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April 02, 2018

VCs favour B2B startups over B2C in Q1 2018

Overall VC investments dip 30%

B2B Companies grabbed 60% of the VC funding in the first quarter of calendar year 2018 - 46 deals (worth $148 million) compared to consumer companies which grabbed 30 deals (worth $109 million). Top VC investments in B2B Companies included those in SaaS startups like Chargebee, SirionLabs and payroll and benefits management company NiYO. Just the Enterprise Software segment accounted for 28% of total VC investments (by volume).


Overall Venture Capital firms made 76 investments (worth $257 million)in Q1’18- 30% lower compared to 109 deals (worth $397 million) recorded in the same period in 2017, data from Venture Intelligence shows. (Note: Venture Capital is defined by Venture Intelligence as Seed to Series D round investments in companies less than 10 years old with value of up to $20 Million.)

Angel investments (by angel networks and super angels) slipped Quarter-on-Quarter to 48 deals in Q1’18 compared to the 51 investments in Q4’17.

Top Deals


Vernacular social network ShareChat raised $18 million from SAIF, Lightspeed Ventures, strategic investor Xiaomi and others. Subscription billing Saas company Chargebee raised a similar amount from US-based Insight Venture Partners and existing investors Accel India and Tiger Global. Women’s wear company Go Colors raised $15.7 million from ICICI Ventures.

Company
Sector
Investors
Amount($M)
ShareChat
Social Network
Xiaomi, SAIF Partners,
Lightspeed Ventures, Others
18.2
ChargeBee
Subscription Billing
Insight Venture Partners, Tiger Global, Accel India
18
Go Colors
Womeswear
ICICI Venture
15.7
Coverfox
Marketplace -  Insurance
IFC, Others
14.7
NiYO
Employee Benefits
Social+Capital, Horizons Ventures, Prime Venture Partners, Others
13.2

By Sector


Tech investments accounted for 92% of the VC investments in the quarter - 70 deals worth $226 million. Among the top sectors, Healthtech registered 12 deals, followed by Fintech, Hardware and Edtech companies which registered 8 deals each.


VC Investments fell across major cities save Chennai. NCR companies registered a 46% fall in VC investments compared to Q1’17.


Venture Capital Exits


Venture Capital investors made 14 exits worth $292 million in Q1’18 - the lowest since Q1’17. 

The largest exit during the period was a $104 million part exit by Tiger Global and other investors from music platform Saavn, which was acquired by Reliance Jio Music. The second largest exit was a $61 million part exit by TPG Growth and IDG Ventures India from eyewear e-tailer Lenskart (through a secondary sale to TR Capital). 

Other VC exits in the quarter include a partial exit by IDG Ventures, SAIF and others from Xpressbees Logistics through a strategic sale to Alibaba. Tano Capital and Aavishkaar offloaded part of their stake in Arohan Financial Services (through a secondary sale to TR Capital).

Venture Intelligence is India's longest serving provider of data and analysis on Private Company Financials, Transactions (private equity, venture capital and M&A) & their Valuations in India.