With 25 acquisitions totaling $222.2 million closed between July 29 and August 3, the Indian startup ecosystem made a remarkable comeback in the final week of July. This was a 416% increase over the $43.1 million earned through 12 agreements the previous week. This jump suggests that investor confidence is returning and that the entrepreneurial climate is flourishing, which is encouraging for the upcoming months.
Rapido: India’s Newest Unicorn
The week’s biggest moment was when Rapido, a bike-taxi aggregator, turned unicorn. Rapido’s valuation increased to over $1 billion with the addition of $120 million from WestBridge Capital, an existing investor. Investor trust in Rapido’s business model and growth prospects, together with the rising potential of the travel tech industry, is demonstrated by this significant investment round.
Sectoral Funding Trends
Bolstered by Rapido’s success, the travel tech sector emerged as the investor favorite, attracting the majority of the week’s funding. The fintech sector followed, with three fintech startups collectively raising $39.4 million. Enterprise tech saw the highest number of deals, with seven startups raising a total of $9.3 million. Seed funding also showed signs of revival, with startups raising $5.1 million, compared to none in the previous week.
IPOs: Ola Electric, FirstCry, Unicommerce
The week also witnessed significant developments in the IPO landscape. Electric vehicle (EV) maker Ola Electric opened its initial public offering (IPO) on August 2, receiving a 35% subscription on the first day. Prior to the IPO, Ola Electric raised INR 2,763 crore from anchor investors, demonstrating strong market interest.
Kidswear brand FirstCry is set to open its IPO on August 6, with a price band of INR 440-465 per equity share. The IPO is expected to raise INR 4,193 crore at the upper price band. SaaS startup Unicommerce will also open its IPO on the same date as FirstCry, with a price band of INR 102-108 per equity share, potentially raising INR 276.57 crore at the upper end.
Upcoming IPOs and Filings
The IPO momentum continued with education-focused non-banking financial company (NBFC) refiling its IPO papers on July 31, addressing issues previously flagged by the Securities and Exchange Board of India (SEBI). The offering will comprise a fresh issue of shares worth INR 1,000 crore and an offer for sale (OFS) component worth up to INR 2,500 crore.
SaaS unicorn Fractal is planning to file its Draft Red Herring Prospectus (DRHP) for a $500-$600 million IPO by the end of August or early September. The enterprise tech startup aims to list at a valuation of around $3 billion. Meanwhile, B2B ecommerce platform Infra.Market is preparing for a $300-$400 million IPO, appointing a syndicate of four to five investment banks to manage the process.
Major Developments and Acquisitions
Venture capital firm Trifecta Capital launched its fourth fund with a corpus size of INR 2,000 crore (around $240 million), including a green shoe option of INR 500 crore. IIMA Ventures initiated a Venture Investing Accelerator programme for new investors, catering to family offices, micro VCs, and corporate venture offices.
In the fintech sector, SaveDesk acquired a 90% stake in Fairexpay, expanding its footprint in the cross-border remittance and fund collection market. Dunzo’s cofounder and former CTO, Mukund Jha, is in talks to raise $6-10 million from Together Fund for his new GenAI venture.
New Fund Launches and Investments
The second fund from micro-VC firm Gemba Capital was introduced with a target corpus of INR 250 crore, which included a 50 crore INR green shoe option. Through this fund, the company intends to assist 30 early-stage consumer tech, B2B, and financial firms. With an unknown sum, IIFL Fintech Fund bought a 10% share in the Gen AI firm Vitra.ai.
Additionally, Mumbai-based trade financing startup Vayana Network is raising $20 million in its Series D funding round, led by new investor SMBC Asia Rising Fund.
Conclusion
The Indian startup ecosystem had a dramatic upturn in the last week of July, with a surge in IPO activity and large inflows of financing. The momentum will probably continue as long as the ecosystem is healthy, spurring growth and innovation in a number of industries.
