Startup

Startup news and updates: Daily roundup (July 18, 2024)

Published

4 months ago

July 18, 2024

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Funding news

Honestly raises Rs 3.2 Cr pre-seed funding from Better Capital

Honestly, an AI-powered beauty and personal care platform, has secured Rs 3.2 crore in pre-seed funding led by Better Capital along with participation from Kunal Shah-led QED Innovations, and senior leaders from Flipkart, Polygon and Cred.

Founded in April 2024, its AI analyses each user’s order history and matches them with similar users across 100+ attributes, such as skin tone, skin type, age, and gender, to discuss product recommendations. Additionally, Honestly’s AI evaluates product ingredients to help users understand how new products fit into their routines.

EV-Ride-hailing startup MyPickup raises Rs 1.5 C in seed round led by Inflection Point Ventures

MyPickup, an urban transit services provider has raised Rs 1.5 crore in seed round led by Inflection Point Ventures.

The funds will be used for developing scheduling algorithms, brand building, and optimising operations management. This investment is part of IPV’s initiative to support early-stage ideas with high innovation and impact potential.

At scale, it plans to expand to on-demand rides with fleet operators and other vehicle classes, maintaining control over drivers and vehicles through robust SOPs and training to ensure a high-quality customer experience.

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” align=”center”> Seed Funding

Protonas secures seed funding from Transition VC

Protonas, a startup specialising in low-cost PEM hydrogen fuel cell solutions, has raised a seed funding round of an undisclosed amount, led by Transition VC.

With this raised capital, Protonas is set to establish initial manufacturing operations in Chennai and build prototype systems.

Protonas’ PEM hydrogen fuel cell technology has achieved cost reductions. Headquartered in Tennessee, US, with a subsidiary in Chennai, India, Protonas was founded by David DeVries, a veteran of the fuel cell industry since 1996.

The company aims to deploy cost-efficient backup power applications in North America and power fuel cell engines for 3-wheeler and 4-wheeler vehicles in India and other Asian markets. Protonas leverages advanced hydrogen fuel cell technology to deliver sustainable energy solutions and plans to collaborate with companies in India to develop carbon-neutral vehicles.

Other news

Google unveils new cohort for Google for Startups Accelerator

Google announced the new cohort of the Google for Startups Accelerator: AI First program in India with 20 AI-first startups from a wide range of sectors from gaming to manufacturing, selected from over 1030 applications across the country.

3DAILY, a gaming startup, Figr, a developer tool, Hypergro.ai, a marketing tech startup, are a few of the 20 choosen startups.

The programme began this week with a week-long, in-person bootcamp at Google Bengaluru. Over the next three months, Google will closely support these startups in overcoming technical and business challenges, scaling human-centered AI solutions.

They will receive exclusive training, Cloud infrastructure credits, mentorship from industry leaders, and access to Google teams like Google Cloud, Google DeepMind, Android, and Web, enhancing their global network.

77% of Indian startups are investing in advanced technologies: SAP – Dun & Bradstreet Study

Over 77% of start-ups invest in advanced technologies such as artificial intelligence (AI), ML, IoT, and blockchain according to the study– ‘Value Creation and Sustainable Growth: The Blueprint for Startup Profitability in India.

Release by SAP India, in collaboration with Dun & Bradstreet it revealed that 79% of startups believe adopting enterprise applications integrated with new-age technologies like AI is essential for scaling and improving unit economics, with 72% already investing in these technologies. Additionally, 85% see unit economics as key to profitability and valuation enhancement.

Tier II and III cities, such as Chandigarh, Jaipur, and Kochi, have become innovation hubs, accounting for 40% of tech startups and 15% of the tech skill pool. These cities offer cost savings due to lower real estate and talent costs.

It said that sectors like Agritech, Fintech, EdTech, and HealthTech benefit significantly from AI and other advanced technologies. Enterprise solutions aid in building robust corporate governance, essential for attracting investors and public listings, with 64% emphasising their role in understanding customer behavior and 71% highlighting their importance for investor attraction and transparency.

The study examined 113 Indian start-ups.

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Collective Artists Network acquires Galleri5

Collective Artists Network, a new media entity has acquired Galleri5,an AI-powered content solutions and influencer marketing technology.

This acquisition follows a series of strategic moves by Collective Artists Network to bolster its position in the new media landscape. Last week, Collective Artists Network acquired Terribly Tiny Tales, a text-first flash fiction platform. In September 2023, the company acquired the tech-powered student community – Under 25 Universe.

Employees aged between 21 and 30 are the most stressed cohort: YourDOST report

Employees between 21 and 30, are the most stressed set of workers, according to the latest report titled “Emotional Wellness State of Employees by YourDOST, a mental and emotional wellness company.

Out of the 5,000+ employees surveyed, staffers were found to be the most stressed. A poll revealed that 64% of workers aged 21-30 experience high stress levels, followed by 59.18% in the 31-40 age group. Employees aged 41-50 are the least stressed. Younger employees seem more open to discussing mental health but face stress from family and friends. Self-improvement (35%) and relationship problems (33%) are the top reasons for seeking counseling, followed by career anxiety. Psychological disorders and sexual wellness were other topics of concern.

Around 72.2% of women reported high-stress levels at work, compared to 53.64% of men. Major stressors for women include lack of work-life balance, recognition, low morale, and fear of judgment. Overall, there is been a 31% year-on-year increase in employees reporting high stress.

The study surveyed employees across various sectors, including IT, manufacturing, transportation, tech, legal services, and business consulting.

Navi Mutual Fund launches India’s first index fund tracking Nifty 500 Multicap 50:25:25

Navi Mutual Fund, a mutual fund investment company in India, launched the Navi Nifty 500 Multicap 50:25:25 Index Fund. It is the first-ever index fund to track the Nifty 500 Multicap 50:25:25 index.

This fund continuously offers units at applicable NAV (Face Value: ₹10/-). The New Fund Offer (NFO) opens on 18th July 2024 and closes on 30th July 2024.

The Nifty 500 Multicap 50:25:25 index offers diversified exposure to large, mid, and small-cap companies in the Indian stock market, with fixed allocations of 50%, 25%, and 25%, respectively. This strategy reduces risk by avoiding concentration in any single category.

Compared to the Nifty 500 index’s 71.8% large-cap allocation, the Nifty 500 Multicap provides greater exposure to mid and small-cap companies (50% vs. 28.2%), potentially offering higher growth prospects. Unlike actively managed funds, the Navi Nifty 500 Multicap 50:25:25 Index Fund passively tracks the index.

India’s first private deep tech hub launches in NCR

8X Ventures, a deep tech VC, Sanchi Connect, a deep tech community enabler, and Arctic Invent, an IP advisory firm have launched India’s first privately sponsored Deep Tech hub.

The hub will engage with up to 10 deep tech startups in the first year with no dilution on the equity front.

The Hub aims to bring together members of the thriving deeptech ecosystem who have graduated from incubation centres but continue to need support from the ecosystem. It targets to mobilise $100Mn in the DeepTech ecosystem.

The DeepTech Hub operates in a 7,000+ sq ft area in Noida and plans to expand to a 100,000+ sq ft space within the next year. This new facility will feature state-of-the-art labs, collaborative workspaces, critical shared resources for scaling DeepTech startups, and exclusive access to industry-leading mentors and experts.

Inertial Labs and ideaForge partner for UAV based LiDAR Solutions

ideaForge Technology Limited, a drone technology company, has partnered with Inertial Labs, a company dealing in inertial sensors and integrated GPS systems, for the integration of Inertial Labs’ RESEPI LiDAR solution into ideaForge’s unmanned aerial vehicles (UAVs).

As part of their partnership, Inertial Labs and ideaForge will provide surveying, mapping, and inspection solutions for applications in mining, forestry, GIS, land surveys, and water resources management. By integrating Inertial Labs’ RESEPI LiDAR payloads with ideaForge’s NETRA/Q6 UAVs, they will deliver highly accurate aerial data with extreme precision and speed.

Key specifications include a portable MTOW of less than 6kg, multi-use platform capabilities (27X Zoom, Thermal, Mapping, Multispectral, LiDAR), fully autonomous flying with built-in fail-safes, and custom maps for accurate resolution in various terrains.

Resumod launches AI-Driven staffing solution

Resumod, an HR solutions provider has launched its AI-driven staffing solution. This AI system aims to reduce the time taken for initial resume screening by up to 50%.

Moreover, through the use of chatbots, Resumod also felicitates initial screening and labeling of resumes for future use.

Resumod empowers jobseekers with actionable insights by offering detailed resume analysis against specific job descriptions, helping individuals tailor their resumes for maximum impact. Additionally, Resumod now provides an “expert help service,” allowing users to hire experienced resume writers for professional resume creation and learning, available for INR 449.

(This article will be updated with the latest news throughout the day.)

Edited by Affirunisa Kankudti

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Startup

Swiggy IPO: Retail portion subscribed 84%, overall 35% shares allotted

Published

30 mins ago

November 7, 2024

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Food delivery and quick commerce platform Swiggy’s Initial Public Offering (IPO) was subscribed only 35% on the second day of bidding as broader market indices slipped in red.

Sriharsha Majety-led Swiggy witnessed the quota reserved for employees being subscribed 1.15 times by the end of bidding on the second day. Retail investors subscribed to 84% of the shares.

According to data from the Bombay Stock Exchange (BSE), non-institutional investors purchased 14% of their allocated shares, and qualified institutional buyers’ (QIBs) part was booked at 28%.

As of the second day, Swiggy’s IPO received bids for 5.57 crore shares, amounting to 35% of the total issue size. The issue was subscribed 12% on day one.

Swiggy, which is set to list on Indian stock markets on November 13, initially aimed for a valuation of approximately $15 billion, but later updated its RHP to seek a valuation of around Rs 87,000 crore or about $11.3 billion at the upper price band.

“Swiggy’s decision to lower its valuation leaves some upside room for the investors, we still recommend an AVOID recommendation to this issue due to the “reported negative” cash flows and ongoing losses, alongside a slightly high valuation of 7.7x FY24 price-to-sales,” noted Aditya Birla Money in a research report dated Nov 4.

It raised nearly Rs 5,085 crore (about $605 million) from anchor investors, which included life insurance and mutual fund arms of HDFC, ICICI, and SBI. The anchor book, which witnessed participation from over 75 key domestic mutual funds, also saw bids from global mutual fund investors like Astrone Capital, Fidelity, and Blackrock.

Swiggy plans to raise close to Rs 11,700 crore in its IPO which will include fresh issue of 11.54 crore equity shares along with an offer for sale (OFS) of 17.51 crore equity share by existing stakeholders. It has set IPO price band at Rs 371- Rs 390.

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Northern Arc secures $65M debt commitment for maiden climate fund

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2 hours ago

November 7, 2024

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Northern Arc has raised $65 million in debt commitments for its maiden Climate Fund, through its fund management arm, Northern Arc Investments IFSC Trust.

The debt commitments include $50 million from the United States International Development Finance Corp (DFC) and $15 million from the official Development Bank of the Republic of Austria, OeEB, it said in a statement on Thursday.

The non-banking financial institution’s (NBFC) fund aims to address critical funding gaps of growth stage startups in the solar energy, e-mobility, sustainable agriculture, and circular economy spaces.

“The significant investment from DFC and OeEB reinforces our ongoing commitment to revolutionise climate finance and transform the financial landscape for all households and businesses in India. By channelling these funds into green projects across our focus sectors of MSME, affordable housing, vehicle finance, agriculture finance, microfinance, and consumer finance, we aim to create a cascading effect that promotes sustainable development,” said Ashish Mehrotra, Managing Director and CEO, Northern Arc.

In October, the company launched its performing credit AIF fund (Category II), ‘Finserv Fund’, through its subsidiary Northern Arc Investment Managers (NAIM).

The fund aims to raise a target corpus of Rs 1,500 crore, including a greenshoe option of Rs 500 crore.

Northern Arc has assets under management (AUM) worth Rs 15,121 crore through its balance sheets and active AIF funds, as of September 30. It is backed by investors such as Sumitomo Mitsui Banking Corporation, LeapFrog, and 360 ONE, among others.

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PhysicsWallah’s losses widen FY24 as rising expenses overshadow 2.6X revenue growth

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3 hours ago

November 7, 2024

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Edtech unicorn PhysicsWallah (PW) saw its losses widen significantly in FY 2023-24, fueled by a sharp rise in employee benefit costs and other expenditures, casting a shadow over a 2.6-fold increase in operating revenue.

The Noida-based company also revised its FY 2022-23 figures, now reporting a loss of Rs 84.1 crore, in contrast to the Rs 8.9 crore profit previously stated in its earlier consolidated financial statements.

The heavy losses come on the back of the edtech company’s rapid expansion over the past couple of years. PW, which initially focused on the test-prep segment, has rapidly diversified its educational offerings over the past few years to encompass everything—from school education to skills training—casting its learning net over a wide base of learners.

PW’s rapid expansion comes amid a turbulent period for BYJU’S, once the leading edtech platform and the poster child of the Indian startup ecosystem.

The Alakh Pandey-led firm reported a consolidated loss of Rs 1,131.3 crore in FY24, up 13.5X from Rs 84.1 crore recorded in the earlier fiscal period.

The reported losses were impacted by non-cash adjustments, such as Compulsorily Convertible Preference Shares (CCPS) amounting to Rs 756 crore, according to the company. This CCPS expense is recorded in relation to the buyback clause provided in the issued CCPS, based on the conversion of accounting standards from IGAAP to INDAS, it added.

After excluding the non-cash adjustment, the company’s actual cash losses come to approximately Rs 375 crore, up 4.4X.

The company had remained the only profitable edtech firm until FY22, while steadily growing its top line.

Its operating revenue surged 160.7%, touching Rs 1,940.4 crore in FY24 compared to Rs 744.3 crore in FY23, as per its recent consolidated financial statements.

The startup’s total income reached Rs 2,015.1 crore, up 160.8% increase year-on-year (YoY).

For context, BYJU’S surpassed the Rs 2,000 crore revenue mark in FY20 and Eruditus in FY23, while PW achieved this milestone in its fourth year of operations. BYJU’S was incorporated in 2011, Eruditus in 2010, and PW in 2020.

Meanwhile, the company’s expenses surged by 280.4% to Rs 3,279.1 crore in FY24 compared with Rs 862 crore in FY23.

The sharp rise in expenses was driven by employee benefits, the firm’s second-largest cost centre, which jumped to Rs 1,159 crore—a 180.9% YoY.

Its other expenses surged by 442.4% YoY to Rs 1,660 crore, including a significant increase in miscellaneous expenses, which rose by 755.9% to Rs 1,452.7 crore.

Interestingly, PW also reduced its advertising and promotional expenses by 39.9%, although these still accounted for the company’s second-largest expense, totalling Rs 37.3 crore in FY24 compared with Rs 62.1 crore in FY23.

PW has experienced impressive growth, however, sustainable growth and profitability are essential, and it must navigate its own challenges as it expands.

Earlier this year, PW Co-founder Prateek Maheshwari told YourStory that FY24 was the year of “growth,” while FY25 is the year of “sustainable growth,” as PW aims to return to a profitable path.

“We have bounced back this year, with the first two quarters being EBITDA profitable for the first time in our company’s history,” he added. EBITDA, or earnings before interest, taxes, depreciation and amortisation, is a measure of core operational efficiency.

While the profitability metric for FY25 cannot be determined due to the transition from I-GAAP to Ind-AS, this fiscal year is expected to be the highest in absolute EBITDA profitability since inception, according to Maheshwari.

I-GAAP (Indian Generally Accepted Accounting Principles) refers to the traditional accounting standards used in the country, while Ind-AS (Indian Accounting Standards) is a set of accounting standards aligned with IFRS (International Financial Reporting Standards) for greater transparency and consistency.

In September, PW raised $210 million in a Series B funding round led by investment firm Hornbill Capital, with a sizable participation from venture capital firm Lightspeed Venture Partners. This was a significant milestone given the scarcity of substantial deals in India’s edtech sector lately.

With the latest funding round, PW’s post-money valuation has soared to $2.8 billion, making it the third-most valued edtech firm, trailing only Unacademy ($3.4 billion) and Eruditus ($3.2 billion), based on their last valuations.

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