Weekly Musings – Big start-up updates for the week to January 12, 2024

15 Jan 2024 , 11:52 AM

Startups raised over $1 billion in December 2023, with the second week and the third week seeing start-up funding of $527 million and $349 million respectively. However, the funding frenzy fell to $90 million in the last week to December 29, 2023 and fell further to just $58 million in the week to January 05, 2024. Funding by start-ups bounced back to $145 million in the week to January 12, 2024. Impact Analytics and the AI venture of former Twitter honcho, Parag Agarwal, lapped up half the start-up funding in the week. 

The number of deals were sharply higher at 25 deals in the latest week, compared to 9 deals in the previous week; indicating a lot of mid-ticket deals of around $5 million. Compared to the average of the last 5 weeks, the start-up funding in the latest week was -34.7% lower, largely due to the substantial funds raised by start-ups in the second and third week of December 2023. Here is the story of start-up fund raising over the last 6 weeks.

Funding Week	Start-up funding raised
Week ending December 08, 2023	$85 million
Week ending December 15, 2023	$527 million
Week ending December 22, 2024	$349 million
Week ending December 29, 2023	$90 million
Week ending January 05, 2024	$58 million
Average of previous 5 weeks	$222 million
Week ending January 12, 2024	$145 million

The start-up funding for the latest week ended January 12, 2024 was higher on a week-on-week basis, but sharply lower compared to the average of the last 5 weeks. In fact, the start-up funding for the week bounced back to above $100 million this week after two weeks of staying under that mark. Here is the story of the major start-up funding deals of the week.

Impact Analytics gets $40 million to streamline retail brands

The funding round of $40 million (₹333 crore) was led by Sageview Capital with participation from Vistara Growth, an existing investor in Impact Analytics. The start-up will utilize the funds to expand its team and its footprint, as well as to ramp up its artificial intelligence (AI) stack and deepen partnerships with clients. Founded in 2015, Impact Analytics offers an elaborate suite of AI-based SAAS (software as a service) solutions for its retail clients. Most of its AI capabilities are offered on a SAAS model platter to tis retail based clients so the power of AI can be leveraged to get better customer insights and tweak business strategy accordingly.

Parag Agarwal AI outfit raises $30 million start-up funding

The former CEO of Twitter (Now X) may have left after differences cropped up with Elon Musk, but he seems to be moving rapidly on his start-up dreams. Parag Agarwal has raised $30 million (₹250 crore) from Khosla Ventures for his proposed artificial intelligence (AI) venture. Khosla Ventures is one of the early entrants in the Silicon Valley start-up space and is run by Vinod Khosla, a man who was part of the design of the original Pentium chip. The latest venture by Parag Agarwal is dedicated to pioneering software that is specifically designed for the IT developers working with large language models. Increasingly, tech leaders have bene focusing on AI as the next big thing in the start-up scene. 

makeO, parent of Toothsi, raises $16 million to offer oral and skin care solutions

MakeO, the parent of Toothsi, is an oral care and skin care company with over 100 orthodontists, dentists, and dermatologists on their contract rolls. Between them, they help the company run 25 flagship experience centres and 400 partner dental clinics. MakeO plans to use the fresh funds to support its plans to expand its geographic footprint and scale up its experience centres. The company claims to have over 1.50 lakh customer across offerings. The funding round of $16 million (₹135 crore) was led by 360 ONE Asset and the investment office of Ashish Kacholia. Additionally, existing investors like Eight Roads Ventures, Paramark Ventures of South Korea, and the family office of Med-life cofounders also participated.

Varthana bags $14 million to offer loans to affordable private schools

After backing education focussed NBFC, Varthana, in 2019; this is the second round of funding provided to the start-up by Blue Earth Capital. Varthana is currently preparing for its Series-D round of funding. The fresh funds will help Varthana to expand its financial support and lending programs to a wider network of affordable private schools in India. The entire funding of $14 million (₹116 crore) came from Blue Earth Capital. In the first round, Blue Earth had provided funding of $8 million in 2019. Varthana is a pure education focused NBFC, to make the costs of private schools more affordable to people.

Grip Invest to diversify product portfolio with $10 million funding

The Series B funding round for Grip Invest was led by Stride Ventures with participation from LC Nueva, Multiply Ventures, and Venture Highway. Out of the $10 million (₹83 crore) raised, $1.5 million will come by way of debt and the balance by way of equity. The equity portion will be funded by a mix of fresh equity and convertible notes. Invest Grip will use the proceeds from this start-up funding round to strengthen its API (application programming interface) stack and make its investment interface available to more distributors. Part of the fresh funds would also be used to invest in the technology stack and to expand footprint.

ConveGenius raises $7 million for its Conversational AI BOT Store

ConveGenius is an artificial intelligence (AI) powered edtech start-up. The company was founded by Jairaj Bhattacharya in the year 2014 as an AI powered edtech platform to address the challenges of AI communication through an AI BOT store. It will use the fresh funds of $7 million (₹58 crore) to scale up the GenAI capabilities of its conversational AI BOT store, SwiftChat. BOTs are popular in automated intelligent communications and can be substantially fine tuned with the intelligent use of AI. This is the second round of funding in 2 years and earlier it had secured $5 million in the year 2021. The funding round was led by UBS Optimus Foundation and Mount Judi Ventures; with participation from existing investors like Michael & Susan Dell Foundation, Bace Capital, Heritas Capital and Gray Matters Capital.

Karkhana.io Raises $6.3 million to offer robust Manufacturing Solutions

Karkhana.io was founded by Sonam Motwani and Karthik MC in 2018 to offer customised manufacturing solutions to original equipment manufacturers (OEMs) and to MSMEs on a product agnostic basis. Its major user sectors include EVs, medical equipment, consumer electronics, and aerospace; among others. Karkhana.io is an on-demand B2B manufacturing solutions platform. The latest funding round of $6.3 Mn (₹53 crore) was part of the Series-A funding round led by Arkam Ventures and Susquehanna Asia Venture Capital. Karkhana.io will use the fresh funds to expand its supplier base, build a robust electronics supply chain and drive economies of scale in the US and Europe. Apart from Akram Ventures and Susquehanna; existing investors; Vertex Ventures Southeast Asia also participated.

SpaceTech start-up PierSight raises $6 million for maritime surveillance satellites

The $6 million (₹50 crore) seed funding round for the SpaceTech start-up, PierSight, was led by Alpha Wave Ventures and Elevation Capital, with existing investor, Techstars, also participating in the seed round. PierSight is building a constellation of SAR and AIS-integrated satellite technology for persistent ocean (maritime) monitoring. The fresh funds will be used to acquire and test critical hardware, as well as to design products and launch and test demo and operational satellites. The user segments like shipping, insurance, defence, coast-guard, and hydrocarbon companies will have 30-minute gap surveillance.

Amaha Health gets $6 million to scale up mental health offerings

With mental health issues getting increasing visibility in India, Amaha Health has secured $6 million (₹50 crore) funding from an array of angel investors and family offices led by Fireside Ventures. Its existing investors include Lightbox Ventures and Capricorn Partners. Amaha Health expects to turn around to EBITDA profits in the next 20 months. Amaha Health has an array of mental health offerings, which helps deal with the psychological problems, which still carry a lot of social stigma attached to it.

SalarySe raises $5.25 million to roll out (Credit on UPI)

SalarySe has just raised $5.25 million (₹43.2 crore) of funding to ramp up and roll out its credit on UPI product. The fresh funds will be used by SalarySe to ramp up its technology stack for offering the credit-on-UPI facility to salaried employees and expand its popularity in Indian markets as a distinct credit product that is easy and flexible. It will partner with banks and HR SAAS platforms, apart from employers, to make this product possible. SalarySe offers a revolving credit facility on UPI by integrating with the payroll systems of firms. The repayments are covered by a lien on future salary payments to reduces the credit risk to the lender. The seed funding round was led by Peak XV Partners, with participation from Pravega Ventures. It will also use the funds to ramp up technology stack.

WealthTech start-up, Fisdom, raises $5 million from PayU

Fisdom, the highly popular WealthTech start-up has raised $5 million (₹41.50 crore) from PayU, which already owns a stake in Fisdom. However, the post-money valuation of Fisdom in this funding round is lower than the previous funding round. This is part of the ongoing Series-C round of funding for Fisdom. The funds will be used to ramp up the business and also upgrade its tech stack to take on the fat growing competition in the WealthTech space in India. Fisdom will allot Series C1 compulsory convertible preference shares (CCPS) to PayU against this fund infusion. 

Riskcovry raises $4.5 million in Series B funding round. 

Riskcovry  has raised $4.5 million (₹37.40 crore) in a Series B funding round from Morphosis Venture Capital, and IIFL Ventures. The funds will be utilized to push the business quickly towards more profitable operations. Riskcovry currently operates on an “insurance-in-a-box” paradigm, which facilitates insurance infrastructure for platforms and vendors seeking to offer insurance products. It almost becomes like IAAS product for product originators, ably support by a strong technology stack. It was more of a bridge funding round, which is an interim sort of funding between major investments to help a company reach specific financial goals in the interim period.

Baker’s Dozen raises $4 million from Wipro Consumer Care Ventures

One of the leading bakery brands based out of Western India, Baker’s Dozen has raised $4 million (₹33.20 crore) From Wipro Consumer Care Ventures and others. The funds will be used by the start-up to expand its business footprint beyond the metro cities and enhance the product offerings in the mass-premium segment. The product is based out of Ahmedabad and has a presence in over 40 cities in India. Other participants in this funding round include Mirabilis Investment Trust, She Capital and Fireside Ventures. Baker’s Dozen offers different kinds of breads, cakes, cookies, crackers, and premixes made of natural ingredients and it currently uses the omnichannel sales model.

Fittr raises $3.50 million from Rainmatter

Fitness specialist, Fittr, has raised $3.50 million (₹29 crore) from the start-up funding arm of Zerodha, Rainmatter. Fittr had earlier raised $11 million in 2021. Fittr targets to make about 5 crore Indians fit and become a global platform for fitness coaching. In the process, it also intends to create career opportunities in fitness industry. Zerodha has been active in funding fitness ventures and this deal gives Fittr access to the entire ecosystem of health and wellness startups backed by Zerodha

MyMuse bags $2.7 million to boost its omnichannel presence

The sexual wellness outfit promoted by Salil Gupta and Anushka Gupta, MyMuse, has raised $2.7 million (₹22.40 crore) to bolster its omnichannel presence and to also scale its distribution operations across India. The start-up has a range of over 25 products, including original educational content, aimed at breaking the social taboos around sexual health. It already has about 1.50 lakh customers across 800 cities, including small towns. This will be part of a pre-Series-A funding round led by Trifecta Capital and Kunal Shah of CRED. Saama Capital and Whiteboard Capital also participated. 

It has been a busy week for start-up fund raising, with the number of deals far outnumbering any of the recent weeks.