Some of the top funded startups during this period include the online coaching platform PhysicsWallah, quick commerce platform Zepto, and ride-hailing unicorn Rapido.
“Despite a positive long-term outlook, Q3 has seen a 30% decline in deal volume, coupled with a 20% increase in average deal size, signalling a shift toward high-ticket dealmaking in quality assets,” said Abhilasha Jaju, director at the firm.
PhysicsWallah on September 20 closed a $210 million funding round, marking the largest fundraising for a firm in the troubled edtech sector post-COVID-19. Led by the Asian hedge fund Hornbill Capital and backed by venture capital firm Lightspeed Venture Partners, the round valued the edtech major at $2.8 billion.
Last month, Rapido raised $200 million in a financing round led by existing investor WestBridge Capital, becoming a unicorn with a $1.1 billion valuation.
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While equity investments dropped to $5.8 billion in Q3, debt deals surged to $4.2 billion from $2.2 billion in the previous quarter. Debt deals accounted for 40% of the total capital raised in this quarter.The banking, financial services and insurance (BFSI) sector led the funding activity with $3.5 billion, followed by the telecom sector with $2 billion, and the software-as-a-service (SaaS) / artificial intelligence (AI) sectors with $1.2 billion, the report noted.
Late-stage investments were largely driven by the ecommerce and listing platforms sector, totalling around $650 million. A listing platform allows businesses or individuals to list products or services, acting as a marketplace that connects buyers and sellers. Key players include companies such as Zepto, hospitality startup Oyo, and omnichannel jewellery retailer Bluestone.
In August, Zepto raised $340 million from new investors General Catalyst, Mars Growth Capital, Epiq Capital, and others, reaching a valuation of $5 billion, and Bluestone had also closed a Rs 900 crore round before filing the papers for its proposed public listing.