by Sayan Ghosh
The New York-based investment firm Tiger Global is roaring aloud and investing billions of new dollars in the Indian startup ecosystem. It’s target: unicorns, companies with at least $1 billion in valuation.
The venture capital firm raised $6.65 billion for its 13th fund for investing in Indian unicorns, according to a filing with the U.S. Securities and Exchange Commission.
It has aggressively passed checks to Indian startups in the first half of 2021, surpassing venture capital firm Sequoia Capital as the company with the most significant number of investments in Indian unicorn companies. It invested in 21 of 57 enterprises between 2011 and 2021, according to the investment tracker Venture Intelligence.
“I will call them ‘Unicorn Machine’ due to the sheer number of Tiger Global-funded startups acquiring the Unicorn status in India,” Pankaj Singh Yatra, co-founder at the online startup Connexdoor, told Zenger News. “No other venture capital firm has poured capital at this scale.”
In the past few years, Tiger Global has invested in edtech startups Byjus, and Vedantu, investment companies like Groww, Upstox, INDWealth, fantasy gaming startups like Dream11 and MyTeam11, among many others. Observers say is unusual to see venture capital investments in competing companies.
A foodtech firm Zomato delivery man is seen riding along the streets of Mumbai. Tiger Global has … [+]
SOPA Images/LightRocket via Getty Images
With China’s recent crackdown on its tech companies, global investors are looking to India’s large market for more opportunities.
“India is the target market for Tiger Global, not possibly China or the U.S.,” Sreedhar Prasad, an internet business expert and ex-partner at KPMG, told Zenger. “The reason being that there is a population of 500 million in the country who are not being catered to by the investment companies, so the size of the addressable market in India is bigger than any other country.”
He added, “Tiger Global is investing in more startups to push them into the unicorn club because it is trying to dictate the valuation of more and more Indian startups which would provide them with a terminal position in India’s unicorn ecosystem.”
The firm has also provided funds to startups like the digital insurance startup Plum and online payments startup Bharat Pe. It has invested in seven late-stage firms, including foodtech firm Zomato, networking service ShareChat, home services firm Urban Company, and six growth-stage startups, including Crypto startup CoinSwitch, and social media platform Koo, among others.
“Till date [in 2021], Tiger Global has invested in around 25 Indian startups across segments – fintech, foodtech, social networking companies, edtech, and others. They have participated in new rounds as well existing portfolio startups,” said Connexdoor’s Yatra, who is also a partner at a $12 million fund for fintechs in India called YAN Fund.
“In 2021 [to July], it led double the number of the deals it did in 2020, participating in 15 deals worth $1.74 billion. That is already more than the total amount of agreements it closed in the country in 2020,” he said.
Number of start-ups becoming unicorns in India from 2015 to 2020.
Statista
Some startups have received multiple funding rounds, exponentially increasing their post-money valuation. Earlier this month, Tiger Global provided funds for the second time in six months to Infra.Market, a Mumbai-based construction company. The new funding round increased the startup’s valuation two and a half times to $2.5 billion.
In February, the construction materials procurement portal secured $100 million in an expansion round also headed by Tiger, valuing the company at $1 billion, pushing it into the much-coveted billion-dollar unicorn club.
“These investments help startups expand market reach, drives technology, and product upgrade,” Madhur Singhal, managing partner and chief executive at consulting company Praxis Global Alliance, told Zenger.
“Such investments also provide them a runway to get to scale where profitability can be achieved.”
Tiger Global continues betting on India’s future, with venture capital deals skyrocketing to $7.78 billion in 2021—a steep increase from $2.83 billion in 2020. About one-fourth of the firm’s venture capital deals have been based in India in the past 11 years.
