Startup Street: UrbanClap Has The Eye Of The ‘Tiger’
The week was dominated by headlines on growing tiger population. There was one in India’s startup space, too.
This week on Startup Street, Delhi-based UrbanClap backed by an investor known for its early bets on Ola and Flipkart. A Mumbai’s venture capital firm launched a Y Combinator-styled accelerator fund. And the three winners of the Nasscom-CBRE challenge. Here’s what went on:
On-Demand Services, In Demand
UrbanClap, an on-demand hyperlocal service provider, raised $75 million in its Series E funding round led by Tiger Global Management as the U.S.-based investor continues its deal-making spree in India.
Existing investors Steadview Capital and Vy Capital also participated in the fundraising, a statement by UrbanClap said. The transaction involved a primary capital infusion by the investors, while some early institutional investors sold part of their stake. Steadview had led the startup’s Series D funding in December.
The Gurugram-based platform, that connects offline service providers like cleaners, plumbers, electricians, yoga instructors and even beauticians to customers, has rapidly become India’s largest home services startup. It is present in 10 cities across India, and in Dubai and Abu Dhabi in the U.A.E.
The startup supports 20,000 “micro-franchisees”—what it calls service professionals—with around 450,000 transactions taking place each month, Co-Founder and Chief Executive Officer Abhiraj Bhal told news website TechCrunch. UrbanClap takes a tiny commission and lets the worker keep 80 percent of the pay.
Also, there’s immense potential to grow. “We believe the industry is well poised to dig much deeper into the beauty and repairs wallet share of existing customers,” market research firm RedSeer said in a note. “We also believe online hyperlocal services make one of the strongest cases (in internet space) for differential pricing as several customer cohorts have a high willingness to pay for a premium service.”
Thus, the industry seems one of the best placed to drive revenue and eventually profitability growth in the future.RedSeer Consulting
That’s what seem to have caught the eye of Tiger Global, known for its early bets on some of the Indian startups like Ola and Flipkart. The influential but super-secretive startup investor has been increasing its presence in India with China’s startup boom starting to fade off. In the first half of 2019, Tiger Global has funded 13 Indian firms, according to Tracxn, compared with eight last year.
Founded in 2014, UrbanClap said it has served more than 30 lakh customers. The startup has raised almost $186 million to date, according to Crunchbase, and has made two acquisitions.
A New ‘Accelerator VC’ Fund
Mumbai’s Venture Catalysts has launched a new Rs 300-crore fund that will be modeled after U.S.-based Y Combinator that incubates startups.
The 9Unicorns Fund will identify high-potential early-stage businesses across various sectors such as electric vehicles, mobility, augmented reality virtual reality, artificial intelligence and machine learning, fintech, retail and FMCG startups, Venture Catalysts said in a statement.
The fund will be a one-stop mentoring, networking and growth facilitation platform for emerging businesses to help the startups grow to their full potential, it said.
9Unicorns Fund has a dedicated fund allocation of Rs 300 crore offered by Venture Catalysts. Out of the funds, the accelerator VC plans to invest in over 100 companies every year, promising a standard deal of Rs 60 lakh for 5 percent equity along with a scope to invest Rs 3-5 crore more during subsequent funding rounds.Venture Catalysts
The funded startups will benefit from ready access to business angels and Venture Catalysts’ corporate community of more than 4,500 members.
“9Unicorns Fund will revive idea stage funding in India. (We aim to) identify budding businesses with terrific possibilities and ensure them every kind of assistance to ensure their success,” Apoorv Ranjan Sharma, co-founder and managing director of 9Unicorns, said.
The model is very similar to that of Y-Combinator, the accelerator behind companies like Airbnb, Dropbox, Reddit, Twitch and Quore. Usually, Y Combinator invests money in a large number of startups twice a year. The startup is incubated for three months where their expenses are paid and offerings refined. Later, it facilitates them to make a pitch to investors. In return, Y Combinator picks up a small stake in the startup.
Three Realty Startups To Get Mentorship From Nasscom-CBRE
IT industry body Nasscom and property consultant CBRE said they will mentor and support three startups that offer tech-based solutions for the real estate market.
The startups — Touchwizard Technologies, XLSYS Technologies and WEGoT Utility Solutions — were selected after three stages of evaluation by industry leaders from across sectors, CBRE said in a statement.
Nasscom and CBRE South Asia had started this competition in May this year.
“We wanted to create a platform in India that advocates PropTech and slowly but steadily walk towards creating a truly global experience for consumers in the realty sector,” said Anshuman Magazine, chairman and CEO, India and South East Asia at CBRE.
Chennai-based Touchwizard Technologies, which stood first in the challenge, deals in manufacturing and trading of video projectors, interactive boards, projector screens, interactive floor systems, virtual field trip service and virtual reality kit trip services.
Bengaluru-based XLSYS Technologies offers job site management and analytics services for the real estate industry. WEGoT Utility Solution specialises in utility management and water management solutions.