LV Data

Q1 Report (April – June 2018)

Analysis of 900+ fundraising and 87 funded companies for Q1 2018

Our Startup Team analyzed 900+ fundraising and 87 funded companies to create the Quarter 1 Report for the financial year 2018 – 2019 (Apr-Jun 2018). The average size of funding this quarter was $633k, 4.09% lower than the last quarter’s $630k. And the number of deals this quarter saw an increase of ~ 100%.

This report delivers insights into the:

  • Percentage distribution of sectors funded
  • Demand-Supply percentage gap of funded and fundraising
  • B2B and B2C fundraising trends
  • Correlation between the location and fundraising trends for startups

Sector

Sector analysis
Sector analysis

 

The pie chart represents the percentage distribution of the top 21 sectors which were funded. Below are the highlights of products from different sectors which were based on relatively new/different ideas

  • Enterprise Software, FinTech, Consumer Goods, Information/Tech (Search/Discovery), Retail were the top funded sectors for Q1, 2018-19
  • Enterprise Software retained its market leader position, saw investments in business solutions enabling automated attendance, sales solutions for productivity/effectiveness and ML with human intelligence to deliver insights to sales team – to maintain better relationships, blockchain platform for managing blockchain networks at scale, internet protocol solutions for digital radio Mondiale receivers, SaaS for invoicing, accounting integration, payments, security etc. and payments solutions without internet connectivity, software platform which helps the client build IoT product in weeks time, customer engagement and marketing automation SaaS – loyalty program, a video creation platform.
  • FinTech shared the first position with Enterprise Software, saw investments in platforms providing financial services like tax saving, investing and saving money in mutual fund, foreign exchange portfolio management, trading, rate audit, transaction process outsourcing, market risk advisory, retail forex, structured trade finance, currency future broking and foreign exchange broking services, products on the span of health, lifestyle and personal accidents insurance, fundraising platform for non-profit organizations, independent filmmakers and individuals, platform for collateral-free business loans – MSMEs. Other investments include peer to peer lending platform in general and catering to blue-collar professionals, marketplace to bring financial institutions to lend to borrowers, an online banking portal, offers banking services such as bank account opening including payments, balance and transaction list, digital banking, bookkeeping, digital cared, invoicing etc., insurance for employee’s benefit, business, life, health, vehicle, home, etc., marketplace for personal loans, home loan, loan against property, gold loan, car loan, business loan, education loan, investment service including FD, recurring deposit, saving account, PPF and taxation service etc., ML products for underwriting and claims decision making in health and life insurance companies, digital token creation services for the trading of real and crypto assets and asset management.
  • Information/Tech (search/discovery), saw investments in a digital service marketplace to hire freelancers, an insurance service portal offering products on the span of health, lifestyle and personal accidents under, a platform for publishing articles on startups, entrepreneurs, funding/acquisition news, platform to discover investment plans, equity-linked saving schemes, saving for children, many platforms connecting borrowers and lenders/financial institutes /investors in general and for blue-collar professionals, banks and non-banking NBFCs for personal loan, an online truck booking platform, a platform for college students to search for events, workshops, conferences, accommodation etc., a ride-sharing platform for intra-city bike and car-pooling services.
  • Retail and Consumer Goods saw investments in nutrition bars and snacks, cooked food retail, a marketplace for rental products, ready to use packaged crispy fried onions, products from Kashmir, optical lens, retail of self grown farm fresh foods and vegetables, education products, a price comparison platform, snacks for children in the age group of six months to 12 years, electronics products consumer brand, solution for wedding planning and bridal products, milk aggregator, developing baby care products. Other investments include air-based products supplying pure oxygen to any house or office, medicine, and medical devices startups.
  • Healthcare saw investments in a blood bank management software, which offers blood traceability, a data analysis platform designed to accelerate drug discovery process, medical devices for episodic neurological events like vertigo with the use of eye-tracking technology. Other investments include machine learning products offering underwriting and claims decision making in health and life insurance companies, digital health management platforms which connecting doctors with patients, home and telehealth services/solutions, solutions offering digital pathology, healthcare data analytics, raw genomics data processing, long-term intensive care, chronic care and wellness, corporate wellness, health check-up programs and interactive knowledge-oriented information sharing platforms for practitioners, academicians and students, dental care, lab tests and health management platforms which connects doctors with the patients, helping them monitor treatment progress and solutions offering continuous interaction between doctors and their expecting patients.
Demand and Supply analysis
Demand and Supply analysis

 

Further on, we compare the percentage of companies on the fundraising and funded side. Blue bars show the percentage of companies raising funds while the red line shows the percentage of companies funded in each sector. Here are the highlights:

    • Communication, Internet of Things, Human Resources, Blockchain have been fairly balanced where the demand matched the supply.
    • Education, Media & Entertainment, Marketing, Travel & Tourism have been the toughest sectors.
    • Enterprise Software, FinTech, Information/Tech, Retail, Healthcare, AI, Hardware, Big Data witnessed lower demand than supply.
    • Artificial Intelligence saw investments in automatic response software, that responds instantly via text to calls that user couldn’t answer, an AI tool in sales, marketing, and support (Indian languages), underwriting soln. For collateral-free loans, enterprise productivity tool, medical imaging solutions and camera-based inspection services like finding surface defects, external dimension measurement, etc. inspection services like digital radiography for industrial and food industry, emoji, stickers tool that allows the users to tag word to emoji or sticker or get the suggestion in the language of choice, a marketing tool that measures, segments and offers the targeted audience to brands by synchronizing mainstream media with mobile and a chatbot based learning tool for English speaking, reading, and writing skills.
    • Hardware saw investments in wifi based switchboard module, which enables air conditioner control using smartphone, energy efficient and fuel saving refrigeration technologies for cold chain storage and logistics, air-based products, supplying pure oxygen to any house or office, manufacturer of imaging radar chip for automobiles, offline entertainment hardware that connects to WIfi and allows content streaming in buses etc., diagnostics equipments which allow needle-free anaemia screening and a sugar management tool.
    • Education saw investments in bite-sized lessons, Infographics, and Gamification based English learning app and another startup providing education services for improving English speaking, reading, and writing skills using chatbot learning services; live tutoring services etc., platform offering chartered accountant courses, an education based applications which offers parents and aspirants to explore the colleges and courses

Market type of companies

 

B2B vs B2C
B2B vs B2C

 

Around 57.47 percent of the companies that got funded this quarter were B2C which is a 2.97% increase from the previous Quarter, while 42.52 percent of the companies were B2B, which is 3.75% lower than the previous quarter. The increase in the number of startups getting funded in B2C can be attributed to the percentage increase in the number of investments in FinTech, Consumer Goods, Information/Tech (search) startups. And the same can be used as a reason for a decline in percentage of startups that got funded in B2B.

Location

Location-wise analysis
Location-wise analysis

 

73.56 percent of the deals happened in Tier-1 cities, which was on the higher side as compared to Q4’s 72.09 percent. The rise of FinTech as the most funded sector (sharing the position with Enterprise Software) can be attributed to this increase. With the users of digital payments by UPI growing rapidly, digital lending is also expected to take off in steeply in India, according to some estimation around 48% of customers will buy digital loans by 2023. Only 16.09 percent deals happened in T2 cities in comparison to 27.9 percent of Q4 FY 17-18.

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