Scoop: ChrysCapital eyes $100 m funding in Lenskart; Match group may invest in matrimonial site Shaadi

Kevin Colleran

2 years ago

Today we are breaking a story on private equity major ChrysCapital holding talks to write a $100-million (Rs 828-crore) cheque in eyewear retailer Lenskart. This is part of a larger $400-500 million funding round at the company.

Also in this letter:
■ Cash-rich edtech firms out to poach rivals in funding winter
■ IndiGG raises Rs 160 crore in seed round
■ Tiger Global offloads 1.7% stake in Delhivery

Lenskart looking to raise $100 mn from ChrysCapital

Omni-channel eyewear retailer Lenskart is in talks with private equity fund ChrysCapital to raise $100 million (Rs 828 crore), people aware of the matter told us. The talks on picking up a stake are ongoing, and the investment is yet to close.

Funding details: If the deal closes, it would be among the largest investments in a new-age entity by ChrysCapital. It will take the total ongoing funding round at Lenskart to around $500 million. The PE fund has backed internet firms such as Dream11, FirstCry and Xpressbees.

The ongoing round is largely a secondary share sale where stocks will change hands from existing to new investors and the money won’t go into the company’s coffers. The new round may have a small primary capital infusion, sources told us. The investment is taking place at a valuation of $4 billion.

Why secondary sale? Secondary share sales are typically carried out at a discount to the last valuation in a primary fundraise. For example, in May last year, fintech firm Razorpay did a secondary share sale of $75 million at a valuation of $6.5 billion after having raised capital previously at a $7.5 billion valuation.

Over the past few years, Lenskart has conducted secondary share sales to pave the way for partial exits to investors like Chiratae Ventures and others.

Financial health: Sources told us that the company clocked about Rs 415 crore in sales in December, of which Rs 183 crore came from Owndays, which it acquired last year.

“They (Lenskart) have clocked decent sales growth and the last financial year numbers show the recovery made after Covid-19. Lenskart is hoping its Bhiwadi (Rajasthan) plant will play a key role in manufacturing locally and ship significant volumes,” a person aware of the matter said.

Also read: Meat delivery startup FreshToHome raises $104 million in funding led by Amazon Smbhav Venture Fund

Exclusive: Looking for right match, Match swipes right on Shaadi

Nasdaq-listed American internet and technology company Match Group is in advanced discussions with Shaadi.com for a strategic investment in the Indian company, said people with knowledge of the matter.

Quote unquote: “Over the past month, Match Group and Shaadi.com have had a few rounds of strategic discussions and are currently at the final stage of discussions where finances are being discussed,” a source told us. “The exact financial terms and arrangement are yet to be ascertained.”

Business plans: In an interview with a business daily in September last year, Shaadi.com founder Anupam Mittal said the company was planning to go public in the next fiscal year.

Last month, Match Group announced a revamped executive leadership team under CEO Bernard Kim. The group stated that the new structure was designed to maximise profitability, enhance growth, streamline operations and prioritise new business opportunities.

Cash-rich edtech firms out to poach rivals in funding winter

As the funding winter continues and raising capital remains difficult, large edtech startups are looking to deploy their huge piles of cash towards acquiring potential targets, founders and analysts told us.

Who’s planning what? PhysicsWallah is planning to increase allocation for mergers and acquisitions (M&As) to $100 million from the current $50 million, cofounder Prateek Maheshwari told us. The Noida-based unicorn is looking to acquire startups operating in various test-prep segments, in addition to augmenting its geographical presence.

UpGrad is looking at possible acquisitions to add to its B2B (business-to-business) and workforce training capabilities. While another edtech unicorn Lead is evaluating businesses that expand its reach or add products that can ride on its distribution.

Edtech downturn: Edtech firms raised $3.1 billion in 2022 from 182 rounds, significantly lower than the $5.4 billion raised in 2021 through 331 rounds, according to Tracxn, a data platform for privately held companies.

The funding crunch has made these startups prune costs by cutting down on marketing spends and employee expenses. Players such as Byju’s, Unacademy, and Vedantu have fired nearly 6,000 employees.

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Web3 gaming startup IndiGG raises Rs 160 crore in seed round

Web3 gaming startup Kratos Studios has raised Rs 160 crore in its seed round, led by Accel, with participation from Prosus Ventures, Courtside Ventures, Nexus Venture Partners, Nazara Technologies and others at a valuation of Rs 1,200 crore.

CEO speak: IndiGG chief executive Manish Agarwal told ET that the company will utilise the funds to build a product platform, support gaming teams, and build communities and a global brand through IPs and Web3 e-sports competitions.

“These are the four areas where we will use the funds. But more importantly, we want to create operational cash flows faster so that this fund is there for a rainy day and not to burn,” he said.

Portfolio of games: Agarwal said the entity had 106 games in its portfolio, of which 40-44 are in the alpha-beta stage, with the rest of them being in development. “Of the 40-44 games, 15 are live on our platform,” he added.

He also alluded to a steady supply of games being important to build the platform.

Tweet of the day

Tiger Global sells 1.7% stake in Delhivery for Rs 414 crore

Sahil Barua, cofounder & CEO, Delhivery

American investment management firm Tiger Global Management sold 1.7% stake in Delhivery through open market deals on Wednesday for Rs 414 crore.

Selling at a discount: Venture capital firm Internet Fund III Pte, through which Tiger Global holds a stake in the logistics services provider, sold 1,23,63,060 shares at Rs 335.06 apiece.

The selling price was at a discount of nearly 4% to Tuesday’s closing price of the stock. On Wednesday, the stock ended nearly 4% down at Rs 336.30 on the National Stock Exchange. The fall on Wednesday saw the stock snapping a seven-day winning streak.

Similar exits: Earlier this month, China’s Alibaba Group sold a 3.3% stake in Paytm parent One97 Communications through the open market and mopped Rs 1,378 crore.

Alibaba has been offloading stakes in listed new-age technology companies in India amid a sharp erosion in the value of its investments. The Chinese multinational had offloaded a 3% stake in online food delivery aggregator Zomato earlier in November.