Startup Funding Overview: September 2023
This week, 33 Indian startups secured $173.48 million, comprising 4 growth-stage and 25 early-stage investments, while 3 startups opted not to reveal their funding amounts. In contrast, the preceding week saw 21 startups achieving approximately $361.5 million in funding.
Growth-stage Deals
Funding for growth and late-stage ventures fell to $60 million this week, down from $320 million the week prior. The largest transaction was a $23 million Series C round for the cleantech startup Chakr Innovation, led by Iron Pillar. Significant raises included an Rs 160 crore ($18 million) pre-IPO investment for Curefoods from 3State Ventures, Vedantu raising $11 million, and KisanKonnect acquiring $8 million.
Early-stage Deals
Early-stage funding surpassed growth-stage investments, with 25 startups obtaining $113.31 million. The standout funding was a $23 million Series A for the AI-driven app-building platform Emergent, spearheaded by Lightspeed, followed by Rocket’s $15 million round. Other notable contributors included agritech startup Handpickd, electric vehicle manufacturer Simple Energy, biotech firm Distil, the gold savings app Gullak, and fintech startup Oolka among others. Furthermore, Wow! Momo, the travel tech platform Yuyiii, lifestyle audio brand Hammer, and climate tech firm Carbon Masters all secured undisclosed funding this week. For a comprehensive funding breakdown, refer to multiple sources.
City and Segment-wise Deals
In terms of deal volume by city, Bengaluru emerged as the leader with 14 deals, followed by Delhi-NCR with 4 transactions. Other cities like Surat, Mumbai, Kolkata, Hyderabad, and others also witnessed activity with various deals closing this week. Segment-wise, e-commerce startups took the top position with 5 deals, while AI, foodtech, agritech, deeptech, and fintech sectors also attracted funding this week.
Series-wise Deals
This week, seed funding led with 11 transactions, followed by pre-seed with 8 deals. Other stages, including Series A, pre-Series A, and Series C, also witnessed activity. For detailed information regarding series-wise funding, including amount breakdowns and additional insights, please refer to various sources.
Week-on-week Funding Trends
The weekly startup funding saw a decline of 52% to $173.48 million compared to around $361.5 million from the previous week. The average funding over the past eight weeks hovers around $271.15 million with an average of 26 deals per week.
Key Hirings
This week was marked by significant leadership changes: Dhan appointed Ketan Shah as CEO of its Omni Channel Business, and Allen Career Institute named Rakesh Ranjan as CEO of Allen Online, its digital-first segment. Additionally, Unacademy promoted Sumit Jain, co-founder and CEO of Graphy, to oversee its flagship Test Prep division, while OneAssist Consumer Solutions appointed Abhishek Maheshwari as its new CEO. For more details, refer to various sources.
Fund Launches
Frontier Tech Capital is launching a $150 million inaugural fund aimed at growth-stage investments in Southeast Asia, with nearly half already acquired from investors based in Singapore, Japan, and the UAE. Chiratae Ventures, a significant tech-focused VC, has accomplished the second close of its fifth fund at $150 million, with expectations for a final close in Q1 2026, targeting early-stage startups across Seed and Series A and B rounds. Duro Capital has completed the first tranche of its Duro Opportunities Fund with commitments exceeding Rs 200 crore. Good Capital, an early-stage VC behind companies like Meesho, Orange Health, and LEAD School, has successfully closed its second fund at $30 million (Rs 260 crore).
New Launches and Partnerships
SeedlingLabs introduced an AI PDaaS platform, Unicommerce rolled out a GST Guidance Tool, and PhysicsWallah unveiled LexGlobal to integrate legal education with industry practices.
Financial Results This Week
- DeHaat reduced its losses by 15% to Rs 207 crore in FY25.
- BharatPe achieved EBITDA profitability in FY25, with revenues reaching Rs 1,667 crore.
- WROGN, backed by Virat Kohli, continues to face challenges with rising losses.
- Auxilo reported Rs 528 crore in revenue, with a PAT of Rs 112 crore for FY25.
- Akumentis Healthcare exhibited a profit of Rs 66 crore in FY25, with a revenue increase of 9%.
- Purple Style Labs maintained flat revenue in FY25, with losses rising to 36%.
- PhonePe achieved Rs 7,115 crore in revenue and an adjusted PAT of Rs 630 crore in FY25.
- Ultrahuman reported Rs 565 crore in revenue alongside a Rs 73 crore profit in FY25.
News Flash This Week
- The RBI introduced new regulations for the authentication of digital payments.
- Swiggy exited its investment in Rapido, reaping a return of 2.5X.
- Startup founders are ceding significant equity amid substantial Series A dilutions, according to an ENTRACKR report.
- Purple Style Labs filed a DRHP to raise Rs 660 crore through an IPO.
- Finance Buddha (Finbud Financial Services Ltd.) received in-principle approval from NSE Emerge for its SME IPO.
Summary
The week saw startup funding decrease by 52% to $173.48 million, down from $361.5 million compared to the previous week. The RBI’s new payment authentication regulations, set to take effect on April 1, 2026, will necessitate that all providers implement two-factor authentication featuring biometrics, device tokens, or passphrases, along with one dynamic factor, ensuring interoperability across applications and including further risk-based checks where needed.
Swiggy’s divestiture from Rapido has netted Rs 2,399.5 crore, with MIH Investments One B.V. (Prosus group) receiving Rs 1,968 crore and Rs 431.5 crore going to Setu AIF Trust and WestBridge, achieving a return exceeding 2.3X on their investment made under four years ago. Many founders of Indian startups are relinquishing over 40% of their equity during Series A, opting for growth capital at the expense of long-term control. According to startup data platforms, numerous early-stage startups, including Dale Vaz’s Sahi, fintech company DPDzero, semiconductor venture Netrasemi, home service platform Pronto, and agritech startup Eeki, have recently seen founders dilute over 40% of their stakes. Finance Buddha, a hybrid lending facilitator, received in-principle approval from NSE Emerge for its SME IPO. Founded in 2012 by Vivek Bhatia, Parth Pande, and Parag Agarwal, the company extends its services to over 30 states and more than 19,000 pincodes, establishing itself as a trusted retail credit marketplace. Its investor roster includes prominent figures like Ashish Kacholia, Shankar V, and the MS Dhoni Family Office, demonstrating strong confidence in its tech-focused strategy. PhysicsWallah launched LexGlobal in Delhi to enhance practical legal education and certifications, equipping graduates and newcomers with valuable experience in corporate law, IP, M&A, and dispute resolution to meet rising industry needs.
