Weekly Rundown: Zomato's $1 bn ecosystem building, Nykaa's blockbuster listing, Paytm's muted IPO

A majority of this week's tech startup action happened at the public market. Among the most important ones are Zomato's ambitious $1 billion fund allocation for startup investments, Nykaa's stellar debut at the public market and a lukewarm response to the much-awaited Paytm initial public offering (IPO).

After its successful public market launch early this year, food delivery major Zomato is embarking on an ambitious M&A journey to create an ecosystem of startups around its affiliate sectors. 

Inspired by the likes of Alibaba, Tencent, and its own investor Info Edge, the food company said it has earmarked $1 billion of startup investments over the next 1-2 years, with a large chunk of it likely going into the quick-commerce space.

Also Read: Zomato pumps in $275 mn in 4 startups in 6 months; eyes investment worth $1 bn in India

The first Indian unicorn to list on the public market, Zomato announced it has invested nearly $275 million across four companies over the past six months. These include fitness startup Curefit, logistics firm Shiprocket, grocery delivery player Grofers, and savings app Magicpin.

After a blistering show with its IPO, online beauty retailer Nykaa crossed the market capitalisation of Rs 1 lakh crore during its market debut on Wednesday. The share hit an intra-day high of Rs 2,129 on BSE, rising 89.24% compared to the issue price.

Earlier, Nykaa made its market debut at Rs 2,001 per share (77% premium) on the BSE against the IPO issue price of Rs 1,125. The price band of the IPO was fixed at Rs 1,085-1,125 per share.

The IPO was open for subscription from October 28 to November 1. The share rose 79% on its market debut on NSE. The share opened at Rs 2,018 on NSE against an IPO price of Rs 1125.

The initial public offering (IPO) of Nykaa's parent FSN E-Commerce Ventures Ltd was subscribed more than 82 times at the end of the final day of bidding on November 1. The firm raised Rs 2,396 crore from anchor investors on October 27.

Also Read: Nykaa IPO: Falguni Nayar and her family's wealth rises by $3.5 billion in a single day

Nykaa's CEO and founder, Falguni Nayar's family wealth increased by a whopping $3.5 billion after the company's public debut. The 54-year-old ex-investment banker's company valuation soared to $13.5 billion, as per estimates put forth by brokerage firms Angel One and IIFL Securities.

Due to the average 96.3 per cent surge at which Nykaa's shares traded on the first day of listing, Nayar and her family trust offices -- which still retains over 50 per cent stake in Nykaa -- now have a collective worth of over $7.5 billion, or something close to Rs 54, 831 crore.

Nykaa's IPO was subscribed more than 82 times at the end of the final day of bidding on November 1. The firm raised Rs 2,396 crore from anchor investors on October 27.

Meanwhile, India's biggest IPO received a lukewarm response as it failed to attract adequate domestic investor interest as nearly 80 per cent of the bids came from overseas investors. 

Also Read: Indian start-ups are not overpriced: Paytm's Vijay Shekhar Sharma

It went down to the third final day for the bids to be fully subscribed. Paytm's issue was subscribed just 1.89 times at the end of the final day, receiving bids for 9.13 crore equity shares against an offer size of 4.83 crore shares.

The portion set aside for retail investors was subscribed 1.66 times, while the reserved portion for non-institutional investors was subscribed 24 per cent. Qualified institutional buyers put in bids 2.79 times the portion allocated for them.

The Vijay Shekhar Sharma-led firm raised Rs 8,300 crore in fresh capital, and the remaining Rs 10,000 crore was an offer for sale. Paytm plans to make its market debut on November 18.

E-pharma start-up PharmEasy said it is looking to raise Rs 6,250 crore ($840 million) in the upcoming IPO. According to its filings with the Securities Exchange Board of India (SEBI), the start-up is looking to raise Rs 1,250 crore (nearly $150 million) as a part of the pre-IPO placement round.

Content-to-commerce platform Good Glamm Group became the latest entrant in the coveted unicorn club with a fresh fundraise of $150 million in its Series-D round. The investment round was co-led by Prosus Ventures, Warburg Pincus, along with the participation from Alteria Capital and existing investors L'Occitane, Bessemer Venture Partners, Amazon, Ascent Capital and the Mankekar Family Office.

In other major developments, Fintech unicorn BharatPe announced the launch of a Merchant Shareholding Programme (MSP) for its merchant partners. With an equity pool of up to $100 million, the company wants to provide an opportunity to its merchant partners to become part equity owners of BharatPe and.

A91 Partners, a venture capital fund floated by three former partners at Sequoia Capital India, has closed its second fund at $500 million. 

The growth stage fund typically invests in about 15-17 startups in sectors such as consumer goods and services, financial services, and healthcare. It has backed sanitary napkins brand Paree, healthy snacks-maker Happilo, and spices maker Pushp.

AI-driven SaaS platform Toch.ai launched a Rs 100 crore startup fund to back video and audio tech startups globally. It recently raised a Series A funding by Moneta Ventures, Baring Private Equity India, Binny Bansal, Ventureast, 9 Unicorns, Anthill Ventures.

Early-stage venture fund Capital A has announced a $25 million fund to invest in 8-10 companies with a ticket size of $50,000 to $500,000. As a part of the initiative, Capital A said that it has made an undisclosed investment in B2B logistics firm RoaDo. RoaDo is a SAAS based platform aiming to optimise visibility, real-time control and efficiency in the supply chains.

Health and wellness start-up Mosaic Wellness secured $24 million in Series A funding-round led by Sequoia Capital India, with participation from existing investors Elevation Capital and Matrix Partners India.