Startup deals hit $2.4bn in July, nearing highs of 2015

The startup scene is seeing the return of the good days of 2015. Investments in July 2018 reached $2.42 billion, which is nearly equal to the numbers of July 2015 when a record $2.79 billion was committed.

The current investment figures are substantially higher than the deals made during July in 2016 and 2017, which saw $878 million and $1.5 billion being committed respectively, data from research firm Venture Intelligence showed.

The deal sizes are, however, higher this year compared to 2015. While the total investment in July 2018 is

13% lower than in 2015, the money was pooled in through 53 PE/VC investments this year, in comparison to 84 investments in 2015. Arun Natarajan, founder, Venture Intelligence, said that while 2015 saw investments in e-commerce companies such as Flipkart, there were fewer early-stage deals.


“This year, we saw startups such as Curefit, Swiggy, PolicyBazaar rake in series E & F deals, while 2015 saw some interest in earlystage startups in the hyperlocal space,” he said.

“Startups which were relatively early-stage enterprises in 2015 that stood the test of time in 2016 and 2017 are now attracting investors. While Freshworks is a winner in the B2B space, PolicyBazaar, BookMyShow are attracting attention in the consumer-facing segment,” Natarajan said.

Investors such as Blume Ventures said that funding mostly came into newly-formed unicorns that have been showing steady revenues and traction.

“Good, solid startups have been toiling for 5-7 years and have been delivering stellar traction in revenues, overseas markets and even profitability. All of these are bound to attract latestage capital,” said Karthik Reddy, co-founder and managing partner, Blume Ventures. Emerging new themes such as social, fintech are seeing interest from investors, he said.

In a clear indication of high-ticket investment dominating the scene, small ticket investments by PE/VCs (under $5 million) saw a drop.

While July 2018 saw 19 deals amounting to $26 million, the corresponding period in 2015 saw 39 deals at $52 million. The number of deals from angels and super angels remained almost the same with 22 deals in 2015 and 23 in 2018.

However, early-stage startups also show promise and are backed by angel networks such as Keiretsu forum and Prime Venture partners. Across fintech, healthcare, logistics & education, a large number of high-quality earlystage startups are offering solutions for tier-2 consumers.

“At Prime, we have a concentrated investment approach where we typically invest Rs 5-10 crore each in 3-5 new companies every year at the seed-stage. We expect to do the same in 2018 and 2019. Our most recent investments, mFine, and myGate, are digitising and using AI to improve healthcare and residential security,” said Sanjay Swamy, co-founder, Prime Venture partners.

“We are genuinely excited about the quality deal-flow and audacity of problems being addressed by entrepreneurs,” he said.