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Youngest Indian unicorn; Pine Labs hires bankers for IPO


In September 2018, Udaan became the fastest Indian startup to achieve unicorn status, doing so in just 26 months. But with the unprecedented sums that Indian startups have been raising this year, that record was always under threat.

Also in this letter:

  • Pine Labs hires Wall Street heavies for US IPO
  • Amazon plans for life after Cloudtail
  • Scaler Academy in talks to raise $70-100M

Ready, steady, unicorn: Apna.co joins the club in 21 months

Nirmit

Apna.co chief executive and founder Nirmit Parikh

Apna.co, a professional networking platform for blue- and grey-collar workers, has entered the unicorn club just 21 months after its product launch. In doing so, it beat the record held by business-to-business commerce startup Udaan, which achieved unicorn status within 26 months of registration.

According to its founder, Apna.co has grown 125x over the past 15 months.

New funding: The company said it had raised $100 million in a new funding round led by Tiger Global, which already has a stake in it. Its valuation shot up to $1.1 billion, double the valuation it commanded in its previous round in June.

Existing investors Sequoia Capital India and Insight Partners also participated in the latest round while Owl Ventures, Maverick Ventures and GSV Ventures came on board as new investors.

With the latest funding, the startup has raised $190 million in three rounds this year.

Youngest unicorn: Apna.co becomes the 27th unicorn of the year, which has seen Indian startups attract unprecedented funding. As of September 3, investors had pumped in more than $21 billion into the country’s startups this year, according to data from Venture Intelligence.

It’s also the second startup unicorn in two days — gaming startup Mobile Premier League joined the club yesterday after raising funds at a valuation of $2.3 billion.

Indian Startups

What it does: Apna.co has verticals for skilled workers such as carpenters, painters, sales agents and beauticians, who can use the platform to upskill themselves and land jobs. It has more than six million users across 70 communities. Its clients include Zomato, Flipkart, Urban Company, Byju’s, PhonePe and Burger King. It is present in 28 cities — up from 14 just three months ago.

In other deal news…

Anar, a business-to-business networking app, has raised $6.2 million in a seed funding round co-led by Elevation Capital and Accel India. The round also saw participation from First Cheque, Utsav Somani of AngelList India, Ranjeet Pratap Singh (Pratilipi cofounder and CEO), Farid Ahsan (ShareChat cofounder), Vidit Aatrey and Sanjeev Barnwal (Meesho cofounders) and Shashvat Nakrani (BharatPe cofounder).

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Pine Labs hires Wall Street bankers for IPO, eyes $6 billion valuation

amrish

Amrish Rau, chief executive officer, Pine Labs

Payments firm Pine Labs has appointed Morgan Stanley and Goldman Sachs as advisors for its initial public offering (IPO) in the US next year, sources told us.

It is looking at a valuation of around $6 billion through the IPO but this could increase, they said. The company was last valued at $3.5 billion earlier this year, after raising around $600 million in two tranches. It is the third-highest-valued fintech in India after Paytm and PhonePe.

One for the road? Pine Labs is also considering raising more money before the IPO. “They are looking to raise new money before the IPO but are not calling it pre-IPO according to the current talks,” a source said, adding that it could look to raise at least $100 million.

As for the timing of the IPO, the source said, “They are aiming for next year, but it might also spill over to early 2023.”

Digital payments continue to see steady growth in India on the back of the pandemic as risk investors, global and domestic, have flocked to the sector.

Two other fintech startups — Paytm and Mobikwik — have also filed their draft IPO papers and plan to go public on Indian exchanges later this year.

Late last month, Prosus, earlier known as Naspers, acquired digital payments processor BillDesk in a $4.7 billion all-cash deal.

What it does: The Noida firm’s main business is developing software and deployment solutions for point of sale (POS) devices for stores. It has been diversifying its offerings with enterprise solutions such as buy now pay later (BNPL) integrations, invoice management, and payment gateway.

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Amazon seeks vendor partners to replace Cloudtail

Amazon

Amazon is looking for vendor partners to replace Cloudtail India, one of the largest sellers on its platform.

ET was the first to report last month that Cloudtail would halt operations from May 2022. Amazon and N.R. Narayana Murthy-owned Catamaran Ventures said they would end their seven-year-old joint venture Prione Business Services, which owns Cloudtail.

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Details: The US firm is scouting for companies that are owned and run by Indians, and are preferably already in the ecommerce space, to put together a network of vendors, sources told us.

  • Amazon will have no stake in these vendors, they said. They will source products directly from brands and manufacturers to sell on Amazon.in.
  • “They are asking us to invest around Rs 100 crore to begin with,” said the head of a company that recently was approached by Amazon.
  • Another large player in the ecommerce industry said his company was in talks with Amazon to become part of a network of vendors that would replace Cloudtail.

Why now? Amazon’s opponents, including many small retailers, have been accusing Cloudtail of being the ecommerce firm’s way of sidestepping India’s regulations that bar foreign-funded marketplaces from selling goods on their own platforms.

No cakewalk: Market watchers said it would be a daunting task for Amazon to replace Cloudtail, which sold products in crucial categories such as smartphones, electronics, fashion and groceries, among others.


Scaler Academy in talks to raise $70-100 million

startup

Edtech startup Scaler Academy is in talks with existing investors Tiger Global and Sequoia Capital to raise $70-$100 million in a new funding round, sources told us. “Tiger Global is likely to top up with a $50 million cheque, with existing investors bringing in the rest,” a person with direct knowledge of the development said.

Scaler, which helps working professionals upgrade their skills and grow in their careers, has so far raised $21.5 million from marquee investors such as Sequoia India, Tiger Global, Global Founders Capital and Rocket Internet.

The company’s business model has come to the fore amid a rising demand for tech talent in India. As most tech-focused startups across sectors grow and expand, demand for talent is ever-increasing. But a dearth of good hands has led to an unprecedented rise in both salaries and drop-out rates in the tech industry, we reported previously.


TCS is first Indian tech firm to cross $200 billion market cap

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Tata Consultancy Services crossed $200 billion in market capitalisation on Wednesday, as customers across sectors continue to invest in technology to transform their businesses.

Reliance Industries is the most valuable Indian company with an M-cap of over $205 billion. TCS’s global rivals Accenture and IBM have market caps of $216 billion and $122 billion, respectively, while domestic rival Infosys is valued by investors at around $99 billion.

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Tracking the double century: TCS, which completes 50 years, listed on the stock exchanges in 2004. It took 13.5 years to get to a $100 billion market cap, while the next $100 billion took 3.5 years, or a third of the time.

India’s top IT firms are expected to grow in double digits in fiscal year 2021-22 as they win record deals from global customers. In the quarter to June, top five software services companies won deals worth nearly $14 billion, led by TCS with an order book of $8.1 billion, and followed by Infosys at $2.1 billion and HCL Technologies at $1.66 billion.

Also Read: Tata Digital could be the TCS of the future, says Rajesh Gopinathan


HCL seeks bigger slice of cybersecurity market

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HCL Technologies, India’s third largest software services company, is working to bag a larger share of the cybersecurity services market, Maninder Singh, corporate vice president, told us.

The number of cyberattacks against organisations worldwide has increased and the company is accelerating its focus on cybersecurity amid the pandemic-led push towards digitisation, he said.

The services pie — which includes system integration, operations management services and consulting services — is growing at between 6% and 13%, according to market research firm Gartner. Singh said HCL is reporting faster growth in the cybersecurity segment than the rest of the industry and has created an overarching strategy to capture a larger share of the fragmented market.


Other Top Stories We Are Covering

Ola restarts electric scooter sale, booking on app only: Ola Electric has restarted the sale of its electric scooters—S1 and S1 Pro—on the Ola app only after the website meant for bookings faced technical difficulties last week.

Rakuten enters B2B space in India: Japanese Internet firm Rakuten is entering the business-to-business space in India with the launch of a software-as-a-service (SaaS) product, SixthSense. The platform will be available on a subscription model.


Global Picks We Are Reading

  • TikTok’s lead EU regulator opens two data privacy probes (Reuters)
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