Weekly Musings – Big start-up updates for the week to September 22, 2023

25 Sep 2023 , 09:37 AM

The previous two weeks to September 08 and September 15, 2023 were very robust. These two weeks had seen start-up fund raising of $257 million and $413 million respectively. IN comparison, the latest week was relatively more subdued with just about $91 million being raised through 15 deals. Kuku FM accounted for the bulk of the funding in the week at $25 million. However, compared to the surge in start-up inflows in the previous 2 weeks, the current week was relatively tepid.

Start-up funding tapers to $91 million across 15 deals in the week

For the week ended September 22, 2023 the start-ups saw fund raising of $91 million across 15 deals was relatively tepid. Here is a quick rundown on the major deals in the start-up space during the week ended September 22, 2023.

1. In the biggest deal of the week, Kuku FM bagged $25 million in fund, just after it had touched 2.5 million users. The funds will be used to fuel expansion of the business. Kuku FM will use the funds to strengthen its content ecosystem and enhance the depth of content as well as focus on technology. The funding round came from Fundamentum Partnership and the International Finance Corporation with participation from Vertex Ventures. It faces stiff competition in the FM space and content investments are key.

    

2. In another major funding this week, Eloelo (the live social entertainment platform) also raised $22 million from Courtside Ventures. Griffing Gaming Partners also participated in this pre series-B funding. The fund will be utilized to onboard more creators, and develop tools for them. It will also use the funds to hire fresh people and to secure revenue partnerships.

    

3. In another significant deal, Atlys ( a company that envisions a world without borders) has raised $12 million to ensure on-time visas for all. This platform, which was founded in 2021, actually commits the exact time to visa. The funding has come from Elevation Capital and Peak XV Ventures. It is planning to capitalize on the global visa market which his expected to be $4 billion soon. Atlys is already operational across 100 countries.

    

4. In another case of digital fund raising, Agritech start-up Ergos has secured $10 million in funding to digitize grain storage. The funding was led by Abler Nordic of Norway as well as existing investors like Aavishkar Capital, Chiratae Ventures and Trifecta. Ergos enables farmers to transform their grain holdings into digital assets that can be traded. It has already helped more than 160,000 farmers through the platform.

    

5. Everest Fleet, backed by Uber, has raised $6 million to venture into newer markets. Everest Fleet will use the fresh funds to accelerate growth plans and explore newer markets. It operates a fleet of more than 13,000 CNG and electric cars across seven Indian cities. The strategic investor in the venture is Paragon Partners. 

    

6. In another interesting deal, D2C outfit, The Good Bug, has raised $3.5 million to offer probiotic alternatives for a healthy gut. The Good Bug offers a range of gut health and wellness products that help people to reverse the effects of poor dietary habits. The $3.5 million funding commitment comes from Fireside Ventures. 

    

7. Finally, Equity List has bagged $2.2 million in funding to simplify equity management for start-ups. The round saw participation from Angel List India, Hustle Fund, Republic, and Mana Ventures. The start-up allows companies to manage their equity shareholding and equity distribution more efficiently and in streamlined manner. It currently manages equity for more than 10,000 stakeholders. .

In addition, there were smaller deals tool. The moral of the story is that although the size of funding was lower this week, the trend seems to be up.

Big start-up strategies in the week to September 22, 2023

Here is a quick take on some of the key start-up strategies evidenced last week.

• Reliance and Blinkit are planning to joint hands to work big time on instant delivery of phones. Jio announced that customers buying iPhone 15 from Reliance stores will get complimentary benefits of Rs2,394. Blinkit delivers such products to your home in 10 minutes flat in Delhi, Mumbai, Bengaluru, and Pune. 

   

• Ola Financial Services turned profitable in FY22 with net profits of Rs9 crore. This contrasts to a rather huge loss of Rs56 crore in FY21. Operating revenues were up 157% yoy. This is the financial arm of the Ola group. At the same time, Ola Electric is quickening its journey towards the IPO and is planning to file the SEBI papers in late October itself. The IPO may happen in the first quarter of 2024. 

   

• Tesla is in talks with the government of India to set up a battery storage factor in India. The plans have been submitted to the government with demand for various incentives. The government is yet to take a final call. Tesla will manufacture and sell its POWERALL in India for a broader and deeper presence in India. Tesla has been trying to sell electric cars in India but the government of India has refused to provide a market for China made Tesla cars. The government wants Tesla to set up an EV car manufacturing facility in India, and the negotiations are on for the same.

   

• Amazon India has launched multi-channel fulfilment for D2C brands and other sellers in India. That means, sellers can leverage the pan-India presence of Amazon fulfilment centres and its logistics network to best effect. The multi-channel fulfilment (MCF) also makes it much easier for these companies to create orders for Amazon shoppers, track them and also generate tax invoices. This comes in preparation for the upcoming festive season in India.

Overall, it was a tepid week for the start-ups as some of the fund raising had gone slow due to the hawkishness of the Fed and also due to the ongoing diplomatic standoff between India and Canada. Hopefully, it should be a return to normalcy from next week.