Tiger Global, a New York hedge fund, reported its first seed stage investment in India earlier this week by participating in a 2.6 million seed round of Shopflo, an e-commerce enablement platform.
Data sourced exclusively by Business Today from Tracxn shows that Tiger, known for writing big cheques for firms globally, has invested in 7 seed stage startups in India over eight rounds.
According to Tracxn data, SoftBank invested in only one seed stage startup in India. The total funding for various seed stage rounds by both investment majors is over $10 million.
Tiger Global has supported 64 such companies in other early stage fund-raises in Indian startups. The data from Tracxn shows that SoftBank has invested in only 2 early-stage startups in India.
Tiger s participation in seed, Series A stages was very prevalent in the early half of the last decade, when the Indian internet companies were yet to take off. In the last two years, the fund has been aggressively writing huge cheques and minting unicorns in India. Tiger may move back to participating in small size transactions, because global markets are experiencing a downturn and tech stocks have been tumbling. Tiger Global, according to several media reports, has lost two-thirds of its cumulative gains, amounting to $17 billion, since the beginning of the year, due to the tech rout that its portfolio firms saw during this period.
SoftBank will scale down its investments across portfolio companies and will stay in defense mode when it comes to writing big cheques. The Japanese tech investment firm posted a record loss of $13 billion in FY 22 with the fair value of some of its portfolio companies including India s Paytm and Policy Bazaar declining by more than half during the last quarter of FY 22. Softbank invested $1.4 billion in Paytm, which has a fair value of $800 million, while an investment of $400 million in PB PolicyBazaar's parent firm has a fair value of $100 million.
Data collated from Venture Intelligence showed that both VC firms in 2021 ploughed in nearly 4 billion in Indian startups. SoftBank invested 2.2 billion in Tiger Global's investments last year, while Tiger Global invested 2.2 billion in the Indian startup ecosystem.
Despite the robust deal-making last year, Indian startups saw a dent in big-ticket transactions, which accounted for 63% of the fund raising in Q 1, CY 21, the proportion of transactions with a deal size of $100 million and above was 58% for Q 1, CY 22. The report said that 81 of the funding activity was driven by early-stage and growth-stage deals.
The industry watchers say that it is the seed stage Series A stage companies that could benefit from the overall market sentiment as Tiger Global and SoftBank go slow on their investment radars.