ETtech Deals Digest: February driest month for Indian startups in a year, funding drops 84% YoY

Funding activity for Indian startups remained muted in the second month of 2023, as new-age businesses raised $809 million in venture funding, a significant drop of about 84% from the $5.2 billion they raised in February last year, data from market intelligence firm Tracxn showed.

February 2023 was the driest month in at least a year for Indian startups when it comes to funding, according to data from Tracxn. For the first time in the last 12 months, cumulative funding for startups remained under $1 billion.

Indian startups raised 41% less money in February than in January, when they had raised $1.38 billion across 157 rounds, whereas in February, startups could only raise $809 million across 84 rounds.

Here are all the startups that raised funds this month.

Insuretech startup InsuranceDekho raises $150 million: Insurtech platform InsuranceDekho raised $150 million in a mix of equity and debt funding, led by Goldman Sachs Asset Management and TVS Capital Fund. Investcorp, Avataar Ventures and LeapFrog Investments also invested as part of the equity funding. The share allotment to some of these investors began in January.

FreshToHome raises $104 million in funding: Online meat delivery company FreshToHome raised $104 million (Rs 860 crore), led by Amazon Smbhav Venture Fund, amid a tough funding environment for late-stage startups. Existing investors including Iron Pillar, Investcorp, Investment Corporation of Dubai, Ascent Capital and others also participated in the funding round. New investors include E20 Investment Ltd, Mountshan Judi Ventures and Dallah Albaraka.

PhonePe lands $100-million top-up at $12-billion valuation: Digital payments firm PhonePe raised another $100 million in primary funding from fintech backer Ribbit Capital, TVS Capital Funds (TCF) and New York-based investment firm Tiger Global at a pre-money valuation of $12 billion. The fresh funding comes close on the heels of a $350-million capital raising from private equity firm General Atlantic in January. PhonePe has so far raised $450 million in primary capital this year, which is part of its ongoing $1 billion round.

Ushur raises $50 million in funding: Ushur, a customer experience automation software provider, raised $50 million, led by Third Point Ventures. Existing backers Iron Pillar, 8VC, Aflac Ventures and Pentland Ventures also participated in the fresh funding round. The latest capital is expected to help the Santa Clara-headquartered startup expand its portfolio of software tools, develop new technologies in artificial intelligence including Large Language Models (LLM) and Generative AI.

MO Alternates invests Rs 400 crore in hygiene products maker Pan Health: MO Alternates, a subsidiary of Motilal Oswal Financial Services invested Rs 400 crore for a minority stake in Pan Healthcare Private Ltd (Pan Health), a Rajkot based manufacturer of hygiene products. Pan Health plans to use funds raised for investing on brands and business expansion.

Edtech startup NxtWave raises $33 million: Upskilling platform NxtWave has raised $33 million in funding led by global equity firm Greater Pacific Capital (GPC). Existing venture investor Orios Venture Partners also participated in the round.

Zypp Electric raises $25 million: Zypp Electric has raised $25 million in a funding round led by Taiwanese EV maker and battery-swapping company Gogoro. The round comprises $20 million in equity funding and $5 million in debt, which came from global impact fund IIX and a large national bank in India. Goodyear Ventures, 9Unicorns, WFC, Venture Catalysts, LetsVenture, IAN, Ivygrowth, and Grip also participated in the funding round for the electric vehicle fleet operator.

Emotion AI startup Entropik raises $25 million: Entropik, an Artificial Intelligence-based (AI) online market research startup, has raised $25 million in a funding round dubbed Series B, led by Bessemer Venture Partners. Other participating investors include SIG Venture Capital, Trifecta Capital and Alteria Capital and returning investor Bharat Innovation Fund.