Posted on

SAIF Partners rebrands as Elevation Capital, secures $400 million for its new India fund

SAIF Partners has raised $400 million for a new fund and rebranded the 18-year-old influential venture capital firm as it looks to back more early-stage startups in the world’s second largest internet market.

The new fund is SAIF Partners’ seventh for early-stage startups in India. Its previous two funds were each $350 million in size, and the firm today manages more than $2 billion in assets.

SAIF Partners started investing in Indian startups 18 years ago. The firm began as a joint venture with SoftBank and its first high-profile investment was Sify. But the two firms’ joint venture ended more than a decade ago, so the firm is now getting around to rebranding itself, Ravi Adusumalli, the managing partner of SAIF Partners, told TechCrunch in an interview.

The firm — which has five unicorns in its portfolio, including Paytm’s parent firm One97 Communications, food delivery startup Swiggy and online learning platform Unacademy — is rebranding itself as Elevation Capital.

“Elevation reflects our investment ethos and re-emphasises our commitment to the founders who help redefine our future. For our existing partners, it is a commitment of continued collaboration on our path-breaking journeys together. For our new partners, it is a promise to do all we can to achieve great heights together, from day one,” said Adusumalli.

SAIF Partners has backed more than 100 startups to date. The venture firm makes long-term bets on founders and backs young firms beginning their early years when they are raising their seed, pre-Series A and Series A financing rounds.

The venture firm invests in startups operating in a wide-range of sectors and plans to continue this strategy and add more areas of interest, said Deepak Gaur, a managing director at Elevation Capital, in an interview with TechCrunch.

“Enterprise SaaS is one area where we are spending a lot of resources,” he said. “We believe the time has come for this sector and we will see many global companies emerge from India.”

More than 15 startups in Elevation Capital’s portfolio are projected to become a unicorn in the next few years, according to Tracxn, a firm that tracks startups and investments in India. These include healthcare booking platform PharmEasy, app-based platform to book home services Urban Company, insurance tech startup Acko, digital loan platform Capital Float, real estate property marketplace NoBroker and online marketplace for gold Rupeek.

A number of SAIF Partners-backed startups, including IndiaMART, MakeMyTrip and Justdial, have become publicly listed companies, too.

Mukul Arora, a managing partner at SAIF Partners, said that the state of the Indian startup ecosystem has changed for the better in the past decade. “A few years ago, we were seeing many startups replicate a foreign company’s play in India. Today, we are seeing our ideas being replicated outside of the country. Someone is building a Meesho for Brazil,” he said.

The founders have also grown more sophisticated, said Mayank Khanduja. Elevation Capital has over three dozen employees, with about two-dozen focused on the investment size.

Elevation Capital’s new fund comes at a time when many established venture capital firms have also closed their new funds for India in recent months. In July, Sequoia Capital announced two funds — totaling $1.35 billion in size — for India. A month later, Lightspeed raised $275 million for its third Indian fund. Accel late last year closed its sixth fund in India at $550 million.

All of the LPs participating in Elevation Capital’s new fund, as was the case with previous funds, are U.S.-based, and the vast majority of them are nonprofits, said Adusumalli. Without disclosing any figures, he said the firm’s previous funds have performed very well.

Read More

Posted on

Indian startups diversify their businesses to offset COVID-19 induced losses

E-commerce giant Flipkart is planning to launch a hyperlocal service that would enable customers to buy items from local stores and have those delivered to them in an hour and a half or less. Yatra, an online travel and hotel ticketing service, is exploring a new business line altogether: Supplying office accessories.

Flipkart and Yatra are not the only firms eyeing new business categories. Dozens of firms in the country have branched out by launching new services in recent weeks, in part to offset the disruption the COVID-19 epidemic has caused to their core offerings.

Swiggy and Zomato, the nation’s largest food delivery startups, began delivering alcohol in select parts of the country last month. The move came weeks after the two firms, both of which are seeing fewer orders and had to let go hundreds of employees, started accepting orders for grocery items in a move that challenged existing online market leaders BigBasket and Grofers.

Udaan, a business-to-business marketplace, recently started to accept bulk orders from some housing societies and is exploring more opportunities in the business-to-commerce space, the startup told TechCrunch.

These shifts came shortly after New Delhi announced a nationwide lockdown to contain the spread of the coronavirus. The lockdown meant that all public places including movie theaters, shopping malls, schools, and public transport were suspended.

Instead of temporarily halting their businesses altogether, as many have done in other markets, scores of startups in India have explored ways to make the most out of the current unfortunate spell.

“This pandemic has given an opportunity to the Indian tech startup ecosystem to have a harder look at the unit-economics of their businesses and become more capital efficient in the shorter and longer-term,” Puneet Kumar, a growth investor in Indian startup ecosystem, told TechCrunch in an interview.

Of the few things most Indian state governments have agreed should remain open include grocery shops, and online delivery services for grocery and food.

People buy groceries at a supermarket during the first day of the 21-day government-imposed nationwide lockdown as a preventive measure against the spread of the COVID-19 coronavirus, in Bangalore on March 25, 2020. (Photo by MANJUNATH KIRAN/AFP via Getty Images)

E-commerce firms Snapdeal and DealShare began grocery delivery service in late March. The move was soon followed by social-commerce startup Meesho, fitness startup Curefit, and BharatPe, which is best known for facilitating mobile payments between merchants and users.

Meesho’s attempt is still in the pilot stage, said Vidit Aatrey, the Facebook-backed startup’s co-founder and chief executive. “We started grocery during the lockdown to give some income opportunities to our sellers and so far it has shown good response. So we are continuing the pilot even after lockdown has lifted,” he said.

ClubFactory, best known for selling low-cost beauty items, has also started to deliver grocery products, and so has NoBroker, a Bangalore-based startup that connects apartment seekers with property owners. And MakeMyTrip, a giant that provides solutions to book flight and hotel tickets, has entered the food delivery market.

Another such giant, BookMyShow, which sells movie tickets, has in recent weeks rushed to support online events, helping comedians and other artists sell tickets online. The Mumbai-headquartered firm plans to make further inroads around this business idea in the coming days.

For some startups, the pandemic has resulted in accelerating the launch of their product cycles. CRED, a Bangalore-based startup that is attempting to help Indians improve their financial behavior by paying their credit card bill on time, launched an instant credit line and apartment rental services.

Kunal Shah, the founder and chief executive of CRED, said the startup “fast-tracked the launch” of these two products as they could prove immensely useful in the current environment.

For a handful of startups, the pandemic has meant accelerated growth. Unacademy, a Facebook-backed online learning startup, has seen its user base and subscribers count surge in recent months and told TechCrunch that it is in the process of more than doubling the number of exam preparation courses it offers on its platform in the next two months.

Since March, the number of users who access the online learning service each day has surged to 700,000. “We have also seen a 200% increase in viewers per week for the free live classes offered on the platform. Additionally there has been a 50% increase in paid subscribers and over 50% increase in average watchtime per day among our subscribers,” a spokesperson said.

As with online learning firms, firms operating on-demand video streaming services have also seen a significant rise in the number of users they serve. Zee5, which has amassed over 80 million users, told TechCrunch last week that in a month it will introduce a new category in its app that would curate short-form videos produced and submitted by users. The firm said the feature would look very similar to TikTok.

The pandemic “has also accelerated the adoption of online services in India across all demographics. Many who would not have considered buying goods and services online are starting to adopt the online platforms for basic necessities at a faster pace,” said venture capitalist Kumar.

“As far as expansion into adjacent categories is concerned, some of this was a natural progression and startups were slowly moving in that direction anyway. The pandemic has forced people to get there faster.”

Roosh, a Mumbai-based game developing firm founded by several industry veterans, launched a new app ahead of schedule that allows social influencers to promote games on platforms such as Instagram and TikTok, Deepak Ail, co-founder and chief executive of Roosh, told TechCrunch.

ShareChat, a Twitter-backed social network, recently acquired a startup called Elanic to explore opportunities in social-commerce. OkCredit, a bookkeeping service for merchants, has been exploring ways to allow users to purchase items from neighborhood stores.

And NowFloats, a Mumbai-based SaaS startup that helps businesses and individuals build an online presence without any web developing skills, is on-boarding doctors to help people consult with medical professionals.

Startups are not the only businesses that have scrambled to eye new categories. Established firms such as Carnival Group, which is India’s third-largest multiplex theatre chain, said it is foraying into cloud kitchen business.

Amazon, which competes with Walmart’s Flipkart in India, has also secured approval from West Bengal to deliver alcohol in the nation’s fourth most populated state. The e-commerce giant is also exploring ways to work with mom and pop stores that dot tens of thousands of cities and towns of India.

Last week, the American giant launched “Smart Stores” that allows shoppers to walk to a participating physical store, scan a QR code, and pick and purchase items through the Amazon app. The firm, which is supplying these mom and pop stores with software and QR code, said more than 10,000 shops are participating in the Smart Stores program.

Read More

Posted on

Google employee in Bangalore tests positive for coronavirus

Google said on Thursday that an employee at its office in Bangalore, India has tested positive for the COVID-19 coronavirus and the firm has asked all the other employees in that office to work from home on Friday out of abundance of caution.
“We can confirm that an employee from …

Read More

Posted on

Venture Highway announces $78.6M second fund to invest in early-stage startups in India

Venture Highway, a VC firm in India founded by former Google executive Samir Sood, said on Thursday it has raised $78.6 million for its second fund as it looks to double down on investing in early-stage startups.

The firm, founded in 2015, has invested in more than two dozen startups to date, including social network ShareChat, which last year raised $100 million in a financing round led by Twitter; social commerce Meesho, which has since grown to be backed by Facebook and Prosus Ventures; and Lightspeed-backed OkCredit, which provides a bookkeeping app for small merchants.

Moving forward, Venture Highway aims to lead pre-seed and seed financing rounds and cut checks between $1 million to $1.5 million on each investment (up from its earlier investment range of $100,000 to $1 million), said Sood in an interview with TechCrunch.

Venture Highway counts Neeraj Arora, former business head of WhatsApp who played an instrumental role in selling the messaging app to Facebook, as a founding “anchor of LPs” and advisor. Arora and Sood worked together at Google more than a decade ago and helped the Silicon Valley giant explore merger and acquisition deals in Asia and other regions.

Samir Sood, the founder of Venture Highway

The VC firm said it has already made a number of investments through its second fund. Some of those deals include investments in OkCredit, mobile esports platform MPL, Gurgaon-based supply chain SaaS platform O4S, social commerce startup WMall, online rental platform CityFurnish, community platform MyScoot and online gasoline delivery platform MyPetrolPump.

As apparent from the aforementioned names, Venture Highway focuses on investing in startups that are using technology to address problems that have not been previously tackled.

Last year Venture Highway also participated in a funding round of Marsplay, a New Delhi-based startup that operates a social app where influencers showcase beauty and apparel content to sell to consumers.

“It’s very rare to have investors who keep their calm, get into an entrepreneurial mindset and help founders achieve their dreams. Throughout the journey, Venture Highway has been extremely helpful, emotionally available (super important to founders) and very resourceful,” said Misbah Ashraf, 26-year-old co-founder and chief executive of Marsplay, in an interview with TechCrunch.

There is no “theme” or category that Venture Highway is particularly interested in, said Sood. “As long as there is a tech layer; and the startup is doing something where we or our network of LPs, advisors and investors can add value, we are open to discussions,” he said.

This is the first time Venture Highway has raised money from LPs. The firm’s first fund was bankrolled by Sood and Arora.

Dozens of local and international VC funds are today active in India, where startups raised a record $14.5 billion last year. But a significant number of them focus on late-stage deals.

Source: TechCrunch