Indian startup funding witnessed a significant decline during the week of June 3rd to June 8th, 2024, coinciding with the Indian general elections. Startups collectively raised $97.3 million across 10 deals, marking a nearly 55% decrease compared to the previous week’s $217.84 million secured through 31 deals.
Funding Breakdown and Key Highlights
- Dominant Deals: The week’s largest funding round belonged to fintech startup Fibe (formerly EarlySalary), which secured $65.5 million in primary capital as part of its $90 million Series E round led by TR Capital, Trifecta Capital, and Amara Partner. The remaining portion of the funding came through secondary transactions.
- Fintech Reigns Supreme: Despite Fibe being the sole funding recipient in the fintech sector this week, it propelled the sector to the top spot in terms of the total amount raised.
- Enterprisetech Emerges: Enterprise software companies emerged as the most active segment, with three deals totaling $12 million.
- Seed Funding Slumps: Continuing a recent trend, seed funding witnessed a sharp decline of 67% this week, dropping to a mere $3 million.
Secondary Transactions Take Center Stage
Although primary funding dipped during this period, secondary transactions saw a surge in activity. Notably, eyewear retailer Lenskart, led by Peyush Bansal, secured $200 million in investments from Temasek and Fidelity. This move effectively doubled Temasek’s existing stake in the company and brought Fidelity on board as a new investor.
Beyond Funding: Major Developments of the Week
- Ather Energy Witnesses Co-founder Exit: Flipkart co-founder Sachin Bansal made a complete exit from Ather Energy, a two-wheeler electric vehicle manufacturer. He sold his 2.2% stake for $14.8 million to Hero MotoCorp, while Zerodha co-founder Nikhil Kamath acquired the remaining 5.3% for $33.7 million.
- CarDekho Seeks Wealthtech Expansion: CarDekho’s insurance arm, InsuranceDekho, is reportedly in talks to acquire a majority stake in BankSathi, a wealthtech startup, through a share swap deal. This move aims to bolster InsuranceDekho’s credit product portfolio.
- Nazara Tech Subsidiary Makes US Acquisition: In a bid to establish itself as a leading sports and entertainment publisher in the US, Absolute Sports (a subsidiary of Nazara Technologies and the parent company of Sportskeeda) acquired Pennsylvania-based entertainment news site Soap Central for $1.4 million in an all-cash deal.
- Amazon Nears MX Player Acquisition: According to reports, Amazon’s acquisition of MX Player from Times Internet is nearing its final stages. The e-commerce giant confirmed signing an agreement to purchase certain assets of the video streaming platform.
- ixigo Gears Up for IPO: Online travel aggregator ixigo is set to make its public debut on June 10th. With a price band of INR 88-93 per share, the company expects to raise INR 740 Cr (approximately $93.5 million) at the upper end of the range. Prior to the IPO, ixigo secured over INR 333 Cr (approximately $42 million) from 23 anchor investors at INR 93 per share.
Looking Ahead
The recent decline in startup funding could be attributed to various factors, including the Indian elections and a potential market correction after a period of high investment activity. However, the robust secondary transaction activity and upcoming IPOs indicate continued investor confidence in the Indian startup ecosystem. The coming weeks will be crucial in determining whether this funding slowdown is a temporary blip or a more significant shift in investor sentiment.
Key Takeaways
- Indian startup funding witnessed a significant decline during the week of June 3rd to June 8th, 2024.
- Fintech emerged as the top sector in terms of funding amount raised, primarily due to Fibe’s Series E round.
- Enterprise software companies witnessed the highest deal activity.
- Seed funding continued its downward trend.
- Secondary transactions remained active, with Lenskart securing a $200 million investment.
- Several noteworthy developments took place beyond funding, including co-founder exits, potential acquisitions, and an upcoming IPO.
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