Fintech, B2C startup funding grows 6x

CHENNAI: Buoyed by investments in fintech and B2C (business-to-consumer) operations, April was a bumper month for startups in India with 50 deals valued at $766 million — more than six times what was recorded in April 2017, which saw 31 deals closed for $121 million.

A sizable portion of the investments last month were grabbed by Paytm Mall ($445 million). Varthana, which offers financial support to affordable private schools, raised $54 million from a group of investors including ChrysCapital, Omidiyar Network and others.

Beauty retailer Nykaa raised its fourth round of funds. Existing investors — Sunil Munjal’s family office, consumer goods maker Marico’s Mariwala family office and others — led the round along with existing and new high net worth individuals.

“Last few quarters, we have seen investors flock towards B2B (business-to-business) or SaaS startups. This time close to 60% investments have gone towards B2C businesses. This is an area that is generally capitalintensive,” said Arun Natarajan, CEO of Venture Intelligence — a firm that tracks private investments. He adds that since several prominent names in the last few months had raised money for lesser valuations, it may have had a positive impact. For instance, Grofers raised $62 million with a 20% drop in valuation. “This reset in valuation is facilitating many deals to go through,” said Natarajan.

Several new funds have raised money and Natarajan adds that these are ready to be deployed in the market like WaterBridge Ventures, which raised $30 million in March, and Omnivore Partners that raised $46 million in February. The fintech space saw 10 deals in April, including CapitalFloat, which raised $22 million from Amazon.