India Startup Angel/VC Funding Digest- Q1 2013


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A 2013 Quarter 1 report on the Indian Startup Space in terms of Angel/VC funding. The report is developed by YourStory Research.

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India Startup Angel/VC Funding Digest- Q1 2013

  1. 1. India Startup Digest Q1 2013- Angel/VC Funding 2 April 2013YS Research India Startup Digest Q1 2013, Page 1
  2. 2. Background to the report2012 was an exciting year for the Indian startup ecosystem. The momentum builtover the past couple of years intensified. Investor interest increased in Indianstartups. More than 200 deals worth more than $700 million were sealed.Qualitatively, emerging startups show high levels of maturity which should have apositive impact on funding.Funding activity is by no means an indicator of success but is a good proxy forbusiness viability tracking.In this report, we provide a synopsis about the startup space in India in the firstquarter of 2013 with our insights.YS Research India Startup Digest Q1 2013, Page 2
  3. 3. Overview71 deals were announced in the first 3 months of 2013, out of which the fundingamount for 33 were disclosed (16 of these were acquisitions).Declared investments total to $140 million. Along with smaller seed rounds ourestimates are that India witnessed a total funding activity of $160 million in Q12013.Note: This relates to deal info till March 2013. Monthwise  funding  amount  and  number  of  deals $  70 $  68 $  56 $  53 $  35 29 26 $  17 $  18 16 $  0 January February March Funding  Amount  ($  million) No.  of  dealsYS Research India Startup Digest Q1 2013, Page 3
  4. 4. 62% of the deals were seed/angel stage investments. Another 5% involved bridgerounds, deal creation and loans. The rest of the deals are undisclosed. A breakupof the disclosed deals is given below: 4% 14% 7% 11% 18% 46% Acquisition Angel/Seed Series A Series B Series C Series DYS Research India Startup Digest Q1 2013, Page 4
  5. 5. Sector wise analysisHealthcare and eCommerce were the most favored categories with investmentsof $42.44 million and $40.51 million respectively.Healthcare saw 10 deals (3 undisclosed) and probably took top spot becauseinherently the sector needs more funds per investment.eCommerce came in close second with $41 million with 7 deals (2 undisclosed).Consumer Web and Education took a distant third with $13.72 million (10 dealswith 5 undisclosed) and $13 million (7 deals with 2 undisclosed) being put inrespectively. 50 38 25 13 0 Funding in millions Cloud Consumer Web eCommerce Education Finance Gaming Healthcare Mobile Payment TravelYS Research India Startup Digest Q1 2013, Page 5
  6. 6. HealthcareOf the 10 deals, three were seed stage investments - Drishti Eye Care, iKure andBiosense.Seven others were Series A and beyond (Richcore Lifesciences, ASG EyeHospitals, Perfint, Nueclear, Strand Lifesciences, and LifeCell International).In addition, Core Diagnostics was funded by Artiman Ventures via deal creation.Deal creation is a kind of an investment wherein the investors put out a businessidea and select a team around the idea to execute it.Of the players, Perfint closed the biggest deal - $11 million - in series D fromNorwest Venture Partners.e-commerceDespite all the bad press, the e-commerce space saw 7 deals signed off worth $41million (2 undisclosed).e-commerce is now in a consolidation and restructuring phase wherein we expectmore mergers and bigger investments being pumped into companies that havemanaged to stabilize.There were four seed stage deals while the others were Series A and beyond.Zovi and Lenskart took away $10 million and $9.86 million respectively.Consumer WebThe consumer web saw an infusion of $13.72 million in a total 10 deals. Eight ofthese were in the seed stage.Notably, Zomato saw a $10 million Series C from Info Edge, the owners Research India Startup Digest Q1 2013, Page 6
  7. 7. EducationEducation saw 7 deals worth $13.05 million out of which 5 were in the seed stage.Meritnation scored the biggest deal with $5.5 million, again from Info Edge.YS Research India Startup Digest Q1 2013, Page 7
  8. 8. Analysis by location 0 15 30 45 60 Bangalore Chennai Hyderabad Mohali Mumbai NCR Rajasthan Funding in millionsThe top 3 hot spots were still Mumbai, Delhi NCR and Bangalore. Mumbai sawthe maximum number of deals with 18 closures, but Delhi saw the highestinfusion of funds at $51.63 million. Location Deals Amount Delhi NCR 12 $51.63 million Mumbai 18 $39.74 million Bangalore 8 $26.65 millionYS Research India Startup Digest Q1 2013, Page 8
  9. 9. Other newsQ1 2013 saw some interesting investments in key growth sectors.Amongst other ecosystem factors affecting funding, NASSCOM setup up aframework to get 10,000 startups. To further interest in entrepreneurship,NASSCOM also had a high profile event where Eric Schmidt addressed keyecosystem players.Another trend was the rise of startup incubators and accelerators.GSF opened up applications for the second match, TLabs announced startups forit’s 3rd batch, Wharton India Economic Forum concluded, Venture Nurseryopened up applications, TLabs announced batch 3, Microsoft Acceleratorannounced batch 2, and the oldest, The Morpheus are well into their 9th batchnow.The World Startup Report was launched along with the India Startup Report thisquarter.Overall, the momentum in the startup ecosystem is strong, and with some of themacro-economic factors expected to ease out, we expect a stronger Q2.YS Research India Startup Digest Q1 2013, Page 9