A daily newsletter summarizing interesting Indian startups and recent activity both in India & globally

INTERESTING STARTUPS

LegUp (2016, Mumbai) Platform for financing career enhancing activities. Founder is from McKinsey and is an alumnus of National Law School of India University.

INDIA INTERESTING NEWS

Xpressbees (2015, Pune) E-commerce logistics startup has raised $12M in funding from SAIF Partners, IDG Ventures India, NEA, Vertex Ventures and Valiant Capital Link

Jaypore (2012, Delhi) Curated online retail store raises $4.3M in funding from social venture capital firm Aavishkaar Link

Advantage Club (2014, Gurgaon) Mobile first platform for corporate-employee benefits raises $400K in funding from Purvi Ventures, Mumbai Angels and other individual Angel investors Link

ArkRobot (2015, Bangalore) Warehouse automation startup gets $350K in equity funding for winning Qualcomm’s Qprize Make in India contest Link

CareOnGo (2015, Delhi) Online wellness platform and aggregator of pharmacy stores raises $300K in seed funding from a group of angel investors Link

AlmaConnect (2011, Gurgaon) Alumni networking-based social network raises undisclosed amount in pre-series A funding from Mohanadas Pai and Aspiring Minds co-founder Varun Aggarwal Link

Global private equity firm KKR acquires 10% stake in Max Financial Services for $140M Link

Paytm (2011, Noida) Mobile payment and e-commerce platform appoints former RBI executive Shinjini Kumar as Its Payments Bank CEO Link

GLOBAL ROUNDUP

Jana (2009, Boston) Mobile rewards platform raises $57M in series C funding led by new investor Verizon Ventures with participation from existing investors Spark Capital and Publicis Group Link

Aria Systems (2003, SF) Provider of subscription based billing & management software raises $50M in series E funding backed by existing investors Bain Capital Ventures, Hummer Winblad Venture Partners, InterWest Partners, Venrock and other Link

Pliant Therapeutics (2016, Redwood City) Company that aims to discover and develop new therapies to treat the pathologic process of fibrotic disorders raises $45M in series A funding led by Third Rock Ventures Link

Vera (2014, Palo Alto) Platform for securing and sharing all forms of business information raises $17M series B funding led by Sutter Hill Ventures with participation from existing investors Battery Ventures, Clear Venture Partners, and Amplify Partners Link

GridGain Systems (2007, Foster City) Provider of an enterprise-grade complete suite of in-memory computing technologies raises $15M in series B funding led by Sberbank and MoneyTime Ventures with participation from Almaz Capital and RTP Ventures Link

Micreos (1993, Wageningen) Biotechnology company raises approximately $13M in equity funding from unknown investors Link

Orion Labs (2013, SF) Platform connecting people through voice communication raises $9M in funding backed by Avalon Ventures and Motorola Solutions Venture Capital Link

Underground Elephant (2008, San Diego) Online performance based marketing company secured $9M in credit facilities from Silicon Valley Bank Link

Go-Jek (2010, Jakarta) has acquired 2 Indian startups namely C42 Engineering (2010, Bangalore) Distributed Agile software consulting firm and CodeIgnition (2013, Noida) Provider of Tech-Infrastructure automation software Link

Google (1998, Mountain View) Search engine Giant acquires Singapore based workplace chat app Pie (2013, Singapore) Provider of chat platform for workplace Link

Pivotal (2012, Palo Alto) Cloud software firm acquires Neo (2012, SF) Startup studio and consulting firm Link

Fox Technologies (2005, Mountain View) Provider of network security and access management software acquired GroundWork Open Source (2004, SF) Provider of unified monitoring solutions for IT operations management, performance analysis, and cloud monitoring Link

Instart Logic (2010, Palo Alto) Provider of application delivery solutions acquired Kwicr (2012, Waltham) Mobile application acceleration platform for Apple and Android platforms for an undisclosed amount Link

GIC, Bain Capital and Advent International have together invested $350M in Quest Global (1997, Singapore) Engineering outsourcing service provider for a minority stake formerly held by US private equity fund Warburg Pincus Link

Finstar Financial Group, Moscow based International private equity group acquired a 51% stake in Prestamos Prima (2013, Barcelona) Provider of a peer-to-peer lending platform Link

A daily newsletter summarizing interesting Indian startups and recent activity both in India & globally

INTERESTING STARTUPS

Banyan (2016, Hyderabad) Cloud based POS solutions for restaurants and chains. Founders are from Symantec, Narus (Boeing Subsidiary), EMC, co-founded Integra and are IIT Guwahati alumni. Local Competitors include MapleGraph (2011, Delhi, Acq. by Zomato) and POSist (2011, Delhi, $480K). Global companies operating in the same space are Revel Systems (2010, SF, $127M) and Lightspeed POS (2005, Montreal, $126M)

INDIA INTERESTING NEWS

Taskbob (2014, Mumbai) Smartphone app for on-demand home services raises $4M in series A funding led by IvyCap Ventures along with existing investors, Orios and Mayfield Link

Magicpin (2015, Delhi) Provider of cash back and deals at local restaurants raised up to $3M in series A funding from Lightspeed Ventures Link

BabyBerry (2014, Bangalore) Mobile app for parenting tips, buying baby care products, medication adherence raises $1M in angel funding led by Nitin Bagamane (Chairman, Tanglin and an industrialist) Link

First Eat (2015, Gurgaon) Breakfast delivery service raises $200K in seed investment from an undisclosed serial investor Link

SigTuple (2015, Bangalore) Provider of data-driven intelligence for healthcare diagnostics raises seed fund from Flipkart founders, Accel Partners and others Link

Finance Buddha (2012, Bangalore) Loan comparison platform gets an undisclosed investment from Chennai Angels Link

Crossroads (1999, Delhi) Provider of roadside assistance and helpline for vehicles acquiresMeriCAR.com (2008, Gurgaon) Location based search engine for car service and repair shops to scale up garage network Link

Surpluss.in (2014, Delhi) Online platform for unboxed, refurbished, over-stock electronic products rejigs business model, introduces marketplace platform Link

TripHobo (2012, Pune) Online portal for personalized itinerary planning partners with Asia Pac startup community Amadeus Next to develop and pilot an end-to-end travel planner Link

Tracxn (2013, Bangalore) Market intelligence platform for private market investing unveils platform to help angels exit startups Link

Heritage Foods (1992, Hyderabad) Homegrown FMCG company firms up plans for e-commerce foray to accelerate turnaround of its retail business Link

Cisco (1984, SF) Designer and manufacturer of networking equipment to collaborate with Edugild, Pune based edtech accelerator to support edtech startups Link

GLOBAL ROUNDUP

Indigo (2013, Cambridge) Agritech company raises $56M in venture capital funding led by Flagship Ventures Link

effector Therapeutics (2012, San Diego) Biopharmaceutical company developing selective translation regulators for the treatment of cancer increases series B financing to $56M Link

MoneyMe (2013, Sydney) Short-term lender in payday lending space secures $30M in debt funding from family fund Link

Marvelstone Tech (2016, Singapore) Yet to launch fintech platform, part of Asian private investment group Marvelstone raises $12.5M in seed funding from angel investors Link

Digital Fortress (2012, Seattle) Data center operator and cloud management provider receives $9M credit facility from Wellington Financial Link

Understory (2012, Boston) Developer of weather sensor hardware and hyper-local data networks receives $7.5M in Series A funding led by 4490 Ventures & Monsanto Growth Ventures Link

Triptease (2013, London) Provider of digital tools for hotels raises $7M in series A funding from investors including Notion Capital and Episode 1 Ventures Link

Salesforce (1999, SF) Cloud based CRM, social collaboration for enterprise acquires PredictionIO(2012, Valley) Open source machine learning server Link

Contently (2010, NYC) Provider of content marketing platform acquires Docalytics (2012, Saint Paul) Marketing and sales analytics company Link

CartoDB (2011, NYC) Location intelligence, data analysis and visualization company acquiresNutiteq (2006, Tartu) Mobile mapping software development company Link

Hexagon (1992, Stockholm) Provider of information technologies for geospatial & industrial enterprise applications acquires SigmaSpace (1998, Lanham) Provider of technologies used to rapidly deliver high-quality 3D maps of earth Link

Invoice Cloud (2009, Braintree) Provider of electronic Bill Presentment with Payment (EBPP) solutions acquires Metropolitan Communications (1997, Marlborough) A former competitor Link

Nokia Growth Partners announces $350M fund focused on IoT Link

The sector has been witnessing a steady increase in the number of early stage deals taking place since 2013, indicating the potential for further growth, fueled by advanced AI capabilities soon to be incorporated into robots

With developments in technology taking place at a rapid space, the Consumer Robotics space has garnered a lot of interest over the last few years. A recent report by ABI Research indicated that the consumer robotics market witnessed 33 million shipments at the end of 2015, with total revenues of $3.5 billion. By 2025, both shipments and revenues are expected to increase to 165 million and total revenue to be more than quadruple, reaching $17 billion.

Our Tracxn Report on the Consumer Robotics space finds that investors such as Intel Capital and Qualcomm Ventures, have also been keeping pace with this trend. While funding in the space still lies at a lower volume, considering companies in the sector find it tough to raise funding because of the longer development cycles with respect to both hardware and software associated with robots, investments into the space have begun to see an increase over the last three years. Out of the $750M invested since 2010, the past three years witnessed ~$576M being raised.

With funding activity being consistently on as rise, 2015 witnessed a peak with startups raising $270M, in 41 deals. Notable Rounds in the year include Sphero’s $45M raise from Grishin Robotics, Foundry Group, Highway 12 Ventures, Mercato Partners, and The Walt Disney Company. Smartphone controlled consumer drones manufacturer, Parrot, also raised $35M in an unattributed round from BPI France.

With the sector still in its nascent stage, it is clearly evident that a large majority of the funding has come through early stage rounds. The number of early stage deals has increased steadily since 2011, and the fact that a majority of the funding are still coming from such deals only further indicates the potential for the sector to see further growth.

Late stage deals on the other hand have been consistently low, with the last three years seeing just 2 late stage rounds.

The sector has also seen a steady, but gradual increase in the number of startups being formed, with 2014 witnessing a peak, owing to several advancements in the machine learning/Deep Learning technology. 2014 also witnessed the formation of new firms across all the sub-segments within the sector. 

On the other hand, 2015 witnessed a dip in this regard, with 28 companies emerging from the year, which might lead to 2016 seeing lesser early stage deals, and more late stage deals.

Due to 2014 seeing new companies coming from all the sub-sectors, 2015 saw a funding activity spread across sectors including industrial robot and companies on the periphery making sensors and other peripherals.

Business Models in Consumer Robotics

When we look closely into the Business Models in the Consumer Robotics space, we find that while Entertain, on the surface, seems to have seen the highest funding, the report finds that the reason for this is that almost half of the category has been contributed by one company: Anki. Anki has so far raised $105M through 2 deals, seeing investments from Andreessen Horowitz, Index Ventures, Two Sigma Ventures and JP Morgan.

Looking beyond the Entertainment segment, we find that the Personal and Domestic Tasks segment stand out as very hot segments. Domestic Task robots in particular, form a part of the oldest sub-segment, out of which cleaning robots and robots performing other domestic chores contribute more than half of this segment.

As it becomes easier for robots to learn more advanced skills, they have begun to augment their positioning as human companions. This is why personal robotics is now one of the most booming sub-sectors present in consumer robotics. As sensors get cheaper, personal robots with better tracking and navigation capabilities will become commonplace, and Service robots will become a major pushing factor owing to the high manual labor involved.

Check out the Consumer Robotics report here:

All of our sector reports are available to Premium Tracxn subscribers. If you are interested in receiving our reports, please write to bd@tracxn.com

The sector has seen a decline in both the dollars invested and the number of funding rounds in 2015 from the previous year. 2014 witnessed the highest funding activity with $1.2M invested through 89 deals 

According to the Tracxn Report on the Banking Tech Report, over ~$3B has been invested into the sector since 2010, with the last two years alone seeing ~$2B of the total funding being raised. During 2014-2015, there have been 169 rounds of funding, with one of the most prominent ones being Atom Bank’s $128M private equity funding led by Toscafund and BBVA in 2015.

The sector has certainly seen an upward trend in funding activity since 2010, with SV Angels, Sequoia Capital and Sapphire Ventures being among the investors bullish about the space. But, while 2014 witnessed a peak in both funding rounds, and total dollars invested, 2015 witnessed a drop in both regards. The steep dip in both metrics in 2015 can be attributed to the overall investment sentiment in the FinTech Industry, which now appears to be cluttered with investor apprehensions regarding sustainability, profitability and compatibility of new age companies emerging with the existing financial regulatory framework.

Challenger banks is the umbrella brand which groups all the new-age banks and Fintech companies, initially emerged with a focus on mobile banking for retail banks. Their focus, however, has since branched into SME banking. These banks are traditionally considered a stigma among investors owing to their competitors, who are mammoth legacy banks. Due to this, the sector still struggles with customer acquisition, which is an indispensable element in Retail Banking, and this has reflected upon the funding activity into these businesses.

A similar theme has been reflected in the number of companies being founded in the last two years, which has been seeing a decline since the peak of 2013.

While the last two years have seen companies coming up in India, US & UK, there has been a steady dip over the period. On a positive note, startups emerging from India are on a rise due to the increase of microfinance solutions.  With the US and UK markets also gaining from the post crisis economic revival, we should see more companies sprouting from these regions.

Business Models in Banking Tech

Within the business models in the Banking Tech space, back end solutions have seen the highest funding. A Majority of the companies in the segment cater to multiple businesses of the banks and offer integrated services linking these businesses. These companies form the Suite sub-segment, which is the most heavily funded sector standing at $825M. The Banking analytics sub-segment follows, and is slowly gaining traction among investors owing to their ability to leverage big data and advanced predictive analytics to streamline banking operations.

Recently, with the advent of FinTech startups, API Banking has emerged due to the urgent need for seamless integration of these startups with banks’ systems for them to scale up.

Also, another recent trend which can dramatically change the face of Banking Tech is the passing of the PSD2, the extension of Payments Services Directive (PSD) in October 2015, which requires banks in the EU to share their customer’s data with anyone that holds the required license, possibly lowering barriers to entry for FinTech applications that enable payments/other banking services, aggregate multiple accounts, facilitate comparisons between products, enable switch account switching et al. It will be interesting to see how this development will impact the market.

Banking Technology is a largely horizontal sector with companies operating under multiple verticals, with multiple business models under each vertical. This report covers companies that either provide technical solutions to banks to enable various banking operations or partner with banks thereby offering these banking services directly to consumers.

Preview the Banking Tech report here:

All of our sector reports are available to Premium Tracxn subscribers. If you are interested in receiving our reports, please write to bd@tracxn.com

2014 witnessed the sector’s highest funding volume till date, with startups in the space raising over $2B of which industry leader Dropbox raised $850M in two deals 

With investors such as Sequoia Capital and Accel Partners looking keenly into the Enterprise Collaboration space, the sector has seen increasingly a good deal of funding activity over the last few years. The popularity of startups in the space, comes at a time when enterprises are constantly looking towards improving employee productivity, while enabling them to better work together and collaborate to meet business objective.

Riding on this trend, startups in the sector have been successful in attracting investor interest, especially in the last two years (2014-2015), where ~$3B was invested, which forms a significant portion of the $6.3B invested since 2010. 2014 in particular saw a peak with $2.1B invested during the year through 96 deals.

While at first glance, 2015 has seen a significant drop in funding over 2014, we have to consider that 2014 witnessed two companies seeing a large scale deals during the year; Dropbox raised $850M in 2 deals, and Atlassian raised $150M, meaning that these two companies alone raised $1B in 2014. If these deals were to not be considered, 2015 has kept pace with the overall funding trend the sector has witnessed since 2012.

Notable rounds during 2015 includes Slack’s Series E raise of $160M from Andreessen Horowitz, Accel Partners, Kleiners Perkins Caufield & Byers, DST Global, GV, Social Capital, Spark Capital and Index Ventures among others. Symphony also raised $100M in an unattributed round from UBS, Natixis, Lakestar, Merus Capital, Google and Societe Generale.

Apart from deals mentioned above, 2015 witnessed a majority of Early Stage rounds, with FileChat, Guru and Frame.io receiving Seed funding, while WeTransfer, ThinkTank, and BetterCompany received     Series A funding. But with 2015 seeing 35 early stage rounds, we are witnessing decline in these deals since 2013. Early stage funding rounds increased during 2010-2013 as the number of companies founded have also increased, and 2013 witnessed a peak with 88 early stage deals with startups in the Messaging and chat room, conferencing sectors seeing a majority of the funding.

Average Late stage funding rounds have remained at around the 20 range over the 2010-15 period, with startups in the Project management and conferencing sectors receiving large chunk of late stage funding rounds during 2014-15.

2013 which witnessed the highest number of early stage deals, also saw the highest number of companies being founded, as well as the highest number of companies funded. Since 2013, however, the number of companies founded has been on a decline.

2013 saw the formation of startups from different sectors, with the Messaging and Chat room category and Project Management segments leading the pack.

Business Models in Enterprise Collaboration

Looking closely into the business models in the Enterprise Collaboration space, startups in the File Synchronization and Sharing, such as Dropbox, box, Hightail, and Egnyte, have received the highest funding. The Conferencing segment follows with startups in the segment raising $1020M, and sees the highest number of acquisitions followed by the File Synchronization and Sharing sector.

In fact, Exit activity in the space has also been high as has been lot of strategic acquisitions happening across the various business models. 2015 witnessed the highest number of acquisitions at 19.

Over the years, there has been increase in number of companies offering SaaS based solutions, with a large number of companies now preferring to adopt SaaS based applications because of subscription pricing, scalability and other benefits. But there will still remain a significant number of companies who prefer to have on-premises solutions to have better control over their data and other security concerns.

Another key driver for investments in the industry will be Analytics, as there is now a greater emphasis on measuring and reporting which will allow organizations to track performance, make adjustments and drive deeper engagement with collaboration platforms.

Preview the Enterprise Collaboration report here:

All of our sector reports are available to Premium Tracxn subscribers. If you are interested in receiving our reports, please write to bd@tracxn.com

As Leonardo DiCaprio finally takes home a well-deserved, and long-awaited Oscar in the ‘Best Actor’ category, Tracxn takes a close look at some of the actors investments

Spoiler Alert: Leonardo DiCaprio has finally won his first Oscar for the ‘Best Actor’ category in the 88th edition of the Academy Awards, adding another feather in the cap of the 41-year old Hollywood veteran.
But besides being a prolific actor, DiCaprio has also stood out for being an environmentalist, and a philanthropist, and also a keen investor.

Here are some of the Oscar Winner’s portfolio companies.

For starters, a look at the Academy Award winner’s portfolio reveals his stand as an environmental activist and a philanthropist. For instance, Diamond Foundry, one of DiCaprio’s recent investments, is looking to change the diamond industry as we know it. The 100-billion dollar diamond industry has often been stained with malpractices involving child labour, human-rights infringements, ecological destruction, and cartel-like pricing. Diamond Foundry is looking to change things around, by ‘growing’ their very own diamonds, that are as high-quality as natural gems. Besides DiCaprio, who played a gem smuggler in Blood Diamond, and the VC investors mentioned in the infographic above, Diamond Foundry has been back by Angels including entrepreneurs Mark and Alison Pincus and Ev Williams, and former COO of Facebook, Owen Van Natta.

Rubicon Global is another investment bet by DiCaprio which was from an environmental point-of-view. The Atlanta-based startup has often been touted as “Uber for trash” or “Uber for recycling”, and offers waste and recycling management services. Rubicon provides waste recovery and recycling, recycling equipment maintenance, waste stream management, recyclable commodity marketing, and vendor performance monitoring services. Their main focus is to avoid waste into landfill and at the same time generate benefit for customers through their innovative technologies while covering a wider area of industries including Food, Grocery, Hospitality, Education, Government, Healthcare and Retail etc. In September, the company raised $50M in an unattributed round from Nima Capital, Goldman Sachs, Wellington and Tudorfunds.

Another of DiCaprio’s environmentally friendly investments went into Fisker Technologies, which was a green American sports car company which aimed to produce an environmentally friendly car without compromising on performance. It launched Fisker Karma, one of the world’s first production plug-in hybrid electric vehicles. In February 2014, the company was bought by Chinese auto-parts conglomerate Wanxiang Group.

On another note, Mobli was one of DiCaprio’s first bets where he participated in the startups first round of funding of $4M. He also serves as an advisor for the company. Other private investors in Mobli include the likes of DiCaprio’s Hollywood buddy, Tobey Maguire, Tennis superstar Serena Williams, former professional American road racing cyclist Lance Armstrong, Carlos Slim and Kenges Rakishev.

Here are the finalists of the RSA Innovation Sandbox Contest 2016, along with the investors who have helped them grow, and the total funding they have raised

Enterprise security has been, and still continues to be, an extremely hot sector. According to our Enterprise security report, the sector raised its highest ever funding total of ~$3B in 2015. The funding activity, along with the emergence of many new and innovative companies, has only made the sector more exciting.

This excitement has carried over to this year’s RSA conference, where a few of the hottest upcoming startups were showcased during the 2016 Innovation Sandbox Contest. Here is a list of those Innovative Enterprise Security companies, to keep an eye on during 2016:

Note: Phantom was awarded as the RSA Conference 2016’s Most Innovative Startup

Funding activity within the space has seen an upward trend, in terms of dollars invested, with 2015 witnessing a total $1.4B raised

The global Business Intelligence and Analytics Software Market is expected to grow from $17.90 billion in 2014 to $26.78 billion by 2019, at a Compound Annual Growth Rate (CAGR) of 8.4%. Investors have certainly picked up on the potential of the sector, and this has been evident from the funding activity the sector has been seeing.

According to our Tracxn report on the BI & Analytics sector, over $4.6B has been invested into the space since 2010, with Andreessen Horowitz and Accel Partners being among the sector’s most active investors. Along with the sector seeing a steady stream of investments, funding activity within the space has seen an upward trend, in terms of dollars invested, with 2015 witnessing a total $1.4B raised.

The rise in funding can be attributed to Domo and Alteryx seeing their next round of funding during the year. The startups, which have played a significant role in the overall funding of 2014, wherein Domo raised $125M in its Series C round, and Alteryx raised $60M, raised their next round funding in 2015.

The average ticket size has also witnessed an increase denoting a marginal increase in the late stage rounds, but generally funding activity during the year has majorly been comprised of early stage deals in the form of seed and Series A rounds. Datascience, Pramata and Periscope Data have received Series A funding while Databox, Argo and Metricstory received Seed funding.

2015 witnessed the highest number of late stage rounds, increasing marginally from the last two years at 44. A number of late-stage funding occurred in cloud-based BI Solution providers like Domo, Birst, GoodData, Alteryx etc in 2015.

On the other hand, early stage funding saw a peak in 2013, which resulted in the highest number of companies being formed in 2014, especially in the Visualization tools and advanced analytics sectors.

The year saw a substantial jump in the number of companies being founded over the previous year.

What is interesting to note is that most of the companies being founded recently offer SaaS-based Big Data solutions as opposed to on-premises Relational Database solution. With TechNavio predicting the Global SaaS-based BI market to grow at a CAGR of 30.93% over the period 2013-2018, we can expect more companies to come from the model in the next few years.

Business Models in BI and Analytics

With notable companies such as Domo, Birst, GoodData and Looker receiving high funding over the last few years, the Visualization Tools segment has secured the highest funding total within the business models of BI and Analysis. Within this segment, Startups which provide Visual Analytics tools with the ability for data exploration to create drill down heat maps, pivot tables, geographical maps are the most funded, with companies such as Tableau, Domo, Birst, and GoodData leading the pack. Tools like data exploration using a Modelling language, which includes the likes of Looker, and Natural language Search startups like Thoughtspot, are the upcoming sectors and have excelled in self-service data analytics for business users.

Note – The report covers companies that develop and provide Business Intelligence (BI) & Analytics software. It also covers prominent industry specific BI solutions. It excludes service providers and consultancy companies.

Check out the BI & Analytics report here:

The Mobile Payments space witnessed its highest-ever funding, at ~$2B, in 2015 and Paytm had a major role to play in the surge

2015, was an exciting year for the Mobile Payments space with segment leader, Square, going public, at an opening price of $11.20.

Besides this milestone, 2015 was still a very interesting year for the space, as indicated by the latest Tracxn Report on the Mobile Payments space. According to the report, the year witnessed its highest-ever funding, at ~$2B, contributing a significant portion to the total funding of $5.6B over the last 9 years. India’s mobile payment startup Paytm contributed heavily to this total, raising $890M from the Alibaba Group.

What is also apparent from the funding activity, where a single startup raised ~45% of the year’s total investments, is the fact that 2015 saw a dip in the number of funding rounds, which has been in decline over the last two years. This is a clear indication of the rise of late stage funding which accounted for ~ 30% of the total rounds in 2015, and a total sum of ~$1B. As the sector continues to mature, we should see more such rounds in 2016.

Signs are positive for the sector, considering its reliance on the upward trend of mobile adoption which is increasing by 1.5% quarter-on-quarter and around 5% year-on-year. By 2020, it is expected that 70% of world’s population will have smartphones, which further bodes well for the mobile payments space. The mobile payments market in 2016 is expected to reach $27.1B, with users spending an average of $721.5 annually, which is a positive sign, and should encourage further investments into the space in the next few years.

But due to the sector reaching maturity, we should see most of the money coming from late stage rounds in the next few years, a sentiment which has clearly been recognized by startups in the space. This is evident from the significant drop in new companies founded during 2015, over the previous year.

The number of companies founded was maximum in 2014 at 149, though there is a relatively same number of start-ups over the period 2012-2014. The major companies like Square, iZettle were founded before 2010, which consequently led to a boom in mPoS companies. From 2014, however, the focus has seemed to change towards mobile wallets pertaining to various applications like dining, bill payments and money transfer coming into existence.

This trend has certainly bode well for startups in the Mobile Wallet space, which has seen keen investor sentiment, raising the highest total among the segments, of $2.2B, which includes Paytm’s funding as well. Mobile Wallets comprise of companies which provide a digital storage service in mobile to link payment cards or load money and pay at the POS terminals via NFC, biometric, beacon or in-app.

Over the next few years, we can expect to see a shift towards Contact-Less Payments through technologies such as NFC and Wearable Technology. This is evident from AliBaba’s announcement on partnering with Xiaomi for Mobile Payments on Wearables. Also, while Samsung and Apple have been focusing on getting their NFC Payment models mainstream, JP Morgan Chase also announced plans to launch its own mobile payment solution called Chase Pay, which works with barcodes to allow customers to pay for goods and services in-store, in mobile apps or for online purchases at retailers, including Walmart, Target, Best Buy and Shell.

MarsterCard is also aggressively jumping onto the Mobile Payments bandwagon and is working with several firms to bring mobile payments to just about every product consumers have. The credit card company is planning to work with fashion designers to automakers to embed mobile-payment technology in their products. MasterCard has already partnered with General Motors, as well as wearable technology companies Nymi and Ringly, and plans to add more companies as time goes on.

The realm of Mobile Payments may soon be moving to a new arena.

Note – The report contains companies which offer mobile as an alternative payment method, besides cash and card payments, like mobile wallet, carrier billing and wearables. This report includes companies which enable merchants to accept card payments at the point of terminal on their mobiles and provide mobile/tablet based point of sale software platforms to the merchants. In addition, report contains companies which provide mobile payment gateways for POS and wallet transactions.

Preview the Mobile Payments report here:

Funding in Healthcare Analytics  during 2015 continues to indicate positive investor sentiment with a total of $1.1B being raised in 127 deals

According to the Tracxn Report on the Healthcare Analytics industry, over $4.5B has been invested in this sector, since 2010, with Rock Health, Bain Capital Ventures and BlueCross BlueShield Venture Partners being among the most notable investors.

2015 was an interesting year for the Healthcare Analytics, with the sector witnessing a slew of M&A activity, with Pamplona Capital Management’s acquisition of MedAssets and Thoma Bravo acquiring majority stake in MedeAnalytics. The past year also witnessed Evolent Health and Inovalon going public and raising $195.5M and $600M respectively. We also saw IBM consolidate its position, with the formation of Watson Health and acquisition of Phytel and Explorys in 2015 and Truven Health Analytics in February 2016.

While exit activity during the year was high, the report finds that there seems to be a drop in funding activity, as compared to 2014.

Looking at 2014, the year saw a surge in funding activity both in terms of dollars invested and the number of rounds. Funding volume was powered by Privia Health’s $400M raise from an affiliate of Goldman Sachs, which accounts for almost 25% of the year’s total investment. If we were to exclude the round, the difference in funding amounts between 2014 and 2015 would certainly narrow down.

The year 2015 was also good in terms of funding, with a total of $1.1B being raised in 127 deals. Patient Engagement and Clinical Decision Support System spaces saw most of the traction. Medical imaging decision support tool, Imaging Advantage raised $250M from CRG, the highest funding amount for the year. Health Catalyst received $70M from multiple investors including Sequoia Capital and Norwest Venture Partners.

The number of startups being founded in 2014 was 77, which is highest so far.

In fact, while 2015 witnessed a drop in the number of new companies,  the 2010-14 saw an increase, with spikes in 2011 (113%) and 2014 (24 %). Out of a total 296 companies founded since 2010, Clinical Analytics accounts for a majority with 217 companies, core focus areas being Patient Engagement and Population Health Analytics.

Business Models in Healthcare Analytics

In terms of business models within the healthcare analytics space, startups within the Clinical Analytics have seen most of the funding, with the segment raising a total $2.8B. Clinical Analytics includes companies which offer solutions that help gain insight into clinical operations, aid decision making and improve the quality of patient care. The applications include Population Health Analytics, Patient Engagement, Clinical Decision Support Systems, Precision Health and Care Quality. These solutions are primarily used by hospitals, but Payers and employers also use clinical data to understand and monitor member health.

While the segment saw a gradual increase in funding between 2010-2013, investments saw a spike during 2014, with the year seeing the sector rope in 4x the investments as compared to the previous year. The above mentioned Privia Health’s, $400M funding in 2014, was the largest single investment of the sector in last five years. The segments funding in 2015 decreased by 27% as compared to 2014, but still showed an investment of $783M, indicating continued interest of investors in the sector.

The year 2016 has seen a promising start, with $276M already invested in 18 rounds of funding so far. Notable deals include Flatiron Health, which raised a $175M Series C funding led by Roche.

Note – Healthcare analytics is defined as the use of data, information technology and computer-based mathematical models to gain insights that support healthcare professionals in decision making.

This report covers B2B and/or B2B2C companies that offer healthcare analytics solutions to Providers, Payers, Employers and Accountable Care Organizations (ACOs). The companies have been classified based on their application – Clinical, Financial, Operational and Suite Solutions. Examples include companies that offer analytics for Population Health Management, Clinical Decision Support Systems, Patient Engagement, Revenue Cycle Management and Workflow Management. It excludes those companies that offer analytics in the form of consultancy, B2C solutions and companies that offer analytics for drug development, drug discovery or research. This report also does not cover companies that offer their solutions to multiple industries (Oracle, SAS) and companies whose non-analytics products and solutions span the entire healthcare sector (Cerner, McKesson).

Preview the HealthCare Analytics report here:

2015 sees the Indian Logistics space witness a surge in funding, with $720M raised

According to the Tracxn India Report on the Logistics Tech space, Indian startups within the sector have garnered a lot of traction over the last year, with investors such as Sequoia Capital and Accel Partners, playing an important role in fueling growth for the space in India

Over $800M has been invested in the space since 2011, with 2015, alone, seeing ~$720M raised. This marks a significant rise in the funding amount for the space, over the last year, which saw a total investment of $54M.

This spurt in funding can be attributed to Grofers, which raised $165M during the year, which is more than three times the total funding the sector received in 2014.

Apart from Grofers, the growth in funding during the year came from the fact that there was a significant increase in the number of companies that got funded in 2015, vis-à-vis the previous year, which resulted in the sector seeing a much higher number of funding rounds. Notable rounds during the year include Rivigo’s $30M, Series B raise from SAIF Partners, and BlackBuck’s $25M Series B from Tiger Global, Accel Partners and Flipkart.

The fact of the matter is, that the sector is now seeing much higher valued late-stage rounds, through a greater number of such rounds. The average ticket size for Late Stage rounds has increased in 2015 as compared to 2014, mostly attributed to E-commerce Delivery, Intracity – Shipping and Grocery Delivery sectors while the number of late stage deals has increased drastically from the last year to 21 from just 4.

But despite the surge in funding during 2015 due to late stage deals, early stage rounds still play an important role in fueling the sector, especially in the case of newer segments such as the Food, Grocery and Horizontal – B2B sectors. These sectors formed a large portion of the companies which were founded in 2015, which resulted in the year seeing the highest number of startups being formed.

The year also saw a good number of startups emerging from newer segments such as Freight Transport, Intracity Shipping and Couriers aggregator, and though average deal size for early stage rounds has decreased in 2015 as compared to 2014, we expect early stage deals to continue to be important in helping these startups grow further. Concierge is also another upcoming segment where we expect to see early stage bets happening.

Business Models in Logistics Tech – India

In terms of the business models within the Logistics Tech space, the E-Commerce Delivery segment is the most mature and well-funded.

Note – This report covers tech-enabled companies that operate in logistics space primarily offering delivery solutions for individuals and businesses. It also includes companies that provide software solutions to other logistics company to optimize their delivery operations. This report excludes companies that provide warehouse solutions and offline services.

Preview the Logistics Tech report here:

All of our sector reports are available to Premium Tracxn subscribers. If you are interested in receiving our reports, please write to bd@tracxn.com

Tracxn looks at some of the women from various walks of life who have been instrumental in fuelling the startup ecosystem

Tracxn looks at top women from the Indian subcontinent who have played a major role in shaping the startup ecosystem into the phenomenon it is today

A look at the Top Early Stage Companies revolutionizing the ‘Internet of Things’

The Internet of things (IoT) has attracted a lot of interest from institutional investors and corporate venture arms alike. Very recently Nokia Growth Partners announced a $350M fund focussed on the IoT space. With other notable corporates like Cisco Investments, Samsung ventures also investing in IoT, we list down 20 hot venture backed early stage IoT companies.

For more IoT companies, visit our feed.

Tracxn looks at some of the most important women in the SEA startup scene

Historically, Banks have enjoyed the privilege of being at the centre of development in the finance space. But today, that notion has changed, with the advent, and increasing popularity of startups in the FinTech space.

FinTech startups have brought about a revolution in the banking industry; a revolution which has been making waves across verticals like Alternative Lending, InsuranceTech, BankingTech, Remittances and Robo Advisors. Due to this, banks are compelled to either evolve, or to partner with these startups.

In line with this thought, Tracxn presents a list of startups innovating the FinTech space along with the total funding in that sector and the banks which are actively investing.

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Funding volumes during the last three years have been relatively high, with the timeframe between 2013-2015 witnessing a total ~2.2B being raised

According to the Tracxn Report on the Customer Service Software market, over $4.3B has been invested into the sector since 2005, with Accel Partners, Sequoia Capital and NEA being among the sector’s most active investors. The report covers companies which provide software and platform enabled customer services during and after the purchase of products and services for both B2B and B2C organizations.

The report finds that funding across 2015 and 2016 YTD amounted to ~$1B, in 613 rounds with 302 companies getting investments till date. 2016 till date has already seen a few large volume deals amounting to a total of $262M,  with Fuze raising $112M in a round led by Summit Partners. Sprout Social also witnessed a Series C $42M raise in a funding round led by Goldman Sachs, during the month of February.

In fact, funding volumes during the last three years have been relatively high, with the timeframe between 2013-2015 witnessing a total ~2.2B being raised. The year-on-year funding and number of funding rounds both saw a steep increase during 2011- 2013 and has since remained almost constant. 2015, alone, witnessed a total funding of $752M being invested through 95 deals. Notable rounds during the year include Medallia’s $150M fund continuing from Sequoia Capital, which contributed majorly to the year’s overall funding volume. And with 2016 already continuing to follow this trend, we can expect funding during this year to maintain the sector’s momentum.

Early stage deals has played a major role in fuelling the sector, especially with the number of such deals peaking in the 2010-2012 timeframe, due to the emergence of many incubators and accelerators in 2010. Since that period, the sector has continued to see a stable flow of early stage deals.

Late stage deals, however, have begun to really make a mark especially post 2012, wherein we are beginning to see an upward trend in their number. This increase in late stage rounds has thereby helped the funding volumes touch the relatively high figures it has during the last three years.

Along with an increase in the late stage rounds, we are also witnessing an upward trend in the number of acquisitions taking place in the space over the last 6 years.

In fact, out of the 780 companies in the space, 65 have been acquired. 2015 saw a peak in this regard as well with 19 acquisitions, notably newBrandAnalytics and GetSatisfaction acquisition by Sprinklr, and Telligent getting acquired by Verint . In 2016, Nexidia got acquired by Nice Systems.

Also, with money continuing to be pumped into the sector, it is not surprising to see an upward trend in the number of companies being founded in the Customer Service Software space, with 2015 seeing a peak.

Over 240 companies were founded in the last two years alone, out of which 2015 accounted for 127. There has been increasing trend in the number of companies founded in the mobile enterprise and enablers apps segment. Of late, an emergence of companies adopting mobile first approach for customer support, has been evident with 40 of the 127 companies founded in 2015 coming out of this segment.

In terms of geographical presence, the U.S. contributes for 50% of the startups in the space. Europe contains the next highest number of companies`at 27%. UK, India and Canada are upcoming geographies holding 8%, 10% and 5% of the total companies in the Customer Service Software space.

Business Models in Customer Service Software

In terms of segments, startups in the Call Center space have raised the most funding, at $1.5B. Within the segment, the Contact Center Suite sub-segment is the most funded and mature sub-segment, and the average funding per company is the highest for suite providers($19.6M) followed by Virtual Agents($17.27M). Call Center software and applications saw 9 acquisitions in 2015 and 2016 YTD. We may see consolidation in call center technology in coming years.

Today, there is an increasing trend in number of companies trying to build tools for automating customer service across all channels using AI and cognitive learning technologies. We are also seeing an increasing number of companies collaborating with IBM Watson and companies building their own virtual agents solutions.

Over the next few years, startups building tools to automate support over call, text, live chat on various interaction places will see major investments and acquisitions.

Note: This report covers companies which provide software and platform enabled customer services during and after the purchase of products or services for both B2C and B2B organizations. It also include companies which provide self service software which includes customer centric communities(web and social) and knowledge management tools for customer service reps and external customers. It also cover companies which provides software to capture customer feedback across all interaction channels to improve customer experience and brand loyalty.

This report does not cover companies which provides:

• Collaboration solutions for internal employee collaboration and networking.
• Social media management and monitoring used for marketing and PR activities.
• Infrastructure for call centers, or VOIP providers, business phone systems, telephony applications.
• Call center software for sales, marketing and telesales activities.
• Website and mobile based marketing solutions for customer engagement.

$1.1B was invested into the Online Rental space during 2015, with Yongche raising $700M

Online Rental startups garnered a lot of popularity from investors during 2015, according to our latest Tracxn Report on the sector. The sector includes companies that provide an online platform to rent as well as rent out products to/from consumers and businesses. According to the report, over $2.4B has been invested in this sector since 2011, with Sequoia Capital and 500 Startups being among the sector’s most active startups.

The report finds that the sector has seen a surge in investments during 2015, with startups in the space raising a total of $1.1B in 57 deals. This surge, however, can be largely attributed to a single deal wherein transport startup, Yongche raised $700M in a round lead by LeTV. If this deal was not to be included, funding activity in the space, would be at pace with the funding volumes raised in the previous years.

But when we do consider Yongche’s funding round, the resultant average funding per round in 2015 increases to $20M, a considerable increase over the previous year. This massive spike is indicative of the sector beginning to see signs of market consolidation.

Another indicative factor to this theory is the fact that the sector is seeing maturity. This is evident as the number of late stage deals has seen a year to year increase of close to 200% since 2013.

The number of early stage deals, however, seems to be stabilizing, another factor which indicates maturity in the sector. But this trend has not seemed to deter new startups from emerging in the space, with a total of 254 companies being formed in the last three years alone.

2015 witnessed the highest number of companies being founded, albeit, by a small margin, with a majority of them coming from the Horizontal Rental and Transport Rental sectors. Also, with the evolution of the sharing economy a number of new companies are being formed in the peer to peer space.

Business Models in Online Rental

Startups in the Online Transport Rental space have, by far, raised the most funding, at $2.3B. This is not surprising, especially when we consider that individual raises by some of the startups in the space are more than the total raised by other segments as a whole. For instance, Yongche has raised a total of $790M, and eHi Car Rentals has raised $420M.

The cars sub-segment dominates funding in the transport sector, and, looking deeper, the B2C model in the cars segment has picked up more than 75% of the total funding for cars. On the other hand, the P2P car sharing model failed to garner traction as it involves a risk of insurance coverage dispute incase an accident occurs.

Funding in the Transport sector rose approximately by 300% in 2015, despite a drop in the number of funding rounds indicating market consolidation, where large companies continue to raise large amounts of money.

The next most popular segments have been Books, which has raised close to $300M, and Fashion which has raised around $230M.

Note: The Tracxn Online Rentals report covers companies that provide an online platform to rent as well as rent out products to/from consumers and businesses. It excludes online and offline real estate rental companies such as Zillow or Re/max. Companies providing SaaS services to the online rental companies are also excluded from the report.

Check out the Customer Service Software report here:

All of our sector reports are available to Premium Tracxn subscribers. If you are interested in receiving our reports, please write to bd@tracxn.com

We, like many other people, are huge fans of the Beatles, and the news of the death of Sir George Martin, was terribly upsetting. As many know, George Martin, or “The Fifth Beatle”, as he was famously called, was instrumental in helping the Beatles become the most successful group in music history.

Image Source: The Guardian

Besides propelling the band to dizzying heights, George Martin is also famous for signing up with the Beatles after they had been rejected by every other label. By doing so, Martin, who was then the head of Parlophone Records, a subsidiary of EMI, went against the conventional practice of early pop business, where individual artists were considered more a draw than bands. Martin’s bet paid off, consequently, as the Beatles are now regarded by many as the greatest band of all time.

So, in the spirit of Sir George Martin, and his work with the Beatles, we look at some of the startups who were initially rejected by multiple investors, and the funds who were ready to bet on them when no one else would.

Sequoia Capital and LinkedIn

Looking at the giant Linkedin has become today, the fact that the professional networking portal initially found it hard to raise funds may come as quite a shocker. But in early 2003, LinkedIn spoke to 23 VC firms and was turned down. It wasn’t until the fall of 2003, when the company received two term sheets and finally selected Sequoia Capital, and closed a $4.7 million round in November.

Sequoia Capital (again!) and AirBnb

It might be unbelievable to think that AirBnB, arguably ‘the Beatles’ of vacation home stays, had a tough time raising funding, at a time when they were attempting to raise $150,000 at a $1.5M valuation in 2008. But the startup was indeed rejected by 7 venture firms in the beginning; well, technically 5, as 2 did not even respond. These rejections have been brilliantly captured in AirBnB CEO, Brian Chesky’s Medium post entitled, 7 Rejections.

AirBnb’s first raise finally came in the April of 2009, when it raised $600,000 from Sequoia Capital, and has since reached Unicorn status.

DFJ’s Tim Draper is Nutmeg’s lucky number 46

Founded in 2010 by Nick Hungerford, Nutmeg is an automated investment management service. Initially Nutmeg was rejected by a total of 45 investors, until Nick finally met Mr. 46; Tim Draper, Founding partner of leading venture capital firms Draper Associates and DFJ.

Draper was quick to say yes, after listening to Tim’s pitch, and other investors soon followed.

DFJ also comes to Hotmail’s Rescue

Hotmail is extremely well-known, especially to folks from the 90s. Today, we know it as Outlook, after Microsoft bought the company for $400M. There’s no denying its significance in the way we mail. So, Hotmail wouldn’t have any problems attracting investors, right? Not really.

In reality, Hotmail Founders, Jack Smith and Sabeer Bhatia, were turned down at least twenty times, as their idea of implementing an email service onto a web browser was completely untested. Luckily for them, Draper Fisher Jurvetson finally agreed to fund them, and history was made.

FanDuel’s Big Three – Pentech Ventures, Piton Capital and Scottish Investment Bank

Today, Fanduel may (or may not) have retained its unicorn status, but it is indisputable that the  Fantasy sports gaming company has come a long way since its conception. Along the way, the fantasy league platform that was founded in Edinburgh but is now headquartered in New York, faced rejection from over 80 investors before finally closing a $4 million Series B funding round from Pentech Ventures, Piton Capital and Scottish Investment Bank in 2011.

Today, the firm has raised more than $361M, and its investor list includes the likes of Comcast Ventures, Bullpen Capital, Time Warner, Shamrock Capital Advisors, NBC Sports, Pro Channel Sports Games, Google Capital and Kohlberg Kravis Roberts & Co.

These are just a few examples of startups which were unable to raise initial funding, and many companies, large and small, face a good deal of initial rejection from investors before persevering. Fortunately, these companies, and many more, have fought on, and have grown to be huge companies, and we have the investors who dared to believe in them to thank for, just as we thank Sir George Martin for the Beatles.