Deal Street: Nandan Nilekani’s Fund Bets On India’s $14-Billion Used Car Market
(Source: BloombergQuint)

Deal Street: Nandan Nilekani’s Fund Bets On India’s $14-Billion Used Car Market

Three startups raised $84.2 million in venture capital funding last week across sectors such as mobility, health-tech and lending, among others.

A $200-million fund set up by Infosys Ltd.’s co-founder led the investment pack with its bet on a used car platform. The fund, launched in 2018, has backed startups such as PharmEasy and Travel triangle, to name a few.

Here’s what went on...

Nandan Nilekani’s Fund Backs Startup That Sells Second-Hand Cars

Spinny, a pre-owned cars platform, raised $43.7 million (around Rs 316.46 crore) in a growth funding round led by the Fundamentum Partnership, a mid-stage venture capital fund.

The fundraising saw participation from new investors such as U.S.-based General Catalyst Partners and Korea’s KB Financial Group, and existing investors, including Accel, SAIF Partners and Alteria Capital, according to a statement.

This comes at a time demand for used cars rose even as Indians halted purchase of newer vehicles amid a prolonged consumption slowdown. Easy availability of finance is also behind the surge. Founded in 2015, Spinny competes with CarDekho, CarTrade, Truebil, and Droom in India’s crowded used car market, which according to online classifieds platform OLX is 1.3 times the size of the new car market. OLX expects the used car market to touch $25 billion by 2023 from $14 billion in 2019.

The Gurugram-based startup said it would use the funds to strengthen its tech infrastructure, business teams and enhance the customer experience, besides expanding to more cities in the country. Spinny said its online-to-offline model allowed customers to discover cars on its website and make their final purchase at a designated car hub.

“With an increase in disposable income and evolving consumer demand, we want to be the market leader in the organised used car market segment,” Niraj Singh, co-founder and CEO at Spinny, said.

Ashish Kumar, partner at Fundamentum Partnership—floated by Nandan Nilekani, co-founder and former chief executive officer of Infosys, and Helion Venture Partners’ Co-Founder Sanjeev Aggarwal—will join Spinny’s board as part of the transaction, the statement said.

Micro-Lending Startup Raises $30 Million

SMECorner, a micro-lending platform for small and medium businesses, raised $30 million (Rs 217 crore) in a mix of equity and debt capital.

Paragon Partners, the homegrown mid-market private equity firm, led the funding round by infusing $10.5 million, according to a statement. Existing investors Quona Capital, Accion Venture Lab, and some high net worth individuals also participated in the fundraising.

The microlender aims to use the funds to scale-up lending partnerships, grow its loan book to more than Rs 1,500 crore and reach over 20,000 customers, the statement said.

“The asset-light model, powered by several co-lending partnerships, makes the business resilient from liquidity challenges, and a highly granular loan book makes it resistant to any lumpy asset quality issues,” Siddharth Parekh, co-founder at Paragon Partners, said.

Founded in 2013, SMECorner provides small-ticket loans between Rs 50,000 and Rs 25 lakh to unorganised retail business owners such as kirana stores, ready-made garment sellers and chemists, among others.

The lender, which obtained a licence for a non-banking financial company in February 2018, claims to have disbursed loans worth more than Rs 550 crore since then. It is currently operational across 15 cities and served more than 8,500 customers.

A cashier counts Indian rupee banknotes in the Byculla area of Mumbai, India, (Photographer: Dhiraj Singh/Bloomberg)
A cashier counts Indian rupee banknotes in the Byculla area of Mumbai, India, (Photographer: Dhiraj Singh/Bloomberg)

University Of Tokyo Edge Capital Leads Series B Funding In Tricog

Healthcare analytics firm Tricog raised $10.5 million (Rs 76 crore) in fresh funding round led by University of Tokyo Edge Capital, Aflac Ventures, LLC, Japan, U.S.-based social impact investment fund TeamFund and Japanese venture capital firm Dream Incubator.

Tricog’s existing investors Inventus Capital and Blume Ventures also participated in the fundraising, the company said in a statement.

The early-stage technology-focused venture capital firm, associated with University of Tokyo, had first invested in Tricog in 2018.

The Bengaluru-based company said it aimed to use the funds to strengthen its artificial intelligence platform for faster diagnosis and expand its product line, besides establishing a strong presence in Africa and Asia, including India, China and Japan.

Founded in 2015, the startup leverages its medical and technology expertise to provide virtual cardiology services to remote clinics.

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