of customisation. 

Further, from a sales perspective, having everything in one place allows the brand to see which channels are showing the highest movement of products and which products are more relevant for which channels. They can also check inventory levels, get detailed analytics and cut costs by removing the additional subscription fees associated with managing multiple SaaS tools. 

Rao believes that Unify is especially helpful for smaller or early-stage D2C brands as it helps them handle fulfilment thanks to straightforward pricing, minimal resource requirements and easy access to a network of fulfilment centres across cities like Gurugram, New Delhi, Mumbai, Kolkata, Guwahati, Bengaluru, Chennai, Hyderabad, Patna, Indore and Lucknow among others.

He also believes that brands need to look at adopting 3PL solutions when they start receiving around 3,000 orders per month.

Besides Emiza, there is a host of other 3PL providers that have been enabling the D2C brands in their growth like ODWEN, TVS Supply Chain Solutions, AAJ Enterprises and Kerry Indev Express. 

Emiza’s Tech-Enabled Warehouses for Efficient Storage

While Unify’s logistics SaaS product is one thing, Emiza goes a step beyond tech-driven warehousing management.  Emiza’s warehouse network has over 22 fulfilment centres. These tech-enabled warehouses offer multi-tier shelving systems for ease of order processing, and a host of safety and security features.

A conveyor system moves products at the right time with minimum human intervention. Automated fire sprinklers handle the safety of products, while CCTV cameras are strategically installed throughout the warehouse to offer surveillance of all stored items and monitor unauthorised access.

This is especially critical because multiple brands may be utilising Emiza’s warehouse space. 

Warehouse managers handle operations like shelf life management, assembly and kitting, quality checks and more, doing plenty of heavy lifting for brands that can focus on their product, sales and marketing operations. 

To ensure same-day/next-day delivery for partner brands, Emiza’s team assists brands in locating inventories at the closest demand centres and the startup has partnered with local courier service providers to meet last-mile demands.

Rao claimed that Emiza’s shipping platform ensures efficient and prompt deliveries by optimising shipment allocation based on delivery performance, payment mode and delivery cost.

Finally, Emiza’s operations team communicates with customers and delivery partners for order tracking and status. 

Emiza Is Enabling D2C Success In The Omnichannel Landscape

Rao says that Emiza has come a long way in its journey, pivoting from part load trucking to fulfilment for consumer brands in 2019.

Rao’s key takeaways from this journey are focusing on core competency, prioritising profitability and cash flow, and identifying market whitespaces. 

“We built an INR 100 Cr business almost entirely out of our own cash flows and without much external capital. We raised external funding for warehousing only in 2022,” he added.

Looking ahead, Rao sees potential in India’s consumer journey, anticipating exponential growth in product consumption, both online and offline. 

To capture the opportunity, Emiza plans to invest in three areas: expand its warehouse network and infrastructure to cover 5 Mn sq ft, improve its Unify tech stack to optimise inventory across multiple channels and strengthen its leadership team to handle this scale.

Rao believes that amid the funding winter, D2C brands need to focus on their product market fit and scale their businesses without cash burn on Facebook and Google marketing. Looking at improving the post-checkout experience can go a long way towards bringing in more repeat users. 

He also reckons that brands must focus on leveraging marketplaces for profitably, and expand offline for the larger brand recall and a connected brand experience. Brands in some categories can also leverage quick commerce channels such as Blinkit, Swiggy Instamart and Zepto. 

They can also tap into cross-border commerce to earn higher margins which would immediately have a positive impact on the bottom line if the distribution challenge is addressed smartly.

Omnichannel retail strategies are shaping consumer behaviour and brands that don’t have the right solution across channels will be left behind in the D2C battle. 

The post How Emiza’s Unify Is Enabling D2C Brands To Unlock Omnichannel Success appeared first on Inc42 Media.

As the nation bursts with joy over the successful landing of Vikram Lander near the Moon’s south pole, too much has been left unsaid about the role of the Indian spacetech sector in this achievement.

However, before we delve deeper into how far Indian spacetech ventures have come in their quest to capture newer horizons, it is pertinent to mention that the nation’s space programmes have today evolved to a point that many nations can be seen gasping in awe of the country’s commitment.

Ever since the establishment of the Indian Space Research Organisation (ISRO) in 1969, India has launched 424 foreign satellites and made significant strides in shoring up the local space ecosystem. 

The homegrown ‘space economy’ was pegged at an estimated INR 36,794 Cr in March last year, offering a glance into the charged-up spacetech economy.

Expected to become a $77 Bn market by 2030, the Indian spacetech industry’s biggest win has been in building a local ecosystem of players that have supported the indigenous effort to send a rover to the moon. Many homegrown startups have also contributed in their own way to the success of the Chandrayaan-3 mission. 

While Paras Defence supplied the navigation system for the spacecraft, MTAR Technologies manufactured the lander’s propulsion system. Ananth Technologies helped build the lander’s camera. Alongside, many others also put their resources behind the moon mission.

The Chandrayaan Stack

The story began with Chandrayaan-1, which was touted as India’s first deep space mission. Built for INR 386 Cr and launched in October 2008, the country’s first moon mission has many firsts to its credit, including discovering water on the surface of the moon. 

Catapulting India into the league of space superpowers, the mission not only achieved almost all key objectives of studying the moon but also offered the world a larger glimpse into the Moon and its topography. 

This paved the way for India’s second lunar mission called Chandrayaan-2, which consisted of three critical indigenously developed elements – a lunar orbiter, Vikram lander and Pragyan rover. Built at INR 978 Cr, Chandrayaan-2 landed short of a home run as it made a hard descent. It was supposed to study lunar topography, mineralogy, exosphere, and signatures of water ice.

However, the mission was a ‘partial’ failure as the lander and the rover crashed on the Moon’s surface during the early hours of September 7, 2019. 

While the first and the second missions were a decade apart, ISRO got back on its feet quickly, with the launch of Chandrayaan-3 within just four years. 

However, what has truly been the hallmark of ISRO across lunar missions is its cost-effective engineering. The newest lunar mission has been built at a cost of $75 Mn, much cheaper than Christoper Nolan’s space movie ‘Interstellar’, which was made with a budget of $165 Mn in 2018. Another space flick ‘Martian’, helmed by Ridley Scott, spent $108 Mn in 2017.

Comparisons aside, the biggest stride for the Indian space programme has been a wave of local startups that have mushroomed in the country in the past few years. The growing coverage of space events and ISRO opening up its infrastructure for local players have inspired and germinated an entire generation of startups that were non-existent two decades earlier. 

Indian Startups In The Space Race

While the ‘conservative space phase’ between 1990 and 2019 was marked by concerns around national security, the whiff of reforms changed the game entirely for the ecosystem in 2020. The Spacecom Policy of 2020 and the subsequent opening up of the space sector unlocked a plethora of opportunities for the homegrown ecosystem. 

Be it AgniKul building a proprietary small-lift launch vehicle or Bellatrix Aerospace advancing innovations in electric propulsion and orbital transfer vehicles, much seems to have happened on Indian grounds in recent years. Digantara’s in-situ space debris detector and Pixxel’s ambition of constructing a constellation of high-resolution hyperspectral earth imaging satellites have also not gone unnoticed. 

All of these startups seem to have adopted ISRO’s playbook, which is centred around cost-effective techniques and leverages the essence of patience to succeed. 

Instead of splurging big bucks on building expensive tech, Chandrayaan-3 employed a series of earth orbits and engine burns to increase the speed of the ‘space vehicle’ and positioned it for lunar insertion. This helped ISRO avoid making huge investments in building a more powerful launch vehicle with a higher payload. In contrast, the Apollo 11 mission, which had Neil Armstrong aboard as a passenger, opted for a Translunar Injection approach to reach the moon. The mission, between 1964 and 1973, had cost the US government a mammoth $6.4 Bn.

The Indian startups have learnt and copied ISRO’s frugal approach to build products out of India for the world. While this is just the tip of the iceberg, the lunar mission has prepared the homegrown startups for many bigger things.

What is interesting is that many of these startups are also increasingly hiring senior or retired ISRO employees to leverage the domain knowledge of these experts.

While more than 400 industries reportedly partnered with ISRO for various aspects of the mission, more than 20 startups actively participated by scaling up innovation and R&D to indigenous production of some critical components, culling dependence on imports. 

With cheaper and high-quality competitive products in their kitty, Indian startups have already started making inroads into global markets. The success of the Chandrayaan-3 mission will now help Indian startups attract more investments from global firms and forge deeper networks and partnerships. This will likely help Indian startups scale up their operations and optimise production with cost and quality being the primary drivers.

The role of the Indian government will be key here, as its support in the form of various production-linked incentive (PLI) schemes has the potential to establish India as the world’s spacetech hub.

Bigger Trajectories To Jump

While the potential seems unlimited, Indian spacetech startups also face multiple challenges. Western countries continue to be the powerhouse of various segments of the global spacetech race. From Elon Musk-led SpaceX to Leo to Astra, the US and Europe continue to lead the sector while Indian spacetech startups look to catch up to them.

Scaling production and footprints also seem to be a cumbersome task, owing to multiple jurisdictional regulations involving the space. What has also impeded the growth of the spacetech sector is challenges related to the availability of seed stage investment as spacetech and allied deeptech products take a long time to build.

This risk-infested long development cycle, continuous testing mandates, and heavy utilisation of expensive resources pose a major challenge to the growth of spacetech startups in the country. However, the major issue seems to be the lack of testing infrastructure in the country. This infrastructure is currently almost exclusively based out of the facilities of ISRO and other governmental institutions. 

Another major issue seems to be the paucity of high-quality talent. As more and more startups join the fray, talent wars could burn a bigger hole in the pockets of many budding players in the domain. 

Despite the hurdles, nothing seems to be stopping ISRO and homegrown spacetech players from further experimentation as they look to solidify their credentials globally. 

The data collected from the Chandrayaan-3 mission is expected to help ISRO gather a deeper understanding of the Earth’s satellite (Moon) and may even pave the way for startups to access this treasure trove of data in the future as the government looks to enable easy availability of valuable geospatial information. 

Despite the funding winter gripping the Indian startup ecosystem, homegrown spacetech players have more or less proven immune and have raised hundreds of millions of dollars in the past year. Even with funding downcycle, innovation seems to know no bounds, and it is this thesis that the growing spacetech players in the country are banking on.

The post Chandrayaan-3 Touchdown: A Proud Moment For India, A Big Boost For Spacetech Startups appeared first on Inc42 Media.

The inaugural wave of modern entrepreneurs or new-age ventures (startups), spanning from pioneers like Flipkart to various enterprise tech startups, opted to set up their bases overseas. Between 2010 and 2020, a multitude of startups, including the likes of Freshworks, Innovaccer, Glance, 5ire, Uniphore, and Druva, alongside numerous others, adopted foreign frameworks in accordance with international regulations.

Inc42’s latest “Decoding India’s Unicorn Club Report 2023” reveals that 18% (20) out of 110 Indian unicorns currently have their headquarters outside India. Notably, 83% (13) of these foreign-based unicorns belong to the enterprise sector, with the United States being the most favoured international destination. The remaining seven unicorns operate across domains like ecommerce, media and entertainment, travel tech, and clean energy.

Extending beyond the realm of unicorns, a palpable exodus of startups has become conspicuous, especially within the fintech sphere and, more recently, in the crypto space.

In the mid of 2022, a multitude of Indian crypto startups relocated to regions like Dubai, Delaware, and the British Virgin Islands (BVI). A confluence of factors — ranging from India’s intricate regulatory landscape and the allure of foreign capital to tax efficiency, international stock exchange listing prospects, global expansion possibilities, and exit avenues — have propelled this trend.

Chirag Shah, Senior VP – Fundraising and Strategy at Blacksoil Capital highlights that despite India’s endeavours to attract enterprises and enhance its business environment, persistent obstacles dissuade many entities from establishing their headquarters within its borders.

“Foremost among these challenges is the complex international tax structure, with its intricate regulations and comparatively elevated corporate tax rates serving as deterrents. The unpredictability of tax regulations and the spectre of dual taxation further dampen the enthusiasm for business investment,” he added.

Nevertheless, the green shoots of the trend reversal have begun to show. In October 2022, fintech unicorn PhonePe relocated its headquarters from Singapore to India in the run-up to its IPO plans, even though the transition incurred a substantial INR 8,000 Cr expenditure.

“We have about 20-odd unicorns that have already reached out to us asking how do we get this changed,” mentioned PhonePe CEO Sameer Nigam during a YouTube conversation with CTO Rahul Chari.

Notably, industry titans such as Razorpay and Groww are now contemplating shifting their respective headquarters to India.

Reshaping Tax Policies: A Blueprint To Attract Unicorns Back To India

Call it the ‘Desh Wapasi’ or ‘Reverse Flipping’ trend, India’s taxation policies stand as a pivotal determinant that could potentially entice Indian unicorns to return home.

In recent years, the Indian government has implemented a range of measures aimed at mitigating tax-related challenges faced by companies. Notably, these measures encompass a decade-long exemption from capital gains tax for investments originating from angel investors and venture capitalists to a three-year tax respite extended to freshly established startups.

Despite these progressive steps, India continues to uphold one of the loftiest corporate tax rates, compounded by a tiered structure instead of a uniform flat rate.

Today, the country has the opportunity to embrace a more competitive and stable tax framework as a solution. This can be achieved through the further reduction of corporate tax rates and the strategic application of targeted tax incentives tailored to specific industries, thus creating a conducive environment for companies to establish their central operations within the nation. Equally vital is the establishment of a transparent and efficient tax administration coupled with measures that thwart double taxation through the implementation of bilateral tax treaties.

Moreover, the synergy between the government, industries, and international organisations becomes imperative for the overhaul of the international tax architecture. The integration of global best practices and alignment with international standards can significantly enhance India’s attractiveness to potential investors.

“By creating a business-friendly tax ecosystem that emphasises simplicity, predictability, and competitiveness, India can encourage more companies to establish their headquarters in the country, boosting economic growth and global investment,” Shah added.

Why Reverse Flip Now?

It’s widely believed that once a startup is registered abroad, navigating through regulatory and other issues can create obstacles when attempting to bring them back to India.

However, Rajeev Suri, a partner at Orios Ventures, holds a different viewpoint. He asserts that startups primarily focussed on the Indian market would benefit from relocating their operations to India. This shift offers several advantages, including streamlined registration and jurisdiction processes, better access to banking, lending, and funding services, as well as a synergistic relationship between financial and market news.

He further emphasises that maintaining banking operations in a foreign country, with exposure to currency risks, inflation, and interest rate fluctuations, isn’t prudent in today’s volatile economic climate.

He cites the SVB (Silicon Valley Bank) incident in March 2023, when trading was suspended due to takeover rumours, leading startups to withdraw and transfer their funds, causing the bank’s collapse.

Investors and financial experts contend that the Reserve Bank of India (RBI) and the Indian government now possess a compelling incentive to enhance the ‘ease of doing business’, particularly in terms of banking regulations and taxation related to capital flows for Indian startups.

The January 2023 Economic Survey outlines six pivotal steps to achieve this goal:

• Simplifying the process for obtaining “inter-ministerial board (IMB) certification” for startups
• Streamlining taxation on employee stock options (ESOPs)
• Addressing complex layers of taxation and the uncertainties arising from tax litigation
• Facilitating capital flows with reduced restrictions on inflow and outflow and treating hybrid securities
• Fostering collaborations with established private entities to cultivate best practices and mentor startup founders
• Enhancing India’s startup incubation and funding landscape in emerging domains like social innovation and impact investment.

In addition, infrastructural advancements such as Bharatmala, smart cities, and GIFT City, along with efforts to enhance global competitiveness and bolster the skilled workforce, are likely to play a pivotal role in attracting businesses.

Notably, after the International Financial Services Centres Authority (IFSCA) formed a panel in March 2023 to promote the reverse flipping of Indian startups, the committee’s mandate included identifying challenges faced by local startups abroad and recommending measures to catalyse the growth of GIFT City into a global fintech hub.

While the one-size-fits-all strategy isn’t applicable, it’s clear that the government is earnestly exploring avenues to prevent the migration of Indian businesses. The domestic investor ecosystem has also gained momentum, with over 240 funds established by Indian investors from January 2021 to August 2023, amounting to more than $30 Bn, according to Inc42 analysis.

This trend is likely to encourage Indian startups to consider raising funds in Indian rupees and maintaining their operations within the country. However, given the intricate nature of the Indian ecosystem, expecting a significant number of startups to reverse flip in a short period could prove to be a bit too ambitious.

The post Rethinking Policies: Can A More Friendly Tax Regime Lure Unicorns To Reverse Flip? appeared first on Inc42 Media.

With millennials and Gen Z accounting for 50% of Indian consumers today, the demand for variety in snacking options has never been higher. What has fueled this demand is the growing new-age customers’ awareness of a variety of ingredients that make snacking a comforting experience, while catering to nutritional needs. 

The demand for more flavourful snacking options has set the stage for a plethora of direct-to-customer (D2C) snack brands. These brands are attuned to the snacking habits of their new-age consumers and are reshaping the snacking landscape with ingredients that are as deliciously satisfying.  

To give the efforts of these brands a further boost, Mondelēz International has launched its startup accelerator programme, CoLab, in India. Mondelēz has collaborated with Huddle, an early stage VC fund, to work with early stage snack brands.

Mondelēz International is a multinational snacking company that is headquartered in Chicago (US). It is also the parent company of Cadbury. It targets brands in the snacking space to drive growth. For this, it launched its startup accelerator programme CoLab in the US in 2021.

The early stage snacking startups that form this year’s cohort are Evolve Snacks, Happy Jars, Flyberry, Tru-Vitals and Nova Nova. These snacking startups will receive mentorship from both Mondelez senior leaders as well as industry experts across business topics of interest as the startups scale to their next phase of growth. 

The CoLab India accelerator programme includes a 12-week curriculum, consisting of virtual sessions and personalised interactions. These startups will also receive a $20K grant, along with the opportunity to raise funding from Huddle and other prominent VCs in India.

With that said, here is a sneak peek into the D2C snacking brands that have been selected under CoLab. 

Evolve Snacks

• Founder: Angad Sehgal  
• Founded In: 2017
• Headquarters: Delhi NCR
• Key Competitors: Snackible, TBH (To Be Honest), Fab Box

Delhi-based Indian snacking startup Evolve Snacks was conceived when marketing professional Angad Sehgal was forced to take a career break after fracturing his ankle in San Francisco. His doctor asked him to change his snacking habits from highly processed, oil-loaded snacks to more nutritious options that could help him recover. 

On his doctor’s recommendation, Sehgal included nuts and seeds in his diet. He was surprised to witness the impact of switching to healthier snacking options. This became the starting point of his entrepreneurial journey, and he launched Evolve in 2017 to promote healthy snacking habits. 

The brand offers snacks like multigrain puffs, oats chips, ragi chips, roasted seeds, makhana, pita chips and more. Ragi chips and bhakarwadi are the best-selling products, according to Sehgal.

The startup leverages high-end tech in manufacturing and packaging its products to ensure the food does not lose its taste and nutrients. Sehgal said that the customers can get their snacks delivered to them on a monthly subscription basis. 

Happy Jars  

• Founder(s): Vikram Sekhar, Surabhi Talwar
• Founded In: 2016
• Headquarters: Delhi NCR
• Key Competitors: Urban Platter, Whole Truth, Two Brothers

Vikram Sekhar, a marketing professional and an avid horse rider, found it challenging to meet his protein goals while staying committed to clean eating, besides horse riding demanded significant energy. One of his major pet peeves was that he didn’t trust store-bought products that claim to be healthy. 

Therefore, in 2016, Sekhar and his wife, Surabhi Talwar, founded the D2C brand Happy Jars. 

The venture made its humble beginning in the founders’ kitchen, where they created small batches of homemade peanut butter. Today, the startup’s peanut butter product portfolio comprises nut butter (made of almond and cashew), unsweetened peanut butter, and dark chocolate peanut butter.

Sekhar claims that Happy Jars’ peanut butter is made from 100% peanuts, sans additives, oil and preservatives. The startup also offers batter mixes for Indian breakfast dishes like idli, dosa and chilla, all manufactured in-house to ensure quality.

The brand has retail points of sale across cities such as Delhi NCR, Chandigarh, Dehradun, Ahmedabad, Jaipur and Lucknow. Happy Jars also leverages quick commerce platforms like Swiggy Instamart, BBDaily (BigBasket), Amazon and Zepto.

Flyberry Gourmet

• Founders: Akarsh Makhija
• Founded In: 2017
• Headquarters: Hyderabad, Telangana
• Key Competitors: Open Secret, Epigamia, Yoga Bar 

According to a study, 53.2% of women are anaemic and 50.4% of pregnant women suffer iron deficiency. Realising this, serial entrepreneur Akarsh Makhija, along with entrepreneurs Sumit Gurdev Singh Rajpal and Surender Singh Makhija, founded Flyberry Gourmet, a D2C snacking startup, in 2017.  

The startup claims to source natural, clean dates to make products like dried dates, granola and trail mixes and date derivatives like date syrup and powder. In fact, the startup allows customers to grind fresh nuts themselves, seeds and spice ingredients to create their own spreads and jars of seed butter at its branded retail stores. 

According to the cofounder, the brand’s savoury range of vegetable chips is first pre-treated for filler-free ingredients and then vacuum fried using 70 to 80% less oil to preserve nutrients. Akarsh says that the in-house R&D sources the best ingredients that have natural probiotics, prebiotics and adaptogens. 

He added that the R&D intensively researched for the brand’s smoky corn chips to replicate roadside ‘bhutta’ (corn) taste. 

To touch all points of sale, the brand has taken an omnichannel approach. It has leveraged quick commerce platforms like Swiggy Instamart and ecommerce platforms such as Amazon and Bigbasket. The startup has five branded retail stores in Hyderabad and Vijayawada, and its offline presence can be found only in South India.

Additionally, Flyberry Gourmet products can also be found in other retail outlets like Spencer’s, Q Mart and Organic World. Its corporate partnership includes the likes of Deloitte, Coca-Cola, Taj Hotel, Marriott, Accenture, and Google, among others. 

Talking about what lies ahead for Flyberry Gourmet, Akarsh said he would leverage social media to increase the brand’s online presence. The startup is also planning to establish an export arm to cater to South East Asian and African markets.

TruVitals

• Founders: Nikita Tamta, Rashi Sethia
• Founded In: 2022
• Headquarters: Delhi NCR
• Key Competitors: HealthKart, Sasta Sunder, Kapiva

Nikita Tamta, a marketing professional, and Rashi Sethia, a business executive, found it challenging to provide their kids with a balanced diet. According to Tamta, their kids were underweight and had chronic respiratory issues. 

To combat these issues naturally, they searched for ingredients that would improve their kids’ health but only came across ingredients that were marketed as effective but lacked nutrients to fulfil all the nutritional demands of a growing kid.

Tamta and Sethia then decided to take charge of their kids’ nutrition needs and help other parents who too were sailing on the same boat.

The two mothers launched TruVitals, a D2C snacking and health supplement brand, in 2022.

TruVitals offers biscuits, protein powder, protein-based bars and cookies, protein pasta and fibre gummies. Tamta said that each product took between nine months to one and a half years before the launch.

The startup has leveraged WhatsApp commerce to offer personalised experiences to their customers. For instance, customers can place an order on WhatsApp that will directly lead them to the checkout page to complete their shopping journey. 

Talking about the future plans, Tamta said that the startup aims to expand its online presence to drive stronger repeat rates.

Nova Nova (formerly known as Waffle House)

• Founders: Nidhi Gadia, Harsh Gadia
• Founded In: 2014
• Headquarters: Mumbai, Maharashtra
• Key Competitors: Yoga Bar, Epigamaia, Open Secret

The chocolate market in India has substantially grown over the past decades but has been majorly dominated by legacy players like Cadbury and Nestle. 

While Cadbury’s tablet-like chocolate bar and Nestle’s chocolate-coated wafer sticks are still ruling the chocolate market, this template has created a lot of white space for experiments in the chocolate sector. While the loyalists will choose the legacy brands, the new-age consumers are willing to experiment with new products. This gives early stage startups an opportunity to cater to the evolving consumer taste. 

Understanding this, advertising professional Nidhi Gadia and serial entrepreneur Harsh Gadia, started D2C indulgent snacking startup Nova Nova.  

The Gadias launched Nova Nova (earlier known as The Waffle House) in 2014. By 2019, Waffle House opened 25 more outlets in Mumbai, including partnerships with multiplexes like PVR  and INOX. 

However, it faced a major setback due to Covid when all its outlets were shut within weeks. It was then the startup pivoted and became a digital-first brand. It also rebranded itself to Nova Nova. 

“We understand that Indian consumers are interested in trying new products, but the traditional ways of selling them through stores are challenging. That’s why Nova Nova uses the direct-to-consumer (D2C) model,” said Gadias.

As the snacking landscape transforms to cater to consumers’ evolving preferences, the disruptive snacking D2C brands are enabled by initiatives such as Mondelēz International’s CoLab. Snacking has become more than a routine. Consumers are driven by modern lifestyles and are frequently replacing meals with snacking items. Besides, snacks have become an expression of comfort, further emphasising the impact of these innovative D2C brands in driving the snacking industry.

The post How Mondelez India’s Cohort Of CoLab Startups Is Changing The Snacking Behaviour Of Consumers In India appeared first on Inc42 Media.

The Indian startup ecosystem is experiencing an unprecedented boom. Between 2021 and 2022, India saw the birth of 67 unicorns, propelling the total count to 110.

Although the ongoing year (2023) has yet to reignite the pace of unicorn creation, projections from Inc42’s latest report, “Decoding India’s Unicorn Club Report, 2023”, indicate that by 2030, India could witness the rise of more than 280 unicorns.

Amid this, we tried to delve into the academic backgrounds of Indian founders, and we were surprised to find that over 50% of unicorn founders are not IITians, Inc42’s latest reveals based on the analysis of 278 unicorn founders.

Some of these prominent names include:

• Freshworks: A NASDAQ-listed cloud-based customer relationship management (CRM) software company established by Girish Mathrubootham, an alumnus of Shanmugha Arts, Science, Technology and Research Academy, Tamilnadu
• BYJU’S: An edtech platform launched by Byju Raveendran, who completed his bachelor’s degree in mechanical engineering from Government Engineering College, Kannur.
• Icertis: An enterprisetech platform launched by Monish Darda, who completed his bachelor’s degree in mechanical engineering from Savitribai Phule Pune University

According to the Inc42 analysis, only 42% of unicorn founders are IITians, with IIT Delhi emerging as a hotbed for nurturing the highest number of founders who built billion-dollar enterprises. IIT Bombay and IIT Kanpur follow closely as the next institutions on the list for breeding a significant number of unicorn founders.

Although this is a considerable shift from the earlier trend (when the startup ecosystem was still in its infancy) when the fundamental decision of pouring funding into any startup was determined by the founder’s academic pedigree.

As Pearl Agarwal, founder and managing director of early stage VC firm Eximius Ventures highlights, those were the times when the only data point to consider investing in the riskiest asset class such as startups was the tag of IIT and IIMs, which reflected the founder’s determination, will and grit to become successful.

However, the change that we are witnessing today reflects a shift in investors’ focus towards a broader range of skills beyond technical and managerial expertise.

As Ankur Bansal, cofounder and executive director at Blacksoil Capital highlighted, creating and running a successful business takes more than an academic pedigree. The recent trend of a higher number of startup/unicorn founders not belonging to the premier educational institutes of the nation, like IITs, showcases precisely that. Entrepreneurs from diverse backgrounds contribute unique perspectives, often inspired by their life experiences, specialised knowledge and innovative thinking — all crucial elements for startups to succeed.

Moving Beyond IITs and IIMs: Influential Factors

Moving away from an exclusive fixation on IITs and IIMs signifies a significant shift in the mindset of all key stakeholders of the startup ecosystem, including investors. Initially, the Indian startup ecosystem, exemplified by companies like Flipkart, Snapdeal, Paytm, Zomato, MobiKwik, and Ola, was dominated by entrepreneurs from the country’s most prestigious schools and colleges.

The allure of degrees from elite institutions, coupled with venture capitalists’ intense focus on founders’ educational backgrounds led to a proliferation of copied business models and concepts from the US and China.

In contrast, recent times have witnessed a growing recognition for founders from non-IIT, non-IIM, and non-engineering institutions.

Moreover, while investors initially favoured tech-savvy founders due to the tech-driven nature of startups, the evolving ecosystem acknowledged the potential value of non-engineering backgrounds as well.

Today’s startup landscape exemplifies this all-inclusive shift, with successful enterprises steered by founders boasting diverse expertise, spanning fields from medicine and business to the arts.

For instance, Hypd thrives in the creator economy space despite its founders not hailing from the IIT background. Similarly, Elda Health features a doctor as a cofounder and brands like Mamaearth underscore the importance of melding marketing and meticulous ingredient attention over sheer technology.

“Graduates from varied disciplines, including commerce, economics, MBA programmes, and those with global exposure and considerable work experience, have entered the Indian entrepreneurial landscape. They are propelled by emerging startup models such as D2C, B2B platforms, fintechs, Agri, healthtech, and the creator economy. These models have been established by non-IIT and non-engineering founders,” said Anup Jain, managing partner at Orios Venture Partners.

Other factors contributing to this shift:

• Non-IIT and non-IIM educational institutes have upped the game: The quality of education at non-IIT and non-IIM institutions has undergone significant change. Many of these institutions have invested heavily in faculty and infrastructure and are now offering world-class education.
• Maturity of the startup ecosystem: As the Indian startup ecosystem has matured, numerous successful startups founded by non-IIT/IIM graduates have demonstrated that success can be achieved even without prestigious degrees from premier institutes.
• Evolution of the investor mindset: Investors have become more open-minded, looking beyond conventional academic pedigrees. They now prioritise founders’ execution capabilities, irrespective of their educational backgrounds.
• Ex-startup employees turning entrepreneurs: With many former tech employees of startups becoming cofounders themselves, the ecosystem has compelled investors to consider experience as the basis of evolution, moving beyond solely relying on top-notch degrees.

The Future Of Entrepreneurship In India

The emergence of unicorn founders from non-IIT and non-IIM institutions augurs well for the Indian startup ecosystem. It also highlights a treasure trove of untapped talent and potential that lies beyond the confines of IITs and IIMs.

This development holds particular promise for aspiring entrepreneurs who might not have had the privilege of attending these esteemed institutions. Concurrently, this trend compels IITs and IIMs to elevate their offerings.

The evolving market landscape demands specialised insights and industry-specific expertise, attributes often possessed by non-traditional founders. This transformation underscores the growing significance of identifying distinctive market needs across diverse consumer segments and delivering fitting solutions.

Consequently, an increasing number of investors are rallying behind companies that adhere to sustainable and profitable business models, demonstrating growth potential irrespective of founders’ academic backgrounds.

Richa Bajpai, founder of the student-focussed venture firm Campus Fund, sheds light on the shifting mindset within the student community. According to her, students, who were previously inclined towards government jobs, are now embracing entrepreneurship.

It is also worth mentioning that the success stories of unicorn founders, many of whom did not emerge from elite institutions, have taken entrepreneurship as a subject of discussion at people’s dinner tables while watching shows like Shark Tank. Today’s youth draws inspiration from the achievements of these founders, with many recognising that elite institutes are not the sole breeding grounds for entrepreneurs.

“The people of this country [India] want to make a difference and create an impact, and this phenomenon is not confined to metropolitan areas or limited to IITs, IIMs, or NITs. With increasing awareness and greater accessibility to venture capital, entrepreneurship is spreading beyond the exclusive circles of elite institutes in our nation,” Bajpai added.

Looking ahead, this trend will reshape the startup ecosystem, fostering inclusivity, interdisciplinary collaboration, and new prospects for aspiring entrepreneurs. Ultimately, this shift enriches the entrepreneurial landscape, ushering in innovation and resilience for a vibrant and dynamic future.

The post How Non-IIT Graduates Are Spearheading The Great Indian Unicorn Show appeared first on Inc42 Media.

When Netflix forayed into India at the outset of 2016, its senior executives flagged slow internet speeds as one of the key hiccups to its penetration. However, all of that changed in a few months as Reliance Jio waltzed into the telecom arena. 

The telecom war spurred the rise of data consumption and penetration of high-speed 4G internet services across the country as telcos offered data at dirt-cheap prices. Seven years later, it seems life has come full circle for the two companies as Jio and Netflix have announced a new offering that has the potential to rejig the streaming space.

For the first time in India, Netflix has partnered with a telecom company to offer prepaid tariff plans bundled with a subscription for the US-based streaming major. While Netflix has largely played it safe so far, targeting standalone subscribers and postpaid users, its latest move could spur its India numbers.

To summarise briefly, Jio has launched two prepaid plans priced at INR 1,099 (2GB/ day) and INR 1,499 (3GB/ day) with a validity of 84 days. The former comes embedded with the Netflix (mobile) plan, which sells for INR 149 a month, while the latter includes the ‘basic’ plan of Netflix, which is worth INR 199 per month.

While the INR 1,099 plan will offer Netflix subscription worth INR 447 over a period of almost three months, the INR 1,499 plan will enable users to avail INR 597 worth of services. To put things in perspective, Jio’s current 2GB per day data plans with 84 days validity sell anywhere between INR 719 to INR 749. On the other hand, Jio’s 3GB data per day plan for 84 days cost INR 999. 

While the details of the financial partnership are not known, Jio and Netflix are banking on the playbook of offering bundled offerings at small concessions to woo new customers. 

However, the stakes are much higher for Netflix, which has lately undertaken multiple changes at its India operations with an eye on alternate revenue streams. The streaming company has partnered with a host of companies and is looking beyond price as a way to increase the number of users. With the latest partnership with Jio, Netflix is looking to hook the users of the telecom operator, offering them a taste of global shows as well as some vernacular content. 

Can Netflix Capitalise On Jio’s User Base? 

Netflix’s previous partnerships with telecom operators only targeted postpaid customers, who accounted for just 8% of the total telecom subscriber base in the country at the end of March 2023, thereby limiting its reach.

The new partnership with Jio will open up a huge swathe of prepaid wireless subscribers for Netflix. Jio, which commanded a market share of 38.17% in the Indian telecom space as of May 2023, is expected to serve as an acquisition channel for Netflix, which so far has failed to zero in on a strategy in the country to shore up its user numbers. 

The partnership with Jio will offer Netflix a direct entry in the subscription slab and ensure that the telecom operator’s users scroll through the bundled offerings whenever they buy a plan. 

The bundled offerings will also make Netflix’s content more accessible to the masses and the streaming giant can skip forging partnerships with multiple stakeholders to push its services.

This mirrors the playbook of ALTBalaji and Eros Now, both of which debuted their shows for free on Jio Cinema and Jio TV to gain traction and popularise their respective platforms. Reliance owns a stake in both these companies. 

The collaboration with Jio will also help Netflix build a different revenue model where it banks on Jio’s network of dealers to get revenue through mobile recharges in a country where penetration of online payments and debit cards is still low. 

Netflix also plans to leverage the data-guzzling Indian population, which spends a good chunk of its days viewing shows on streaming platforms. As per a report by Eros Now and KPMG, an average Indian viewer spent around 70 minutes per day on OTT platforms. 

As per Reliance’s Q1 FY24 results, the per capita data usage of Jio users stood at nearly INR 25 GB per month, offering Netflix a window to capture these content-crazy subscribers. 

The move will also enable Netflix to shed its image as a predominantly Gen Z and millennial offering and open the floodgates for other demographics to experience the streaming service. 

The partnership appears to be a win-win situation for both players, especially for Netflix which can bank on Jio’s infrastructure, billing system and customer care to build a better customer experience while attracting more user eyeballs.

On the other hand, it will also enable Jio to keep customer churn lower. 

“Netflix has strategically introduced an INR 149 plan catered specifically for mobile users. The bundling strategy not only helps OTT players and aggregators in garnering substantial viewership figures but also synergistically aligns with the core offerings of both products, it’s like a win-win for both,” Avinash Mudaliar, cofounder and CEO of content discovery platform OTTplay, told Inc42. 

Netflix’s India Problem

India has been a challenging market for the US-based streaming giant for a long time. In 2021, its founder and co-CEO Reed Hastings said that the company was still trying to figure out the product-market fit for India even as it potentially spent about $400 Mn in the country since 2019.

Since then, Netflix has slashed corners, cut subscription prices and unveiled a host of locally produced shows to attract the predominantly vernacular audience in the country. While it burned a lot of capital on expensive productions, banking on premium content and lower pricing, its competitors were the first ones to tap into the bundled offering ecosystem to woo customers. 

While Amazon bundles its streaming service with free music and free deliveries through Prime, along with partnerships with Airtel and Vodafone Idea (Vi), Disney+ Hotstar has leveraged its partnerships with broadcasters to bring in a larger library of vernacular content and premium English productions to the country. Besides, the lack of cricket streaming in a country which is crazy for the game has also slowed down Netflix’s growth.

Disney+ Hotstar, which has digital rights for many cricket tournaments despite losing the rights for Indian Premier League (IPL),  was one of the first companies to partner with all three major telecom operators – Jio, Airtel and Vi – to offer bundled subscriptions to customers. Meanwhile, Netflix seems to be catching up only now.

The US-based streaming giant now offers its streaming service with postpaid plans of all three major telcos. Netflix has also been bringing more users on its platform, albeit on a smaller scale. It added 7.6 Mn subscribers in Q4 2022 globally as against 8.2 Mn during Q4 2021. In 2022, the company’s India arm saw a 30% increase in engagement and a 25% rise in revenue in 2022. 

It also tweaked its content and pricing strategy in the country and scaled up its local production tally to 100, adding 28 new titles just last year. Alongside, it trimmed the budget of its original content productions in India by 35%-40%, while listing more tent-pole Bollywood movies and South Indian titles to rake in more customers. 

The rollout of the streaming giant’s ban on password sharing in India earlier this year is also expected to bolster revenue. 

However, questions remain about how successful Netflix would be in leveraging Jio’s user base to push its products.

Netflix directly competes with the likes of Reliance’s JioCinema, which has emerged as a key player in the OTT segment since acquiring digital broadcast rights for the IPL and striking exclusive content deals with Warner Bros Co. and NBC Universal. While Netflix is cutting corners, JioCinema has unveiled an INR 2,000 Cr warchest to take on competitors and release as many as 100 movies and shows over the next 18-24 months. 

Produced at a cost of well over INR 2,000 Cr, the movies and TV series span various languages and genres. It is important to note that Netflix still has a long way to go in regional language content in India.

The Bumpy Road Ahead

While plenty of OTT platforms have tied up with telcos in the past, the story has not always been without its own set of challenges. The traditional revenue-sharing models between OTT players and telcos encompass a range of possibilities from profit-sharing arrangements to flat fees, or even minimum guarantee structures.

While a fixed upfront fee model offers a stable monetisation avenue from telcos, a minimum guarantee model may or may not work for smaller OTT players that do not generate significant viewership. However, Netflix, being a big player with a differentiated offering, could have a better bargaining power compared to smaller players in the market.

Meanwhile, as such collaborations grow, the telcos have reportedly largely turned to the revenue-sharing model, especially with smaller players that do not generate significant viewership to reduce minimum guarantee payments.

Not just this, revenues of OTT platforms from partnerships with telecom operators account for nearly 50-70% of the overall revenues of streaming platforms. This could lead to an overdependence on telcos as a distribution channel.

The biggest issue, however, seems to be the affordability of the bundled plans in the price-sensitive Indian market. Only a limited number of telecom customers are likely to spend INR 1,099 or INR 1,499 upfront for the bundled offerings. 

In addition, it is widely believed that Indians prefer smaller subscription ticket sizes payable over longer periods, allowing them to cancel services anytime. Paying upfront for the entire 84-day period may not be feasible for a big chunk of users. 

“The viability of these plans for a majority of Indians is a challenging consideration, given India’s diverse preferences and consumption habits. Price sensitivity plays an important role, as what’s expensive for some might be affordable for others,” said OTTplay’s Mudaliar.

“Indian consumers who avidly consume content and are willing to spend for quality viewing experiences might find these plans reasonable. However, it’s crucial to remember that the Indian market is scattered, and this might appeal to a narrower segment of users willing to invest more in premium content and integrated services,” he added. 

Despite these hiccups, India continued to be a key growth market for Netflix, as the country emerged as the fastest-growing market for the streaming company, with the highest net paid additions in 2022.

Overall, the OTT streaming space still appears to have a huge room to grow. With internet and smartphone penetration on the rise, more and more Indians are experiencing the streaming space for the first time. At a time when competitors such as Disney+ Hotstar are facing a tough battle in India, Netflix’s latest move seems to be a signal that it is all geared up to grab a bigger pie of the Indian OTT streaming space, which is projected to grow to a market size of $12.5 Bn by 2030.

The post Can Netflix’s Partnership With Jio Revive Its Indian Streaming Dreams? appeared first on Inc42 Media.

India’s real money gaming industry is on a precipice. The recently proposed changes for GST have thrown a major curveball for players such as Dream11, MPL, Zupee, WinZO, Rush by Hike, and a host of other startups that fear the worst.

While the rules will only go into effect from October, the new GST rate could be applied retrospectively which has clearly created panic among many startups. We have already seen this in the case of MPL, Hike and Spartan Poker which have laid off employees, but more severe steps are likely to come.

Besides revenue panic, there’s a fear that VCs might walk away from RMG and invest in other gaming models, denting the fortunes of some large companies. Let’s jump into these problems, but after these must-read stories from our newsroom this week:

• Skill-Lync’s Debt Trap For Students: Fake loan applications, personal loans masquerading as educational loans, no placements and a debt trap. The story of why hundreds of students are outraged at edtech platform Skill-Lync
• Unicorns As Job Creators? Inc42 data shows that Flipkart is the biggest employer among Indian unicorns, with 47,859 employees on its payroll. Where do the other unicorns stand?
• The Zyber 365 Mystery: Ahmedabad-based web3 & AI startup ZYBER 365 recently claimed to have become India’s 109th unicorn. But Inc42’s exclusive investigation shows this is a smoke and mirrors game

RMG Vs The Tax Boss

Let’s get one thing out of the way. The changes in the GST structure impact those online games that include wagering or an entry fee to play with a real-money payout. It covers “games of skill” as well as “games of chance”, but for the purposes of the startup ecosystem, it’s largely going to disrupt those gaming platforms that have fantasy sports, rummy, poker, card games and similar real money casual games as their primary models.

The revenue models of each of these different games will be impacted distinctly by the new changes. Here’s a look at how things change in the two most popular categories:

As we can see, the new GST rules make it more complicated for the latter category to be appealing to users who are chasing real money rewards. Players will need to consistently make 40% or higher profits on their entry amount to get any real outcomes from these games.

The impact is slightly lower on the fantasy sports platforms, which typically involve a one-time entry fee that can be spread across multiple pooled competitions. In pooled competitions, the prize money is distributed to multiple players.

With the new GST rules, the winners of pools might continue to get the same prize money, whereas second or third place players might not get the same payouts as they do now.

So even within the real money gaming ecosystem — which accounted for 77% of the total gaming sector revenue of INR 13,500 Cr as per a FICCI-EY report — there is a clear disparity in terms of the impact. And the higher tax burden is set to hurt smaller companies more.

VCs believe that even though the tax burden has risen, companies such as Dream11 have the revenue safety net to continue scaling up despite the disruption. With INR 142 Cr in profits in FY22 and being a market leader, Dream11 in particular, is in a better position than others to navigate this market. Other companies will have to not only bear the tax burden, but also compete with Dream11 which can count on high brand recall and a legacy in the fantasy sports arena.

“It is the smaller companies that have to worry. They neither have the scale to justify a fund infusion to navigate the new GST world nor do they have the revenue to pay the taxes and also absorb the lower potential revenue,” according to a Delhi NCR-based gaming investor.

Gaming Startups Stare At Layoffs 

So what kind of impact can one expect? MPL has laid off 350 employees, Hike (Rush) has also let go of more than 100 employees and Spartan Poker has let go of 40% of its workforce. And this is just the beginning, according to many of those in the industry.

Founders in the space tell us that cost-cutting has become necessary for many because if they want to survive, they need to solve the unit economics problem created by the potential slowdown in RMG adoption.

This is particularly true for poker, rummy and other card games, where players are smart enough to see that they either have to be ready for higher losses or invest more and balance the tax burden vs the potential for winning.

“In the initial few days of the GST changes going into effect, there will be a drop-off of the casual players who typically put in like INR 200-INR 300 per month. This is about 90% of the user base. It’s only a small percentage that pay fees in excess of INR 10,000 per month,” says the cofounder of a Delhi NCR-based RMG startup.

The cofounder added that most startups are more or less writing off casual users. They expect to retain only a handful of the high value players.

“RMG players were hiring multiple product managers and focussing on expanding on formats, but all of that has to be revisited now. As it is many of these companies were bloated and some of them needed to cut costs anyway. The GST disruption means they have no recourse now,” according to an exec from a game development company.

VCs Are Walking Away

The new unit economics battle in light of 28% GST is not only for creating sustainable models but also to attract investors.

Any unit economics disruption in the current funding winter means delays of months in funding talks and investors are already walking away. Sources within the ecosystem tell us that investors are now exclusively looking at gaming startups that don’t have any real money component. The tax nightmare for real money gaming companies means startups are possibly looking at an additional tax liability of nearly INR 45,000 Cr, as per reports.

In recent weeks, we have also seen instances of unscrupulous online gaming companies syphoning away money from India and even defrauding users.

“We just don’t think the tax exposure risk is worth it. There are problems such as collection on a retrospective basis. A lot of their books will go through audits. It’s likely to create a lot of regulatory friction,” added the Delhi NCR-based investor quoted above.

The investor added that the real money space is saturated with several big players. Now, it makes no sense to invest in a new platform that can hope to take on the big names such as Dream11 in the fantasy sports arena, or MPL, WinZO and others in casual games.

There are also concerns about companies moving abroad, similar to what was seen with the taxation clarity in crypto. Even under that circumstance, operating in India would require companies to be compliant with the local tax laws, if they want to cater to Indian users.

What Next For Gaming Startups?

So where’s the focus turning for gaming investors? The obvious answer is game development. These models are typically multi-year investments and currently many Indian game development startups are starting off with titles in popular genres — battle royale, casual titles, puzzles and more — that involve in-app transactions, which do not come under the new GST rules.

Game development company Yudiz Solutions listed on the NSE SME platform at a 12% premium this week.

Sources also told us that Bengaluru-based gaming unicorn MPL is likely to focus heavily on Mayhem, its game development studio, and is looking to reduce its reliance on RMG revenue in the future. Mayhem raised $20 Mn in April this year from Peak XV and Steadview.

Backed by AET Fund and others, Pune-based SuperGaming is another startup looking at developing mobile games such as Indus (set to launch later this year), MaskGun, Silly Royale, and Tower Conquest. It is also building its own gaming engine for real-time multiplayer games.

Mumbai-based Nazara too is likely to ease off the accelerator when it comes to HalaPlay, its fantasy gaming vertical, given the dominance of Dream11, which will continue to have a sizable market share even in the new regime. The company has multiple other revenue streams in non RMG segments.

Nazara claimed that the GST changes will have minimal impact on its revenue, but will the company continue to carry HalaPlay along if the revenue potential is dented? It remains to be seen whether investors and Nazara’s shareholders will entertain that prospect.

Nevertheless, it’s looking more and more like the future of gaming in India will be driven by game development, studios and publishing rather than by real money gaming, as it has been for so long. Real money gaming’s rise overshadowed other aspects of this industry.

“Worldwide, the value in gaming is unlocked by game development and studios. The major companies such as Microsoft and Sony largely invest only in game development. India needs to get on this track too, and not just rely on fantasy cricket or rummy,” said the gaming startup executive quoted earlier.

In many ways, the flipping of the GST switch has led to a big reset for the online gaming ecosystem. Will it set the sector on the right track?

Startup Spotlight: Exponent Locks Horns With Tesla

Most commercial battery charging technologies worldwide take 30 minutes to 10 hours to fully charge EVs, depending on battery capacity and vehicle types. But Bengaluru-based Exponent Energy claims to have broken all records and has eyes on competing with the likes of Tesla in the global EV charging market.

Founded in 2020 by former Ather Energy executives Arun Vinayak and Sanjay Byalal, the startup is looking to cut charging times to 15 minutes regardless of the vehicle category. The startup is banking on its patented ‘water-based’ off-board thermal management system to accelerate the future of EV charging infra in India.

The startup has also set an ambitious target of deploying 1,000 ‘e^pumps’ and 25,000 Exponent-powered EVs by 2025. Will it get there and solve one of the biggest hurdles in EV adoption?

Read the full Exponent Energy story

Sunday Roundup: Startup Funding, Tech Stocks & More

• Weekly Funding Updates: Just a total of $4.4 Mn was raised by Indian startups in the past week. No, that’s not a typo. Startup funding has never seen these lows for many years
• EaseMyTrip’s Q1 Results: EMT saw its profits plunge by 22% YoY as a result of a significant increase in discounts during the quarter ended June 2023

• Ola Electric Plays Big: Besides launching a cheaper electric scooter, Ola Electric unveiled its plans for the motorbike space with four new concepts targeted for late 2024
• Navi’s UPI Play: The Sachin Bansal-led company has entered the payments space to become something of a fintech super app

That’s all for this week. We will see you next Sunday with another weekly roundup, and till then, you can follow Inc42 on Instagram, X/Twitter and LinkedIn for the latest news as it happens.

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Even though India produces around 15 Lakh engineering graduates every year, there is a huge gap in the skills they possess versus what the job market demands. According to a study by Scaler, an upskilling platform, only 2.5 Lakh engineering graduates (or 16%) land relevant jobs every year.

A lack of close collaboration between India Inc and academia has created a huge demand in the market to upskill fresh out-of-college engineers in the constantly-evolving age of new-age technologies like artificial intelligence (AI), machine learning, etc.

It is on the back of this red-hot market that several big edtech companies have been able to raise millions of dollars to make fresh graduates job-ready and upskill working professionals. On the flip side, recently, many bad actors have been accused of exploiting this lucrative space, and continue to get exposed every now and then.

Chennai-headquartered Skill-Lync, founded by SuryaNarayanan PaneerSelvam and Sarangarajan V Iyengar in 2018, is witnessing itself standing at a crossroads of many controversies from employee layoffs to now students levelling serious allegations against the edtech startup.

Since its inception, the Y Combinator, Better Capital and Iron Pillar-backed startup has raised more than $20 Mn in multiple funding rounds. Its playbook is simple — tap into the growing upskilling market by offering advanced PG-level courses to young engineering graduates and make them job ready.

Indeed a noble idea, however, the company may have walked too far with its playbook when it started to guarantee jobs and internships to its students. Now, amid an uproar by students that Skill-Lync has faltered to deliver, it could be looking at multiple lawsuits from its customers for allegedly duping them of lakhs of rupees on the pretext of giving jobs and allegedly tricking them into taking loans.

This is not it — many serious allegations have been slapped by students, both former and current, on Skill-Lync’s modus operandi and the authenticity of the student data that the company shares with its lending partners to avail loans.

Before we delve into the series of allegations, it is vital to highlight that the edtech is on a cost-cutting spree and has axed more than 600 employees so far this year.

Is It Really Raining Jobs At Skill-Lync?

More than a dozen former and current Skill-Lync students that Inc42 spoke with have alleged that Skill-Lync made them take loans by showcasing them as salaried employees with various companies, which as per the students, don’t even exist.

These students told us that their job details and salary information, which reflect in their loan documents allegedly submitted by Skill-Lync to its partner lenders, are all fake.

Inc42 has access to various materials, including student data provided to a lender, showcasing them as working professionals instead of students.

What’s even more surprising is that one of these students works for a company, ‘student’, for an annual salary of INR 1.9 Lakh. (Images for reference below)

As we dug deeper, we met a 24-year-old Skill-Lync student, Mohit (name changed upon request), who showed us his details on the website of lender Eduvanz, which states that he has been working with a company, for more than two years and was drawing an annual salary of INR 3,48,000.

An unemployed Mohit who had completed his course in Data Analytics last year, told us that his mind was boggled, and he got pushed into a state of mental turmoil before he could finally digest that Skill-Lync made him take a loan by showcasing him as a salaried employee, at least what his loan documents show.

“Typically, these aren’t educational loans under which students are expected to pay after the completion of the course. These rather seem to be personal loans where the salaries of the borrowers act as collateral. In education loans, banks or NBFCs ask for the repayment of loans, along with interest, only after the completion of their courses, and even give students an extension in many cases,” a Bengaluru-based banking professional said, requesting anonymity.

Meanwhile, a former Skill-Lync student from Chennai shared an audio recording with us in which a Skill-Lync employee can be heard using ‘job guarantee’ as bait to divulge the details of his bank account for the loan application. “One year on, there is no job, and the employee has left the company too,” the student said.

Inc42 did not receive a satisfactory answer from the CEO and cofounder of Skill-Lync, PaneerSelvam, when we asked if the company’s finance team showcased students as working professionals to avail loans.

“The loan transaction/EMI for enrolment in our course emerges from an “Agreement” which is entered between the student and the Lending Institution, and Skill-Lync is not privy to the contract,” the Skill-Lync CEO said.

If this is the case then why an employee of the company’s finance team can be clearly heard requesting bank details of a student for the loan application in a call recording shared with us.

“The loan is an “OPTION” provided to students who intend to pursue the course but do not have the means to pay the course fee. In such a case, such students are connected to third-party lenders. It is made clear that Skill-Lync is not the lender here. Upon confirmation from the students through Aadhar verification, OTP verification or e-signatures, the loan application is processed and approved,” said the CEO.

On the contrary, students whom we spoke with said that more than 50% of them, who registered with a nominal fee of INR 5,000, were not even informed that the monthly payments they were making as course fees were rather the EMIs they were paying for the loan taken on their behalf.

“We were put under the impression that the course fee is divided into EMIs. For this, the Skill-Lync finance team took our bank details, and bank statements, along with Aadhar and PAN card details. When we questioned, the officials told us that the details were being taken to ensure that students do not falter in making payments post the completion of their courses. Soon, we were left scratching our heads when we got a message from Eduvanz that our loan application has been accepted,” said the students who are accusing the company of showing them as employees of fake companies.

Moving on, our quest to get to the crux of the matter took us to many more students, who too alleged that the company made them fall prey to its questionable practices.

Several students have alleged being tricked into taking loans, ‘probably personal’, from various lenders, including Eduvanz. Interestingly, all these students have one thing in common — they are all employed but only in their loan documents.

“We don’t even know if the companies where we are shown to be working exist or not. Even the NBFCs or lending partners that closely work with Skill-Lync have failed on multiple fronts while conducting due diligence,” another aggrieved student said.

Note: Our multiple attempts to reach out to Skill-Lync’s lending partners, including the Eduvanz CEO, failed to yield any result. The story will be updated accordingly once they respond.

Notably, Skill-Lync’s saga has a striking resemblance with another upskilling startup, GreekLurn, whose CEO Kamalapuram Srinivas Kalyan was arrested by the Bengaluru police in June this year for allegedly defrauding at least 2,000 students by availing loans in their names.

Students Prepare To Lock Horns With Skill-Lync

At the core of the issue is Skill-Lync’s strategy to target students from middle to low-income households, who are looking to upskill themselves to land suitable job roles.

As of now, the company is being cornered by its students for failing to provide jobs, with many debt-laden individuals in the process of lodging a complaint with the Chennai Police against Skill-Lync for defrauding them under the pretext of providing jobs after the completion of their courses.

Sources close to the development told Inc42 that a group of students is expected to meet Chennai police and file a complaint against the company for duping them, in connivance with an education-focussed NBFC, Eduvanz.

As seen by Inc42, a complaint letter from one of the students at Skill-Lync, addressed to the Chennai Police director, accuses Skill-Lync and Mumbai-based Eduvanz of coercing the student (name withheld upon request) into taking a loan to pursue a PG-level certificate course in car designing.

The student had first enrolled in the course and took a loan from the edtech’s partner NBFC, however, later the complainant’s mind changed and he wanted an exit but couldn’t. Inc42 has a copy of the letter.

“I found the course material and the videos on the platform substandard after I got registered on the platform. Therefore, I changed my mind and asked the company to cancel my candidature. Despite multiple attempts to reach out to the company, all my requests have fallen on deaf ears. I am unable to cancel the registration of the course, and the lender (Eduvanz) continues to raise EMIs,” the complainant told Inc42.

“But for exigencies like medical grounds, there is no prohibition for the enrolled students to opt for course cancellations at any point. The cases of cancellations are dealt with on a case-to-case basis and merits,” the company said in an email response.

What Does Skill-Lync Promise?

After speaking with several students who claim to have completed their courses last year and are yet to get jobs, we decided to take a look at the agreement that the edtech signs with students, along with how it promotes itself.

A recent contract agreement states that for securing a job/placement, students must meet certain terms and conditions. If students are unable to get a job in 180 days even after meeting the terms and conditions, they will be refunded in full.

However, more than a dozen students we spoke with claimed that they have been sitting jobless since last year after completing their courses, the duration of these varied between three and nine months.

Notably, under the terms and conditions in its agreement, Skill-Lync mentions that students will have to appear for various mock interviews and tests, and score a certain percentile during their courses to land a job.

Meanwhile, on the promotional front, Skill-Lync via email marketing promise jobs or money back if students pursue courses in data sciences and analytics.

Interestingly, the internet has many media reports that acknowledge Skill-Lync as an edtech that either guarantees a job or refunds money.

However, it is quite unclear if the edtech changed its strategy later and included multiple competencies to be eligible for a job, even after completing the course.

Explaining Skill-Lync’s side, the CEO told Inc42 that the company has replaced its job guarantee programme with a job assistance programme, which refrains from giving guarantees.

“It is crucial to note that the non-refundable nature of all courses, except for the 25% with a job guarantee, is explicitly communicated during the enrolment process and has been clearly mentioned in the terms and conditions on our website,” PaneerSelvam said.

Meanwhile, students have alleged that the company had to change its policy after it failed to deliver its promise to give jobs.

One of the students who completed a PG programme in Data Analytics and Data Science, which came with a job guarantee, has been waiting to get a job for the past 11 months. Inc42 was given access to an emailed communication from Skill-Lync’s team to this student.

Skill-Lync was also sending out promotional emails to students guaranteeing jobs for courses like PG in Electric Vehicle Design and Development until last year.

Even as Skill-Lync may have moved to a more sensible approach now of not guaranteeing jobs to all the students enrolled, however luring the fresh college students with promises as above and finally not meeting these terms and conditions has backfired for the edtech platform.

Moving on, Skill-Lync charges anywhere between INR 2.5 Lakh and INR 3.5 Lakh for its courses that may stretch anywhere between three and nine months. To make it easy for students to pay the fee, the company has partnered with NBFCs such as Liquiloans, Eduvanz, etc.

Various students told us that the company promised to offer paid internships, with a stipend of INR 10,000 per month, within the first three months of starting their courses so that they could start paying their course fees.

“While some students got lucky, a majority fell prey to the company’s forked tongue,” a student said.

Meanwhile, he said that some students, who approached the director of Chennai police with a plaint, were called by Skill-Lync officials and were directed by them to stay away from raising the issue on social media platforms, including WhatsApp groups, if they wanted refunds.

“Our Maharashtra and Tamil Nadu Chapters are already in the process of approaching the authorities under various sections of cheating and fraud against Skill-Lync,” a student said.

A Flawed Business Model?

The Skill-Lync saga is unravelling at a time when the Indian edtech industry is fraught with the challenges of market overestimation, a decline in users and a pent-up demand for offline learning.

This perhaps explains why many edtech giants, including BYJU’S and Unacademy, are cutting or have cut costs massively.

In Skill-Lync’s case, the edtech promises zero-interest EMIs to students, under which the interest is to be paid by the edtech and the loan amount is borne by students.

On its website, one of Skill-Lync’s partner NBFCs, Eduvanz, mentions that it charges an interest rate of 15-45%, which is to be borne by edtech platforms.

When we asked the Skill-Lync CEO about the edtech’s main revenue streams, PaneerSelvam said that it was the company’s internal matter.

In another question, we requested the CEO to talk about the edtech’s financial performance in FY23 and how it plans to walk on the profitability path, especially when he was recently quoted proclaiming that the startup was on track to achieve operational profitability by Q4 2023.

While PaneerSelvam refrained from divulging details on the company’s FY23 financial performance, his strategy to make the startup profitable is by “providing stellar services and responsible entrepreneurship.”

At a time when the company’s confidentiality clause restricts the CEO from giving insights into how the company performed during FY23, it becomes imperative to highlight that Skill-Lync’s FY22 loss bloated 6X year-on-year (YoY) to INR 140 Cr. Its revenue from operations in FY22 rose 3X to INR 46.7 Cr from INR 15.9 Cr in FY21.

Interestingly, another part of the edtech’s strategy to generate revenue was to take a 10-15% share of students’ income once they get placed after completing the course.

One year after the inception of the edtech, CEO PaneerSelvam said that the monetisation will come from students who will share 15% of their salaries with the company for at least two years.

However, the model hardly seems to have worked given that a majority of students allege sitting jobless even after completing their courses.

Further, the edtech’s decision to lay off 600 employees and shut its offices in Hyderabad and Bengaluru (as per sources) to cut costs and increase its runway has done more harm than good. According to the students that Inc42 spoke with, this has had a negative impact on the quality of the courses and many students now want to drop out.

“There are practically no teachers. Even more frustrating is the fact that there is no one to attend to our cancellation requests,” said a student, who is leading a group of former Skill-Lync candidates in Chennai. Let us reiterate that the company “does not have any cancellation/refund policy”.

The student added that since many employees have been fired, students aren’t sure if the company will be able to complete the tenure of their courses, let alone job ‘assistance’.

Skill-Lync’s CEO has rubbished the allegations by stating that the edtech has a team of 60 full-time teachers who teach over 2,000 students every week.

Students Under A Pile Of Debt 

Despite Skill-Lync’s claims of making the next generation of Indian engineers job ready, the reality is that many fresh-out-of-college engineers have only been tricked into taking loans and are now struggling to pay off the debt in the absence of guaranteed jobs.

While many students have alleged that they have failed to find a job even after completing their course, others are facing continuous harassment from loan agencies and recovery agents for failing to pay EMIs.

“One of the partner NBFCs has threatened legal action against me because of my four pending EMIs,” a student said, requesting anonymity.

Can An Edtech Policy Resolve Such Gaps?

At a time when the Indian edtech sector is stuck between a rock and a hard place to curtail the rise of bad apples in the space, many sectoral experts want the government to weave a fool-proof edtech policy.

Speaking with Inc42, an industry analyst said that under the Reserve Bank of India’s (RBI’s) guidelines, partner lenders are required to conduct due diligence on educational institutes and edtech platforms, the courses they offer, and the associated fee structure before agreeing to disburse loans.

“Unfortunately, we have seen many cases of predatory lending in the edtech space since the pandemic, and this is giving the industry a bad name,” the analyst said, requesting anonymity.

Given that more and more instances of allegations and frauds are coming to the fore in the industry, the blame lies on lenders too, the expert added.

What is more concerning is that the industry has time and again urged the government to regulate the sector, but little has been done so far.

In 2021, the Indian government issued an advisory to the edtech companies and notified them that such firms will fall under the Consumer Protection (e-commerce ) Rules, 2020, but this has not been able to achieve the objective of streamlining the sector like in the case of the fintech industry.

After the government’s intervention, leading edtech companies like BYJU’S, Unacademy, upGrad, and Vedantu got together in 2022 to form an Indian Edtech Consortium for self-regulating the industry.

Ironically, some of the member companies in the consortium have also faced allegations of unethical practices. It is due to such instances that the sector today demands the Centre and state governments to come together in the best interest of students, and formulate regulations that can keep any instances of future fraud or even aberration at bay.

[Edited by Shishir Parasher]

The post How Edtech Skill-Lync Pushed Students Into A Debt Trap With False Promises appeared first on Inc42 Media.

Back in 2011 when Indian startup InMobi acquired the elusive $1 Bn valuation, the word ‘unicorn’ was yet to be coined. Just two years later, in 2013, venture capitalist Aileen Lee came up with the term to refer to startups that were a ‘rare’ billion-dollar private tech enterprise.

A decade later, Indian unicorns seem to have taken the country and the entire world by storm. From minting its first unicorn in 2011, the Indian startup ecosystem has today grown to foster 110 unicorns, accounting for 8.8% of the global number.

According to Inc42’s Decoding India’s Unicorn Club Report 2023, the country had a mere 42 unicorns till 2020, which grew to 87 by the end of 2021. 

Thereon, macroeconomic volatilities weighed on the Indian startup ecosystem, which could add only 22 unicorns to its kitty till September 2022. Since then, there has been a dry spell of unicorns in the world’s third-largest startup economy.

Interestingly, these uncertainties could not stop investors from accumulating dry powder and backing big-ticket Indian startups. The headwinds notwithstanding, Inc42 estimates that India’s unicorn club will have more than 280 startups by 2030.

Leading the charge will be the investors who have been pumping billions of dollars into the ecosystem and are expected to pave the way for many more in the not-so-distant future. 

However, what’s striking is that only a handful of venture capital (VC) and private equity (PE) firms have been the biggest backers of Indian unicorns. Inc42 has collated a list of investors who have actively contributed to the growth of unicorns in India. Let’s take a look!

Editor’s Note: The list has been arranged in descending order of the number of unicorns backed by these investors.

Tiger Global

Since the fund ventured into India in 2007, Tiger Global has emerged as one of the most active investors in the Indian startup ecosystem. Largely stage-agnostic, Tiger Global focusses on Series A to pre-IPO stage startups. 

The New York-based VC firm counts 39 Indian unicorns in its portfolio, including names such as Flipkart, Bharatpe, and NoBroker, among others.

In June 2023, the firm raised $2.7 Bn for its 16th fund, a far cry from the target of $6 Bn set by the investment firm previously. 

Peak XV Ventures

Peak XV Partners, formerly known as Sequoia India, is one of the biggest investors in the Indian startup ecosystem. Since foraying into India with the acquisition of Westbridge Capital Partners back in 2006, the VC firm has invested in a host of Indian startups across sectors and segments. 

Being one of the first marquee global investors to ride on the Indian startup wave, Peak XV Partners has previously backed names such as Flipkart, Paytm, and BYJU’S, among others.

With $9 Bn worth of assets under management (AUM), Peak XV Partners has so far invested in more than 400 Indian startups, of which as many as 37 have turned unicorns while some have even listed. 

Some of its big-ticket unicorn investments include the Good Glamm Group, BharatPe, Zomato, Freshworks, Ola, OYO, Pine Labs, and Razorpay, among others. 

SoftBank

SoftBank is a Japanese tech investor that operates a global fund called SoftBank Vision Fund, which invests in tech-based startups across the world. 

So far, SoftBank has invested capital to the tune of $15 Bn in homegrown startups and counts India as its third-largest market, after the US and China, in terms of the number of deals. 

The tech investor has so far backed 22 unicorns, including the likes of Ola, Paytm, and Blinkit (formerly Grofers), among others. As many as four unicorns in its India portfolio, Swiggy, Lenskart, FirstCry and OfBusiness, are also planning to go public soon. This could bring a major windfall gain for SoftBank. 

Innoven Capital

Since its inception in 2008, Temasek-backed InnoVen Capital has emerged as one of the biggest players in India in the venture debt space. It has backed 200 startups so far and has deployed more than $800 Mn so far globally. 

It backs early and growth stage tech-based startups. Other than India, it also operates in China and some parts of Southeast Asia.

Within India, the startup has had a stellar run and has so far provided debt funding to 19 Indian unicorns, including the likes of Myntra, OYO, BYJU’S, PharmEasy, and VerSe Innovation (Dailyhunt parent). 

Trifecta Capital

Founded in 2015 by Nilesh Kothari and Rahul Khanna, Trifecta offers equity as well as debt funding to startups. The alternate financing firm also offers financial advisory services to its portfolio startups. 

With more than $600 Mn in AUM, Trifecta focuses on startups from industries such as consumer services, consumer brands, ecommerce, mobility, edtech, and agritech, among others. 

Trifecta Capital claims to have pumped in more than INR 5,500 Cr in Indian startups since 2015. It counts 25 unicorns in its kitty, including big names such as Meesho, NoBroker, BharatPe, Urban Company, Licious, and Rebel Foods. 

Accel India

Headquartered in the US, Accel was one of the early global investors to enter India to back the burgeoning startup ecosystem. It entered India in 2005 with the acquisition of a $10 Mn early stage fund called Erasmic Venture Fund, which was rebranded as Accel India later. 

Since its India entry, it has launched seven funds and invested in startups across sectors. Accel India, which invests across stages from seed to growth stage, had a cumulative portfolio valuation of well over $100 Bn as of mid-2022. 

With more than 22 unicorns under its belt, Accel India has so far invested in the likes of Flipkart, Chargebee, Freshworks, Vedantu, BookMyShow, Myntra, Moglix, Ninjacart, and Swiggy. 

The post Chasing Unicorns: Meet India’s Top Investors With Most Unicorns In Their Portfolio appeared first on Inc42 Media.

A very happy Independence Day to all Indians everywhere from Team Inc42. It’s a day to cherish our freedoms and memorialise the hard roads we took to get them.

It’s been a year of struggles for Indian startups, but as Indians all over the world celebrate the 77th Independence Day and India’s 76th year of freedom, we wanted to talk about what this struggle has yielded.

Last year, we spoke about the paradox that is Digital India because we saw that the Indian internet economy’s growth is at times tempered by debatable policy decisions and a digital divide. And while many of these macro issues persist today, Indian startups have found some rays of hope in the gloom and doom of the past 12 months.

Not only have more entrepreneurs returned to the table to build again but there’s also a renewed freedom to pursue niche business models. Further, we have seen digital public goods become a major factor in the past year, driving innovation among incumbents. On the investor side, there’s more enthusiasm to back early-stage innovation and to be part of the startup ecosystem’s growth story.

But at the same time, we cannot ignore what we need to work towards — a lot more focus on corporate governance, cutting the reliance on external funding and building with a bootstrapped mindset, shedding vanity metrics and an effort to build efficient models despite regulatory hurdles.

As India’s 76th year of independence begins today, we are looking to focus on what we have achieved in the past year, and why Indian startups need freedom from regulatory bottlenecks, the shortsightedness of leaders and vanity metrics-driven faulty business models that are holding back the potential of the world’s third-largest startup economy.

Freedom From Bad Actors & Founder Myopia 

There’s no way around it. We have seen several unscrupulous acts in the past year and only a handful have actually made the headlines. Investors and limited partners are enforcing stricter processes in the aftermath of the litany of allegations about revenue inflation, forging of books and more. We all know the names.

What needs to be celebrated is the spotlight on best practices and governance standards, which are fast becoming investment criteria. And VCs are delivering the message clearly even in their existing portfolios, which has even resulted in founders coming clean and confessing.

Granted, a lot of these issues are being swept under the rug before they make the headlines, but there’s certainly a push towards stronger controls, which is highlighted by the several CFO and independent director appointments in the past few months.

Inc42’s ‘The State Of Indian Startup Ecosystem Survey 2023’ shows that just 36% of surveyed investors have high confidence in the startup governance standards. It’s a clear focus area for VCs.

Freedom From Over-Reliance On VC Money

The biggest startups in the country are making strides towards profitability (even though some of them are mere claims at the moment). But just consider Zomato’s first-ever net profit, Paytm coming within touching distance of doing the same and listed companies generally turning things around in the first quarter of FY24.

In the case of startups too, the focus has turned to customer money rather than VC money. Consumer internet startups are experimenting with subscription models that increase stickiness. Many are also reducing their reliance on discounts by leveraging customer data or with the right channel mix.

The efficiency in unit economics is bound to trickle down from listed companies to startups. That’s the nature of the market.

Freedom From Vanity Metrics

Even in the age of profitability, startups will need external funding rounds for working capital. And while founders have long relied on vanity metrics such as GMV, downloads and user base to court investors, profitability is the master metric today with a sharp focus on unit economics and contribution margins.

The experience of the past year brings some hope that new funds will likely be utilised towards actually moving the revenue needle rather than for hollow growth. Even though funding is the lifeblood of startups, the incentives from investors are changing.

The spate of write-offs and markdowns has prompted investors to insert conditions in term sheets related to tranches, such as revenue or profitability benchmarks, IPO targets and more.

Freedom From Rampant Regulation

Best-laid plans can be derailed by regulators. Startups and investors have benefitted from policies but many rules and regulations tend to blindside them as well.

Whether it is the RBI’s strict eye on the fintech sector or the ever-changing landscape for ecommerce, gig economy platforms, consumer internet companies, taxation for angel investors, crypto and now online gaming, there’s always something new around the corner that startups have to grapple with.

The most recent Digital Personal Data Protection Act could prove to be another significant headwind for tech startups. In response to the waves of regulations, startups have teamed up in the form of self-regulatory bodies and have also achieved greater say in key lobbying bodies such as IAMAI, but the side effect of interventionary regulation is that it disrupts existing models, and that’s something startups definitely need freedom from.

Undoubtedly there’s a lot of ground to cover for the startup ecosystem, but the past year has also unearthed some positive trends that have proven to be liberating for founders and investors. 

Freedom To Start Up Again

Amid the ongoing funding winter, there’s also a spring of second-time and serial founders starting up again in India. The churn has brought in fresh optimism for founders.

The trend of serial entrepreneurs launching new startups with a bang has been clear for a number of years even before 2023. And now, the funding winter has accelerated plans for many founders who have been mulling exits from their existing ventures. Early stage capital is more easily available than growth capital and ideas are more likely to be backed if there’s an experienced hand running things.

There’s a realisation that product-market fit is more critical now and this opens up the field for new ventures. In other cases, entrepreneurs are no longer able to influence matters in their company because perhaps the startup has pivoted or simply because their role which may have been critical at one time, is no longer relevant.

For founders starting up again, often they already have the investors in place. Due diligence gets even thinner in the case of a noted founder and past experience reduces chances of failure in many cases.

Freedom To Retreat From Loss-Making Areas

While some founders have the luxury of starting over, others have to see their startups through a rough patch.

The layoffs that have plagued the startup ecosystem are a sign that cutting off a stunted branch is often better than letting the tree suffer. Startups have looked to retreat from loss-making verticals and shut businesses that proved to be cost drains. Growth at all costs and in all areas is simply not sustainable. The freedom that comes from knowing this will create more sustainable employment at startups in the long run.

Now, layoffs are terrible. We don’t see that as a good thing, but this experience could yet prove to be a valuable lesson for startups to chase value instead of just outright scale.

Freedom To Add Value As Investors

India’s wealthy class is moving away from investing in public markets to private startups. Some of the most storied investors across stages are approaching LP management through a domestic lens and tapping India’s vibrant family office and HNI landscape for new fund raises.

The influx of domestic capital is about to unlock the future of startups as an asset class in India. As startups have entered the mainstream, even the most inexperienced investors are looking for a piece of the action.

As we saw at MoneyX last month, VCs and PE firms, family offices, HNIs and angel investors are now looking at the Indian startup opportunity with a more bullish lens, as far as the next decade is concerned.

Freedom To Leverage Digital Public Infrastructure

India is a unique market, where monetisation has long remained an elusive target for consumer internet startups. The same could even be said for fintech companies that have en masse entered into digital lending from various parts of the financial services world.

Even ecommerce companies have struggled with scaling up due to logistics hurdles or challenges in seller partnerships. But one thing that has undoubtedly eased the operational overheads for many startups is the high degree of digital public infrastructure in India — from UPI to IndiaStack to ONDC and other initiatives that seek to democratise vital sectors.

From the successful rollout of the UPI to the beta launch of the ONDC, a slew of state-backed projects have taken off in the past few years. While Aadhaar has been the building block, the overall architecture is part of the larger IndiaStack which also includes other in-progress products such as the Open Credit Enablement Network (OCEN) and a potential insurance-related offering.

If not directly enabling startup business models, digital public goods have created the foundation for the adoption of digital services through consent-based data sharing, interoperability, easing friction, and removing entry barriers for digital adoption.

The post India’s 77th Independence Day & What Freedom Should Mean For Startups  appeared first on Inc42 Media.

In 2013, venture capitalist Aileen Lee floated the term ‘unicorn’ for private companies or startups to indicate the rarity of startups with a valuation of over $1 Bn. A decade later, unicorns in India are no longer rare! In May 2022, India became home to 100 unicorns, when neobanking startup Open raised $50 Mn to claim the position of India’s 100th unicorn.

India achieved the milestone shortly after a wild funding year which saw Indian startups raising $42 Bn across 1,583 deals in 2021 and minting 45 unicorns in the process. India ended 2021 with 87 unicorn startups, and at a striking distance from scoring a century of unicorns, according to Inc42’s unicorn tracker. 

The march continued in 2022, as India added 20 more unicorns to the club.

From producing its first unicorn in the form of InMobi in 2011 to hitting the century of unicorns in India by 2022, it has been a long and eventful journey for the Indian startup ecosystem. The country is witnessing an unprecedented surge in VC investment and tech entrepreneurship, and the Startup India initiative has played an important role in it.

Since its inception in 2015, a slew of policies, FoF and thematic funds, incubation programs, tax holidays and tax benefit schemes have been announced and launched under the Startup India initiative. With a massive tech transition to digital services and products in place and an active internet subscriber base of over 783 Mn (as of February 2022), India is now ready for the next stage of tech evolution.

While 2021 was the year of record-breaking funding, 2022 has seen India achieve a historic landmark in the first few months with 22 Indian startups entering the unicorn club. The focus should now be on the sustainability of these 100+ unicorns and helping a new set of Indian startups turn unicorns.

However, for that, the government will need to work on removing some of the obstacles like solving structural issues in the economy, preventing migration of Indian startups to cities like Dubai, and improving the ease of doing business, among others, to achieve the plausible target of having 280 unicorns by 2030.

List Of Unicorns In India

Collectively, the 110 Indian unicorns have raised a total of $99 Bn in funding to date and are valued at around $347 Bn combined. We at Inc42 have been tracking Indian unicorns since 2016.

Here is a list of all the startups in India’s unicorn club:

Unicorns In India: Indian Startups That Entered The Unicorn Club In 2022

1mg

Founded in 2015 by Prashant Tandon, Gaurav Agarwal and Vikas Chauhan, healthtech startup 1mg offers medicine delivery, B2B distribution of medicines, healthcare products and diagnostics and telemedicine services. 1mg became India’s fifth healthtech unicorn after raising $40 Mn in a round led by Tata Digital.

According to the healthtech unicorn’s website, it delivers to more than 1,800 cities and towns in India, having shipped more than 31 Mn orders since 2015. 1mg was acquired by Tata Digital in 2021.

Post the deal, the startup was renamed Tata 1mg. The unicorn is also a part of Tata Digital’s super app, Tata Neu. Tata 1mg’s losses widened to INR 526 Cr in FY22, up 67% from INR 314 Cr reported in FY21. At the same time, its consolidated revenue reached INR 644.8 Cr, up 104% from INR 316 Cr reported in FY21. However, its total expenses also increased 85% to INR 1,171 Cr from INR 630 Cr in FY21.

Shiprocket

Founded in 2017 by Saahil Goel, Vishesh Khurana, Gautam Kapoor and Akshay Gulati, Shiprocket is a Gurugram-based third-party logistics service provider, backed by the likes of Zomato, Temasek and Bertelsmann. The 3PL player became India’s 106th unicorn in August 2022 when it raised $33.5 Mn in a round led by Lightrock India.

Shiprocket claims to serve the logistics needs of more than 2.5 Lakh sellers across India and ships to more than 70 Mn consumers annually. The company offers logistics services to ecommerce sellers and direct-to-customer (D2C) brands alike, also providing tech-enabled logistics solutions for sellers.

In 2022, Shiprocket has made five acquisitions so far, including one of the biggest-ever acquisitions in the Indian startup ecosystem when it acquired rival 3PL player Pickkr for $200 Mn in June.

5ire

Founded in 2021 by Pratik Gauri and Prateek Dwivedi and Vilma Mattila, 5ire is a 5th generation Layer-1 (L1) blockchain network. The deeptech startup joined India’s unicorn club in July 2022, after raising $100 Mn in a funding round led by UK-based conglomerate SRAM & MRAM at a valuation of $1.5 Bn.

5ire has its own blockchain, called 5irechain, which is based on sustainability and works on a Proof-of-Benefit methodology for consensus. 5ire’s blockchain measures and rewards sustainability using a unique mathematical model. Talking with Inc42, Gauri said that Proof-of-benefit gives scores based on the UN’s 17 sustainable development goals (SDGs) and 650 environmental, social and governance (ESG) parameters.

The newly-minted unicorn will keep India as its core focus and is working with various companies and government agencies across the globe to solve sector-agnostic problems with blockchain.

OneCard

Founded in 2018 by Anurag Sinha, Rupesh Kumar and Vaibhav Hathi, OneCard is a Pune-based fintech startup that offers Visa credit cards. The startup joined the unicorn club, becoming India’s 104th unicorn in July 2022 after it raised $100 Mn in a round led by Temasek. According to Inc42’s calculation, the startup’s valuation reached $1.25 Bn with the latest funding round.

Apart from offering credit cards, OneCard also has its own credit score platform called OneScore, which allows users to check their credit score free of charge. OneCard has disbursed over 2.5 Lakh cards to its customers so far. In FY21, the startup recorded a loss of INR 33.1 Cr, with its revenue standing at INR 16.3 Cr.

OneCard competes with other credit card providers such as slice and Uni Card, among others. The newly-minted unicorn becomes India’s 22nd fintech unicorn.

LeadSquared

Founded in 2011 by Nilesh Patel, Sudhakar Gorti and Prashant Singh, LeadSquared offers CRM, marketing and sales software solutions. The India and US-based startup became India’s 103rd unicorn in June after it raised $153 Mn from WestBridge Capital, taking it to unicorn valuation.

The startup offers products to verticals such as edtech, healthcare, BFSI, real estate, automotive and hospitality. The newly-minted startup has more than 2,000 enterprise clients and 150K mobile users across 40 countries, counting the likes of BYJU’S, Dunzo, Zoomcar and Cars24 among its clientele.

The SaaS unicorn’s cofounder and CEO Nilesh Patel, while talking with Inc42, had said that LeadSquared will go for acquisitions and international expansion with the incoming funds. “The intent is to look at what is there and basically what offers the opportunity to expand faster than the market,” he added.

Purplle

Founded in 2012 by Manish Taneja and Rahul Dash, Purplle is a Mumbai-based ecommerce startup focused on beauty-oriented products and appliances. It became India’s 102nd unicorn after it raised $33 Mn in a Series E funding round, from new and existing investors at a valuation of $1.1 Bn. The ecommerce startup has raised a total of $215 Mn so far.

Purplle features a range of products from both legacy and new-age beauty companies, having more than 1,000 brands and over 60,000 products listed on its platform. The Mumbai-based ecommerce unicorn also claims to have 7 Mn users. It has also created a house of brands with the likes of FACES CANADA, Good Vibes, Carmesi, Purplle, and NY Bae.

It is targeting an annualised GMV rate of $180 Mn in FY22, having recorded a loss of INR 51.27 Cr in FY21, up 110% from INR 24.38 Cr in FY20.

PhysicsWallah (PW)

Started in 2016 as a physics-focused competition prep YouTube channel by Alakh Pandey and Prateek Maheshwari, PhysicsWallah pivoted to being a full-fledged edtech platform in 2020. The startup became India’s 101st unicorn after raising $100 Mn in a Series A round from Westbridge and GSV Ventures, at a valuation of $1.1 Bn.

The edtech platform focuses on competitive exam prep for NEET and IIT/JEE alone, with multiple course offerings on both its YouTube channel, the website and the mobile app. PW, as it is colloquially known, claims that more than 10,000 of its students have cracked NEET and JEE in 2020 and 2021.

PhysicsWallah is also moving towards offline centres, having already opened 20 centres in 18 cities so far. With the recent fundraise, the Noida-based edtech startup will open another 20 centres across the country.

Open

Open, the 100th Indian unicorn, is a neobanking fintech startup founded in 2017 by Anish Achuthan, Ajeesh Achuthan, Mabel Chacko, and Deena Jacob. Open offers business banking, payments, and expense management services to small and midsize businesses (SMBs) across the country. 

The startup claims to have increased its customer base to 2.3 Mn in the past 12 months and plans to reach 5 Mn customers globally in the next year. Open processes over $24 Bn annually and claims to add 100K SMEs every month.

The fintech startup counts Temasek, BEENEXT, 3one4 Capital, and Trifecta Capital Advisors among its key investors. It has raised $140 Mn so far.

Open hit the unicorn status in April 2022, becoming the 100th Indian unicorn, by raising $50 Mn at a valuation of $1 Bn.

Games24x7

Founded by Bhavin Pandya and Trivikraman Thampy in 2006, Games24x7 is a gaming startup which houses popular brands such as RummyCircle, an online card game, and sports fantasy game My11 Circle. The third product from the startup is U Games, a hub for casual games.

Games24x7 became the 99th unicorn of India in March when it raised $75 Mn in a funding round led by Malabar India Fund at a valuation of $2.5 Bn. Its existing investor US-based hedge fund Tiger Global also participated in the funding round.

Games24x7’s My11Circle competes with Dream11, MPL, BalleBaazi, and Nazara’s Halaplay, among others. RummyCircle’s competitors include PlayRummy, JungleeRummy, and Adda52Rummy, among others. 

Oxyzo

Oxyzo, the financial arm of B2B commerce unicorn OfBusiness, was founded in 2016 by OfBusiness founders Asish Mohapatra and Ruchi Kalra. It is a lending platform that provides cash flow and matched working capital financing for buying new materials for SMEs in the manufacturing and contracting sectors.

The Indian startup claims to have $350 Mn in assets under management (AUM), growing 100% on a year-on-year (YoY) basis. Oxyzo is currently serving 2,500+ SMEs across India, disbursing loans worth INR 4,000 Cr per annum.

It counts the likes of Alpha Wave, Tiger Global, Norwest Venture Partners, Matrix Partners, and Creation Investments among its investors, and has raised only one funding round so far. However, it was the largest Series A funding round in the country. The startup raised $200 Mn in that funding round, turning into a unicorn.

Amagi

Founded in 2008 by Baskar Subramanian, Srinivasan KA, and Srividhya Srinivasan, Amagi offers creation, distribution, and monetisation tools for live, linear, and on-demand channels across cable, OTT, and free ad-supported streaming TV platforms.

The Bengaluru-headquartered cloud-based media Saas technology startup turned unicorn earlier this year after raising $95 Mn in a funding round led by Accel. Recently, it also announced the enhanced version of its live orchestration platform, Amagi LIVE.

CredAvenue

Continuing the momentum from 2021, debt marketplace CredAvenue joined the unicorn club in March 2022. CredAvenue entered the unicorn club with $137 Mn funding from Insight Partners, B Capital, and Dragoneer Investment Group, among others. 

At the time of the fundraise, the startup said that it intended to use the funds to expand the business in India along with key global markets, organically and inorganically, by acquiring diverse companies for forward and backward services and products integration.

Founded by Gaurav Kumar in 2017, CredAvenue is a debt platform that connects enterprises with lenders and investors.

Its offerings include CredLoan, CredCoLend, Plutus, CredSCF and CredPool. It claims to have more than 2.3K corporates and over 750 lenders in its portfolio.

It recently acquired an 82% stake in SaaS startup Corpository through a combination of primary investment and secondary purchase from existing shareholders. In February 2022, the startup acquired about 75% stake in digital collections startup Spocto.

Hasura

Founded in 2018 by Tanmai Gopal and Rajoshi Ghosh, Hasura provides data access and data flow tools and services via GraphQL APIs, a solution to accelerate product and data delivery. The company’s technology automatically creates real-time GraphQL APIs, granting customers instant access to their data via secure APIs.

Hasura entered the unicorn club early this year after raising $100 Mn led by Greenoaks Capital. The Series C funding round also saw participation from existing investors such as Nexus Venture Partners, Lightspeed Venture Partners, and Vertex Ventures.

The Series C round came almost after two years of its Series B round. The Indian startup had raised $25 Mn from Lightspeed Venture Partners in participation with Vertex Ventures, and Nexus Ventures, among others, in its Series B round.

Uniphore

Conversational automation startup Uniphore became the eighth unicorn of 2022 after raising a record $400 Mn in funding at a valuation of $2.5 Bn. 

Founded by Ravi Saraogi and Umesh Sachdev in 2008, Uniphore is a conversational automation platform that combines conversational AI, workflow automation, and RPA (Robotic Process Automation) in a single integrated platform to transform and democratise customer experience across industries.

The startup is backed by marquee investors like Sorenson Capital Partners, Serena Capital, Cisco Investments, Iron Pillar, and Chiratae Ventures, among others.

Checkout The Indian Unicorn Tracker

Xpressbees

Logistics startup Xpreesbees was one of the early entrants to the unicorn club this year. The startup, which began its operations under Supam Maheswari’s FirstCry, later spun off to operate independently in 2015. The logistics startup claims to have operations across 3,000 cities and delivers across 20,000 pin codes. 

The startup bagged $300 Mn in its Series F round led by Blackstone Growth, TPG Growth, and Chrys Capital to cross the $1 Bn valuation mark. Currently, the startup has 100 hubs with over 10 lakh sq ft warehousing capacity.

Livspace

Founded in 2014 by Anuj Srivastava and Ramakant Sharma, Livspace is a curated marketplace that provides an end-to-end home design experience. The startup’s online marketplace also offers software tools that can help designers and homeowners design interiors.

It is present across nine metro cities and claims to have served about 20,000 customers. In India, Livspace competes with Bengaluru-based Homelane and other players in a largely unorganised market for home redesigns, interior design and custom furniture.

The startup hit the unicorn valuation in February 2022, raising $180 Mn in a funding round.

In total, it has raised upwards of $431 Mn through various funding rounds from investors such as Kohlberg Kravis Roberts, Trifecta Capital, and Tahoe Investment Group.

ElasticRun

Founded in 2016 by Sandeep Deshmukh, Saurabh Nigam and Shitiz Bansal, ElasticRun’s tech platform acts as an extended arm of FMCG companies’ direct distribution networks in rural areas and enables these businesses to reach small ’Kirana’ stores in the hinterland. The startup also engages with banks and financial institutions to give them access to underserved SME customers from its Kirana network.

The Pune-based commerce startup entered the unicorn club in February after it raised $300 Mn in a funding round led by Masayoshi Son’s SoftBank. It also saw the participation of New York-based Goldman Sachs, Prosus Ventures (earlier known as Naspers Ventures), Innoven Capital, and Abu Dhabi’s Chimera Investment, a subsidiary of Abu Dhabi’s Royal Group.

DealShare

Founded in September 2018 by Vineet Rao, Sourjyendu Medda, Sankar Bora and Rajat Shikhar, DealShare is a social ecommerce marketplace. It enables first-time internet users to shop online. 

The startup sells grocery and household essential products through social media and messenger platforms like WhatsApp. DealShare competes with the likes of social commerce unicorn Meesho, BulBul, YouTube’s SimSim, and GlowRoad, among others. 

At the beginning of 2022, the Bengaluru-based social commerce startup raised $165 million from investors led by Tiger Global and Alpha Wave Global to become the fifth Indian unicorn of 2022.

Darwinbox

Founded in 2015 by Chaitanya Peddi, Jayant Paleti and Rohit Chennamaneni, Darwinbox is a cloud-based HRtech startup that caters to companies’ HR needs across recruitment, onboarding, core transactions (leaves, attendance, directory), payroll, travel and people analytics, among others.

Darwinbox raised $72 Mn in a funding round led by Technology Crossover Ventures. With this capital infusion, the startup’s valuation crossed the $1 Bn mark, making it the third Indian unicorn minted in 2022.

Existing investors Salesforce Ventures, Sequoia India, Lightspeed India, Endiya Partners, 3One4Capital, JGDEV and SCB 10X also participated in the round.

LEAD

Founded in 2012 by Sumeet Mehta and Smita Deorah, LEAD is a Mumbai-based edtech startup focusing on enabling better school education using technology.

LEAD offers a range of services, including full-stack school edtech solutions targeting students, especially in non-metro cities. The startup aims to reach 25 Mn students in 60,000 schools by the end of 2026. According to the startup, it will be entering the 2022-23 academic year with more than 5,000 schools from across 500 Indian cities on board, serving more than 2 Mn students.

LEAD became the first Indian startup to hit unicorn valuation in 2022 when it raised $100 Mn at a valuation of $1.1 bn. The edtech startup is backed by WestBridge Capital, Elevar Equity and GSV Ventures, among others. It has raised $166 Mn across various funding rounds.

Fractal

Fractal Analytics was founded in 2000 by a five-member team including IIM Ahmedabad alumni Srikanth Velamakanni and Pranay Agrawal, along with Nirmal Palaparthi, Pradeep Suryanarayan, and Ramakrishna Reddy. 

Fractal provides artificial intelligence and advanced analytics solutions. The AI and advanced analytics solutions startup employ people across 16 locations globally, including India, the US, the UK, and Singapore, among others.

The Mumbai and New York-based startup offers several products such as Qure.ai which assists radiologists, Crux Intelligence to assist CEOs and senior executives, and Theremin.ai to improve investment decisions, among others.

Velamakanni-led Fractal entered the growing unicorn list in January 2022 with an investment of $360 million from the private equity firm TPG Capital Asia. Although it became the second unicorn of 2022 following MamaEarth, it had to wait for two decades for it.

boAt

Founded in 2015 by Aman Gupta and Sameer Mehta, boAt has become a household name in India’s consumer electronics market. boAt offers 100+ products across categories, including headphones, smartwatches, speakers, gaming accessories and personal care appliances. boAt recently said its net sales rose to around INR 4,000 Cr during FY23 without disclosing other financial metrics.

In FY22, the startup reported a net profit of INR 68.7 Cr. The startup claims to be the fifth-largest wearable brand globally. Per a 2022 report by International Data Corporation (IDC), the startup secured a 32.1% market share of India’s wearables market in Q3 2022, aided by earwear devices.

Unicorns In India: Indian Startups That Entered The Unicorn Club In 2021

Acko Insurance

Insurance provider Acko entered the coveted unicorn club in 2021 after it raised $255 million in its series D funding round led by private equity firms General Atlantic and Multiples Private Equity. The Mumbai-based unicorn has raised around $428 Mn to date. Founded in 2016 by Varun Dua and Ruchi Deepak, Acko offers auto insurance and covers workers through partnerships with companies, including Zomato and Swiggy. 

Acko counts Amazon, Accel Partners, Catamaran Ventures, Elevation Capital, RPS Ventures, and Binny Bansal, among others, as its investors. The startup has also introduced a health insurance policy for consumers between the ages of 18 to 45 years as part of its strategy to enter the retail health insurance space.

Apna

Founded in 2019 by Nirmit Parikh, Apna provides a job marketplace for India’s blue-collar workers and skilled professionals such as painters, carpenters, and sales agents, among others. It entered the celebrated unicorn club in 2021, within two years of its inception, when it raised $100 Mn in a Series C round led by Tiger Global at a valuation of $1.1 Bn.

During the fundraise, the startup claimed it had over 16 Mn job seekers on its platform and that it helped 150K employers hire talent. 

Zomato, Urban Company, PhonePe, BurgerKing, edtech giant BYJU’S and Bharti AXA are among the clients served by Apna. The startup recently launched its first brand campaign to reach job aspirants pan India.

Checkout The Indian Unicorn Tracker

BharatPe

From boardroom battles to social media spats, Indian startup BharatPe has been the talk of the town in the last couple of months. The controversies around the startup started with an infamous audio recording which gradually culminated in the resignation of BharatPe cofounder Ashneer Grover. 

In sharp contrast to the current situation, the fintech startup was celebrated for all good reasons last year. It entered the unicorn club after raising $370 Mn in a Series E equity round, led by Tiger Global, at a valuation of $2.85 Bn. 

Founded in 2018 by Ashneer Grover and Shashvat Nakrani, BharatPe launched India’s first UPI interoperable QR code. It is primarily a merchant-focused payments platform that offers a single interface for all existing UPI apps and other payment systems. It has also diversified into lending and other verticals.

Blackbuck

Founded in 2015 by Rajesh Yabaji, Chanakya Hridaya, and Rama Subramaniam, Blackbuck connects businesses with truck owners and freight operators. The Bengaluru-based logistics startup lists truck services on its platform and does an intelligent match for customers, based on their requirements.

It entered the unicorn club in 2021 after raising $67 Mn in its Series E round. The startup claims to have over 15,000 clients, 12,00,000 + trucks. Blackbuck also has a presence in Europe.

Blinkit (Grofers)

Grofers, now rebranded as Blinkit, was founded in 2013 by Saurabh Kumar and Albinder Dhindsa. After witnessing several ups and downs, the startup entered the unicorn club last year following an investment from Zomato. The foodtech giant acquired a 9.16% stake in the online e-grocery firm for INR 518.2 Cr, which valued the startup at around $1 Bn.

Grofers initially started as an on-demand pick-up and drop-off service, and later forayed into the grocery business. After Zomato invested in it last year, Grofers rebranded itself as Blinkit to focus on quick commerce. 

“We learnt a lot as Grofers, and all our learnings, our team, and our infrastructure is being repurposed to pivot to something with staggering product-market fit – quick commerce. Today, we are surging ahead as a new company, and we have a new mission statement – “instant commerce indistinguishable from magic”. And we will no longer be doing this as Grofers – we will be doing it as Blinkit,” Dhindsa said in a blog post. 

Blinkit is also now all set to merge with Zomato in a share-swap deal. Zomato also approved a $150 Mn loan to Blikit’s parent company, Grofers India, in March. As part of the deal, the loan will be disbursed to Grofers in one or more tranches.

Browserstack

Founded in 2011 by Ritesh Arora and Nakul Aggarwal, Browserstack is a software and mobile app testing cloud platform. The homegrown software-as-a-service (SaaS) startup joined the unicorn club after it raised $200 Mn in a Series B funding round. The company claims that its platform is used by 4 Mn developers spread across 50,000 companies, including tech giants such as Google, Microsoft and Twitter. 

The startup has been profitable since day one and has been a market leader since its early days. Earlier this year, BrowserStack announced the launch of BrowserStack Champions, a community program to bring together the thought leaders of software testing and development.

CarDekho

CarDekho is an Indian search and ecommerce platform for new and used cars. It also has an insurance vertical. Founded in 2007 by Amit Jain and Anurag Jain, CarDekho claims to have tie-ups with many auto manufacturers, more than 4,000 car dealers and numerous financial institutions to facilitate the purchase of vehicles. 

The automobile marketplace turned unicorn in October 2021 after its parent CarDekho Group (also known as GirnarSoft) secured $250 Mn in its Series E financing round. The round was led by Leapfrog Investments alongside Canyon Partners, Mirae Asset, Harbor Spring Capital and existing investors Sequoia Capital India and Sunley House.

At the time of fundraising, Amit Jain, cofounder and chief executive of CarDekho, said that the startup was planning its initial public offering in the next 18 months. GirnarSoft’s revenue from operations stood at INR 884.3 Cr during the financial year ended March 31, 2021. 

Chargebee

Founded in 2011 by Krish Subramanian, Rajaraman Santhanam, Saravanan KP and Thiyagarajan T, Chargebee is a revenue management platform that automates revenue operations of over 4,000 high-growth subscription-based businesses.

The Chennai-based startup entered the unicorn club with its $125 Mn Series G Round in 2021. This year, the startup doubled its valuation to $3.5 Bn after a $250 Mn funding round led by major VC funds like Tiger Global and Sequoia Capital.

To date, Chargebee has raised total funding of $470 Mn. Its customer portfolio includes the likes of access management companies Okta, Freshworks, Calendly, and Study.com, among others.

CoinDCX

Founded in 2018 by Sumit Gupta and Neeraj Khandelwal, CoinDCX became the first Indian cryptocurrency exchange to reach unicorn status last year. The crypto exchange closed a $90 Mn Series C funding round in August 2021, led by Facebook cofounder Eduardo Saverin’s B Capital Group as well as Coinbase Ventures, Polychain Capital, Block.one, Jump Capital among others, to reach the unicorn status.

Recently, CoinDCX became India’s most valued crypto startup after it raised more than $135 Mn in a Series D funding round.

With this fundraise, the startup’s valuation soared to $2.15 Bn. It also runs CoinDCX Go, a crypto investment app; CoinDCX Pro, a professional trading platform; and DCX Learn, a crypto-centric investor education platform.

CoinSwitch Kuber

Founded in 2017 by Ashish Singhal, Govind Soni and Vimal Sagar Tiwari as a global aggregator of cryptocurrency exchanges, CoinSwitch launched its India exclusive crypto platform, CoinSwitch Kuber, in June 2020 to simplify crypto investments for Indian retail investors. 

Last year, it became the second crypto unicorn when it raised $260 Mn at a valuation of $1.9 Bn in its Series C funding round led by Coinbase Ventures and Andreessen Horowitz (a16z).

The Bengaluru-based crypto startup recently completed its first-ever employee stock ownership buyback plan (ESOP) worth $2.5 Mn.

CRED

Founded in 2018 by Kunal Shah, CRED offers premium credit card users rewards and benefits for paying credit card bills. It has also been working on ancillary services built around its primary ecosystem of credit card-centric services. The startup entered into P2P lending late last year. 

In April 2021, the Bengaluru-based fintech startup raised $215 Mn in Series D funding, at a post-money valuation of $2.2 Bn to turn unicorn. Later in the year, the startup raised $251 Mn in its Series E round, co-led by Tiger Global and Falcon Edge, at a valuation of $4 Bn. 

Recently, CRED allotted a total of 6,048 equity shares to around 125 employees upon ESOP conversion. The fintech startup is also reportedly in talks to raise another funding round which is likely to further soar its valuation from $4 Bn to around $6 Bn.

Cure.Fit

Founded in 2016 by Mukesh Bansal and Ankit Nagori, CureFit uses an online-offline model to offer physical fitness (Cult.fit), mental fitness (Mind.fit), and nutrition (Eat.fit). It also has a primary care vertical (Care.fit).

CureFit entered the unicorn club late last year after foodtech giant Zomato invested in the startup. Zomato sold its fitness facility arm Fitso to CureFit for $50 Mn and invested another $50 Mn in the health and wellness startup. In the cross-selling, Zomato acquired a total shareholding of 6.4% worth $100 Mn in CureFit. 

“This will help us potentially explore cross-selling benefits between Zomato and CureFit, as we see food and health becoming the same side of the coin in the long term,” Zomato founder Deepinder Goyal had said in a blog post then.

Soon after it became a unicorn, CureFit acquired at-home cardio equipment brands RPM fitness, Fitkit, Onefitplus, and Urban Terrain in a single transaction. However, the Zomato-backed fitness startup saw its sales revenue decline 67.4% in the financial year ending March 31, 2021. It posted total revenue of INR 294.9 Cr in FY21, as compared to INR 567.4 Cr in FY20.

Digit Insurance

Bengaluru-based insurtech startup Digit Insurance was the first unicorn of 2021. The startup raised $18 Mn from existing investors A91 PArtners, Faering Capital and TVS Capital in January 2021 at a valuation of $1.9 Bn.

Founded in 2016 by Kamesh Goyal and Prem Watsa’s Fairfax Holdings, Digit Insurance is a tech-driven general insurance company. The company offers customised policies on health, auto, travel, smartphones, and commercial properties such as stores and holiday homes. 

Digit Insurance recently said it crossed the INR 5,000 cr yearly revenue milestone in FY22. Its gross written premiums stood at INR 5,268 crore during the year.

Droom

Founded in 2014 by Sandeep Agarwal, Droom provides an online platform where users can buy and sell used and new automobiles in India and other emerging markets. Droom has four marketplace formats — B2C, C2C, C2B, and B2B, and three pricing formats — fixed price, best offer and auction.

The Indian startup entered the unicorn club after a pre-IPO round of $200 Mn in July 2021. Existing and new investors, such as 57 Stars and Seven Train Ventures, participated in the round. 

Later in the year, the auto marketplace converted itself into a public company. It is likely to launch its INR 3,000 Cr initial public offering (IPO) in the next two months.

EaseMyTrip

Founded in 2008 by Nishant Pitti, Rikant Pitti and Prashant Pitti, EaseMyTrip allows its customers to book air, rail and bus tickets, hotel and holiday packages, and also offers other travel services. In the Indian market, EaseMyTrip competes with Yatra, MakeMyTrip, ixigo, and Cleartrip, among others.

The Delhi-based traveltech startup was bootstrapped until its public listing in March 2021. Later in the year, it hit a market capitalisation of $1 Bn on September 17, soon after it announced its international foray into the US, the Philippines and Thailand markets.

The company also has a presence in the UAE, Singapore, and the UK. It is also planning to foray into currency exchange service for which it will be applying for a licence to the Reserve Bank of India, as per a PTI report.

Eruditus

After the pandemic accelerated the growth of the edtech industry in India, Mumbai-based Eruditus became India’s fourth edtech startup to join the unicorn club. It raised $650 Mn in a funding round led by Accel US and Masayoshi Son-led SoftBank Vision Fund II in 2021, which increased its valuation to $3.2 Bn from $800 Mn in 2020.

Founded in 2010 by Chaitanya Kalipatnapu and Ashwin Damera, Eruditus offers executive education programmes in association with global business schools such as MIT, Columbia, Harvard Business School, INSEAD, Tuck at Dartmouth, Wharton, UC Berkeley and London Business School.

The startup also offers courses from Indian institutions such as IIT Kozhikode, IIM Lucknow, and BML Munjal University among others. It is also backed by Bertelsmann India Investments, Chan Zuckerberg Initiative (CZI), a non-profit organisation headed by Facebook CEO Mark Zuckerberg and his wife Priscilla Chan.

GlobalBees

Thrasio-style startup GlobalBees joined the unicorn club in December 2021. It raised close to $111.5 Mn in a mix of equity and debt in a Series B round of investment led by FirstCry. The round also saw participation from SoftBank, Premji Invest, Chiratae Ventures, and Trifecta Capital, among others. The funding round valued GlobalBees at $1.1 Bn. 

Launched in 2021, GlobalBees, which is headed by Nitin Agarwal as the CEO, invests in and acquires seller businesses on Amazon India, Flipkart and other ecommerce marketplaces. 

Recently, Inc42 reported that GlobalBees would make its foray into the consumer electronics segment with an investment in D2C appliance brand Candes. In an extraordinary general meeting on April 18, the shareholders of Candes decided to allot 17,544 compulsorily convertible preference shares (CCPS) to GlobalBees. 

Good Glamm Group

Founded in 2015 as MyGlamm, The Good Glamm Group turned a unicorn last year after it raised $150 million in a Series D funding round led by Prosus Ventures (Naspers) and Warburg Pincus. Darpan Sanghvi, founder and CEO of The Good Glamm Group, built the direct-to-consumer makeup brand MyGlamm.

Last year, MyGlamm announced the formation of The Good Glamm Group to consolidate its position as a ‘Digital House of Brands’ powered by a content-to-commerce strategy. The Good Glamm Group runs multiple brands, including MyGlamm, MomsCo, POPxo and Baby Chakra, Plixxo, ScoopWhoop, among others. 

Continuing its acquisition spree, it acquired a majority stake in beauty and personal care brand Organic Harvest in February 2022 for an undisclosed amount.

Checkout The Indian Unicorn Tracker

Groww

Founded in 2017 by ex-Flipkart employees Lalit Keshre, Harsh Jain, Neeraj Singh, and Ishan Bansal, Groww offers direct plans for mutual funds and investing via mobile application and web platform. It also allows users to invest in stocks, mutual funds, ETFs, IPOs, and gold.

Talking about the inspiration behind starting Groww, Keshre recently said that he and other cofounders of the startup felt that financial products and services in India were more commission-centric than customer-centric. “We wanted to build a Flipkart for financial services,” Groww’s Lalit said at The Makers Summit 2022.

Groww raised $83 Mn in its Series D funding, led by Tiger Global, to enter the unicorn club. The round also saw participation from existing investors Sequoia India, Ribbit Capital, YC Continuity and Propel Venture Partners. Later in the year, Groww also raised $251 Mn in its Series E round, which valued the Indian startup at $3 Bn.

Gupshup

Founded by Beerud Sheth in 2004, Gupshup is a conversational messaging platform that caters to businesses from multiple sectors, including banking, ecommerce, hospitality, and consumer goods, among others. Along with India, it also has presence in the US and Latin America. Some of its clients include Kotak Mahindra Bank, IndusInd Bank, HDFC Bank, Ola, Zomato, and Flipkart. 

San Francisco-headquartered Gupshup entered the unicorn club in 2021 after raising $100 Mn in its Series F funding round led by Tiger Global Management.

The enterprisetech unicorn recently acquired a 100% stake in conversational AI provider AskSid in an all-cash deal to strengthen its customer experience offerings. In the last few months, Gupshup acquired Dotgo, Knowlarity, and Active.Ai.

Infra.Market

Founded in 2016 by Aaditya Sharda and Souvik Sengupta, Infra.Market is a B2B online procurement marketplace for real estate and construction material. The platform aggregates demand and matches it with the supply chain, with wholesale pricing on materials, along with affordable credit or financing.

The company’s platform connects its clients directly to its supply chain infrastructure for the ease of ordering, tracking and manufacturing till on-site delivery.

Infra.Market hit unicorn valuation in 2021 after it raised $100 Mn in a Series C funding round. It has backing of Accel, Tiger Global, InnoVen Capital, and Nexus Venture Partners, among others. The B2B startup has raised $376 Mn to date across various funding rounds.

Innovaccer

Founded in 2014 by Kanav Hasija, Abhinav Shashank and Sandeep Gupta, Innovaccer is a healthtech SaaS startup based out of Delhi-NCR. Innovaccer unifies previously siloed data and helps healthcare providers achieve better care quality at a lower cost. It further allows its customers and partners to develop interoperable applications to improve patient outcomes. 

The Innovaccer Health Cloud software is used by more than 50 healthcare organisations. Currently, the platform is being used to maintain medical records of over 24 Mn patients. It claims to generate savings of more than $600 Mn for institutions and healthcare providers in the US. 

Innovaccer hit unicorn valuation in 2021, it was the first healthtech unicorn in India, after raising $105 Mn in a Series D round. Shortly thereafter, the company raised another $150 Mn, taking its valuation to $3.2 Bn.

Licious

Founded in 2015 by Vivek Gupta and Abhay Hanjura, Licious is a D2C foodtech brand focused on cold-chain food deliveries, including meat. Licious functions on the farm to fork business model, meaning that the company owns the entire back-end supply chain.

In the fresh meat category, Licious specialises in chicken, goat, and lamb products, among others. Besides this, the company also offers a range of fish and seafood products, along with exotic meat varieties like turkey, blue crab, quail and Atlantic salmon.

The D2C startup became a unicorn in 2021, when it raised $52 Mn in its Series G round led by IIFL AMC’s Late Stage Tech Fund. The company is backed by IIFL, along with 3one4 Capital, Bertelsmann India Investments, Mayfield Fund, Nichirin, Temasek Holdings and Vertex. It has raised $488 Mn in funding so far.

Mamaearth

Founded in 2016 by Ghazal and Varun Alagh, Mamaearth initially started by selling baby care products but gradually moved on to become a complete personal care brand. 

The startup’s offering consists of a wide range of products, including hair, face and body products, among others. The startup claims that its products are dermatologically tested and FDA approved. It also claims that the products are ‘Made Safe’ certified. 

Mamaearth enjoys the backing of marquee investors like Sequoia India, Stellaris Ventures, Fireside Ventures, Marico’s Rishabh Mariwala, Snapdeal founders Kunal Bahl and Rohit Bansal, and Shilpa Shetty Kundra, among others. It has raised $111 Mn so far across various funding rounds. It crossed the $1 Bn valuation mark in December 2021, raising $38 Mn from Sequoia.

MapmyIndia

Founded in 1995 by Rakesh Verma, MapmyIndia is a digital mapping startup that offers geospatial data services to other companies, along with rivaling Google Maps and Apple Maps for mapping in the country.

With over 2,000 customers (as of September 2021) including the likes of Apple, Uber, Amazon, BMW, Honda, Toyota, Mercedes, Ola, Yulu, Flipkart, HDFC Bank as well as public sector entities such as the Central Board of Direct Taxes (CBDT), UMANG e-governance app, ISRO, and others.

MapmyIndia has been profitable for several fiscals now, and it was listed in December 2021, becoming the third profitable tech startup to make a public markets debut, following beauty marketplace Nykaa, and used car marketplace CarTrade.

It charted the unicorn territory with its IPO itself, hitting a market cap of more than $1 Bn with the initial listing. At business close on 9th May, its market cap hovers ever so slightly below the market value.

Meesho

Founded by Aatrey and Sanjeev Barnwal in 2015, Meesho is an online reseller network for individuals and small and medium businesses (SMBs), who sell products within their network on social channels such as WhatsApp, Facebook, and Instagram. It has about 13 Mn individual entrepreneurs, bringing the ecommerce benefits to 45 Mn customers pan India.

Meesho counts B Capital Group, DST Partners, Elevation Capital, Facebook, Fidelity Management And Research Company, Investopad, Prosus & Naspers, Raju Garg, RPS Ventures, Sequoia Capital India, Shunwei Capital, SoftBank Vision Fund, Venture Highway, and Y Combinator among its investors. It has raised upwards of $1 Bn through various funding rounds.

The startup became India’s first social commerce unicorn in India after it raised $300 Mn in a funding round.

Mensa Brands

Founded in May 2021 by Ananth Narayanan, Mensa Brands is a Thrasio model-based rollup ecommerce unicorn.

Mensa Brands’ current portfolio includes Pune-based women’s apparel brand Karagiri, Delhi NCR-based jewellery brand Priyaasi, men’s casualwear brand Hubberholme, Mumbai-based men’s casual wear brand Dennis Lingo, women ethnic wear brand Ishin, smart FMCD startup Helea, Jaipur-based ethnic wear brand Anubhutee, Ahmedabad-based men’s care brand Villain, among others. It claims that the majority of these brands are growing at 100% YoY.

Mensa Brands achieved a $1 Bn valuation after raising $135 Mn in its Series B round led by Alpha Wave Ventures and Falcon Edge Capital. With this, the startup became the fastest to reach unicorn valuation in India, within just 6 months. The startup counts Accel, Alpha Wave Incubation, Alteria Capital, Falcon Edge Capital, InnoVen Capital, and Norwest Venture Partners among its investors, and has raised $218 Mn so far.

Mindtickle

Founded in 2011 by Krishna Depura, Deepak Diwakar, and Nishant Mungali, Mindtickle is a Pune-based sales enablement platform that focuses on improving the sales function in businesses by understanding ideal sales behaviours, increasing seller knowledge and skillsets, and incorporating real-world feedback from their meetings with customers. 

The Pune and San Francisco-based company claims to cut training time for salespeople who need to be kept up-to-date on new product lines. It also offers solutions for onboarding, micro-learning, skills development and coaching to companies that have been using legacy learning management systems (LMS).

Mindtickle counts Canaan Partners, New Enterprise Associates, Norwest Venture Partners, and SoftBank Vision Fund among its investors.  It has raised more than $281 Mn across various funding rounds. It hit unicorn valuation in August 2021 when it raised $100 Mn in its Series E round of funding.

MobiKwik

Founded in 2009 by the husband-wife duo of Bipin Preet Singh and Upasana Taku, the fintech startup offers multiple financial services. It started its journey as a digital wallet and then pivoted into a horizontal fintech platform that offers multiple financial services, including credit, insurance, and gold loans, among others.

MobiKwik joined the $1 Bn club in October 2021 after a few of its employees exercised employee stock option plans (ESOPs).

Sequoia Capital India, Abu Dhabi Investment Authority, Hindustan Media Venture, and Bajaj Finserv Limited are among its key investors. The fintech unicorn has raised $202 Mn across various funding rounds.

MobiKwik plans to go for an initial public offering (IPO) to raise INR 1,900 Cr at a valuation of $1.5 Bn–$1.7 Bn. However, so far, it has not made any move for it owing to market volatility following the ongoing Russian invasion of Ukraine.

Mobile Premier League

Founded in 2018 by Shubh Malhotra and Sai Srinivas Kiran G, Mobile Premier League, also known as MPL, is an esports gaming startup which offers various gaming options from skill-based games like daily fantasy sports and chess to casual games such as 8 Ball Pool and Fruit Ninja.

MPL claims to have 85 Mn users in India, the US, and Indonesia. Over the years, the startup has partnered with several game developers and added over 70 games to its platform. Sequoia Capital India and Times Internet are among its key investors. MPL has raised more than $376 Mn from its key investors.

The gaming startup hit unicorn valuation in 2021 when it raised around $150 Mn from Legatum Capital, Accrete Capital and Gaingels LLC at a pre-money valuation of $2.3 Bn.

Moglix

Founded in 2015, Moglix is an ecommerce marketplace for different kinds of industrial tools such as power tools, hand tools, adhesives, safety and security, and electricals. It procures and supplies safety tools, hardware, office supplies and more. Moglix runs a supply chain network of 16,000+ suppliers and more than 35 warehouses and logistics infrastructure.

The company serves over 500K small and medium businesses (SMB) and big enterprises including Hero MotoCorp, Vedanta, Tata Steel, Unilever and Air India. It has also set up 3,000 manufacturing plants across India, Singapore, UK and UAE.

The Delhi-NCR-based B2B startup has 13 key investors, which include the likes of Accel, Tiger Global Management, Sequoia Capital India and Ratan Tata, among others. Moglix has raised $622 Mn across various funding deals, hitting the unicorn valuation in 2021 when it raised a $120 Mn funding round in May.

Recently, it crossed $2.6 Bn in valuation, which saw its early investors making as much as 80X returns.

NoBroker

Founded in 2014 by Akhil Gupta, Amit Agarwal, and Saurabh Garg, NoBroker is a Bengaluru-based real estate platform. It provides verified listings from property owners, without any brokerage fees for middlemen. The startup also has the NoBroker Financial Service platform which provides home loans, and the NoBroker Home Services platform which provides packers and movers and legal documentation, among other services.

The company recently launched a tech-enabled security management system called NoBrokerHood that aims to simplify visitor management within residential accommodations and also offers a seller’s marketplace for verified users. 

NoBroker counts Elevation Capital, General Atlantic, and Tiger Global Management among its nine key investors. The proptech startup hit unicorn valuation in 2021, after raising $210 Mn in a Series E funding round led by General Atlantic and Tiger Global.

OfBusiness

Founded in 2015 by Asish Mohapatra, Ruchi Kalra, and Bhuvan Gupta, with Nitin Jain, and Vasant Sridhar joining as cofounders, later on, OfBusiness is primarily a B2B ecommerce marketplace. It also offers working capital financing for the procurement of raw materials to small and medium enterprises (SMEs) in the manufacturing and infrastructure space. Its value-added services also include integrated SaaS products.

“Our businesses have grown 3x over the last year just on the impact of the sheer economic recovery we are seeing,” Sridhar had said while speaking at Inc42’s The Makers Summit 2022. He also added that OfBusiness’ lending segment and commerce business saw 2x and 4x growth, respectively, in the same period.

Kotak Mahindra Bank, Norwest Venture Partners, SoftBank Vision Fund, and Tiger Global Management are among the key investors in the B2B marketplace. It is valued at $5 Bn currently and has raised almost $900 Mn in funding across multiple rounds.

OfBusiness became a unicorn in 2021, six years after its incorporation when it raised $160 Mn in a funding round led by SoftBank.

PharmEasy

Founded in 2015 by Dharmil Sheth, Dr Dhaval Shah, and Mikhil Innani, PharmEasy is a healthtech startup that offers an online pharmacy on its platform. The company caters to the chronic care segment and offers a range of services such as teleconsultation, medicine deliveries, and sample collections for diagnostic tests. Post its merger with Medlife, the resulting entity was named API Holdings.

PharmEasy claims to have partnered with over 60K+ brick-and-mortar pharmacies across India and has reportedly served over 20 Mn patients since its inception.

The epharmacy became a unicorn in 2021 after its parent API Holdings raised $323 Mn in a Series E funding round at a valuation of $1.5 Bn. Since its incorporation, PharmEasy has raised $1 Bn in funding across various rounds from marquee investors, such as Prosus Ventures, TPG, Amansa Capital, and Blackstone-backed hedge fund ApaH Capital, among others.

Pristyn Care

Founded in 2018 by Harsimarbir Singh, Vaibhav Kapoor, and Garima Sawhney, Pristyn Care is a Gurugram-based healthtech startup. Pristyn offers affordable advanced surgical care to patients through innovative surgical techniques and recovery measures.

The startup has partnerships with over 700 hospitals in more than 40 cities to provide surgeries and treatments for proctology, urology, ENT, gynaecology, and vascular, among others. Pristyn Care claims that it has more than 300 full-time doctors and has performed more than 45,000 surgeries so far.

Pristyn hit unicorn valuation in 2021 after it raised $96 Mn in a funding round, four months after raising $53 Mn. The unicorn counts Epiq Capital, Hummingbird Ventures, Sequoia Capital, and Tiger Global among its backers. It has raised $164 Mn in various funding rounds.

Checkout The Indian Unicorn Tracker

Rebel Foods

Founded in 2011 by Jaydeep Barman and Kallol Banerjee, Rebel Foods is a  Mumbai-based foodtech startup. Its house of brands includes Faasos, Behrouz Biryani, Ovenstory Pizza, Mandarin Oak, The Good Bowl, SLAY Coffee, Sweet Truth, Wendy’s, among others.

With more than 450 kitchens across 70+ cities, Rebel Foods has developed its full-stack technology – Rebel OS – through which, it claims, multiple brands are launched and scaled up in a short period. It is eyeing an IPO in the next 18-24 months.

The foodtech startup hit unicorn valuation in 2021 after raising $175 Mn in a Series F funding round. It is backed by Alteria Capital, Goldman Sachs, InnoVen Capital, Lightbox, Qatar Investment Authority, Sequoia Capital, Sequoia Capital India, and Sistema Asia Capital. Rebel Foods has raised upwards of $500 Mn in its various funding rounds.

ShareChat

Founded in 2015 by Ankush Sachdeva, Bhanu Singh and Farid Ahsan, ShareChat is a Bengaluru-based social media startup. It positions itself as an Indic language social media platform, with an average user time spent of 31 minutes daily.

Currently, ShareChat is the highest valued social media platform in India. It competes with Chingari, Mitron, and DailyHunt’s Josh, among others. 

It crossed the unicorn valuation in April 2021 after raising $502 Mn in a funding round. The unicorn raised $913 Mn in funding in 2021 alone. It has raised $1.77 Bn across all rounds to date and is backed by the likes of Google, Lightspeed, Temasek Holdings, Tiger Global, Twitter, and Xiaomi, among others.

ShareChat merged with short video platform MX TakaTak in a $700 Mn deal in February 2022.

slice

Founded in 2016 by Rajan Bajaj, slice is a fintech startup that offers payment cards and credit cards to millennial and Generation Z customers. 

The startup issues credit cards and payment cards to this segment in partnership with Visa and SBM Bank, while also offering rewards and discounts on payments. The startup provides a credit line starting from INR 10,000 and going up to INR 10 Lakh. slice claims that it has a registered user base of over 5 Mn and a 40% month-on-month growth rate. It ships over 2,00,000 credit cards each month.

The fintech startup hit unicorn valuation in 2021 when it raised $220 Mn in its Series B round. It has raised almost $300 Mn from its 8 key investors, including Das Capital, Insight Partners, Pegasus Wings Group, and Tiger Global.

Spinny

Founded in 2015 by Niraj Singh, Mohit Gupta and Ramanshu Mahaur, Spinny is a Delhi-NCR-based online used car marketplace. Spinny competes against the likes of CarsTrade, Droom, Cars24, Cardekho, OLX, Quikr and OlaCars. 

It operates across the entire value chain of pre-owned cars and claims to embed superior technology and processes to deliver a premium experience to customers. The startup has 15 car hubs that operate across eight cities – Delhi-NCR, Bangalore, Mumbai, Pune, Hyderabad, Chennai, Kolkata, and Ahmedabad.

Spinny hit unicorn valuation in 2021 after raising $283 Mn in a Series E funding round, in which its valuation soared to $1.8 Bn from around $800 Mn in the round before. It has raised more than $530 Mn in various funding rounds to date. Spinny is backed by the likes of Abu Dhabi Growth Fund, Accel, Elevation Capital, and Tiger Global Management, among others.

upGrad

Ronnie Screwala-led edtech startup upGrad entered the unicorn club in August last year. Founded in 2015 by Screwvala, Mayank Kumar, Phalgun Kompalli, and Ravijot Chugh, it offers higher education courses in collaboration with various universities. The startup last raised $185 Mn in a funding round led by Singapore’s sovereign fund Temasek at a valuation of over $1.2 Bn. 

The startup has been on an acquisition spree this year. It has acquired Insofe, Talentedge, and Work Better this year.

Upstox

Upstox’s parent company, RKSV Securities, was founded by Shrini Viswanath, Raghu Kumar and Ravi Kumar in 2008. It started as a proprietary trading firm but ventured into retail brokerage with the launch of Upstox in 2012. The startup offers online stock market investment services, advisory services, mutual fund investments and more. As per its website, Upstox claims to have more than 10 Mn investors trading on its platform.

The startup has raised $143 Mn from multiple investors, with the last funding coming in September 2022 with a $108 Mn investment from Tiger Global. In FY22, Upstox reported a loss of INR 444.57 Cr against revenue of INR 765.6 Cr during the financial year.

Urban Company

Gurugram-based hyperlocal services startup Urban Company was founded in 2014 by Abhiraj Bhal, Raghav Chandra, and Varun Khaitan. The startup offers a range of services from beauty and spa at home to appliance repairing. It achieved the unicorn status in June last year after bagging $255 Mn in its Series F round.

The startup is backed by marquee investors like US-based Tiger Global, Steadview Capital, Vy Capital, among others. Earlier this year, Inc42 had exclusively reported about Urban Company’s foray into medical video consultation.

Vedantu

Bengaluru-based K12 focussed edtech startup Vedantu was founded in 2014 by Vamsi Krishna, Anand Prakash, and Pulkit Jain. The startup offers an interactive online tutoring platform. Currently,  over 35 Mn students attend its live classes every month, with teachers delivering 8 Mn+ hours of live classes. 

Last month, the startup launched an immersive platform W.A.V.E 2.0 to bring further innovation in live classes. 

Vedantu entered the unicorn club in September last year after raising $100 Mn led by Temasek, ABC World Asia, Tiger Global among others.

Zeta

Founded in 2015 by Bhavin Turakhia and Ramki Gaddipati, Zeta offers cloud-native neo-banking platform for the issuance of credit, debit and prepaid products. It also provides digitised solutions to enterprises such as automated cafeteria billing and more.

Headquartered in Bengaluru, Zeta serves big fintech firms and banks including Axis Bank, Kotak Mahindra Bank, Yes Bank, Induslnd Bank, and HDFC Bank. Zeta has more than 1,300 employees across US, UK, Middle East, and Asia. The startup claims to have served eight issuers and 30 fintech firms. In total, Zeta says that it has issued more than 10 Mn cards.

Zeta entered the unicorn club in 2021, having raised $250 Mn in its Series C funding round led by Japanese conglomerate SoftBank. Recently, credit card giant MasterCard has invested in the fintech unicorn, and the two will bring co-branded credit cards soon.

Zetwerk

Founded in 2018 by Amrit Acharya, Srinath Ramakkrushnan, and Vishal Chaudhary, Zetwerk entered the unicorn club in August 2021 after raising $150 Mn from D1 Capital Partners. 

The startup is a manufacturing services platform that connects manufacturing companies with vendors and suppliers for customised products, industrial machine components and other equipment. The startup reported sales of INR 828.6 Cr in FY21, while reducing its losses to INR 41.2 Cr. 

Last year, Zetwerk raised $210 Mn in a funding round led by GreenOaks Capital at a valuation of over $2.5 Bn valuation.

Unicorns In India: Indian Startups That Entered The Unicorn Club In 2020

Cars24

Founded in 2015 by Vikram Chopra, Gajendra Jangid, Ruchit Agarwal and Mehul Agrawal, Cars24 is an ecommerce platform for pre-owned vehicles, including cars and bikes. In 2019, it also procured a non-banking financial company (NBFC) licence from the Reserve Bank of India (RBI) to venture into consumer lending business.

In 2020, the Gurugram-based startup entered the unicorn club by raising $200 Mn in a Series E funding round led by DST Global. Within five years of its inception, it became the first used car marketplace to join the unicorn league.

FirstCry

Founded in 2010 by Supam Maheshwari and Amitava Saha, FirstCry offers different categories of baby and kids products from clothing to other essentials. Besides the online presence, the startup also has a retail footprint. 

The Pune-based baby products marketplace turned unicorn in 2020 when it raised $296 Mn from Japan-based Softbank’s Vision Fund at a valuation of $1.2 Bn. Later, the startup raised around $315 Mn from TPG, ChrysCapital and Premji Invest. To date, the ecommerce unicorn has raised $741 Mn in funding.

The startup is gearing up for its initial public offering (IPO), and recently converted itself into a public company.

The Pune-based startup posted a profit after tax of INR  215.94 Cr in FY21, as against a loss of INR 190.8 Cr in FY20. FirstCry’s consolidated total revenue soared to INR 1,740 Cr, a 141.3% rise from INR 896.7 Cr in FY20. 

Glance

While 2021 proved to be a watershed year for the Indian startup ecosystem, with 42 startups joining the unicorn club, the pandemic-hit 2020 was among the most difficult years for startups amid uncertainty. However, Glance was among the few startups which weathered the storm and entered the unicorn club in 2020. The startup, owned by adtech unicorn InMobi, turned unicorn after raising $145 Mn from Google and existing investor Mithril Capital.

Glance delivers AI-driven personalised content in multiple languages, including English, Hindi, Tamil, Telugu and Bahasa, on the lock screen of Android smartphones. The content includes trending news across a range of categories, such as entertainment, sports, and fashion, and is delivered in a visually rich format. In 2019, Glance also acquired Roposo, a short-video platform. 

It must be noted that Glance was the second unicorn to emerge from Naveen Tewari founded InMobi group. Glance raised $200 million in its Series D round from Reliance-owned Jio Platforms in February this year. The Google and Reliance-backed startup recently launched Glance TV – a live, interactive content platform for the home screen of Android smart TVs.

Nykaa

Founded in 2012 by Falguni Nayar, Nykaa is an online marketplace for beauty and wellness products. After starting as an online platform, Nykaa also launched offline stores in 2015, and currently has 80+ outlets today across three formats, driving an omnichannel presence.

Fidelity Management and Research Company, Lighthouse Funds, Steadview Capital, Sunil Munjal, and TPG Growth are the key investors in the ecommerce platform. Besides, it also counts Bollywood stars Katrina Kaif and Alia Bhatt as investors. Nykaa hit unicorn valuation in 2020 after raising two funding rounds in March and May from Steadview Capital, reaching $1.2 Bn in valuation.

Nykaa went public in 2021, with its shares listing at a huge premium on the stock exchanges over its IPO price. On the NSE, its shares were listed at INR 2,018, higher by 79.37% than the issue price of INR 1,125. On the BSE, the shares are listed at INR 2,001 apiece. Nykaa’s shares closed at INR 1,643.60 on the BSE on Wednesday (May 4).

Pine Labs

Founded in 1998 by Lokvir Kapoor, Tarun Upaday and Rajul Garg, Pine Labs is a fintech startup that enables businesses to accept online and offline digital retail transactions. 

The startup claims that its cloud-based platform powers over 1,40,000 merchants, and 3.5 lakh PoS (point of sale) terminals across 3,700 cities and towns in India and Malaysia. The fintech unicorn also claims to process $30 Bn of transactions per year.

Pine Labs attained unicorn valuation in 2020. Since becoming a unicorn, the fintech startup has raised multiple rounds of funding, taking its current valuation to $5 Bn. It counts Flipkart, Investco, Lone Pine Capital, Mastercard, PayPal Ventures, Sequoia Capital India, Temasek Holdings, and Alpha Wave Ventures among its key investors. It has raised $1.4 Bn across various funding rounds and is eyeing a US listing this year.

Postman

Founded in 2014 by Abhinav Asthana, Abhijit Kane, and Ankit Sobti, Postman is a San Fransico and Bengaluru-based B2B SaaS startup. Postman helps developers and companies build new applications through the application programming interface (API) workflow.

Postman boasts of more than 17 Mn users and 500K organisations on its platform. The startup said that 98% of its clients are Fortune 500 companies, including the likes of Salesforce, Cisco, PayPal, and Microsoft. The company recently announced that its public API Network is now the largest API hub in the world, with more than 75,000 APIs shared on the network.

The SaaS startup hit unicorn valuation in 2020, raising $150 Mn in a Series C funding round. In 2021, it raised another $225 Mn in funding, becoming India’s highest-valued B2B SaaS startup, at a valuation of $5.6 Bn. It counts CRV, Insight Partners, and Nexus Venture Partners among its key investors.

Razorpay

Founded in 2014 by Harshil Mathur and Shashank Kumar, Razorpay is a Bengaluru-based B2B fintech startup that provides APIs for payment gateways to other companies. It started as a payments gateway but has now expanded to provide services such as SME payroll management, banking, lending, and payments, among others.

According to Razorpay, it powers payments for 34 of the 42 startups that turned unicorn in 2021. It achieved $60 Bn TPV (Total Payment Volume) as of early December 2021 and plans to achieve $90 Bn TPV by the end of 2022.

It hit unicorn valuation in 2020 after raising $100 Mn from existing investors and GIC. Since then, it has raised another $535 Mn in two funding rounds, taking its total fundraising to well over $739 Mn and its valuation to $7.5 Bn. Razorpay is backed by marquee VC firms such as Sequoia Capital India and Tiger Global Management, along with the likes of MasterCard and Salesforce.

Unacademy

Bengaluru-based Unacademy is currently the country’s second most valued edtech startup after BYJU’S. Initially founded as a YouTube channel, founders Gaurav Munjal, Roman Saini, and Hemesh Singh officially registered Unacademy in 2015.

The startup was the second in the edtech segment, after BYJU’S, to achieve the unicorn status in September 2020, when it raised $150 Mn in a round led by Japan’s SoftBank.

The startup has to date raised close to a billion dollars in funding, counts Tiger Global, General Atlantic, Blume Ventures, Steadview Capital, and Sequoia Capital among its investors. 

Unacademy, which mostly focuses on test prep and upskilling, claims to have more than 50,000 registered educators and more than 62 Mn learners. The startup offers content in 14 languages across 5,000 cities.

VerSE Innovation (DailyHunt)

Founded in 2009 by Umesh Kulkarni and Chandrashekhar Sohoni as NewsHunt, the Bengaluru-based content startup rebranded as DailyHunt in 2015. NewsHunt was acquired by VerSe Innovation in 2012.

DailyHunt parent VerSe Innovation became India’s first tech unicorn focused on vernacular content after raising $100 Mn funding from Google, Microsoft and Falcon Edge’s Alpha Wave Incubation in December 2020.

Recently, VerSe Innovation raised $805 Mn in a round led by Canada Pension Plan Investment Board (CPPIB), Ontario Teachers’ Pension Plan Board (OTPPB), Luxor Capital and Sumeru Ventures. The deal is the largest investment round in 2022 so far, followed by Byju’s $800 Mn.

Dailyhunt claims to have 350 Mn+ monthly users, while it offers content in 15 languages from an ecosystem of over 100K content partners and individual content creators. Its parent company incurred a total consolidated loss of INR 807.9 Cr in FY21, almost a 97% jump from a loss of INR 410.2 Cr in FY20.

Zenoti

Spa and salon software startup Zenoti entered the unicorn club in December 2020, when it raised $160 Mn in a funding round led by Advent International and Sunley House Capital, along with Tiger Global and Steadview Partners. 

Founded by Sudheer Koneru and Dheeraj Koneru in 2010, Zenoti is an all-in-one cloud-based software for spas, salons, and medi-spas. 

Later, in the first half of 2021, the startup bagged $80 Mn, led by TPG Global, at a valuation of $1.5 Bn. 

Zerodha

Founded by brothers Nithin Kamath and Nikhil Kamath, Zerodha is one of the few Indian startups that is often looked at as a successfully run business. It is among the handful of Indian startups to have entered the unicorn club without raising any money from external investors.

The startup continues to remain bootstrapped, completely operating on the basis of its earnings. 

Zerodha, which entered the unicorn club in 2021, posted total revenue of INR 2,729.6 Cr in FY21, a 2.5X rise from INR 1,093.7 Cr in FY20. Its total profit stood at INR 1,122.3 Cr in FY21, an increase of 164.7% from INR 423.9 Cr in FY20.

Checkout The Indian Unicorn Tracker

Unicorns In India: Indian Startups That Entered The Unicorn Club In 2019

BigBasket

Founded in 2011 by VS Sudhakar, Hari Menon, Vipul Parekh, V S Ramesh and Abhinay Choudhari, the grocery delivery startup BigBasket has not only evolved but also witnessed a rapid change in consumer behaviour, especially during the pandemic.

However, even before the online grocery delivery segment went mainstream in India, BigBasket turned unicorn by raising $150 Mn in its Series F funding round in 2019. Last year, Tata Digital acquired a majority stake in the online grocery startup. Riding on the recent wave of quick commerce, BigBasket has also launched the express delivery service BB Now.

Delhivery

Delhivery became the first Indian logistics startup to enter the coveted unicorn club in 2019 after SoftBank invested $413 million from its Vision Fund in it.

Founded in 2011, the Gurugram-based startup offers logistics services such as express parcel transportation, LTL (less than truckload) and FTL (full truckload) freight, reverse logistics, cross-border, B2B & B2C warehousing, end-to-end supply chain services and technology services.

The logistics unicorn is gearing up for its initial public offering (IPO) which will open for the public on May 11 and close on May 13.

The price band for the IPO has been set at INR 462-487 per share.

Dream11

Founded in 2008 by Harsh Jain and Bhavit Sheth, Dream11 offers its users fantasy gaming in categories such as cricket, football, kabaddi, among others. The Mumbai-based fantasy gaming startup joined the Indian unicorn club with an investment round led by Steadview Capital in April 2019. It became the first gaming startup to achieve a $1 Bn-plus valuation. 

Last year, ahead of the beginning of the new Indian Premier League (IPL 2021) season, Dream Sports, the parent company of Dream11, announced the completion of a $400 Mn secondary investment led by TCV, D1 Capital Partners and Falcon Edge. The funding round helped Dream11’s valuation inch closer to $5 Bn. It also claims to have reached 14 cr users in 2021.

Dream11 saw a 53% growth in its revenue from operations in FY21. The gaming unicorn posted INR 2,554.4 Cr in revenue from operations in FY21,  as compared to INR1,670.2 Cr earned in FY20.

Druva

Founded in 2008 by Jaspreet Singh, Milind Borate, and Ramani Kothandaraman, Druva offers cloud data protection and information management solutions to enterprises by leveraging the public cloud with an integrated cloud management console.

NASA, pharma giant Pfizer, hotel chain Marriott, the US National Cancer Institute, and global logistics player DHL are among its clients.

The Pune-based startup joined the unicorn club after it raised $130 Mn in June 2019 in a round led by Viking Global Investors. Last year, it raised $147 Mn in a new round of funding at a valuation of over $2 Bn. 

Icertis

Founded in 2009 by Monish Darda and Samir Bodas, Icertis is SaaS company that provides contract management services to enterprises. The company’s flagship product, Icertis Contract Management (ICM), can manage sell-side, buy-side, and corporate enterprise contracts across the globe.

The Seattle and Pune-based software company joined the unicorn club in 2019 after it raised $115 Mn in a funding round led by US-based venture capital firm Greycroft and PremjiInvest.  Earlier this year, Icertis raised an undisclosed amount from German-based SaaS giant SAP. With this funding round, Icertis’ valuation reportedly reached $5 Bn.

Icertis also provides business applications to manage clinical trials, collaboration modules, GDPR compliance, risk management, among others. The company caters to multiple industries such as financial services, healthcare, pharmaceutical, retail, and manufacturing industries.

Lenskart

Founded in 2011 by Amit Chaudhary and Peyush Bansal, Lenskart is a Delhi-NCR-based vertical ecommerce startup for the eyewear segment, and other eye care products and services. 

The company claims to reach 100K customers per month. Lenskart also boasts of serving more than 7 Mn customers annually through its omnichannel shopping experience, which spans online, mobile application, and over 750 omnichannel stores in 175 cities across the country.

In 2021, Lenskart launched ‘Vision Fund’ under which it would invest $2 Mn in selected startups synergistic to the eyewear, eye care, and omnichannel retail sectors. 

Lenskart became the first D2C startup to reach unicorn valuation when it raised $231 Mn from SoftBank in 2019. Recently, it raised $24.7 Mn in a fresh round of investment from its existing investor Epiq Capital, taking its total fundraising to date to well over $770 Mn.

Ola Electric

Initially established as Ola’s EV venture in 2017, Ola Electric Mobility was set up as an independent entity in March 2019. The company makes electric two-wheelers, while also running pilots for the country’s electric charging infrastructure, including charging stations and battery swapping stations.

The company has invested INR 2,400 Cr in building the largest EV manufacturing facility in the country. The EV unicorn sold 9,121 e-scooters in March 2022, according to reports. It also plans to expand into four-wheeler EVs.

The company has 12 key investors, including Falcon Edge Capital, Hyundai Motor Company, Kia Motors, Softbank, Tata Sons, Tiger Global Management, and Edelweiss. Ola Electric has raised around $863 Mn across various funding rounds to date. It crossed the $1 Bn valuation mark after it raised $250 Mn in Series B funding in 2019. Most recently, the e-mobility startup raised $200 Mn in January 2022, taking its valuation to $5 Bn.

Unicorns In India: Indian Startups That Entered The Unicorn Club In 2018 & Before

2018

Billdesk

Founded in 2000 by MN Srinivasu, Ajay Kaushal, and Karthik Ganapathy, Indian payments gateway startup BillDesk took almost two decades to achieve unicorn status. Mumbai-based IndiaIdeas.com Ltd, which operates BillDesk, joined the unicorn club in 2018 after a funding round. 

Later in 2021, Prosus, a global consumer internet group that operates fintech company PayU, acquired BillDesk for $4.7 Bn. At that time, it was touted as the largest acquisition deal in India’s fintech space. The deal also gave exit to investors General Atlantic, TA Associates, Temasek, Clearstone Ventures, and Visa.

As per reports, the Competition Commission of India (CCI) sought more information on the acquisition and its implications from PayU earlier this year. PayU India reportedly filed a revised merger notification with the antitrust watchdog a week ago.

BYJU’S

Founded in 2011 by Byju Raveendran, BYJU’S was the first edtech unicorn in India. The startup has a presence in 7 countries and more than 150 Mn students on its platform. BYJU’S flagship app, BYJU’S – The Learning App, has students from more than 1,700 cities. 

In March 2022, BYJU’S, which is reportedly gearing up for its initial public offering, raised $800 Mn in a strategic funding round led by CEO and founder Byju Raveendran, Sumeru Ventures, Vitruvian Partners, and BlackRock. With this round, Raveendran became the third Indian founder to invest in his own startup. The round also helped the company valuation soar to $22 Bn. 

The edtech platform has been named as the official sponsor of FIFA World Cup Qatar 2022. With this partnership, the edtech startup became the first Indian company to be associated with the FIFA World Cup.

Checkout The Indian Unicorn Tracker

Freshworks

Founded by Girish Mathrubootham and Shan Krishnasamy in 2010, Freshworks offers a suite of softwares for customer management, which includes an artificial intelligence-powered chatbot and messaging platform for customer support, as well as call centre-based solutions for customer service resolutions.

The SaaS startup entered the unicorn club eight years after its incorporation when it raised $100 Mn from Sequoia Capital, Accel Partners and CapitalG. While SMBs have been a major focus area for the company since the beginning, it has also scaled up the number of mid-market enterprise clients in the last couple of years.

Mathrubootham, who is regarded as a veteran of the Indian SaaS industry, also successfully led the public listing of the company. Last year, the company became the first Indian SaaS startup to list on Nasdaq. As it made a stellar debut on the stock exchange, its market crossed $12 Bn on the first day itself. Interestingly, over 500 of its shareholding employees in India became ‘crorepatis’ following the listing.

OYO

Founded in 2013 by Ritesh Agarwal, OYO is one of the leading travel tech platforms in the country which provides accommodation and other solutions to users. OYO partners with hotels and lists them on its platform. Users can make hotel bookings as per their requirements. 

OYO has also expanded into providing technology solutions for hospitality facilities. The hospitality startup has expanded to more than 157K storefronts that use its full-stack hospitality technology solutions.

The hospitality unicorn is backed by marquee investors such as Masayoshi Son’s SoftBank, NASDAQ-listed Airbnb, Lightspeed Venture Partners, and Innoven Capital, among others. The startup has raised almost $4.5 Bn to date from 26 investors across various funding rounds. 

OYO turned unicorn in 2018. Soon after, it raised a mammoth $1 Bn in a single funding round, valuing the traveltech startup at $5 Bn. The startup has also filed the DRHP for an IPO worth INR 8,430 Cr.

Paytm Mall

Paytm Mall, the ecommerce arm of Paytm, was established in 2017 by Paytm founder Vijay Shekhar Sharma. The ecommerce marketplace offers products in fashion, grocery, electronics, entertainment, beauty and health, and travel and holidays segments. It has partnered with multiple brands for the same.

Based on China’s TMall retail model, Paytm Mall operates as an independent entity and a consumer shopping app. 

The ecommerce arm of the fintech decacorn earned unicorn status when it raised $445 Mn in a funding round from SoftBank and Alibaba at a valuation of more than $1.6 Bn. Paytm Mall counts Softbank Vision Fund, Alibaba Group, and eBay among its key investors.  It has raised $645 Mn across various funding rounds so far.

PhonePe

Founded in 2015 by Burzin Engineer, Rahul Chari, and Sameer Nigam, PhonePe is a fintech platform that provides multiple financial services such as bank transfers, UPI-based payments, mobile recharges, and bill payments. The company has also diversified into providing digital insurance and other related services.

PhonePe was acquired by ecommerce giant Flipkart in 2016. According to the National Payment Corporation of India’s (NPCI’s) latest data, PhonePe is the biggest UPI app in terms of transaction volume as well as transaction value. The fintech startup saw more than 2.5 Bn transactions, worth more than INR 4.71 Tn, in March 2022.

PhonePe achieved unicorn status in 2018, merely 3 years after its incorporation. The fintech unicorn has raised more than $1 Bn in funding since 2016. Most recently, PhonePe’s Singapore-based parent company received $297 Mn in funding from Flipkart.

Policybazaar

Founded in 2008 by Yashish Dahiya, Avaneesh Nirjar, and Alok Bansal, Policybazaar aggregates insurance policies from a range of providers for use-cases, including life insurance, automobile insurance, health insurance and more.

Its parent company, Gurugram-based eTechAces Marketing and Consulting Pvt Ltd, also runs PaisaBazaar, a marketplace for loans and credit cards. Policybazaar became a unicorn in 2018, 10 years after its incorporation when it raised $200 Mn from SoftBank Vision Fund and InfoEdge. Its current valuation is well over $6 Bn.

Backed by the likes of SoftBank, Tencent, Tiger Global Management, True North, and Falcon Edge Capital, among others, the company has raised more than $700 Mn in various funding rounds. Policybazaar was listed on the stock exchanges in 2021, with an INR 6,017 Cr IPO.

Rivigo

Founded in 2014 by Deepak Garg and Gazal Kalra, Rivigo is a Delhi-NCR-based logistics startup. The company owns trucks and operates across multiple parts of India. Rivigo’s website claims that it owns a fleet of more than 5,000 trucks, and is present in more than 4,000 cities, covering around 29,765 pin codes across India.

The logistics startup offers both part-truck and full-truck deliveries, and also provides the option for cold-chain deliveries,  along with various pre-and post-delivery support services. Rivigo also launched the National Freight Index (NFI) to bring transparency to the largely unorganised logistics sector.

Rivigo first hit the unicorn valuation in 2018, when it raised $50 Mn in a Series D funding round. After it, its valuation declined to below $1 Bn for a short while but again crossed the threshold in 2019, raising $65 Mn in a Series E round. Warburg Pincus and SAIF Partners are among its key investors.

Swiggy

Founded in 2014 by Nandan Reddy, Rahul Jaimini and Sriharsha Majety, Swiggy is a food and groceries delivery decacorn, though it likes to call itself a logistics company. 

Since starting as a food delivery company, Swiggy has diversified into providing intra-city delivery services with Swiggy Genie and hyperlocal grocery delivery services with Swiggy Instamart (in which it invested $700 Mn last year). The startup will also offer online restaurant table booking with its acquisition of Dineout for $200 Mn earlier this year.

Currently, it claims to have more than 150K restaurants on its network, with a presence in more than 500 cities.

While Swiggy achieved unicorn status in 2018, it achieved the hallowed decacorn status in January 2022 after it raised $700 Mn in a funding round. So far, it has raised $4.4 Bn across multiple funding rounds. It is backed by Accel, SoftBank, Alpha Wave, Investco and Goldman Sachs, among others.

Udaan

Founded in 2016 by Sujeet Kumar, Amod Malviya and Vaibhav Gupta, Udaan is a B2B ecommerce platform.

It connects small and medium-sized businesses (SMBs), manufacturers, wholesalers, traders, and retailers to sell goods and services to each other. It also offers a credit facility to select small sellers. It currently functions across electronics, home and kitchen products, clothing, and footwear segments. The startup claims to have a network of 25,000 sellers across the country, offering over 5 lakh product categories. Udaan is operational in 900 cities.

In 2018, Udaan became a unicorn when it raised a $225 Mn funding round. With that round, it became the then fastest startup to reach the unicorn status – within 2 years of its incorporation. Udaan is backed by BlackSoil Capital, Citi Ventures, InnoVen Capital, Lightspeed, and Tencent, among others. It has raised $1.4 Bn across funding rounds to date.

2017

ReNew Power

Founded in 2011 by Sumant Sinha, ReNew Power is a Delhi-NCR-based energytech startup. It is a renewable energy independent power producer (IPP). It develops, builds, owns, and operates utility-scale wind energy, solar energy, and hydro projects. 

As of April 2022, ReNew had a gross total portfolio of about 12.1 GW of renewable energy projects across India, including commissioned and committed projects

The cleantech startup joined the unicorn club in 2017 after raising $300 Mn through a rights issue. ReNew Energy raised $450 Mn in January 2022 by issuing dollar bonds. The bonds have a tenor of 5.25 years. It was the first high yield issuance out of the ASEAN and South Asian regions in 2022, it said.

2016 & Before

Hike

Hike was founded in 2012 by Kavin Bharti Mittal, the son of billionaire Sunil Bharti Mittal, the chairman of Bharti Enterprises. Hike entered the unicorn club in 2016 when India didn’t have many startups valued at $1 Bn or more, by raising $175 Mn in a funding round.

Despite its high valuation and cash inflow, Hike has struggled to find a sustainable monetisation model. The startup, which started as a messaging app, tried to take the super app route with services such as digital wallet, ticket booking, ecommerce and more. However, as the endeavour did not pay off, Hike unbundled its super app in 2019 to focus on services that were showing traction.

Last year, Hike decided to shut down its messaging app to focus more on gaming and social media experiences.

In August last year, five years after the funding round which turned it into a unicorn, Hike raised an undisclosed amount of investment from Tinder cofounders Sean Rad and Justin Mateen, SoftBank Vision Fund CEO Rajeev Mishra, Tribe Capital’s Arjun Sethi and others.

Hike CEO Kavin Mittal had said then that the startup would utilise the capital to build platforms that will enable people to express themselves online through competition and interaction, along with hiring talent from different sectors such as cryptocurrency, gaming and social media platforms.

ShopClues

Founded in 2011 by Sandeep Aggarwal, Sanjay Sethi and Radhika Aggarwal, ShopClues was a Delhi-NCR-based ecommerce platform similar to the likes of Flipkart and Snapdeal. ShopClues claimed to be the first company to evangelise the ‘managed marketplace model’ in India. 

Currently, the ecommerce platform claims to get 100 Mn monthly visitors and has 600K sellers on the platform. It delivers to more than 32,000 pin codes across the country.

ShopClues counts Helion Venture Partners, Nexus Venture Partners, GIC, Tiger Global Management, InnoVen Capital, Unilazer Ventures, and Clues Network among its key investors, and has raised $256 Mn from them so far. The company hit unicorn valuation in 2015 after raising $100 Mn from Tiger Global and GIC.

The ecommerce platform was acquired by Singapore-based Qoo10 Pte Ltd in 2019, which saw the latter’s entry into the Indian market, valuing the once-unicorn ShopClues at about $70-$100 Mn.

InMobi

Founded in 2007 by Naveen Tewari, Mohit Saxena, Amit Gupta and Abhay Singhal, 

InMobi is a Bengaluru-based adtech startup. The company owns a variety of businesses such as Glance, a mobile content unicorn, and Roposo, a short-video content platform.

The company has operations across 5 continents and works mostly in the advertising space. However, its IPs also include content and social commerce, among other verticals.

In 2011, InMobi became the first Indian startup to turn into a unicorn. The company had raised $200 Mn from Sequoia Capital at a unicorn valuation.

Since then, it has also turned profitable, becoming the second Indian unicorn to do so after Mu Sigma. The company has raised $360 Mn in funding so far.

Flipkart

Founded in 2007 by Binny Bansal and Sachin Bansal, ecommerce giant Flipkart was one of the earliest unicorns in India. The startup became a unicorn in 2012 after raising $150 million in a round led by South African tech major Naspers. 

The Bengaluru-based ecommerce startup was acquired by US retail giant Walmart in 2018. Walmart acquired a 77% stake in Flipkart for approximately $16 Bn. From a startup valued at $1 Bn in 2012 to reaching a valuation of over $37 Bn, the ecommerce giant has come a long way in the last ten years to emerge as the strongest rival of Amazon in India.

Flipkart raised $3.6 Bn in a funding round last year from a slew of investors, including its parent company. Besides Walmart, Singapore-based GIC, Canada Pension Plan Investment Board (CPPIB), and SoftBank, through its Vision Fund II, also participated in the round. 

The ecommerce giant is reportedly planning its IPO next year. Moreover, it has raised its IPO valuation target to $60-70 Bn.

MakeMyTrip

Founded in 2000 by Deep Kalra, Keyur Joshi, and Rajesh Magow, online travel agent (OTA) MakeMyTrip offers air tickets, customised holiday packages, hotel bookings, railway tickets, and a plethora of other travel-related services to its customers.

Over time, the OTA platform also expanded its services to provide visa services, homestays, charter flights, buses, and cabs. MakeMyTrip recorded a 57.4% quarter-on-quarter (QoQ) growth in gross bookings during Q3 FY22, and a 70.5% QoQ increase in revenue to $115 Mn.

The Delhi-NCR based startup counts Ctrip, Tiger Fund, Helion Venture Partners, and Sierra Ventures as its key investors, having raised $548 Mn thus far across various funding rounds. It hit unicorn valuation in 2016, shortly after Chinese OTA platform Ctrip invested $180 Mn in MakeMyTrip.

Checkout The Indian Unicorn Tracker

Mu Sigma

Founded in 2004 by Dhiraj Rajaram, Mu Sigma is a Bengaluru-based data science and analytics firm. The data analytics firm boasts of a clientele of over 140 Fortune 500 companies such as Microsoft Corp, Walmart Stores Inc, Dell Inc, and Pfizer Inc.

Mu Sigma counts Sequoia Capital, General Atlantic, and MasterCard as its key investors. However, General Atlantic has since sold its stake – it owned 20% – in the big data unicorn. 

The startup hit unicorn valuation in 2013, when it got $45 Mn from a MasterCard arm and a group of global financial investors, including Fidelity Investments, taking about a decade to become a unicorn. Currently, CEO Dhiraj Rajaram is the majority shareholder in the Chicago and Bengaluru-based unicorn with a 52% stake.

Ola

Founded in 2010 by Bhavish Aggarwal and Ankit Bhati, Ola is one of Indian startup offering ride-sharing platforms.  It has also forayed into manufacturing electric vehicles (EVs), through its unicorn arm Ola Electric, and hyperlocal delivery, through its arm Ola Dash.

The transport tech unicorn had taken only four years to hit unicorn valuation. Steadview Capital, Tiger Global Management, Sequoia Capital India, Softbank Group, Accel Partners India, Government of Singapore Investment Corporation (GIC), Mauritius Investments, SoftBank Capital, Ratan Tata, and Tencent Holdings are among its key investors. Ola has raised almost $5 Bn in funding across multiple equities and debt rounds since its incorporation. Most recently, Ola Cabs raised close to $20 Mn from Hong Kong-based Segantii Capital.

The ride-hailing platform is aiming for an IPO this year, with founder Aggarwal saying that the parent company ANI Technologies planned to list both Ola and Ola Electric on the stock exchanges. 

However, Aggarwal said that Ola will be listed first as it is a more mature business compared to Ola Electric, which was started just three years ago. 

Snapdeal

Founded in 2010 by Rohit Bansal and Kunal Bahl, Snapdeal is a Delhi-NCR-based ecommerce platform. It competes with the likes of Flipkart and Amazon in India’s ecommerce market.

Snapdeal claims to have 40.15 Mn monthly active users with over 200 Mn app installations. The startup says that 50.37 Mn customers have shopped on its platform since FY19, and it has 14.82 Mn annual transacting customers. Snapdeal covers 96.65% of the pin codes across the country and its net merchandise value stood at INR 374 Cr in Q2 FY22.

Snapdeal has received over $1.5 Bn in funding from marquee investors such as SoftBank, Foxconn Technology Group, and Alibaba Group. The ecommerce platform became a unicorn in 2014. In 2016, it was valued at $6.5 Bn when it raised $200 Mn. However, its valuation has fallen below the $1 Bn mark since then. 

The company was in lengthy talks with Flipkart for a merger in 2017, but the deal fell through. In 2021, Snapdeal filed a DRHP for an IPO worth INR 1,250 Cr, valuing the company at $1.5 Bn.

Info Edge

Founded in 1995 by Sanjeev Bikhchandani, Info Edge is a Delhi NCR-based discovery platform that runs jobs classifieds website Naurki.com and matrimony website Jeevansaathi.com, real estate platform 99Acres.com and education consultancy platform Shiksha.com.

The company has various businesses in the discovery segment. It recently increased its stake in dating platform Aisle, in a deal worth INR 91 Cr, to 76%. It has also made multiple investments across various verticals, including in Zomato, Recur Club, greyHR, and Zingbus, among others. Info Edge also announced an INR 100 Cr fund in 2020, aimed at backing tech startups

Currently, the company is valued at $10 Bn and is one of the four decacorns of the Indian startup ecosystem.

Paytm

Founded in 2010 by Vijay Shekhar Sharma, Paytm is a Delhi NCR-based fintech decacorn which offers payments services, bank transfers, mobile recharges, bill payments, travel and accommodation bookings, and multiple other financial services.

The company has 71 Mn monthly average users and 2.9 Mn devices deployed, along with a GMV of $34.5 Bn, as of Q4 FY22. Paytm went public in a mega IPO in November 2021 that was worth INR 18,300 Cr.

The decacorn has raised $2.5 Bn across multiple rounds so far, with the biggest round coming when Paytm raised $1.4 Bn from SoftBank in 2017, taking its valuation past the $10 Bn mark.

Quikr

Founded in 2008 by Pranay Chulet, Quikr is a Bengaluru-based online classifieds marketplace. The company allows its users to post classified advertisements on its online platforms.

At one point, the startup had 30 Mn monthly unique visitors and was present in 1,200 cities in India. Quikr spread its verticals across diverse domains like grocery, home rentals, beauty services as well as online recruitment. However, following a major scam at the company, it had to lay off around 2,000 employees in 2019.

The company first hit the $1 Bn valuation mark in 2015 after raising $150 Mn in funding from Tiger Global Management, Investment AB Kinnevik, and Steadview Capital. However, its valuation dipped below the mark for a while. It crossed the threshold again in 2019, however, it is currently valued below $1 Bn.

Zoho

Zoho, like Zerodha, is another startup that is closely followed and admired in the Indian startup ecosystem. Founded in 1996 by Sridhar Vembu and Tony Thomas, Zoho, which was initially known as AdventNet INC, is also a bootstrapped unicorn. 

The SaaS giant, which plans to continue to remain private, has more than 60 Mn customers and over 9K employees globally. With offices in the US, Singapore, UAE, Japan, among others, it has more than 50 integrated online applications that support multiple business operations spanning sales and marketing, finance, email and collaboration, app creator and analytics, among others.

The startup reported total revenue of INR 5,442.4 Cr in FY21, while its profit stood at INR 1,917 Cr.

Zomato

Food delivery giant Zomato is a household name and will always be remembered for being one of the first Indian tech startups to go for an IPO. 

Deepinder Goyal-led Zomato, which initially started as Foodiebay, entered the unicorn club in 2015. The foodtech unicorn, which made its IPO debut in July last year, is backed by Info Edge, Tiger Global, Alibaba, Sequoia Capital, Antfin, among others. 

Currently, the startup is heavily investing in companies that are into logistics or in ecommerce.

Checkout The Indian Unicorn Tracker

[This is a running list of Unicorns in India, we will be updating this list whenever an Indian startup enters the unicorn club]

Written by Hemant Kashyap, Gargi Sarkar, Debarghya Sil, Laxitha Mundhra

Update | August 14, 2023, 6:00 PM IST

The story was updated to include the details of boAt and Upstox.

Update | May 10, 2022, 11:50 PM IST

The story was edited to incorporate the correct details of Licious founders.

Update | June 6, 2022, 11:00 AM IST

The story was edited to incorporate the correct details of the EaseMyTrip founders.

The post India’s Unicorn Club: Here’s The Comprehensive List Of 100+ Unicorns In India appeared first on Inc42 Media.

The Indian startup job market is bleeding and the constantly declining funding numbers are the key convicts of this mayhem. According to data compiled by Inc42, Indian startups raised $25 Bn in 2022, down 40% compared with the watershed moment that was 2021.

Now, halfway through 2023, funding in the world’s third-largest startup ecosystem has further faded significantly. According to Inc42’s Indian Tech Startup Funding Report H1 2023, Indian startups raised $5.4 Bn in the first six months of 2023, down 72% compared to approximately $19 Bn raised during the corresponding period last year.

While the current scheme of things has prompted many marquee investors to instruct their portfolio startups to cut costs and increase runways, many founders seem to have caused a bloodbath in the job market in the name of undertaking cost-cutting measures.

Since the onset of the funding winter in 2022, an estimated 28,871+  employees have been laid off by 111 Indian startups.

Further, edtech has seen the most layoffs, followed by consumer services and ecommerce. The three sectors have collectively seen 51 startups laying off 20,769 employees since last year.

The edtech segment, in particular, has come under intense scrutiny. Since last year, 22 edtech Indian startups, including five of the seven edtech unicorns, have fired 9,871 employees.

An estimated 10,046 employees have been fired by 63 startups so far this year, highlighting the fact that the situation around job cuts has hardly improved.

As the startup ecosystem continues to endure a funding winter and the subsequent slowdown, Inc42 has compiled the list of startup layoffs that have happened so far.

If you would like to report a layoff, pay cut etc. at a startup, write to us at editor@inc42.com.

Indian Startup Layoffs

August 10 | Hike Fires 22% Employees Amid GST Pressure

Web3 gaming startup Hike, which pivoted from instant messaging, fired 22% of its workforce, about 55 people, following the GST Council’s decision to charge a 28% GST on online gaming.

People familiar with the development told Inc42 that the retrenchments came as the gaming company was staring at a 400% increase in tax burden. While sources said as many as 100 employees were impacted, Hike’s founder and CEO Kavin Mittal told Inc42 that nearly 55 people have been laid off by the company.

“…Business is in the best shape ever but this 400% increase in GST is a bazooka pointed at us. We’ll need to absorb some of it and as a result, the RIF [reduction in force] at Hike/Rush,” Mittal said.

Meanwhile, there was no information available on the teams impacted and any severance benefits the outgoing employees were entitled to.

August 8 | MPL Fires 350 Employees Following The 28% GST Regime

Gaming unicorn Mobile Premier League (MPL) decided to slash 350 jobs to cut costs following the GST Council’s decision to levy a 28% tax on online gaming. The move comes more than a year after the startup fired 100 employees in May 2022.

In an internal mail, MPL cofounder and CEO Sai Srinivas said that the startup would lay off about 350 employees. Placing the blame squarely on the levy of 28% GST on full face value for real-money gaming, Srinivas told employees that the new levy has increased the tax burden on the company by as much as 350-400%.

Srinivas also told employees that the company spent a ‘lot of time evaluating and re-evaluating’ the layoffs. He added that the unicorn eventually decided that ‘the sooner we are able to deliver certainty to everyone, the better’.

However, no details were available on the teams affected and any severance benefits the outgoing employees were entitled to.

August 3 | Spinny Lays Off 300 Employees Post Merger

Spinny downsized around 4.5% of its total workforce, approximately 300 employees, out of a total of 6,500 after the merger of Truebil and Spinny Max with its main Spinny platform.

“This business reorganisation will strengthen our go-to-market business model, reduce costs and improve our margin profile, putting us on an expedited path to profitability. However, it will impact approximately 4.5% of our total workforce as we consolidate our operations under a single brand,” the company told Inc42.

The used cars marketplace did not share any information regarding the teams impacted by the layoffs, or whether the impacted employees were entitled to any severance benefits following the retrenchments.

August 2 | SaaS Startup Actyv.ai Fires 60 Employees

SaaS startup Actyv.ai fired 60 employees or around 50% of its 120-strong workforce, impacting employees from the product, marketing, HR, sales and solutions teams at Actyv.ai, sources told Inc42.

Actvy.ai fired the employees during a town hall meeting on July 31, the sources said, adding that the startup offered one month’s salary as severance pay to the impacted employees.

Raghu Subramanian, founder and global CEO of the startup, said, “We value the dedication and commitment of each team member during this transition period, and we believe that these measures will position us for a stronger and more resilient future.”

The development comes months after the SaaS startup announced the close of a $12 Mn (INR 96 Cr) Pre-Series A funding round from Singapore-based 1Digi Ventures and Subramanian’s family office in January 2023.

August 1 | Inc42 Exclusive: Increff Lays Off 20% Workforce To Cut Costs

Premji Invest-backed SaaS startup Increff laid off around 60 employees or 20% of its workforce in a cost-cutting exercise. The employees were from the tech, sales, customer success, and HR teams, among others.

Responding to Inc42’s queries on the development, Increff CEO and cofounder Rajul Jain confirmed the layoffs. Per Inc42 sources, adverse macroeconomic conditions and failure to meet the targets for onboarding new clients led to the layoffs. There was no information made available by the startup regarding any severance benefits.

Last year, it raised $12 Mn in a Series B round, which saw participation from Premji Invest, Binny Bansal’s 021 Capital, among others. Earlier, in 2017, it raised around $2 Mn from Sequoia Capital (now Peak XV Partners).

July 14 | Skill-Lync Fires 225 Employees In Another Round Of Layoffs

Skill-Lync conducted a second round of layoffs which impacted nearly 20% of its workforce or around 225 employees. There was no clarity on which specific teams and positions were impacted as part of the mass firings.

“This decision was not taken lightly, and we have done our utmost to ensure that the process was as transparent and fair as possible for the employees involved,” said Skill-Lync cofounder Suryanarayanan Paneerselvam in a statement to Techcrunch. 

In April this year, the Chennai-headquartered startup slashed more than 400 jobs, blaming macroeconomic conditions.

July 13 | Sachin Bansal-Led Fintech Navi Fires 200 Employees

IPO-bound fintech startup Navi Technologies reportedly has fired around 200 employees across multiple departments. Per media reports, product development and management teams have seen up to 70% of members impacted by the layoffs at Navi.

A spokesperson for the fintech unicorn attributed the layoffs to a routine performance appraisal. “Navi conducts performance appraisals twice a year, which results in expected departures from the company,” said the spokesperson. Navi did not respond to Inc42’s query related to any severance to which the impacted employees would be entitled.

The move comes days after Navi’s NBFC arm, Navi Finserv, started raising up to INR 500 Cr through the public issue of Non-Convertible Debentures (NCDs). The debt raise opened on July 10, and the subscriptions will close on July 21.

July 12 | WayCool Fires 300 Employees To Chase Profitability

Agritech startup WayCool fired 300 employees in a restructuring exercise to chase profitability. The agritech startup will also shut down some of its distribution centres and a few new experimental projects.

“We plan to focus on our core and profitable businesses, slowing down on some of our experimental initiatives as we work to grow further. This will change the profile of our business but is aimed at ensuring a sustainable and long-term success of our enterprise,” a WayCool spokesperson told Inc42.

The layoffs come nearly 18 months after WayCool raised $117 Mn in January 2022 in the largest-ever agritech funding round.

June 19 | Inc42 Exclusive: Chingari Lays Off 20% Workforce, Pivots Content Model

Short-video app Chingari fired 20% of its workforce weeks after Chingari cofounder Aditya Kothari quit the startup. While employees across teams lost their jobs, the tech team was impacted the most. The layoffs specifically affected employees at the startup’s Mumbai and Bengaluru offices.

“We deeply regret the need for these workforce reductions of 20% as a part of Chingari’s organisational restructuring,” a Chingari spokesperson said.

Chingari has offered a two-month salary as severance pay to the laid off employees and extended their health insurance by three months.

Shortly after the layoffs, Inc42 also exclusively reported Chingari’s apparent pivot into the NSFW territory with paid live 1-on-1 calls between creators and users. The app has introduced the feature in an apparent bid to increase monetisation on the platform.

June 17 | Mojocare Fires 80% Workforce, Misconduct Allegations Surface Against Founders

Healthtech startup Mojocare fired more than 80% of its workforce as part of its cost rationalisation drive and focus on profitability. While media reports suggested a number of more than 200 employees being impacted, a spokesperson of the startup pegged the number at 150-170 employees. 

The development comes nearly 10 months after Mojocare raised a funding of $20.6 Mn from the likes of B Capital, Chiratae Ventures, Sequoia India’s Surge and Better Capital.

Shortly after the layoffs, Mojocare’s founders admitted before the board and investors of the startup that they had fudged numbers. Sources told Inc42 that Mojocare founders approached investors in May and confessed to round-tripping of funds.

For now, the group of investors has appointed an interim CFO, asked the founders to step away, and is considering a legal action against the founders. As for Mojocare, the startup’s operations have been suspended and it is staring down the barrel of dissolution.

June 14 | Mamaearth To Shut Momspresso’s MyMoney, Brand Marketing Vertical; 80 Employees Impacted

IPO-bound D2C unicorn Mamaearth will shut Momspresso MyMoney, the influencer engagement platform of Momspresso, later this month due to the latter’s mounting losses, sources told Inc42. The move led to 80 employees at Momspresso being fired.

According to Inc42 sources, in a town hall meeting in the first week of April, Momspresso’s top management, including the cofounders, informed the employees about the decision to shutter MyMoney. The D2C beauty unicorn is also likely to shut Momspresso’s brand marketing business, multiple sources informed us.

Mamaearth acquired the parenting platform Momspresso in 2021 for INR 152.3 Cr. The platform currently operates three verticals – user-generated content platform, brand marketing, and MyMoney.

June 12 | Freshworks Fires Employees For The Third Time

Freshworks has seen another round of layoffs across multiple teams in the US, citing performance reviews. The layoffs have happened within senior positions in the SaaS unicorn’s product, engineering and go-to-market (GTM) teams, sources told Moneycontrol.

When Inc42 reached out to the listed SaaS unicorn for clarification, a spokesperson said, “Freshworks does not comment on the management of the workforce in our normal course of business. There have been no organisation-wide layoffs to report.”

Freshworks fired around 2% of its staff – around 90 employees – in December 2022. While there were no confirmations from the SaaS unicorn on the number of impacted employees during the second layoff round in March, media reports indicated around 114-125 staff being impacted.

June 1 | Glamyo Health Joins Indian Startup Layoff Spree

Glamyo Health reportedly fired employees without any prior notice or without any clarity on final salary settlements, according to a police complaint cited by a YourStory report. The complaint, filed by an employee at Barakhamba Road police station in New Delhi, reportedly also claims that Glamyo Health delayed salary payments ‘several times’ over the last few months.

“About 50 employees were let go in the last two months with the aim of cutting costs and containing losses. But almost all the employees were asked to leave in the last two days without any information of severance, salaries or reasoning,” the report quoted a former employee as saying.

A legal representative of Glamyo was cited as terming the claims ‘baseless allegations’, as Inc42 did not hear back from the startup till the time of publishing of the article.

May 30 | Mensa Brands Cuts Jobs From Recently Acquired India Lifestyle Network 

House of Brands unicorn Mensa Brands laid off around 30 employees from India Lifestyle Network (ILN), which it acquired in December last year.

A spokesperson of Mensa Brands told Inc42 in a statement, “ILN is committed to providing the best content to its consumers and industry-leading services to its client partners. To enhance efficiency post-integration, we restructured some teams that impacted a few positions. This activity affected less than 30 team members in ILN.”

The Mensa spokesperson said the startup is providing each of the impacted employees up to three months’ salary, extended health insurance and support in finding new roles.

May 25 | Inc42 Exclusive: Prosus-Backed Airmeet Lays Off 75 Employees

Virtual events platform Airmeet fired about 30% of its 250-300 people workforce or at least 75 employees, sources told Inc42. The layoffs impacted multiple teams, including sales, marketing, tech, and operations. Besides India, employees working in the US, and Europe, among others, were also impacted by the layoffs.

In an internal mail, Lalit Mangal, cofounder and CEO of Airmeet, said the startup had to lay off employees as its ‘execution’ was not yielding the desired outcomes. Inc42 has accessed the mail sent by Mangal. Mangal confirmed the layoffs with Inc42 but didn’t disclose the number of employees impacted.

The startup has offered two months of salary as severance pay to the Indian employees and acceleration of vesting of all ESOPs options till June 30, 2023. It will also extend its health insurance coverage for these employees till August 18, 2023.

The layoffs came more than a year after Airmeet raised $35 Mn in its Series B funding round from Prosus Ventures, Sistema Asia Fund, RingCentral Ventures, KDDI Open Innovation Fund, DG Daiwa Ventures and Nexxus Global.

May 12 | Inc42 Exclusive: CRED-Owned Happay Cuts 35% Workforce

Fintech unicorn CRED-owned Happay has reduced its workforce by approximately 35%, sources told Inc42. At least 160 employees across various departments, including sales, marketing, tech, product and operations were let go as part of a restructuring exercise.

While sources told Inc42 that the restructuring was related to employee performance and was part of the appraisal process, Happay did not revert to a detailed questionnaire till press time.

As part of the severance package, the startup is offering employees three months’ salary along with additional benefits, such as an extension of insurance coverage and job placement assistance.

The layoffs come after Kunal Shah’s CRED spent $180 Mn on acquiring Happay in December 2021.

May 8 | Gold Loans Startup Rupeek Fires 20 More Employees Citing Restructuring

Sequoia-backed Gold loans startup Rupeek fired 20 more employees, around 2% of its workforce, as it looks to become profitable amid an ongoing funding crunch.

A Rupeek spokesperson told Inc42, “We have witnessed strong growth and efficiency gains that take us closer to becoming profitable. As we continue to assess the volatile market situation and take strategic and proactive steps to adapt, it is necessary to maintain a leaner and more agile organisation. Unfortunately, this also meant that we had to make the difficult decision to part ways with less than 2% of our workforce.”

The startup incurred a total loss of INR 364.3 Cr in FY22, a 2.3X jump from INR 156.3 Cr in FY21, while Rupeek saw its total revenue climb to INR 132.4 Cr in FY22, a 49% jump from INR 88.5 Cr in FY21.

May 8 | Edtech Startup Cuemath Fires 100 Employees Citing Restructuring

Cuemath restructured its management and laid off its employees, with founder Manan Khurma returning as its full-time CEO. According to media reports and Inc42 sources, the company has fired around 100 employees.

“Some functions and roles will also be rationalised to reflect our increased focus on LCX and retention. While this will impact some talented people who have contributed a lot to Cuemath, we are committed to supporting our affected colleagues with everything they need to ensure a smooth transition into the next phase of their professional journey,” Khurma said on LinkedIn.

The development comes less than a year after the edtech raised $57 Mn in June 2022, as it saw its standalone losses reach INR 216.6 Cr in FY22.

May 5 | Inc42 Exclusive: Edtech Startup Teachmint Fires 70 Employees

Teachmint conducted its second round of layoffs since the onset of funding winter, having fired over 70 employees, sources told Inc42. Employees working in talent acquisition, tech, and support roles; and quality analysts were impacted during this round of layoff.

Employees were informed about the layoffs in a town hall held by the top management, including founders, on May 4, sources privy to the matter informed Inc42. Teachmint confirmed the layoffs to Inc42 without disclosing the number of impacted employees.

In a statement, the startup said that they are working to provide support to the impacted employees. The layoffs come after the startup’s net loss surged 24X to INR 131.7 Cr in FY22 from INR 5.5 Cr in FY21, while its revenue from operations stood at INR 77.45 Lakhs in FY22. The startup’s first year of operations was FY22.

May 5 | Meesho Fires 251 Employees In Third Round Of Layoffs

Ecommerce unicorn Meesho fired 251 employees or about 15% of its present workforce of 1,675 as a part of a cost-cutting exercise. The ecommerce giant’s cofounder and CEO Vidit Aatrey informed the employees of the decision in an email earlier on May 5.

“As leaders, we made judgement errors in over-hiring ahead of the curve. At the same time, we could have run our org structure in a more effective and lean manner overall,” said Aatrey in the email. This was Meesho’s third round of layoffs, having fired 450 employees over two layoffs in 2022 before.

A Meesho spokesperson told Inc42 that the exiting employees will be entitled to a separation package that includes a one-time payment of 2.5-9 months, depending on the tenure and designation, insurance benefits, job placement support and accelerated vesting of ESOPs by one year.

April 29 | Data Startup Cogito Laid Off 177 Employees 

New York and Delhi NCR-based automation startup Cogito fired 177 employees after the project they were working on was scrapped, leading to protests by the impacted employees who claimed they were not paid any remunerations before being let go.

Speaking with Inc42, Cogito CTO Rohit Agrawal said, “Due to the current market environment, a client of ours decided to abruptly ramp down their operations,” which led to the 177 employees working on the project being let go.

He further refuted the employees’ claims and added that every employee was paid April salaries and they were satisfied with the company’s actions.

April 26 | Inc42 Exclusive: Edtech Startup Extramarks Fires 300 Employees

Edtech platform Extramarks laid off over 300 employees in a restructuring exercise as it is looking to shut down its B2C vertical, sources told Inc42. While most of the employees let go were from the closing B2C vertical, employees from sales, customer support, HR, marketing, tech, and content teams were also impacted.

While Extramarks has stopped onboarding new students for its B2C vertical, it would continue to provide its services to the existing students.

The company did not respond to Inc42’s queries. In an internal mail seen by Inc42, the startup said it would pay the laid off employees salary till April 20 and an additional pay as per their respective notice periods.

April 25 | Inc42 Exclusive: Skill-Lync Lays Off 400 Employees

Skill-Lync, which provides job opportunities to students upon completion of the programme, fired over 400 employees in a restructuring exercise, sources told Inc42. The impacted employees were from sales, marketing, pre-sales, tech and talent acquisition departments.

Skill-Lync cofounder SuryaNarayanan PaneerSelvam informed the employees about the layoffs in an internal mail and attributed it to the “recent macroeconomic conditions”. Inc42 has accessed the mail sent by PaneerSelvam. “This doesn’t reflect in any way on the performance of the individual,” the cofounder wrote in the mail.

The startup offered severance packages to the laid off employees based on their respective notice periods. Besides, Skill-Lync also closed the shutters of its Delhi NCR office post the latest layoff round, the sources told Inc42.

April 20 | Neobanking Unicorn OPEN Fires 47 Employees Citing Performance

Neobanking unicorn OPEN laid off 47 employees based on performance evaluation, the company said. OPEN also said that all four of its cofounders have taken a 50% salary cut. However, it added no other employee will be subjected to any such pay cuts.

“While 47 Openers were exited based on performance, the company is actively recruiting for critical functions such as growth marketing, product, and sales functions to continue growing the business and better serve its customers,” OPEN said in a statement.

“As a part of scale up and profitability, OPEN will continue the efforts to make a highly performance-oriented effective organisation fit for scale and is one of the very few startups with visibility on profitability and runway above 30 months to well face the market conditions,” said the cofounder Anish Achuthan.

The startup has offered a one-month notice period worth of salary to the impacted employees.

April 19 | BNPL Soonicorn Simpl Fires 120-150 Employees In A Cost-Cutting Exercise

BNPL platform Simpl fired an undisclosed number of employees, though media outlets have reported between 120 and 150 people impacted by the layoffs. It was not immediately clear as to which teams were impacted by the layoffs.

“In lieu of the current economic condition and preparing for the new economic reality, we’ve re-looked at our headcount towards becoming a leaner and agile organisation. We are sincerely grateful to the employees for their valuable contribution,” a Simpl spokesperson told Inc42.

Simpl’s cofounder and CEO Nitya Sharma reportedly did a virtual town hall and informed employees that the move would help the startup extend its runway. The startup has offered a severance package to the outgoing employees, though it did not share the details of the package with Inc42.

April 17 | FamPay Sees Top Level Exits, Fires Employees Amid Funding Crunch

Teen-focused fintech platform FamPay fired employees as it looks to extend its runway amid an ongoing funding winter. The startup also saw head of engineering Shobhit Gupta, Brijesh Bhardwaj, who oversaw product and growth and Fatema Raja, who led the design team, resign from the startup.

While media reports suggested that FamPay fired up to 50 employees, the startup’s founder said in a tweet that that less than 10 employees have been impacted by the retrenchments.

FamPay saw its loss widen to INR 50 Cr in FY23 from INR 43.3 Cr reported in the previous fiscal. The fintech company posted a meagre INR 3 Cr in operating revenue in the year ended March 2022.

April 14 | Inc42 Exclusive: Drip Capital Fires 20% Staff Without A Clear Reason

Trade financing startup Drip Capital laid off about 20% of its 400-member workforce in November last year in a restructuring exercise, sources told Inc42. The tech, engineering and sales departments took the biggest hit in the retrenchments.

The sources told Inc42 that the startup did not give a clear reason for the layoffs, and when Inc42 reached out to the startup on the matter, it declined to comment. The sources said that CEO Pushkar Mukewar announced the business restructuring plan during a town hall meeting with all employees in mid-November last year.

Within hours, the impacted employees were separately asked to resign over emails. Drip Capital gave a two-month salary as severance pay to the impacted employees and it cleared the full and final payments within 15 days.

April 10 | EV Maker Euler Motors Fires 10% Workforce Six Months After Raising $60 Mn

EV manufacturer Euler Motors has laid off 10% of its employees across departments citing restructuring. While the company’s LinkedIn page shows around 500 employees, taking the number of impacted employees to 50, an Inc42 source said the number was between 180 and 200.

“We are restructuring our company to better deliver to customers as well as to investor expectations of greater efficiency in the context of changing global circumstances,” said a company spokesperson in a statement on Monday (April 10).

The startup claimed that it has provided “appropriate” severance to the laid-off employees. The layoffs come after its net loss almost doubled to INR 36.3 Cr in FY22.

April 8 | Healthech Major Practo Fires 41 Employees

Practo fired 41 employees as part of its performance management and planning process. In a statement sent to Inc42, the startup confirmed the development saying that it will provide all required support to the impacted employees.

At the same time, the company claimed that it was not undergoing any restructuring exercise and that the employees were handed pink slips over performance issues.

“… as part of our continuous performance management and planning process, we had to part ways with 41 employees in accordance with their employment contracts. As always, we are and will remain fully committed to providing the requisite support to all employees who may be impacted,” a company spokesperson said.

April 7 | ZestMoney Fires 20-30% Workforce As PhonePe Deal Collapses

ZestMoney has laid off between 20% and 30% of its workforce as part of a cost-cutting exercise after PhonePe cancelled its plan to acquire the BNPL platform. While Inc42 sources said the number was close to 30%, other media outlets reported a number close to 20%, translating to about 100 employees impacted across departments.

Sources further said a sizeable chunk of the employees are moving to PhonePe, even as the fintech decacorn pulled the plug on the deal to buy ZestMoney over multiple issues, including due-diligence issues, disagreements over valuation, sustainability of the business and the shareholding structure.

ZestMoney has paid the impacted employees one month’s salary as severance pay and other benefits like insurance and mental health assistance.

April 6 | Dunzo Fires 30% Staff In Second Layoffs In Three Months

Dunzo went for another round of layoffs within three months as it fired 30% of its employees ahead of a business model shift. Reportedly, the number of impacted employees comes to around 300.

Following the layoffs, the quick commerce unicorn will shut down 50% of its dark stores and run only those which can either be profitable or are close to being profitable. Dunzo will partner with supermarkets and other merchants wherever it shuts down dark stores.

The unicorn’s consolidated loss in FY22 widened 2X to INR 464 Cr from INR 229 Cr in FY21 on the back of a doubling of its expenses.

April 4 | 1K Kirana Fires 40% Employees Citing Restructuring

Gurugram-based Kirana tech startup 1K Kirana fired 40% of its workforce, citing a restructuring and closure of operations in a few regions.

As per the startup’s LinkedIn page, it had 1,052 employees at the beginning of April, taking the impacted employees to 421. However, media reports suggest the number could be more than 600 employees.

In a statement shared with Inc42, 1K Kirana cofounder Kumar Sangeetesh said, “We are currently in the process of restructuring as our growth forecasts have changed. We are changing our focus areas and moving out of a few geographies. Due to this, we have to let go of 40% of our employees. All the employees will be given severances and we will assist them with outplacements.”

The development comes less than a year after the startup raised $25 Mn in a Series B funding round in May 2022.

March 30 | Temasek-Backed Blue-Collar Jobs Platform GoodWorker Fires 90% Staff Ahead Of Acquisition

Bengaluru-based blue-collar job discovery platform GoodWorker, backed by the likes of Temasek, fired 90% of its employees, per a DealStreetAsia report. The retrenchments have impacted employees across departments.

Per the startup’s LinkedIn page, it has 190 employees, therefore, the retrenchments could have impacted as many as 171 employees. GoodWorker has also been reportedly acquired by Affinidi, a Singapore-based decentralised identity verification platform, which is also backed by Temasek.

Interestingly, GoodWorker is a joint venture between SchoolNet and LemmaTree, and the latter is a wholly-owned subsidiary of Temasek. As such, the retrenchments and the fire sale seems to have been orchestrated by the Singapore-based investor.

March 30 | Unacademy Fires 12% Of Workforce In Fourth Round Of Layoffs In 12 Months

Unacademy fired 12% of its workforce in the fourth round of layoffs at the edtech unicorn. While media outlets reported a number of around 380 employees, according to Inc42 data, the number would be around 540, post the three layoffs it has done before.

In a Slack message sent to the team, Unacademy CEO and cofounder Gaurav Munjal said, “We have taken every step in the right direction to make our core business profitable, yet it’s not enough. We have to go further, we have to go deeper.”

He added, “Unfortunately, this has led me to take another difficult decision. We will be reducing the size of our team by 12% to ensure that we can meet the goals we are chasing in the current realities we face.”

The outgoing employees will be eligible for a severance pay equivalent to the notice period and an additional month’s pay, along with accelerated vesting of one year for employees that were with Unacademy for at least one year.

March 30 | Inc42 Exclusive: FanClash Fires 75% Workforce Following Business Model Pivot

Delhi NCR-based fantasy esports startup FanClash laid off around 75% of its workforce this year, according to Inc42 sources. The startup undertook the layoff exercise in three rounds and fired about 100 employees, the sources said.

Apart from firing employees, the startup also shut down FanGuild, a fantasy Web3 gaming platform, and halted operations of its fan engagement platform FanSpace.

“Considering the temporary uncertain environment towards mobile esports, we had no option but to restructure our business which meant that we had to ask 75% of our workforce to leave,” said a company source, requesting anonymity.

Inc42 sources added that the impacted employees were given a two-month salary as a severance package.

March 17 | Freshworks Goes For Round Two Of Layoffs

Freshworks undertook a fresh round of retrenchments, a second round of layoffs in the past three months. Without specifying the number of employees impacted in the exercise, Freshworks said that the move has been made to strengthen organisational and operational efficiencies.

“Freshworks has not conducted org-wide layoffs and continues to hire for open positions. We continue to review organisational efficiencies to avoid duplicated efforts and maintain a strong performance culture. As a result, a small number of individuals are impacted and are leaving the company,” a Freshworks spokesperson said.

The development came three months after Freshworks fired ‘less than 2%’ of its workforce amid an organisational reshuffle.

March 15 | Inc42 Exclusive: Home Decor Unicorn LivSpace Fires 100 Employees Citing Restructuring

Home renovation and interiors platform Livspace fired 100 employees, or 2% of its workforce, as part of a cost-cutting exercise, sources told Inc42. Product, engineering, content, and marketing teams were the most impacted by the layoffs, a source added.

“Our focus continues to be on the most efficient deployment of capital and resources to maximize value for our shareholders, customers, partners and employees,” the company said in a statement, adding, “in a company of our size, we will, in the normal course of our operations, redeploy resources. This is organic and a reflection of normal adjustments and/or performance management parameters.”

Without sharing details, LivSpace said it is extending an assistance package and healthcare coverage to the impacted employees. The startup has raised close to $430 Mn across funding rounds, entering the unicorn club in February 2022.

March 15 | Inc42 Exclusive: Retailtech Startup Dukaan Fires 30% Workforce Citing Restructuring

Retail tech startup Dukaan laid off around 56 employees, or around 30% of its workforce, sources told Inc42. The layoffs, due to a change in Dukaan’s focus to D2C brands from SMBs, affected inside sales team and account managers.

Dukaan offered a two-month salary as a severance package to the impacted employees. Suumit Shah, Dukaan’s founder and CEO, confirmed the development to Inc42.

Dukaan last raised $12.4 Mn in its pre-Series A round, led by 640 Oxford Ventures, in September 2021. In all, the retailtech startup has raised more than $18 Mn in funding across its seed and Pre-Series A round.

March 6 | upGrad Campus Lays Off 30% Workforce Amid Prolonged Funding Winter

Video learning platform upGrad Campus fired 30% of its total workforce, accounting for nearly 120 employees, Indian Express reported. It was unclear if the layoffs were targeted at a specific department within the startup.

Impartus, as upGrad Campus was known prior to its acquisition in March 2021, operates independently as an upGrad subsidiary. The layoffs at upGrad Campus are the second one at a subsidiary of the Ronnie Screwvala-led edtech unicorn.

In January, Harappa Education, which was acquired by upGrad in July 2022 for $38 Mn, fired 40% of the workforce or about 73 employees.

March 2 | Inc42 Exclusive: Fitness Startup Fittr Fires 11% Workforce Citing Role Redundancy

Pune-based fitness startup Fittr laid off 11% of its workforce, or around 30 employees, across marketing, sales, client servicing and tech teams, sources told Inc42. The sources added that the company may have fired as many as 60 employees, though the claim remained unconfirmed.

In a statement given to Inc42, the cofounder and CEO of Fittr, Jitendra Chouksey, said the company had to let go of people due to role redundancy (11% of the total workforce in a span of 6-8 months). “Meanwhile, we did hire to backfill certain critical positions,” Chouksey added.

According to Fittr’s MCA filings, it slipped into losses in FY22. The startup registered a loss of INR 25.2 Cr in FY22 against a profit of INR 49.04 Lakh in FY21, even though its revenue from operations rose to INR 83.05 Cr in FY22 from INR 52.7 Cr in FY21.

March 1 | Conversational AI Startup Yellow.ai Lays Off 15% Employees Amid Funding Winter

Conversational AI startup Yellow.ai has fired 15% of its employees since August, on account of slow growth and a bloated workforce. According to media reports, the SaaS startup has carried out two layoffs between August 2022 and February 2023.

The startup has 1,063 employees, according to its LinkedIn profile. Confirming the development to Inc42, a Yellow.ai spokesperson said, “We had to reorganise some of the teams to double down on high-priority, high-growth areas, which in turn has affected 15% of the company.” The spokesperson added that the company is supporting the outgoing employees, without sharing details of any severance packages.

The layoffs come just months after Yellow.ai announced a $43 Mn ESOP plan for its employees. The startup has raised more than $102 Mn across funding rounds so far, with the latest round coming in August 2021 when Yellow.ai raised $78.15 Mn from the likes of WestBridge Capital, Sapphire Ventures and Salesforce Ventures.

February 22 | Edtech Startup Camp K12 Fires 70% Employees

Edtech startup Camp K12 reportedly fired 70% of its workforce without paying any dues to the impacted employees. While Inc42 could not reach Camp K12, media reports suggest that it might have laid off as many as 300 employees, of the 433 it had, according to its LinkedIn account.

According to media reports, the coding edtech startup has not paid salaries to its employees since December 2022; the layoffs took place in January 2023. The company has allegedly not paid any salaries to the impacted employees and it is not letting the remaining employees resign either.

Another edtech startup on the verge of capitulation, Camp K12 has raised $16 Mn in funding across two rounds, with the startup last raising $12 Mn in August 2021.

February 21 | Crypto Startup Polygon Fires 20% Staff As Crypto Winter Extends

Ethereum Layer-2 scaling startup Polygon laid off around 20% of its workforce, or 100 employees, as part of a restructuring exercise amid the ongoing crypto winter. The startup has fired employees across multiple business functions.

“Earlier this year, we consolidated multiple business units under Polygon Labs. As part of this process, we’re sharing the difficult news that we’ve reduced our team by 20% impacting multiple teams and about 100 positions,” the startup said in a blog post.

Polygon said that the employees impacted will receive a three months’ pay as severance, regardless of their level or tenure. The layoffs come a year after Polygon raised $450 Mn in a funding round, led by Sequoia India

February 20 | Security Management Startup MyGate Fires 30% Staff Amid Funding Crunch

Community and security management startup MyGate has reportedly laid off 30% of its employees across mid-management and junior roles. The startup’s total headcount was reduced from 600 pre-layoffs to 400.

Only a few laid off employees were offered a salary of two months as a severance package, while others did not receive severance at all, according to media reports.

Founded in 2016, MyGate offers security solutions for apartment complexes at entry and exit gates, along with other security systems such as RFID cards, biometrics and vehicle stickers. It has raised $79.5 Mn in VC funding to date.

February 14 | Inc42 Exclusive: Healthtech Platform Phablecare Faces Capitulation, Fires 350 Employees

In another startup capitulation story amid the harsh funding winter, healthtech platform Phablecare has fired 350 employees, nearly 50% of its workforce. The startup is currently facing a funding crisis and has held back the salaries of employees.

While sources told Inc42 that Phablecare has laid off around 350-400 employees so far, hundreds voluntarily resigned due to the delays in getting their salaries. The founders are yet to revert to a detailed questionnaire sent by Inc42.

In the meanwhile, the founders communicated to the staff as late as January that they were trying to raise funds. Phablecare’s situation is still developing as its day-to-day operations have taken a beating.

February 14 | Prime Venture-Backed HackerEarth Fires 9% Employees, Introduce Pay Cuts

Tech-focused skilling and hiring startup HackerEarth laid off nearly 9% of its employees working in different verticals, according to media reports. The number of employees impacted was around 17 of a total headcount of 190.

Sachin Gupta, CEO of HackerEarth, said, “2020 and 2021 were years of strong growth for us. We built a team in anticipation of this trend continuing. Instead, the second half of 2022 saw a slowdown in hiring, which resulted in lower growth in our business than what we had prepared ourselves for.”

HackerEarth has provided a severance package including eight weeks of pay to impacted employees. While employees with more than two years of stint in the company have been given one additional week of pay for every year of their service.

February 6 | FilterCopy Parent Pocket Aces Fires 25% Staff To Cut Costs

Digital entertainment startup Pocket Aces, which owns YouTube channels such as FilterCopy and Dice Media, fired a quarter of its workforce, or about 25 employees. The job cuts impacted employees in content, production and post-production teams.

Aditi Shrivastava, cofounder and CEO of Pocket Aces, told Inc42, “It has been a tough decision to part with some of our talented team members and friends. However, we must keep innovating our operating models, and this is the right thing to do in order to ensure that we remain agile with the changing audience preferences. We deeply care about the people leaving us and will provide them with financial support, and ongoing health insurance coverage and help them with their transition.”

The company further added that it would keep engaging with some of the outgoing employees on a freelance basis.

February 3 | Inc42 Exclusive: SaaS Logistics Startup FarEye Fires 90 Employees In Layoffs Round Two

Microsoft-backed SaaS logistics startup FarEye laid off 90 employees in a second round of layoffs in just eight months. The startup has fired 340 employees or around 45% of its workforce before the first layoffs. The job cuts impacted people across tech, product, HRBP and sales, sources told Inc42.

Confirming the layoffs, FarEye cofounder and CEO Kushal Nahata told Inc42 in a statement, “The reduction in staff was necessary to align business strategy with market demand and continue to serve our customers’ business needs, as has always been our mission. Our focus on product innovation and customer solutions remains strong, and we will continue to expand our reach in new industries and markets around the globe.”

While the startup did not go into the specifics, it said it has offered severance packages to the impacted employees as per the local laws.

January 27 | Ecommerce Unicorn DealShare Fires 100 Employees To Cut Costs

Tiger Global-backed grocery delivery unicorn DealShare fired 100 employees or about 7% of its 1,500-strong workforce in a bid to reduce monthly burn rate. The move impacted employees across all teams, according to the unicorn’s founder Sourjyendu Medda.

“We have removed the roles as a result of the current market conditions. We look at the business plan for the year and we have reduced the focus on some of the areas which would need very long-term capital infusion before becoming totally profitable,” said Medda, confirming the development to Inc42.

The grocery delivery unicorn did not specify the details of the severance benefits the outgoing employees would be entitled to.

January 25 | Inc42 Exclusive: SaaS Startup SirionLabs Fires 130 Employees Days After Raising $25 Mn

Sequoia and Tiger Global-backed SaaS startup SirionLabs fired around 15% of its total workforce, or about 130 employees, days after announcing a Series D fundraise of $25 Mn, Inc42 exclusively reported. Employees in DevOps, analysts, and support teams were impacted by the layoffs.

In a mail sent to the employees, Ajay Agrawal, the founder and CEO of the contract management startup, informed the employees about the decision. Inc42 has reviewed the mail sent to the employees by Agrawal. In the mail, Agrawal said that the startup has to shift its business strategy towards profitability due to the current macroeconomic environment, and this will result in downsizing.  

SirionLabs offered a salary of two months as a severance package to the impacted employees.

January 24 | Inc42 Exclusive: Healthtech Unicorn Innovaccer Goes For Second Layoff Round, Fires 245 Employees

Tiger Global-backed healthtech unicorn Innovaccer fired around 15% of its workforce, or 245 employees, in the second round of sackings at the unicorn within four months. The layoffs impacted teams in India and the US across multiple departments, Inc42 exclusively reported.

Confirming the development with Inc42, the unicorn’s cofounder and CEO Abhinav Shashank cited an ‘uncertain macroeconomic environment’ as the reason for the second round of layoffs. The cofounder said that Innovaccer will deprioritise certain areas that distract the unicorn from its “core portfolio”.

The startup will offer severance packages to the impacted employees along with transitional health insurance benefits, and job placement support, an Innovaccer spokesperson told Inc42. The round of layoffs also comes after the unicorn fired 90 employees in September 2022.

January 23 | India’s First Unicorn InMobi Fires 50-70 Employees After Performance Review

InMobi, India’s first-ever unicorn, fired around 50-70 employees or about 3% of its workforce after it concluded a performance review, Business Standard reported. The impacted employees are both from InMobi and its mobile advertising platform Glance.

“InMobi/Glance is in the market actively hiring talent for the ambitious plans that we have. We also evaluate the performance of our existing talent on an annual basis and make decisions based on it. This is business as usual for us and part of our annual process. This year is no different,” the adtech company was cited as saying.

The company also announced that it will skip increments for CY23 and also undertake recruitment only when required.

January 20 | Inc42 Exclusive: MediBuddy Fires 200 Employees After Restructuring

Lightrock India-backed healthtech startup MediBuddy fired around 200 employees after conducting a restructuring exercise. The tech, product, sales and operations teams were the worst impacted because of the sudden layoffs, sources told Inc42.

“While layoffs are never easy and it is painful in the short term, this was to realign our current business goals for long-term stability and growth. In this entire process of realignment, we had to part with 8% of the workforce across all departments as a one-time restructuring exercise and eliminate any redundancy in roles and responsibilities,” MediBuddy said in a written statement.

MediBuddy said it would provide outplacement assistance to the impacted employees. Further, it has designed a care package that includes MediBuddy wallet continuity and extended health coverage.

January 20 | Swiggy Lays Off 380 Employees Citing Restructuring To Cut Costs

Food delivery major Swiggy fired 380 employees as part of a restructuring exercise to cut costs, founder and CEO Sriharsha Majety said in an email to the employees on January 20. The layoffs impacted around 5% of Swiggy’s workforce.

“While we’d already initiated actions on other indirect costs like infrastructure, office/facilities, etc, we needed to right-size our overall personnel costs also in line with the projections for the future,” added the CEO. The layoffs come after Swiggy reported a 2.2X growth in its losses, which reached INR 3,628.9 Cr in FY 22 compared to INR 1,616.9 Cr in FY21.

Swiggy is offering several benefits to the outgoing employees, including a payout worth at least three months of salary, including all the bonuses and incentives. Employees can also avail of the payout equivalent to their notice period, plus 15 days ex-gratia for every completed year of service.

January 19 | Hubilo Goes For A Second Layoff, Fires 115 Employees 

Event management startup Hubilo laid off 115 employees or around 35% of its workforce in a restructuring exercise.

In a written statement, the startup said, “Hubilo has made the difficult decision to restructure the company amid global macroeconomic conditions. Approximately 35% of the company was laid off as a result. We have made our best effort to ensure that the impacted employees are supported with generous severance packages as well as outplacement services to give them a smooth transition.”

Hubilo fired employees for the second time in six months after it fired around 45-50 employees in July 2022.

January 17 | Inc42 Exclusive: Exotel Lays Off 80 Employees

Bengaluru-based cloud telephony platform Exotel laid off 142 employees, or 15% of its workforce, citing their poor performance, sources told Inc42.

The layoffs took place following a revision in the startup’s performance improvement plan (PIP) policy in November 2022, under which Exotel removed the clause of giving two warnings to employees for below par performance.

However, a company spokesperson told Inc42 in a statement that 80 employees were impacted due to the revision in PIP policy and business restructuring.

An Exotel spokesperson, without confirming or denying the number of employees sacked, attributed the recent layoff exercise at the startup to restructuring and mid-year review. 

“Recently, some members of our team have been affected due to our restructuring efforts (3%) & the mid-year review, business as usual performance improvement planning process (less than 5%),” the spokesperson said.

January 17 | Auto After-Sales Service Platform GoMechanic Fires 70% Employees

Automobile after-sales service startup GoMechanic sacked nearly 70% of its workforce, which amounted to nearly 500 employees being fired. 

While Inc42 could not immediately verify the details, media reports noted that the startup’s backer Sequoia has launched a forensic audit of its finances amid allegations of financial irregularities at the startup. The startup is said to have a total loans of INR 120 Cr and ‘market pendency’ of INR 40 Cr.

The Gurugram-based startup needs to raise funds in the ‘next few months, sources familiar with the development added, as the startup does not have any runway beyond that.

January 16 | Quick Commerce Soonicorn Dunzo Fires 3% Workforce After Shutting Dark Stores

Reliance-backed quick commerce startup Dunzo laid off nearly 3% of its workforce, having shut down a few dark stores a few months ago. While the startup did not clarify how many employees left the organisation, media reports reported a number between 60 and 80.

“Whatever the numbers, these are people who chose to build their careers with Dunzo, and it is sad to have talented colleagues leave us. We are extending the best support possible to help them during this transition,” Dunzo CEO and cofounder Kabeer Biswas said in a statement.

As with the number of employees fired, Dunzo did not clarify the severance packages given to the impacted employeer, nor the departments the employees were fired from.

January 16 | Foodtech Unicorn Rebel Foods Fires 50 Employees Citing Performance Review

Foodtech unicorn Rebel Foods fired 50 employees, or about 2% of its workforce, citing an annual performance review at the startup. The startup did not provide details on the departments the employees were fired from or the sewerage benefits the said employees would be entitled to, if any.

“Any news heard is on account of annual performance evaluation and realigning the organisation to our priorities for future goals. The impacted number is less than 2% of our organisational strength,” a Rebel Foods spokesperson said.

The layoffs come after the startup‘s net loss widened 55% YoY to INR 564.4 Cr in FY22 from INR 364 Cr in FY21, while its revenue also doubled to INR 907 Cr from INR 436.5 Cr in FY21.

January 16 | ShareChat, Moj Parent Mohalla Tech Fires 500 Employees 

Mohalla Tech Pvt Ltd, the parent company of content platforms Sharechat and Moj fired 500 employees or about 20% of its workforce. It was not immediately clear which departments were impacted by the layoffs.

In a statement, a Sharechat and Moj spokesperson said, “We’ve had to take some of the most difficult and painful decisions in our history as a company and had to let go of around 20% of our incredibly talented employees who have been with us in this startup journey.”

The impacted employees will be receiving the entire salary of their notice periods, two-weeks’ pay for each year served with the company and 100% of the variable pay till December 2022. Also, the company will allow impacted employees to encash unused leave balance of up to 45 days, while also allowing them to keep their office assets, such as laptops.

January 13 | Inc42 Exclusive: SaaS Start Skit.ai Fires 115 Employees Citing Restructuring

Bengaluru-based SaaS voice automation startup Skit.ai laid off around 115 employees citing restructuring at the firm, sources told Inc42. The sources added that the number could be as high as 130. The layoffs were announced by Skit.ai CEO and cofounder Sourabh Gupta during a town hall meeting. 

The startup has fired employees across business analyst, software engineering, product, operations, SPM and CSM roles, the sources said. Most of the laid off employees are from the India team as the startup shifts its focus to the US market, according to Inc42 sources.

The startup has offered two months of salary as a severance package to the laid off employees and will extend their insurance coverage for the next six months, while also allowing employees to keep their assets such as laptops and iPads, documents reviewed by Inc42 showed.

January 12 | Crypto Unicorn CoinDCX Fires Employees As Part Of Restructuring Drive

Crypto unicorn CoinDCX fired some employees as part of a restructuring drive at the cryptocurrency exchange, a source close to the development told Inc42. 

While the number was not immediately verifiable, media reports suggest that the crypto exchange has fired around 50 people from the sales and marketing teams at the company, or around 8% of its total workforce. The impacted employees have reportedly been given a month’s severance pay and let go after serving their notice periods. 

The layoffs come as a prolonged crypto winter and the recent collapses of FTX and Terra Luna have shaken the public confidence in crypto as an asset class in India.

January 12 | Payments Soonicorn Cashfree Sacks 80 Employees Citing Organisational Reshuffle

Fintech platform Cashfree Payments sacked 80 employees – as many as 13% of its workforce – across several teams as part of an organisational restructuring, sources told Inc42. The fintech soonicorn could have fired as many as 120 people, but that could not be verified.

However, the company claimed that only 6-8% of the employees were affected by the retrenchment. The details of any severance packages or any other benefits that the outgoing employees would have been entitled to were not clear either.

“The organisation has reevaluated the relevance of certain roles and functions leading to movement of talent within teams and a few employee exits. This process of organisational restructuring has impacted around 6-8% of employees,” said a Cashfree spokesperson.

January 12 | Ola Fires 200 Employees Citing Restructuring

Mobility startup Ola fired 200 employees across verticals, citing an organisational restructuring. The laid off employees are from Ola Cabs, Ola Electric, and Ola Financial Services verticals, sources told Inc42.

Confirming the development, a Ola spokesperson told Inc42 in a statement, “We regularly conduct restructuring exercises to improve efficiencies, and there are roles which are now redundant. We will continue making new hires in engineering and design including senior talent in our key priority areas.”

The company offered severance packages as per their respective notice periods, they said, adding that the layoffs began earlier this week. 

January 10 | LEAD Fires Another 60 Employees, Takes Total Layoffs To 100

Mumbai-based edtech startup LEAD laid off around 60 employees, mostly from the tech and product teams. However, the startup told Inc42 that it was a regular churn due to business activities.

In a statement shared with Inc42, LEAD said, “We have grown 2X this year and are hiring for growth. If projects don’t meet success criteria or don’t fit our strategic roadmap, teams are either re-assigned or asked to seek other opportunities. This is a regular business activity and a normal churn of 1-2 % in an organisation of 2,000 people.”

The layoffs came shortly after LEAD raised INR 35 Cr in debt from Alteria Capital, and shortly after the layoffs, the startup raised INR 160 Cr. 

January 10 | Unacademy-Owned Relevel Fires 40 Employees As Company Pivots

Unacademy-owned Relevel plans to lay off 40 employees or nearly 20% of its workforce. In an internal mail sent to employees, Unacademy CEO and cofounder Gaurav Munjal cited Relevel’s pivot from core education business to test product business and focus on the newly launched NextLevel app as the reason for the layoffs.

“Almost 80% of Relevel’s remaining team will be absorbed by other businesses of Unacademy Group and we will have to let go of around 20% (around 40 people) of the team because of lack of availability of roles for them,” Munjal said in the mail. 

The impacted employees would be provided with severance pay equal to the notice period and an additional two months. Besides, the company also said that the laid off workers would also get accelerated vesting, medical insurance and placement support.

January 6 | Bike Rental & EV Startup Bounce Fires 3-4% Of Staff Citing Restructuring

Bike rental and electric vehicle (EV) startup Bounce laid off around 3-4% of its total workforce as part of an ongoing ‘restructuring drive’. The layoffs largely affected customer service and other segments, Bounce said.

A company spokesperson told Inc42 that the employees were “let go off” phase wise and the exercise largely affected the non-original equipment manufacturer (OEM) vertical. As per the company, the layoffs largely affected customer service and other segments.

It is prudent to mention that media reports have mentioned a much higher number, to the tune of almost 250 employees being fired. The startup, however, has denied the claims.

January 5 | Ecommerce Rollup UpScalio Fires 15% Of Staff Citing Performance Review

UpScalio became the first Thrasio-style startup in the country to lay off employees, as it fired around 15% of its staff citing a performance review.

In a statement shared with Inc42, Ankur Singh, head of people and culture at UpScalio, said, “While UpScalio has been able to grow aggressively, we always keep a keen eye on profitability. As part of our standard annual employee appraisal process, in December, we have let go of 15% of our staff.”

The layoffs come nine months after the ecommerce rollup startup raised $15 Mn in its pre-Series B funding round in March 2022. UpScalio has raised around $60 Mn from investors across funding rounds.

January 5 | B2B Marketplace Moglix Fires 40 Employees Citing Automation

B2B industrial goods marketplace Moglix fired 40 employees – around 6% of its total workforce – citing process automation and performance reviews. While other media reports mentioned the number could be as high as 200, Inc42 could not independently verify the same.

“We have hired 700+ people this year and continue to expand with a target to hire 300+ people for 2023. We keep a watch out for low performers and continue to automate tasks, for which annually 2-3% of people can be impacted,” said Moglix in a statement.

Moglix posted a loss of INR $21.03 Mn in FY22, up 88.1% from $11.18 Mn in FY21. At the same time, its revenue rose 192% to $306.9 Mn from $105.2 Mn in FY21.

January 4 | upGrad-Owned Harappa Education Fires 40% Of Workforce After Business Model Change

upGrad-owned edtech startup Harappa Education fired around 73 employees – about 40% of its workforce – in the first layoff of 2023. The startup laid off employees from content, design, product, and marketing teams, sources told Inc42.

Harappa might just see more layoffs this month, as sources told Inc42 that more employees are likely to lose their jobs in the coming days. “This is the first phase of layoffs and there could be more. It seems that two lists were made – one for December and the other for January. Hence, in January more layoffs are expected,” the sources told Inc42.

Harappa Education was acquired by edtech unicorn upGrad for $38 Mn (INR 300 Cr) in July 2022. Last September, upGrad announced plans to invest $40 Mn (INR 320 Cr) in Harappa Education to drive the edtech’s growth.

December 26 | PayU India Fires 150 Employees After Org Reshuffle

PayU India, the payments and fintech unit Prosus, laid off around 6% of its workforce or around 150 employees citing an organisational reshuffle in India. The layoffs mainly affected PayU India’s digital payment security and mobile payment technology unit Wibmo, which it acquired for $70 Mn in 2019.

“Keeping in mind our highest strategic priorities, we are realigning teams across some of [our] businesses in India. As a result of which, regretfully we will to have part ways with some of our colleagues,” a PayU spokesperson told Inc42.

The layoffs at PayU happened despite the fintech achieving profitability in FY22. The startup’s FY22 results showed a profit of INR 126 Cr against revenue of INR 2,130.3 Cr.

December 16 | Listed SaaS Unicorn Freshworks Fires 90 Employees Citing Org Rejig

Nasdaq-listed enterprisetech major Freshworks fired around 90 employees as part of an organisational reshuffle, or about 2% of its total workforce. The employees were fired across sales, marketing, and engineering verticals.

“We shifted some existing roles in product, marketing and sales to support more critical initiatives and reduced the need for a small number of others – less than 2% of our workforce. Freshworks did not do a company-wide layoff,” said a Freshworks spokesperson. The company paid severance packages and other settlements to the impacted employees.

In the third quarter of FY22, Freshworks reported consolidated revenue of $128.8 Mn, up 37% YoY. During the same period, the company narrowed its losses to $58.3 Mn from $107.4 Mn during the year-ago period.

December 8 | Swiggy Lays Off 250+ Employees Citing Performance Review

Foodtech unicorn Swiggy joined its competitor Zomato in having fired employees in 2022, with news coming that it may lay off 250+ employees or around 3% of its total workforce after a performance review.

“We concluded our performance cycle in October and have announced ratings and promotions at all levels. As with every cycle, we expect exits based on performance,” a Swiggy spokesperson told Inc42. The layoffs come off the back of Jefferies reporting that Swiggy’s losses during H1 FY23 were six times higher than Zomato’s standalone losses during the same time. 

Swiggy’s losses in the first half of FY23 were at around $315 Mn (INR 2,570 Cr), while Zomato’s standalone loss during the period remained around the $50 Mn (INR 410 Cr) mark.

December 7 | Vedantu Fires Another 385 Employees, Takes Total Layoffs To 1,109

Edtech unicorn Vedantu fired employees for the fourth time this month, laying off 385 people to take the total count to 1,109. The layoffs have impacted people from sales, HR and content teams.

The latest layoff comes around a month after the unicorn acquired a majority stake in Karnataka-based test prep platform Deeksha for $40 Mn. Internal sources told Inc42 that the startup was left with around 18 months of runway, prompting the decision to let go of employees again. Vedantu is left with 3,300 employees after the latest firings.

Vedantu is offering a salary of two months as a severance package and has extended the medical coverage for the fired employees till March 31, 2023, according to Inc42 sources.

December 3 | Inc42 Exclusive: Healthtech Startup HealthifyMe Fires 150 Employees Citing Global Recession Fears

Health and fitness startup HealthifyMe fired 150 employees, or about 15-20% of its total workforce, citing slow growth triggered by the fears of a global recession. Employees in SME (subject matter expert), quality analytics, product and marketing roles were impacted by the layoffs.

“We have had to take the tough decision to let go 150 of our team members. Like much of tech, growth hasn’t kept pace with expectations and hiring,” the startup said in a written statement. HealthifyMe will be offering a two-month severance package and will further extend medical coverage to the impacted employees.

The layoffs come a year and a half after the startup raised $75 Mn in a Series C round of funding, having raised $100 Mn to date.

December 3 | Inc42 Exclusive: Traveltech Major OYO Fires 600 Employees Across Multiple Teams

IPO-bound hospitality chain OYO fired 600 employees from tech roles in product and engineering teams. The layoffs come after OYO decided to merge the two teams.

“The downsizing in tech is also happening in teams which were developing pilots and proof of concepts such as in-app gaming, social content curation and patron-facilitated content,” said OYO in a statement. However, the hospitality chain did not provide any details of the benefits the outgoing employees would be entitled to.

Ritesh Agrawal, founder and CEO of OYO, added, “We will be doing all that we can to ensure that most of the people we are having to let go, are gainfully employed.” The layoffs come after OYO posted an adjusted EBITDA of INR 56 Cr in Q2FY23, its second consecutive EBITDA-positive quarter.

December 2 | Inc42 Exclusive: ShareChat Parent Shuts Down Fantasy Cricket Subsidiary Jeet11, Fires 100 Employees

Mohalla Tech Private Ltd, the parent company of ShareChat, has shut down its fantasy gaming platform Jeet11, sources aware of the development told Inc42. Mohalla Tech has also fired 100 employees, mostly from non-tech roles within Jeet11.

The shutdown comes two years after the ShareChat and Moj parent forayed into fantasy sport. “We can confirm that we are ceasing operations of Jeet11 and have reorganized some of our functions, which meant movement of this talent within teams and a few employee exits,” Mohalla Tech said, confirming the development.

The layoffs also come almost 19 months after the startup raised $502 Mn in its Series E round, becoming the first social media unicorn in the process.

November 30 | Inc42 Exclusive: Edtech Startup Teachmint Fires 45 Employees Citing Restructuring

Joining the contingent of edtech startup firing employees, Teachmint laid off 45 employees or about 5% of its workforce citing restructuring. Inc42 exclusively reported that the layoffs were conducted across sales and operations teams.

“The impacted employees have been informed in advance and we are supporting them to the maximum extent possible,” Teachmint said in a statement given to Inc42, confirming the development.

The layoffs came almost a year after the edtech startup raised $78 Mn in a Series B round led by new investors Rocketship.vc and Vulcan Capital. Teachmint has raised $118 Mn in total to date.

November 29 | Hiring Platform Hirect Fires 200 Employees Citing Restructuring

Bengaluru and US-based hiring platform Hirect fired 40% of its workforce, or 200 employees, citing an organisational restructuring and a change in its business model.

The layoffs triggered several social media posts from employees that were fired, alleging high spending on social media influencers, non-payment of PF contributions and dues, and non-receipt of relieving letters. Others reported that the startup did not provide any severance package or job search assistance as well.

According to Crunchbase, Hirect has raised nearly $15 Mn across several rounds. Incidentally, the startup was reported to have raised $14.6 Mn in its Series A just two days after conducting layoffs.

November 28 | VerSe Lays Off 150 Employees After Raising $805 Mn In April

The parent company of DailyHunt and Josh, VerSe Innovation, laid off 150 employees, or about 5% of its workforce of 3,000 before the layoffs. The startup also decided to undertake an 11% pay cut for employees with annual salaries of more than INR 10 Lakh, according to Inc42 sources.

According to Inc42 sources, most of the layoffs happened from the short video platform, Josh. The layoffs at VerSe come just a few months after it raised $805 Mn at a valuation of $5 Bn in April this year. Incidentally, the startup did not share details of the benefits the outgoing employees would receive.

The startup’s expenses surged 2.35X to INR 3,714 Cr in FY22 from INR 1,580 Cr in FY21, while revenue from operations increased only about 45% to INR 965 Cr in FY22.

November 19 | Zomato Fires At Least 100 Employees In Performance-Related Layoffs

Listed foodtech startup Zomato became the first in its segment to fire employees amid a global economic downturn, laying off 3-4% of its workforce. In response to Inc42’s queries, a Zomato spokesperson said, “There has been a regular performance-based churn of under 3% of our workforce; there’s nothing more to it.”

Over the last few weeks, Zomato has seen several high-profile exits, including cofounder Mohit Gupta. Further, Kuwait-based startup Talabat, who bought Zomato’s UAE food delivery business in 2019, shut down Zomato’s food delivery business there.

The foodtech unicorn narrowed its loss to INR 250.8 Cr in Q2 FY23 YoY.

November 9 | B2B Insurtech Plum Fires 10% Employees Citing Restructuring

Tiger Global-backed B2B insurtech player Plum fired 10% of its workforce, or about 36 employees, as part of a cost-cutting exercise. The startup said it conducted multiple cost-cutting measures before going for layoffs.

Plum’s CEO and founder Abhishek Poddar added that the impacted employees will receive severance pay, healthcare benefits, well-being counselling, ESOP vesting and placement and career support.

Notably, the layoffs came after Poddar had said Plum would increase its employee count to 1,000 by FY23. The startup’s last funding round was its Series A round worth $15.6 Mn, which saw Tiger Global participate. In all, the startup has raised $20.6 Mn.

November 7 | Unacademy Goes For Third Layoff Round, Fires 10% Employees

Edtech unicorn Unacadamy conducted its third round of layoffs citing “unprecedented times”, as communicated to the employees in an internal email. The third round of layoffs impacted 10% of its workforce, taking the total number of employees fired by Unacademy to 1500 for the year.

The layoffs come after the edtech major had said it would not conduct further layoffs during the earlier round. However, Unacademy’s losses almost doubled year-on-year (YoY) to INR 2,848 Cr in FY22. At the same time, the startup reported consolidated revenue of INR 719 Cr in FY22.

Unacademy said that the affected employees will receive severance pay equivalent to the notice period and an additional two months. Munjal also said that the affected employees will get medical insurance coverage for an additional year and a supposed ‘dedicated’ placement support.

November 7 | Edtech Startup Practically Lays Off Employees, Cuts Down Headcount By 190 In Three Months

Hyderabad-based K-12 STEM edtech startup Practically conducted a layoff in November, firing an unconfirmed number of employees. The edtech startup has gradually reduced its headcount by 190 employees since August 2022, according to Practically’s COO and cofounder Charu Noheria.

The layoffs at Practically come a year and a half after it raised $4 Mn in January 2021, after which it could not secure funding, resulting in the layoffs. Noheria told Inc42 that Practically’s last funding round worth $5 Mn could not materialise as investors backed out. The COO noted that the current investors have helped stabilise the startup.

November 4 | B2B Ecommerce Unicorn Udaan Fires 350 In Second Layoffs This Year

B2B ecommerce unicorn Udaan fired 350 employees, stating its move to turn profitable and “achieve efficiency”. The move comes less than five months after the ecommerce unicorn fired 180 people to cut costs, which Inc42 exclusively reported.

“As we move forward in our journey towards making Udaan a profitable company, the efficiency enhancement drive and the evolution in business model has created some redundancies in the system, with some roles no longer required,” an Udaan spokesperson told Inc42.

The layoffs at Udaan happened a week after it raised $120 Mn in debt, having raised $250 Mn in debt in January this year as well.

November 2 | SaaS Unicorn Chargebee Lays Off 10% Employees Citing Macroeconomic Conditions

Chennai-based SaaS unicorn Chargebee fired 10% of its staff citing macroeconomic conditions and a need to cut costs going forward. The development was confirmed in a LinkedIn post shared by the cofounder Kris Subramanian. The move impacted 142 employees across departments.

Chargebee said that the employees impacted will receive three months’ pay, three months of extended medical benefits and outplacement service. “This difficult decision was driven by external market forces as well as our need to address the operational debt we have accumulated in the last few years,” said Subramanian.

The layoffs come nine months after Chargebee raised $250 Mn in a funding round and nine months after it acquired collections management platform numberz.

October 12 | FrontRow Fires 125-130 Employees, Takes Layoff Total To 275

After having laid off 145 employees in May, edtech startup FrontRow laid off another 125-130 employees. With the latest layoffs, the edtech startup has laid off as much as 85% of its total workforce in less than six months.

FrontRow founder Ishaan Preet Singh said, “Unfortunately, as we realized that a sales and marketing-led approach to this market didn’t work with our current delivery model, we had to let go a large part of our team.” Singh added that the laid-off employees would receive a month’s salary as severance.

The layoffs come almost a year after the startup raised $14 Mn in its Series A funding round. FrontRow is backed by Deepika Padukone’s Family Office, Vishal Dadlani, rapper Raftaar, CRED’s Kunal Shah, Unacademy’s Gaurav Munjal and ShareChat’s Farid Ahsan.

October 12 | BYJU’S Lays Off 2,500 Employees After Notching Up INR 4,588 Cr In Losses

India’s most valuable startup BYJU’S laid off 2,500 employees from its workforce, citing its push to achieve profitability by the end of FY23. The decacorn laid off employees across product, content, media, and technology teams.

The edtech giant has also restructured its business, consolidating its K-10 acquired businesses such as Toppr, Meritnation, TutorVista, HashLearn, and Scholar into one unit, while Great Learning and Aakash would operate independently.

The move comes seven months after BYJU’S announced raising $800 Mn in a funding round and just weeks after it published its financial report for FY21. The edtech major clocked up INR 4,588 Cr in losses, almost 20X higher compared to FY20.

October 3 | WazirX Lays Off 60+ Employees Amid Crypto Winter

Indian cryptocurrency exchange WazirX laid off around 40% of its workforce, or at least 60 people, citing adverse economic conditions. The startup laid off across customer support, HR and other teams. WazirX has also relieved the entire public policy and communication team of its duties.

The laid-off employees would receive severance pay for 45 days and would not be required to report for work effective immediately. The reduced trade volumes across crypto exchanges in India prompted the startup to conduct layoffs.

The layoffs came when WazirX is facing heat from Indian authorities such as the ED on allegations of money laundering and tax evasion. Further, it was recently embroiled in a public spat with Binance after the Chinese crypto exchange denied acquiring WazirX.

September 19 | Dukaan Lays Off 23 Employees Citing Restructuring And Automation

Dukaan tech startup Dukaan laid off 23 employees citing restructuring and automation. Cofounder and CEO Suumit Shah announced the layoffs in a Twitter thread on September 19. Dukaan laid off employees in live chat support, call support and on the tech front after those processes were automated.

“Since we shifted our whole focus from the small kirana/SMB segment to enterprises/D2C brands, there wasn’t much of a role for live chat support or call support, and on the tech front, we automated a lot of stuff,” said the cofounder in a tweet.

The move comes more than a year after Dukaan raised $11 Mn in Series A; the enterprisetech startup has raised $17 Mn in funding so far.

September 19 | Ola Lays Off 200 Software Engineers As Part Of Its Restructuring Plan

Mobility giant Ola laid off 200 software engineers as part of its mega restructuring plan in a bid to centralise its operations and reduce redundancies. The startup had over 2,000 engineering roles across verticals, with 10% of them let go during the layoffs.

The unicorn has also hinted at hiring 3,000 more engineers in the coming months as part of its restructuring plan. The layoffs come after unconfirmed reports suggested the unicorn laid off as many as 2,100 off-role employees a few months ago.

Over the past few months, Ola has shut down various verticals in a bid to streamline its operations, including the used cars marketplace Ola Cars, the quick commerce vertical Ola Dash and its car-leasing service to drivers on Ola.

September 16 | Inc42 Exclusive: Clear Lays Off Around 200 Employees Citing Restructuring

SaaS startup Clear (formerly Cleartax) laid off 190-200 employees or about 20% of its total workforce. The startup cited restructuring to extend the runway as a reason for conducting layoffs across teams. According to Inc42 sources, the number of employees laid off could get higher.

The layoffs come after Clear made two acquisitions this year, compliance application CimplyFive and supply chain financing application Xpedize. The startup’s last funding round saw it raise $75 Mn in October 2021.

Clear reported a loss after tax of INR 118 Cr in FY21, 24% higher from INR 95 Cr in FY20. The startup reported an increase in both total income and total expenses during the said fiscal year.

September 7 | Inc42 Exclusive: Rupeek Lays Off 50 More Employees, Takes Total Count To 230

After laying off 180 employees exactly three months ago, fintech startup Rupeek laid off another 50 employees. The number let go amounted to around 5% of Rupeek’s workforce, said a spokesperson. The latest layoffs take the total number to 230, or around 20% of the startup’s original workforce.

Incidentally, these pink slips were issued just a day after Inc42 exclusively reported that Rupeek is in talks with investors to raise $16 Mn. So far, the fintech startup has raised $134 Mn, with its latest funding round back in January 2022.

Rupeek reported a loss of INR 156 Cr in FY21, down 68% from INR 487 Cr in FY20. At the same time, its total revenue grew to INR 88.5 Cr from INR 31.9 Cr in FY20.

September 1 | Inc42 Exclusive: Healthtech Unicorn Innovaccer Lays Off 120 Employees Amid ‘Adverse Economic Conditions’

Healthtech unicorn Innovaccer laid off 120 employees citing ‘adverse economic conditions’, with most of the employees being from the tech team. Many team managers have also been laid off, resulting in multiple projects shutting down.

According to Inc42 sources, Innovaccer offered a three-month salary as a severance package to the impacted employees. Innovaccer cofounder and CEO Abhinav Shashank confirmed the layoffs to Inc42.

The layoffs come nine months after Innovaccer doubled its valuation to $3.3 Bn after raising $150 Mn. In all, the healthtech unicorn has raised $375 Mn over its lifetime.

August 31 | Inc42 Exclusive: Microblogging Site Koo Lays Off Over 5% Workforce

Koo, the microblogging site being touted as India’s answer to Twitter, laid off 5% workforce. Most of the employees that were laid off were from the operations and backend teams.

The social media startup last raised funds in February 2022, when a dozen investors pumped $10 Mn into the startup. In all, Koo has raised $44.5 Mn so far.

August 25 | Meesho Shuts Down Meesho Superstore Operations In 90% Cities, Lays Off 300+ Employees

Ecommerce unicorn Meesho shut down the majority of its Superstore business, according to Inc42 sources. This has resulted in around 300 people being laid off as Meesho rolled back Superstore to only two cities, after expanding to six states in a short amount of time.

Sources told Inc42 that Meesho offered two months of salary as a severance package to the employees. It has also absorbed some of the on-roll employees in its core business. According to Inc42 sources, low revenue and high cash burn prompted the ecommerce unicorn to roll back its e-grocery service.

The layoffs come after Meesho raised a whopping $570 Mn in 2021 alone, having raised $1.1 Bn since it was founded in 2015.

August 5 | Edtech LEAD Lays Off Around 100 People After Performance Appraisal

Edtech unicorn LEAD has laid off around 100 employees as part of a performance appraisal process. The employees that were laid off belonged to multiple departments at the edtech unicorn.

A LEAD spokesperson said that performance appraisals happen each year and cited the layoffs as part of the same process. While media reports seemed to suggest a number of around 100, LEAD stated that the number is less than 100, without sharing the exact number of employees let go.

The layoffs come almost eight months after LEAD became a unicorn after raising $100 Mn in a funding round.

August 2 | Vedantu Takes Its Layoff Tally To Over 724 Employees; Conducts Third Layoff Citing Restructuring

Edtech startup Vedantu laid off a combined 724 employees across three layoffs, giving internal restructuring as the primary reason. Incidentally, Vedantu got the unicorn tag last year after raising $100 Mn in funding. 

The edtech’s first layoff came on May 5, when Inc42 exclusively reported that the edtech startup laid off 200 employees. The edtech startup said that it will be hiring around 1,000 people in the coming months. However, Vedantu conducted another layoff on May 17, this time firing 424 employees.

The third layoff came on August 2; Inc42 exclusively reported that Vendantu laid off more than 100 of its employees citing restructuring. The edtech asked the employees to put in their papers between July 4 and July 9 this year.

July 20 | Inc42 Exclusive: BlueStacks Lays Off 60 Indian Employees Citing Restructuring

Android emulator platform BlueStacks laid off 60 of its Indian employees as part of a restructuring exercise within the company. The layoffs impacted employees in various departments in BlueStacks’ Delhi office.

Hue Harguindeguy, CHRO, BlueStacks confirmed the developments to Inc42, stating that owing to macroeconomic changes, the startup had to realign. Harguindeguy added that the startup is helping the employees that were let go find new jobs.

BlueStacks has offered a one-month salary as severance pay to the laid-off employees which also includes medical benefits, per Inc42 sources.

July 12 | Event Tech Startup Hubilo Lays Off 12% Employees Citing Restructuring

Event tech startup Hubilo laid off 12% of its workforce, or around 45-50 employees after it stated that it will shift its focus to live and hybrid events. The Bengaluru and San Francisco-based has laid off employees across several departments.

A Hubilo spokesperson told Inc42 that the layoffs are a strategy to boost business. “On July 7th, Hubilo let go of approximately 12% of its workforce to pursue a strategy that will allow it to lay the foundation for the future of virtual, live, and hybrid events. We greatly value the contributions of all our team members,” the spokesperson said. Hubilo claimed that it has offered compensation packages and benefits, including stock options, bonuses, laptop retention, and job placement assistance to laid-off employees.

The layoffs come nine months after the startup had raised $125 Mn in a funding round.

July 12 | Inc42 Exclusive: Fresh Fruit & Vegetable Delivery Startup Fraazo Lays Off Over 150 Employees

Mumbai-based fresh fruit and vegetable delivery startup Fraazo has laid off more than 150 employees amid a cash crunch, winding down operations in Delhi NCR entirely and shutting down 50 dark stores across the country in the process. The layoffs took place across operations, tech, product, procurement, HR store managers, and planning and growth teams, among others, to cut expenses amidst a fund crunch.

Inc42 sources also noted that the number would be much higher if we include off-role employees such as delivery drivers. The employees that will leave the startup will receive a month’s salary as a severance package, mostly based on notice periods of the said employees.

The layoffs come nine months after the startup raised $50 Mn in a Series B funding round. Fraazo is shutting down more dark stores in Bengaluru and Hyderabad, which will result in more layoffs, particularly for the off-role employees.

June 30 | Inc42 Exclusive: Edtech Startup Crejo.Fun Shuts Down, Leaving 170 Employees Without A Job

Bengaluru-based edtech startup Crejo.Fun became the second edtech startup to shut down in June alone after Udayy, after failing to raise funding and schools reopening. The company claims to have refunded all of the customers, while it works to sell the IP to return some capital to the investors.

The company had raised $3 Mn in pre-seed funding last year from Matrix Partners India and Flipkart cofounder Binny Bansal-backed venture capital firm 021 Capital. However, it had been more than 14 months since then and Crejo.Fun was under pressure to raise fresh funding. The company’s 170-strong workforce will receive salary for July and the company claims that almost 90% of the same have been placed elsewhere. 

Cofounder Vikas Bansal confirmed the development with Inc42, saying in a written statement that even though the company grew well even with schools reopening, it has decided to shut down operations. “However we were running out of funds and while we were trying to raise capital for the last couple of months, but given the fundraising environment, we were unable to raise funds,” Bansal added.

June 29 | Inc42 Exclusive: EV Mobility Startup Oye Rickshaw Lays Off 40 Employees

Gurugram-based EV mobility startup Oye Rickshaw laid off 40 employees amid increasing losses and declining business, becoming the first in its industry to do so. Employees from tech, sales, marketing and several on-ground executives have been laid off by the startup citing adverse market conditions.

Mohit Sharma, cofounder and CEO of Oye Rickshaw, in a statement, said, “As we head towards a market downturn, we have had to make some difficult decisions to ensure the company continues to stay stable and achieve our mission of redefining India’s EV ecosystem.” Sharma said that when market improves in the future, the startup would look to get some of the laid-off employees back on board.

After having raised INR 24 Cr in a debt round last year, Inc42 was also informed that Oye Rickshaw is raising another INR 40 Cr in debt for day-to-day operations and to buy more batteries for its battery-swapping business.

June 29 | BYJU’S-owned Toppr Lays Off 350+ Citing Restructuring

In another layoff at a BYJU’s-owned edtech company, Toppr has laid off around 350 employees citing company restructuring. Most of the impacted employees were subject matter experts, content developers, managers and heads of departments for various subjects, among others, according to Inc42 sources.

According to an email sent to laid-off employees accessed by Inc42, the company said that it conducted a restructuring and that left multiple roles redundant. Toppr will provide severance payment equivalent to the notice period of the laid-off employees, along with a package including 15 days’ salary for each year completed and prorata performance bonus (if applicable) till June 30.

A BYJU’s spokesperson told Inc42 that it has absorbed 80% of Toppr’s workforce, after having bought the edtech startup for $150 Mn last year. In FY21, Toppr incurred a loss of INR 125.9 Cr. It generated INR 52 Cr in revenue, of which INR 50.6 Cr came from operations. Its expense stood at INR 178 Cr during the same time.

June 28 | Nova Benefits Lays Off 70 Employees Citing Restructuring, Takes Total Layoffs To 80

Bengaluru-based employees wellness platform Nova Benefits has laid off 70 employees as a result of restructuring. Earlier this month, the startup had laid off 10 employees, and the current layoffs take the total employees impacted to 80, or about 40% of its total workforce. The employees were laid off from sales, accounts, marketing and creative teams, among others.

“We owe everyone at Nova a challenging, fast-paced growth path. However, in the face of our redefined business strategy, we cannot provide this to 30% of our teammates,” a mass mail accessed by Inc42 read. The startup also cited cost-cutting as a reason to lay people off and conduct a business restructuring.

The layoffs come four months after it raised an undisclosed amount from Naval Ravikant-backed AngelList Early-Stage Quant Fund. In September, last year, the startup had raised $10 Mn in its Series A which Inc42 had exclusively reported. The round back then was led by Susquehanna International Group (SIG) and Bessemer Venture Partners.

June 28 | Inc42 Exclusive: BYJU’s-owned WhiteHat Jr Lays Off 300 Citing Cost Cutting

After forcing around 1,000 employees to resign as it called them to work from office, BYJU’s-owned WhiteHat Jr has laid off around 300 employees to cut costs. The sales, marketing and operations teams were the affected teams, with the first two being the worst affected.

According to Inc42 sources, the management has cited business restructuring as the reason behind the layoffs. Another source informed Inc42 that the WhiteHat Jr is in process of firing more people, and the number of employees impacted could double to reach 600 by the end of it. The company is said to have run out of operating capital, and is set to be completely absorbed by BYJU’s, a person said on condition of anonymity.

WhiteHat Jr has been posting staggering losses. In FY21, the edtech startup recorded INR 1,690.4 Cr in losses. During the same fiscal, it spent INR 2,175.2 Cr to earn INR 483.9 Cr.

June 27 | Inc42 Exclusive: Ecommerce Platform Udaan Lays Off 180 Citing Cost Cutting

B2B ecommerce platform Udaan became the eighth ecommerce startup to lay employees off in 2022, laying off 180 employees citing cost-cutting. While the layoffs do not amount to a significant percentage of its employees, Inc42 sources said that there are more layoffs to come. The number of employees affected can reach as high as 600, sources said.

Udaan has conducted the layoffs mere months after it raised $250 Mn in a round from big-name investors such as Microsoft, M&G Prudential, Kaiser Permanente, Nomura, TOR and others. In a statement given to Inc42, Udaan said that it will support outgoing employees. Udaan has said that it will provide medical insurance, a compensation package and outplacement assistance.

Udaan generated INR 5,919 Cr in revenues at an expense of INR 8,742 Cr in FY21. The startup narrowed its loss to INR 2,482.3 Cr in FY21 from INR 2,518.7 Cr in FY20. According to an internal mail sent a week before the layoff, the CEO Vaibhav Gupta had said that Udaan was en route to hit positive unit economics by the end of the June quarter. However, the startup still cited unit economics as a reason to lay people off.

June 20 | Inc42 Exclusive: Sequoia Surge-backed Aqgromalin Lays Off 80 After Investors Back Out

Chennai-based Animal husbandry and aquaculture startup Aqgromalin laid off 80 full-time employees from its corporate offices as a funding round did not materialise. The layoffs account for 30% of the startup’s total workforce and have impacted marketing, sales and support, among other teams.

The funding round was supposed to be led by a Korean fund, which pulled out on the day of signing the deal. The layoffs came almost five months after Aqgromalin raised $5.25 Mn in a pre-Series A round from the likes of Sequoia India’s Surge, Omnivore Partners and Zephyr Peacock India.

The layoffs have also likely prompted a pivot in the startup’s business, as Inc42 sources told that Aqgromalin might look to move away from animal husbandry and focus only on its aquaculture business. The Chennai-based startup is also in talks for a potential merger, with Licious coming up as a potential candidate.

June 18 | Social Commerce Startup CityMall Lays Off 191 Employees Citing Restructuring

Gurugram-based social commerce startup CityMall has laid off 191 employees, both on-roll and off-roll, across multiple positions citing restructuring. The move comes three months after the startup had raised $75 Mn in its Series C round of funding.

The startup has shuttered its operations in Noida and is likely to do the same at the warehouse in Jaipur, according to Inc42 sources. The startup has also closed two dark stores for one-day delivery in Rohtak and Gurugram.

CityMall recorded a loss of INR 15.18 Cr in FY21, having spent INR 28.9 Cr to make INR 15.18 Cr. A CityMall spokesperson, confirming the development, told Inc42 that the startup will provide outgoing employees with outplacement assistance to find jobs at other places.

June 17 | Inc42 Exclusive: Unacademy Lays Off 150 Employees, Takes Total Layoffs To 1,150

It has been a difficult few months to be an edtech employee, and this is far more evident at Unacademy than anywhere else.

The edtech unicorn has conducted four separate layoffs citing cost-cutting, performance reviews, restructuring and whatnot, as it pivots to offline and perhaps more interestingly, into SaaS with Cohesive, all in a bid to achieve profitability.

In late March, Inc42 first reported that in a cost-cutting exercise, the edtech startup had laid off more than 125 consultants from its PrepLadder team. PrepLadder, which was acquired by Unacademy in July 2020 for $50 Mn, gives students material for competitive exams such as IIT/JEE, NEET and so on.

Days later, Unacademy laid off more than 200 teachers in a cost restructuring exercise. Inc42 exclusively reported that the edtech unicorn fired the educators based on their poor performance. In early April, the startup laid teachers off again, this time firing 600 teachers. The layoffs, according to a company spokesperson, were based on several assessments to determine the performance.

The latest layoff has seen Unacademy lay off 150 more employees, mostly from its sales and operations verticals. According to Inc42 sources, the impacted employees are from Unacademy Group’s core business, Unacademy, and PrepLadder.

June 16 | Inc42 Exclusive: IPO-Bound PharmEasy Lays Off 40 Employees From Subsidiary Docon Technologies 

PharmEasy’s parent company, API Holdings has laid off 40 employees from its subsidiary Docon Technologies, an EMR or electronic medical record solutions provider. Docon has seen layoffs mostly across the sales background, such as business development managers, cluster heads and area managers.

Docon has been taken apart and incorporated into PharmEasy by API Holdings, forming PharmEasy One. According to Inc42 sources, many of the employees had resigned following the restructuring, and the remaining 40 employees were the ones that were laid off from the Docon team.

Docon Technologies made a loss of INR 29.7 Cr in FY21 against a total income of INR 2.25 Cr. Currently, it has stopped all on-ground operations and is working virtually.

June 14 | Inc42 Exclusive: Breathe Well-being Lays Off 50 To Cut Costs

Gurugram-based healthtech startup Breathe Well-being laid off around 50 employees or around 30% of its total workforce over the last few weeks in a bid to cut costs and extend its runway. The sales, operations, tech, and talent acquisitions, among others, are the teams that were impacted by the layoffs.

Per Inc42 sources, the startup had been aggressively hiring until April, looking to raise fresh funding. However, in failing to do so, it has not only laid off existing employees but also rescinded offer letters from employees that were supposed to join soon.

As per FY21, the startup had incurred a total loss of INR 2.27 Cr, while generating sales worth INR 39.2 Lakh, registering expenses of INR 2.66 Cr. The company had last raised $5.5 Mn in a funding round last August.

June 10 | Inc42 Exclusive: Logistics SaaS Startup FarEye Lays Off 250 Employees Citing Restructuring

New Delhi-based logistics SaaS startup FarEye has laid off 250 employees this week, impacting employees across offices in India, North America and Europe. FarEye has laid off across its product & engineering, professional services, talent acquisition, quality analysts, sales and developers teams, among others.

According to founder and CEO Kushal Nahata, the layoffs have happened because of a shift in focus of the startup and internal restructuring. He said that the laid-off employees will receive “rightful benefits and entitlements”, though employees that talked with Inc42 blame extensive hiring for the layoffs.

Notably, the layoffs come slightly over a year after FarEye raised $100 Mn in a Series E round. The startup has raised $150 Mn so far. FarEye recorded losses of INR 62 Cr on a standalone basis in FY21, having incurred an expenditure of INR 142.2 Cr during the same period.

June 9 | Inc42 Exclusive: Edtech Startup Yellow Class Lays Off 19 Employees

Elevation Capital-backed edtech startup Yellow Class has let go of around 19 employees in recent weeks. The startup had informed its team about the layoffs on May 19, as per Inc42 sources.

While Inc42 sources hinted that a lack of funds is the reason behind the layoffs, founder Anshul Garg denied any such claims. He agreed on the layoff count but said the layoffs were part of restructuring as Yellow Class has chosen to focus deeply on fewer initiatives. The startup had a total workforce ranging from 120 to 130 on its payroll.

The layoffs have come almost 10 months after Yellow Class raised $6 Mn in its Series A round led by Elevation Capital along with a clutch of angel investors including Vidit Aatrey, and Dhruv Agarwala.

June 7 | Sequoia-Backed Gold Loans Startup Rupeek Lays Off 200 People To Cut Costs

The Bengaluru-based gold loans provider Rupeek laid off 200 people in a bid to cut costs. The laid-off workforce represents 10-15% of Rupeek’s total workforce, a company spokesman said, adding that the startup will support the outgoing employees without sharing any details.

Rupeek’s layoffs came five months after it had raised $34 Mn in January 2022, valuing the startup at over $600 Mn. So far, the fintech soonicorn has raised $134 Mn in venture capital funding.

Incidentally, the startup reported a net loss of INR 156.5 Cr in FY21, having incurred a total expense of INR 245 Cr. The startup reported a net income of INR 88.5 Cr in FY21.

June 4 | SoftBank-Backed Edtech Startup Eruditus Lays Off 40 Employees After Resizing Expansion Plans

Mumbai-based edtech unicorn Eruditus laid off 40 employees from its workforce. The company has rolled back its expansion plans to around 100-150 hirings this year, eliminating the need for a large talent acquisition team.

“So that team (talent acquisition), unfortunately, has been affected. And yes, we have downsized that team because we don’t need the same set of people,” Eruditus cofounder and CEO Ashwin Damera said.

According to Damera, Eruditus scaled down its expansion plans to achieve profitability in the near term, saying that the startup’s India business is already profitable.

June 2 | Inc42 Exclusive: Info Edge-Backed Yojak Fires 140 Employees, Shuts Domestic Operations

Gurugram-based construction-focused ecommerce startup Yojak laid off 140 employees in April and May. Yojak is also shutting down its domestic operations and will now focus on Yojak Exports to export construction materials and equipment.

The startup, backed by Info Edge, ran out of funds to operate its domestic operations, sources claimed. Out of the 140 employees it has asked to leave, 60 were full-time, while 80 were contractual hirings. Yojak founder Rachit Garg further told Inc42 that the startup has laid off many third-party workers, without sharing any numbers for the same.

Yojak’s employee benefits expenses increased by 40-50% since January 2022 owing to its aggressive hiring, which saw its runway shrink significantly.

June 1 | Edtech Startup Udayy Shuts Down, Leaves 100 Employees Jobless

Gurugram-based edtech startup Udayy said that it will be shutting down operations, three years after it was founded by Saumya Yadav in 2019. This has left 100 people that it employed without a job.

At the time of the shutdown, the edtech claimed to have users across 45 cities, with 400 classes a day being operated. Udayy had last raised $2.5 Mn in January last year in a seed funding round, backed by the likes of Alpha Wave Global and InfoEdge Ventures. In all, the early stage startup had raised $13.5 Mn of institutional capital.

Udayy’s founder and CEO told Inc42 that it has given severances to its employees and contractural teachers. After winding up operations, Udayy will also return $8.5 Mn to some investors.

May 31 | Inc42 Exclusive: Indiabulls’ Social Commerce Venture Yaari Lays off 150 Employees

The social commerce platform Yaari, a venture of Indiabulls, asked almost 150 employees to submit their resignations in the last week of April. The impacted employees, from the supply support, customer support, business development and marketing teams, account for 60% of its total workforce.

Yaari looked to compete with the likes of Meesho and Trell, but it was underfunded by several orders of magnitude as compared to the two unicorns. According to several employees Inc42 talked with, the company was not doing well. Even so, the employees were reassured of their jobs.

In the aftermath of the layoffs, Yaari’s tech team has been absorbed by Dhani.com, another Indiabulls-backed ecommerce venture. Yaari itself will be merged with Dhani.com as well.

May 30 | MPL Lays Off 100 Employees, Exits Indonesia, Shuts Down Streaming

Mobile Premier League (MPL), the fantasy gaming unicorn, laid off 100 people from multiple teams. The layoff has impacted about 10% of its total workforce as the unicorn exits Indonesia and shuts down its streaming service.

In an email to employees, MPL cofounders Sai Srinivas and Shubh Malhotra said, “It is time to make the difficult decision to redeploy our resources in other parts of our business to ensure our long-term health and success as a company.”

The unicorn had last raised $150 Mn in funding in September 2021, becoming one of India’s 100 unicorns at that point. The layoffs come eight months after the said fundraise.

May 27 | Inc42 Exclusive: FrontRow Lays Off 145 Employees To Cut Costs

Extracurricular edtech startup FrontRow laid off 145 employees across sales, quality control and HR teams. The layoff, impacting almost a third of the startup’s total employees, has been done to cut costs and increase the startup’s runway. According to Inc42 sources, the sales team alone saw 100 people fired.

FrontRow founder Ishaan Preet Singh told Inc42 that the decision was taken to ensure that the startup has over 24 months of runway. “This included letting go of ~30% of our team, primarily in sales, to make sure that we come out of this market stronger,” he added.

FrontRow laid off employees eight months after it raised $14 Mn in a Series A funding round, having raised $17 Mn in funding overall, having the backing of the likes of Deepika Padukone, and several other angel investors.

May 24 | Invact Metaversity Crashes; Lays Off 66% Of Workforce

Invact Metaversity, founded by ex-Twitter India head Manish Maheshwari, started as a promising edtech startup, offering a 16-week MBA alternative for around INR 2 Lakh. The first course was supposed to start on May 12.

However, even before anything like that, the Metaversity is all but closed up, having laid off 20 out of the 30 employees that were working from the Bengaluru office. Maheshwari had announced his plans in December 2021 and the startup had raised more than $5 Mn from some of India’s biggest angel investors.

Even so, Metaversity’s fall from grace has come as little surprise, as the founders struggled to find the right product and the right approach. The startup lacked a shared vision among the leadership.

Last evening, Metaversity said that Maheshwari has stepped down from his position as CEO.

May 21 | Inc42 Exclusive: MFine Lays Off 600 Employees Prompting Protests

In what proved to be another example of apathy of a startup, healthtech startup MFine fired almost 75% of its workforce citing financial difficulties.

However, the writing was already on the wall for MFine. The company had reported a loss after tax worth INR 102.7 Cr in FY21, as it spent INR 116 Cr to make INR 12.9 Cr. According to an ex-employee, MFine had already been firing people in small batches since October 2021.

Entire teams were laid off in the process, which triggered protests against the startup as 100 former employees gathered outside MFine’s Bengaluru office. The protestors demanded the rollout of the full May salary along with an early release of their full & final payment.

However, not only did MFine not let Inc42 enter the office, it did not allow female ex-employees, which included a pregnant woman, to use the restroom.

May 19 | Inc42 Exclusive: Cars24 Lays Off 600 Citing Automation, Cost Cutting

Used car unicorn Cars24 also joined the list of startups that have laid employees off. Mostly laying off across lower divisions, Cars24 cited automating operations and cutting costs as the two reasons for laying off 7% of its total workforce.

On the other hand, the unicorn has raised $950 Mn across its lifetime. These layoffs come five months after it raised $400 Mn at a valuation of $3.3 Bn. Speaking on the layoffs, a Cars24 spokesperson told Inc42, “This is business as usual – performance-linked exits that happen every year.”

The startup is looking for an IPO over the next 18-24 months, joining the list of Indian startups that are waiting for the storm to pass to go for a public listing.

May 17 | Vedantu Lays Off 624 Employees In 15 Days Citing Restructuring

Edtech startup Vedantu laid off a combined 624 employees across two layoffs within a span of 15 days, citing cost restructuring as the primary reason.

First, Inc42 exclusively reported that the edtech startup laid off 200 employees. The edtech startup said that it will be hiring around 1,000 people in the coming months. However, two weeks in, Vedantu conducted another layoff, this time firing 424 employees.

The startup has conducted the layoffs after it achieved the unicorn tag last year after raising $100 Mn in funding. A blog post by CEO Vamsi Krishna showed that the startup will extend health benefits for laid-off employees and their families till August 5, 2022.

May 10 | Inc42 Exclusive: WhiteHat Jr Conducts ‘Soft’ Layoffs As 1,000 Employees Resign

In a strange and probably the first case of its kind, Indian startup WhiteHat Jr asked its remote employees to either join offices or hand in their resignations. Inc42 had exclusively reported the resignations of 800 employees, however, after publishing the story several employees reached out, claiming the number to be more than 1,000.

According to ex-employees, this was a layoff in disguise. Interestingly, Inc42 learnt that if an employee is based out of Gurugram, they were not allowed to join WhiteHat Jr’s Gurugram’s office, but the Bengaluru office for a similar job role.

The edtech startup’s soft layoffs have triggered the debate between working remotely and working from the office as more and more companies are asking their employees to join. However, WhiteHat Jr gave the employees no choice at all.

April 21 | Ola Restructures Quick Commerce Business; Lays Off 2,100 Dark Store Workers

After going bullish on quick commerce twice before, Bhavish Aggarwal-led Ola’s quick commerce arm Ola Dash went for restructuring its entire business, which resulted in the unicorn laying off around 2,100 dark store workers. Ola ended the contracts of these workers who were hired to man its 200 dark stores.

In terms of its dark stores, Ola has reportedly scaled down half of them and may even shut a few of them down. The unicorn had run into regulator challenges with bringing in its $500 Mn term loan from foreign lenders and that had prompted the scale back.

However, doing a 180 recently, Ola has announced that it will go for quick commerce again, scaling down its food delivery operations this time around. This means that laying off those 2,100 people meant nothing, as the company tries hard to pivot away from its core business of cab aggregation.

April 11 | Layoffs At Meesho: 150 Employees Fired Citing Restructuring

The ecommerce unicorn Meesho laid off 150 employees, saying that it is restructuring Meesho Superstore which has impacted the said number of employees.

Meesho said, “As we look to boost efficiencies in the light of the integration, a small number of full-time roles and certain third-party positions on six-month contracts at Meesho Superstore were reassessed to remove redundancies with the core business.”

The layoffs happened less than seven months after the unicorn raised $570 Mn in funding. The ecommerce and social commerce unicorn tried its hands at grocery delivery with a pilot project in Karnataka less than nine months ago. It had plans to expand to Tier 2+ cities, but it has had to scale back following limited success.

March 26 | Furlenco Lays Off 180 Employees To Cut Costs

Furniture startup Furlenco laid off around 180 employees to cut costs and achieve profitability ahead of a public offering, according to several employees Inc42 spoke to.

Around 95% of the employees let go were in customer-facing roles which include customer support and other similar roles. The startup claims to have extended medical coverage for the impacted employees, which constitute almost a third of the startup’s total workforce.

The layoffs come as the company had raised $165 Mn in funding last year alone, including a $24 Mn funding round in February 2022 itself.

March 14 | Trell Lays Off Half Of Its Workforce To Extend Runway, Cut Costs

Bengaluru-based social commerce platform Trell laid off 300 employees after the company’s founders were alleged of financial irregularities and the company saw its $100 Mn funding round fall through.

Amid the boardroom tussle, which saw the company’s investors order an investigation against the founders and the founders hitting back, the company’s employees suffered.

The layoffs were cited to be an exercise to cut costs and extend its runway as Trell looked to survive. The company incurred a loss of 78.4 Cr in FY21. This is an almost 550% increase from INR 12.07 Cr that it had incurred in FY20.

March 10 | Blinkit Lays Off Nearly 1,600 Employees After Splurging INR 600 Cr

Quick commerce startup Blinkit reportedly laid off employees across major cities including Mumbai, Hyderabad and Kolkata. The layoffs impacted close to 5% of Blinkit’s overall workforce, which amounts to around 1,600 people, including riders, pickers and store managers.

The layoffs came on the heels of Zomato investing $150 Mn in the cash-strapped company, which had also picked up a loan of $10 Mn from Innoven Capital.

Blinkit has had to cut back after reportedly splurging INR 600 Cr on expanding its business last year between November and February. The deep discounting tactics backfired and the startup cut costs and corners to reduce its cash burn by firing employees.

February 23 | OkCredit Lays Off 35% Of Workforce To Change Business Model

Bengaluru-based bookkeeping startup OkCredit laid off 40 employees or around 35% of its total workforce. Most of these layoffs were from the backend, tech and engineering teams.

The Tiger Global and Lightening-backed startup said that it is focusing on its fintech initiatives and strengthening its growth channels, which has resulted in the startup laying off the said employees. OkCredit said that the laid off employees were being supported by outplacement services and extended medical insurance.

In FY21, the startup spent INR 114.6 Cr, to earn a mere INR 3.79 Lakh in sales revenue, forming another possible reason for the layoffs.

February 21 | Lido Lays Off 150 Employees To Cut Costs

Edtech startup Lido’s founder Sahil Sheth, during a virtual town hall, told the company employees that they were in a financial crunch. Following this, the company asked 150+ employees to submit their resignation as it looked to raise funds or possible acquisition of Lido.

The company assured these employees that they would be paid the pending salaries for January 2022 and the 1st week of February 2022 within ’30 to 90 days’, but to date, their salaries are pending, which has prompted them to take the fight to social media.

Since its launch in 2019, Lido Learning has raised close to $24 Mn in funding. The layoff had come only six months after it raised $10 Mn from Ronnie Screwvala’s Unilazer Ventures.

This is a running article. We will add as new information comes in.

If you would like to report a layoff, pay cut etc. at a startup, write to us at editor@inc42.com.

Last updated on August 14, 2023, 20:00 IST.

The post Indian Startup Layoff Tracker: 28,800+ Employees Laid Off By 110+ Startups Since 2022 appeared first on Inc42 Media.