Here’s a look at the startups that are on the watchlist of top VCs in the country.
2021 will be remembered as the year Indian startups went for the stars, finding the escape velocity to touch greater heights. 80 unicorns in all, 43 of them created in the year alone --- that’s one-billion-dollar startup added to the list every 10 days. Multiple in a single week at times.
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Zomato, PolicyBazaar, Paytm, Nykaa listings with more IPOs lined up answered the big question of ‘what next?’ for investors as Indian startups hit scale and size. Venture investors pumped in almost $35 billion into Indian startups in 2021 as per Venture Intelligence. That’s over three times the funding handed to Indian startups in a single year ever before. Sectoral success has been broad-based, from e-commerce to SaaS (or global SaaS), BFSI to logistics and from B2B marketplaces to life sciences, growth has been meteoric and has matched the money that has chased these startups.
2022 promises to be no different. We already have reported the first unicorn of the year with D2C startup Mamaearth closing its latest funding round at a valuation of $1.2 billion and at least 5 startups are set to go public in the first half of the year.
In terms of themes, while fintech, SaaS, health-tech, and education continue to be top of mind for investors as the growth potential remains immense, social commerce, Thrasio-styled roll-up commerce, crypto, agritech, D2C play, and EV are other areas that are clocking a steady supply of capital.
Additionally, the importance of ‘Bharat’ as a key market for startups cannot be underestimated. By 2025, there will more internet users in rural India than in urban India, according to an IAMAI-Kantar report and even though internet penetration in urban India is twice that of rural areas, the users in rural regions is growing at a faster rate on a year-on-year basis. It is quite clear that India's digital ecosystem will need to evolve to address the specific needs of this emerging market and entrepreneurs are already moving in to capture this very aspirational segment.I spoke to some of the country’s top VCs to get a sense of the sectors and companies they are betting on in 2022, here’s what’s on their watchlist.
Sanjay Nath, Co-founder, Blume Ventures
“I would say there is already somewhat of a rebalancing of deep investor interest and bullishness, favoring India relative to China. Witness the creation of more than 80 Indian unicorns in the past 24 months, the ready availability of world-class talent, spin-offs from successful unicorns starting up — all pointing to an even more vibrant Indian startup ecosystem. Today’s founders want to build global from day one, and their ambitions of scale are like never before. This next decade should see an exponential take-off of digital innovation across the consumer internet sector, serving small and medium businesses (SMBs), and of course, Global SaaS."
Sanjay Nath’s 2022 Watchlist:
The space startup is building constellations of high-throughput earth imaging satellites to provide global imagery at a daily frequency to customers in a wide range of industries worldwide. It plans to deploy 30 satellites by Dec 2022 for its global constellation.
A testing infrastructure company that allows users and developers to run both manual and automated tests on their websites and web apps on over 2,000 different browsers, browser versions and operating system environments.
Sprinto helps SaaS companies obtain SOC2 compliance 10X faster and makes infoec accessible to all. Their security program is built ground-up in collaboration with infosec, compliance and technology experts.
Homegrown college admissions platform Leverage Edu helps student discover the right program and identify the right match for a higher education option.
The fintech company is building a platform for direct indexing & model portfolios of stocks & ETFs known as smallcases, the idea is to simplify investing in equity markets.
About Blume Ventures: The early stage investor manages almost $300 million across a whole host of sectors. Some of its notable investments in 2021 include Exotel, Purplle, ApnaClub, Classplus, Ultrahuman and others. Founded in 2010, the firm typically partners with founders at very early-stage ventures with a special leaning for B2B businesses & capital-light ventures.
Padmaja Ruparel, Co-founder, Indian Angel Network
“The crystal ball tells me that in 2022, the Indian startup ecosystem will see some catalytic changes and Indian founders will continue to build innovative companies in the deep tech (space drones, 5G), agri, cybersecurity, D2C, manufacturing tech etc. Global and domestic investors will increase their focus on India to not only fuel the growth of these companies but also give excellent returns to early investors.”
Padmaja Ruparel’s 2022 Watchlist
End-to-end space engineering solutions company, Dhruva Space builds full-stack space engineering solutions and application-agnostic small satellite platforms.
A women-led venture, Astromehas developed an innovative wireless product that gives fibre-like bandwidth at fraction of cost of fibre to help telecom operators deliver reliable low-cost internet services to suburban and rural areas.
The Intelligent Delivery Management Platform makes deliveries efficient for industries across retail, manufacturing, transport and logistics. Far Eye’s intelligent logistics platform enables enterprises to orchestrate, track, and optimize their logistics operations.
A conversational automation platform, Uniphore’s vision is to disrupt an outdated customer experience model using voice, video, AI and automation. It enables businesses to automate solutions and allow digital agents to take over r transactional conversations from humans, coach agents during calls, and accurately predict language, emotion and intent.
Artificial intelligence-based voice company, Skit was formerly known as Vernacular.ai. The SaaS voice automation firm enables enterprises to automate their call center operations via its suite of speech and language solutions.
Walmart-owned unicorn PhonePe is one of India’s leading digital payments platforms. Its 340+ million registered users can send and receive money, recharge mobile, DTH, data cards, pay at stores, make utility payments and also buy and invest in gold and silver. It is accepted at 25 million merchant outlets across India.
Edtech platform for kids, PlanetSpark provides public speaking lessons to children between 4-16 years of age. The company has a ‘Wow’ curriculum that incorporates storytelling, debate & discussions, podcasting, stand-up comedy, poetry, among other activities for users to improve their communication skills.
Mobile-based, agritech platform, Farmart helps businesses source high quality produce at reasonable prices. It provides access to information, market linkages and inputs streamlining the entire value chain making it transparent and improve returns for farmers and businesses.
About Indian Network: Indian Angel Network is of India’s largest business angel network with close to 500 members across the world. It has funded start-ups across 17 sectors in India. Some of its top investee companies include Druva, Box8, Sapience Analytics, WOW Momos, Consure, Fareye among others. The IAN Fund invests in innovative companies in sectors including healthcare and medical devices, VR, AI, software as a service, marketplaces, fin-tech, big data, artificial intelligence, agritech, and hardware.
Pranav Pai, Founding Partner and CIO, 3one4 Capital
“Local consumption of fintech and SaaS especially is going to be an avalanche trend. ESG (environmental, social and governance) theme in India is going to be much more mainstream. We are also seeing extraordinary innovation in climate tech - from electric vehicles to fast charging for mobility to agritech. A lot of interesting India-first strategies will compete for attention going forward including unlocking tier 2/3 customers.”
Pranav Pai’s 2022 Watchlist
A connected healthcare platform Eka.Care, aims to build a digitally-enabled and connected healthcare ecosystem between healthcare providers and patients for better health outcomes. The platform which is available in 12 languages enables users to create multiple health profiles, store health records such as vaccination charts for children, developmental milestones, prescriptions, lab reports, scans and allows sharing of records with healthcare providers.
The homegrown microblogging platform allows users to send text, audio or video in multiple Indian languages and share them with the community at large. The platform has clocked 15 million downloads so far, with 5 million users added in the last quarter.
Dozee has built a contactless remote patient sensor that can convert any bed into a step-down ICU in under 2 minutes. The sensor is able to montor key vitals such as heart rate, respiration rate, oxygen saturation, stress-recovery etc.
Y Combinator backed Lokal App is a hyperlocal content platform catering to India’s non-English speakers. The application is available in Kannada, Telugu, Tamil, Malayalam, Gujarati and Marathi, and has over 10 million downloads with a presence in 150+ districts. The platform claims to have achieved deep penetration in tier 2 & 3 towns in India.
Full-stack financial services provider, WeRize builds and sells customized credit, group insurance and savings products in 1000 cities and towns in India. The startup that leverages a social distribution model for financial products, plans to reach 4000 cities in the next two years.
About 3one4 Capital: With a portfolio of over 50 companies and $270+ million dollars under management, VC firm 3one4 Capital’s investments are biased towards companies exploiting technology to create, grow, and dominate large markets in India.
Rahul Khanna, Managing Partner, Trifecta
“2021 was a watershed year for the tech ecosystem in India thanks to significant exits through IPO’s and M&A activity. This has created significant wealth for the founders, employees and investors in these companies which should feed further investment activity in 2022. While some concerns remain around COVID, rising inflation and excessive liquidity impacting valuations, India continues to be a hotbed of startup activity and we are cautiously optimistic about the coming year”.
Rahul Khanna’s 2022 Watchlist
Good Glamm Group
The Good Glamm Group comprises a portfolio of proprietary beauty and personal care brands that are powered by a proprietary digital ecosystem of content, community and creator assets. The Content to Commerce platform clocks 3.5 billion monthly impressions across its bouquet of brands like POPxo, ScoopWhoop, BabyChakra, The Mom’s Co along with MyGlamm and others.
Roll-up e-commerce unicorn GlobalBees, aggregates digital brands in a bid to transform marketplace sellers into global brands. The company invests in, acquires, and grows seller businesses across Amazon, Flipkart & other commerce marketplaces.
An SME-focused neo-banking platform, Open Bank integrates all the tools used by small businesses and integrates it with the business current account. The Open platform claims to power over 2 million SMEs and processes over $20 billion in annualized transactions.
DeHaat is a B2B agritech platform that offers full-stack agricultural services to farmers, including distribution of high-quality agricultural inputs, customised farm advisory, access to financial services, and market linkages for selling their produce. The startup has currently built a rural retail network of more than 3,000 DeHaat microentrepreneurs for last-mile delivery as well as aggregation, serving more than 650,000 farmers located across Bihar, UP, Jharkhand & Odisha.
An end-to-end logistics service provider, Shadowfax works across all verticals including food, grocery and e-commerce deliveries. The startup works with neighborhood stores to use their real estate to store inventory, and a large network of freelancers for the delivery. It has over 150,000 delivery partners on its platform. It has also set up its own warehouses and fulfillment hubs. It processes over 500,000 orders per day.
A cloud kitchen operator, the company operates brands like EatFit, Yumlane, Aligarh House Biryani, and Masalabox. The firm is now acquiring and incubating cloud kitchen brands to expand its cloud kitchen footprint across India. The aim is to aggregate digital-first food brands into a single platform.
About Trifecta Capital: Alternate financing platform for startups across their life-cycle and has invested over $310 million in over 85 companies. Its portfolio comprises 20 unicorns and multiple ‘soonicorns’. As of September 30, 2021, it has raised over $200 million across two venture debt funds and $160 million in its equity fund. Trifecta Capital recently also launched its third Venture Debt Fund.
Ankur Mittal, Co-founder, Inflection Point Ventures
“2020 and 2021 saw some amazing deal momentum, especially in the early stage. Many of these deals will come back in the markets for next round fund raise and that will be a consistent theme for 2022. And this is where well run businesses led by great founders will stand out.”
Ankur Mittal’s 2022 Watchlist
Operates an electric ride-hailing and charging platform in NCR. BluSmart claims to have completed 700,000+ trips, covering over 23 million kilometers since inception.
A B2B2C social commerce platform, markets fresh vegetables, fruits, and other grocery items through its app.
Fabheads is a hardware startup creating automation equipment to manufacture high-end carbon fiber parts. The company's primary focus areas presently are Aerospace, Automobile and Biomedical sectors.
A rural tech startup, Hesa integrates business models in rural India by digitizing businesses. The company’s core offering is a physical network of Village Level Micro Entrepreneurs, called ‘Hesaathis’, spread across villages connected through their Tech platform.
e-learning platform Suraasa offers solutions for in-service and pre-service teacher education. Suraasa offers a Graduate Level Teaching Qualification Program to aspiring teachers.
A health-tech company, focused on the ‘Employee Healthcare Management’ vertical. Qube Health provides primary care, health screening and other 'non-insurance healthcare services' to large companies across six different Industries including, financial services, food services, facility management and manufacturing.
About Inflection Point Ventures: An initiative of top CXOs & angel investors, Inflection Point Ventures is an angel investing firm. The 6000+ community of investors has invested over Rs 300 crore into Indian startups.
Illustrations by: Akhil V
First Published: Jan 3, 2022 6:03 PM IST
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