The article is contributed by Anand Bhushan, Chief Executive Officer, Educrack.
Instagram, the photo-sharing app was acquired by Facebook for $1 billion with only 13 team members at that time. Everyone thought and said that it was insanely overvalued at the time, but now I wonder if anyone would dare oppose the fact that it might be one of the greatest acquisitions of all time. There has been a multitude of successful acquisitions of startups, even so, there are some considerations that must be understood and kept in your deliberations as boundary conditions, before acquiring a startup.
The most important question to be answered is why acquire? Why not create from scratch on your own?
The first issue that needs to be looked into is, what would it would cost to develop the service, in terms of cost, human resources and also in terms of the time that would be required to develop it. For example, if it is going to take 6 months to develop the service then there would be no revenue during this period. That is also a cost; opportunity cost-are you willing to live with this and have built it in your costing? The acquisition will work only if there is a substantial saving of time or money or both.
Gestation Period
The next thing to be examined is whether, by startup acquisition, revenue realisation is going to start immediately or how much time would be required to spruce up after the acquisition for revenues to start. It makes little sense to acquire a startup if the gestation period is too long. The interest costs associated with the gestation period can eat into the profitability of the venture. In the edtech sector, we have observed that if half of the course is ready to be delivered, the course can be launched and the revenue realisation can start immediately. However, one needs to be extra cautious to ensure that the promises made to the student are fulfilled.
Startup Reputation
Another aspect that needs to be examined is the reputation of the startup. Though there may not be many who are using the service at that time, it is important to take into consideration the views of the people, though a small number, who have used the service. In today’s world where almost, everyone is connected digitally, negative feedback spreads through social media rapidly but positive feedback rarely does so at the same speed, hence checking on the current user experience is important.
Startup Work Culture
It is a universally acknowledged fact that organisations have their own distinct culture and work environment which initiates and flows from the leaders and employees of that organisation. If a startup has been successful in creating a service and making it marketable, it is the result of the initiative and hard work of the people associated with the company. This is an important fact to be recognised. To ensure continuity of success, it is imperative that the existing employees do not act hostile towards the new owners and vice versa. Some systems indeed would need to be put in place to scale up the startup, which may be resisted by the old employees, especially if communication clarity is missing. Therefore, this has to be done smoothly by taking them into confidence. High-handedness will not work. After all, a system is only as good as the people associated with the system.
Profitability
Nowadays, in the rush for getting higher valuations, profitability has taken a back seat. While valuation might be important in getting an investment, for the investor profitability should always be higher on the agenda. For this, due diligence needs to be done on both the sector in which the startup is operating and the startup itself.
Today, it has been observed that many startups provide certain services free of cost, or at an enormous discount so that the number of users of the service increase. This increases the valuation of the startup. However, it dents their profitability. The due diligence process should examine whether customers would be willing to pay a higher price for the services. Are the services of such a quality that the users would pay more? That is the crucial question. It may happen that the quality of the services is so low that people will use it only if it’s free. That finding would be discouraging. “Present value of future cash inflows” is fine. But there should be a clearly established path to profitability and this should be achieved within a strict time frame.
Product Life Cycle
From a macro-economic perspective, the Product Life Cycle also needs to be looked at. Suppose, it is going to take three years for the startup to break even. Is the service being offered by the startup going to be relevant and innovative till that time?
Synergy
The last checkpoint where it makes sense to acquire one is if it matches the area of existing work. This means, the startup itself is not in that good a state but you believe that with your existing system and resources either you can make the startup profitable or with the tools and resources of the startup, you can make your existing problems go away. In both cases, if you have done good market research and the odds are in your favour. Chances are that you might end up getting the acquisition at a fair amount and make it the best of both worlds. Synergies are important. Remember, proper research and analysis are the keys.
Conclusion
The only thing one can say about an acquisition making sense is that- “It depends”. Depends on how much time the startup has spent in the market, depends on what problems they are having, depends on your capability of solving those problems and also depends on the resources you have to make it work or use the startup’s resources to make something of your own known to the world. The thing is, if this all makes sense, then “Go for it”.
Startup acquisition seems to be a great trend for many big companies. The companies or the startups that have made it big likes to indulge themselves in the game of acquisitions.
So, when a small startup is doing well in the market but does not have the capability to sustain that, bigger companies tend to take control of it. However, this does not mean that the big companies intend to turn them into successful businesses.
Razorpay is one of the startups that has made a huge success and now has jumped into this field of acquisitions. Over the years, it has acquired startups like TERA Finlabs, Opfin, and more.
It is India’s top and leading company founded in 2014 by Shashank Kumar. Along with him, Harshil Mathur is the co-founder. The company is based in Bengaluru, Karnataka.
It allows you to use any payment mode. This includes debit and credit cards, UPI, mobile wallets (Mobikwik, JioMoney, etc.) multi-currency, and more. It helps businesses and traders to automate bank transfers, bills, checks, salaries, etc.
It is a digital system of payments that acts as a link between many apps. The decreasing role of debit and credit cards has given rise to the idea of auto-payments. In this regard, Razorpay offers features like UPI autopay.
It has administrative features like reporting, payout time, and dispute resolution. Security features like two-factor authentication, fraud protection tools, and more.
Along with these, other features include E-commerce integration, application programming interface, accounting software integration, etc.
About Razorpay
List of Startups Acquired by Razorpay
Startup Acquisition is a process where bigger companies buy an entire small startup or take the maximum authority over it by buying most of its shares or equity. This usually happens, when large companies want to remove their competition in the market.
Also, many startups begin their businesses with the hope of ultimately selling them in the future. This is because, after a point of time, the growth of certain startups becomes stagnant. So, going under the shelter of big companies help them to stay afloat and get better exposure.
Razorpay is one of the most noted companies in India. This payment platform made online transactions super easy and efficient. Its efficiency, great strategies, and right funding at right time made it a Unicorn startup in 2020.
Over the years of its existence, it has made a total of five acquisitions. It has also made investments in NextPay, Shiprocket, and MSMEx.
The following is the list of startups acquired by Razorpay:
IZealiant Technologies
Founded: 2015 Acquired: March 2022
This is the most recent acquisition made by Razorpay. It is a Pune-based fin-tech startup founded in the year 2015 by Prashant Mengawade. It provides for payment transaction processing by banks, traders, and processors.
The startup provides application programming interface empowered, cloud-ready, and mobile-first payment processing products. The businesses are able to receive, process, and distribute the payments smoothly with this startup.
It offers features like multi-factor authentication, 3D secure 2.0, E-commerce acquiring, Mobile POS and Micro ATM, and more.
Razorpay announced the acquisition of the startup on the 16th of March, 2022 for an undisclosed amount.
It is a Malaysian direct debit payment startup founded in the year 2018 by Zac Liew and Steve Kucia. The startup is designed to aid and ease the collection of recurring payments.
The startup tends to make settlements between customers, merchants, and their banks. It manages transactions and also collects cash receipts. It ensures all this by building technology on top of the payment framework.
It offers features like card payments, direct debit, payment collection, payouts, management of subscriptions, billing, and more.
Razorpay announced the acquisition of this startup on the 8th of February, 2022. It acquired the startup for an amount between 19 to 20 Million dollars.
TERA Finlabs
Founded: 2017 Acquired: July 2021
It is a startup that offers businesses financing solutions. It was founded in the year 2017 by Pradeep Rathnam and Harshil Mathur. It is based in Bengaluru. It provides technology, risk, and capital solutions.
This risk technology startup offers digital lending solutions for the organizations of finance and customer technology companies.
It is known for its great specialty in digital lending. It specializes in data-driven risk management, credit underwriting, and capital solutions.
Razorpay announced the acquisition of the startup for an undisclosed amount on the 19thof July 2021.
Opfin
Founded: 2017 Acquired: November 2019
It is a payroll management startup founded in the year 2017 by Anuj Jain. It is based in Gurugram. This enables the customers to custom-make their payment workflow to be as hands-off or hands-on as they want.
The startup is super helpful for small businesses. Its interface is perceptive and simple to use. This discards irrelevant jargon and unwanted steps.
It offers a wide variety of features like compliance management, attendance management, approval process control, application programming interface, attendance tracking, and more.
Razorpay announced its acquisition of it on the 23rd of November, 2019 without disclosing the amount.
It is a fraud detection startup founded in the year 2016 by Shashank Kumar. The startup rules out scams and frauds in digital, e-commerce, and banking transactions by using Artificial Intelligence. It is based in Gurugram.
The startup provides automatic detection and prevention solutions by using AI, big data technology, location profile, and device fingerprinting.
It offers features like risky order profiling, verification of shipping addresses, model customization, intelligent automation, and more. This helps to cut fraud, keep the rate of interest in check, and improve success and profitability.
Razorpay declared its acquisition of the startup on the 5thof August, 2019. This was the first acquisition made by Razorpay for an undisclosed amount.
Conclusion
Over its eight years of existence, Razorpay has surely made great progress and created a significant name for itself in the market. It has not only made itself successful but has also helped various other businesses by making their processes easy and efficient.
Since its birth, it has made a total of five acquisitions. All these startups have helped Razorpay to become even more skillful than it was on its own. These have strengthened the company more in the fields of banking services, neobanking, payout processing, e-commerce fraud detection, and more.
FAQs
What are the startups acquired by Razorpay?
Razorpay has acquired 5 startups:
IZealiant Technologies
Curlec
TERA Finlabs
Opfin
ThirdWatch
Who is the founder of Razorpay?
Shashank Kumar and Harshil Mathur are the founders of Razorpay.
Infosys Limited is one of the most well-known Multinational Tech Companies in India, headquartered in Bengaluru, Karnataka. The company is known for services like Business Consultation, IT and Outsourcing.
Infosys was established in 1981 and is now NYSE listed global consulting and IT company with more than 2,49,000 employees all around the world. The company is also considered to be the second-largest IT Company in India after Tata Consultancy Services. Infosys is also ranked 602nd largest company in the world according to the Forbes Global 2000 ranking.
Infosys first started out with a capital of $250 but now has grown into a company that generates over $14.22 billion in revenue in the year 2021, with a market capitalization of approximately $90.25 billion.
The company is over 40 years old and made a lot of development for the IT industry in India over the past years. It has played a role in the country’s emergence as a hub for software services. The company presently has over 123 development centres all over the world but is well known in countries like India, the US, China, Australia, Japan, Middle East and Europe.
Over 60%, 24% and 3% of its revenue was generated from North America, Europe and India in 2019, while the rest 13% comes from other parts of the world. Infosys is the first Indian company to be listed on NASDAQ. It has also created many salaried millionaires over the years.
The company works in domains like finance, insurance and manufacturing and provides services like NIA (Net generation AI platform), Infosys Consulting, Infosys Information platform, EdgeVerve Systems, Panaya Cloud Suite, Engineering services and digital marketing. Another well-known product is Finacle which is a universal banking solution.
Infosys wasestablished in the year 1981 by N R Narayan Murthy and six other engineers in Pune, Maharashtra with a small capital of $250.
Know everything about Infosys Business Empire
By 1987, the company had already opened its first international office in Boston, US. In 1992, the company went public so had to change its name from Infosys Technologies Private LimitedtoInfosys Technologies Limited.Later, the company was renamedInfosys Limited in 2011.
The company received the ISO 9001/TickIT certification and opened a development centre at Fremont in 1994. In the next year, Infosys also opened its first European office in the United Kingdom and will also set up its business practice.
The tech company established the Infosys Foundation and was assessed at CMM level 4 in 1997. It wasn’t until 1999 that Infosys got listed on the NASDAQ. Infosys becomes the 21st company in the world to achieve a CMM level 5 certification and opens offices in countries like Germany, Sweden, Belgium, and Australia.
Infosys has its offices in France and Hong Kong and development centres in Canada and UK in 2000 and has also expanded its offices in UAE, Argentina in 2001. The same year the company goes on to launch Finacle which is a universal banking solution.
In 2002, the company expanded its offices to countries like Netherlands, Singapore and Switzerland. The company finally reached the US $1 billion mark in revenue and then launched Infosys Consulting Inc in 2004.
Infosys crossed the $5 billion revenue mark in 2010 and even gets listed on the NYSE in 2012. According to Forbes, Infosys became the world’s most innovative company. It provided $250 million to help the “Innovate in India” and in order to support startups in India in 2015.
The company finally launched the awaited Infosys Maya. It is a platform that helps drive automation and innovation in companies. It has also launched Skava Commerce, a modular for e-commerce platforms in 2016.
In 2019, Forbes ranks Infosys as No. 3 in the best-regarded companies list and also launches the Infosys Live Enterprise Suite. In 2020, the company targets to attain carbon neutrality and even announces its ESG Vision 2030 where it would measure targets across the environment, social and governance.
Infosys Limited has been ranked number 1 in the 2021 HFS Top 10: Banking and Financial Servicesas per The Best of the Best Service Providers report.
EdgeVerve is one of the most popular Infosys subsidiaries that is known for its products and services. It is an innovative software product and offers an on-premise or cloud-hosted business platform. The company is a global leader when it comes to Automation and AI.
The company works in sectors like banking, digital marketing, interactive commerce, distributive trade, and credit servicing, and even enterprise buying and customer service. The company has a portfolio of AI which includes Infosys Nia, automation with AssistEdge and business applications like TradeEdge and ProcureEdge.
EdgeVerve also helps other companies in developing deeper connections with stakeholders and make innovations. Nowadays global companies from financial services, insurance, retail, life science, manufacturing and telecommunication use the company’s products.
One of its most known services is the Finacle, a universal banking solution that serves over 547 million customers nearly 16.5% of the world’s adult banked population. By providing these services the company is creating possibilities and helping other enterprises grow.
Panaya
Panaya – Infosys Subsidiary
Panaya is an international subsidiary of Infosys which is a software company based in the US. Some of its popular products and services are automated code remediation, collaboration test management and test execution and ALM acceleration.
The company is a leader in providing Automation technology, especially to large-scale enterprises. Panaya is a popular software as a service (SaaS) company and has its presence in the US, EMEA and Asia and also has its subsidiaries in Israel, Germany, Japan and Australia.
Infosys BPM Limited
Infosys BPM – Infosys Subsidiaries
Infosys BPM became a subsidiary in 2002 and is known for business process management. The company mainly operates in countries like India, Poland, Netherlands, South Africa, Brazil, Mexico, the US, Puerto Rico, China, Philippines, Australia and others.
The company focuses on providing end-to-end outsourcing and other benefits at lower costs, productivity improvements and process reengineering. The company also has other subsidiaries under it that are Infosys Portland and Infosys McCamish Systems.
The company is headquartered in Bengaluru, Karnataka and is mainly popular for integrated outsourcing and transformative services. More than 60% of the company’s business comes from the overlapping clients of their parent Infosys.
Infosys BPM has so far opened 33 delivery centres in 14 different countries and 44,443+ employees from more than 110 nationalities. The company has also won over 60 awards and recognition in the past 5 years.
Infosys Consulting Holding AG
Infosys Consulting – Infosys Subsidiaries
This company was initially called Infosys Lodestone. It is a global company known for providing consulting, technology, outsourcing and next-generation services. The company is now a global advisor to leading companies on things like process engineering and also managing tech-enabled transforming programs.
The company offers various customized solutions to the businesses that their clients face and also helps them renew their existing IT landscapes along with bringing in new technology and innovation to their business.
One of their most well-known services is the Infosys Aikido which includes working with clients in order to leverage the knowledge of systems. The company has so far conducted over 150 design thinking workshops and is actively engaged in 50 plus global companies and using Aikido to transform programs.
Infosys consulting holding tries to combine human-centric approaches with advanced technology and help companies to reimagine their future and create lasting business value.
Infosys Public Services Inc.
Infosys Public Services – Infosys Subsidiary
The company is a US-based subsidiary of Infosys known for providing services like business consultation, technology solutions and even advanced digital service.
Infosys Public Services, Inc. helps public sector organizations mostly in the countries like the US and Canada to stay ahead by innovating new things.
Their services allow their customers to renew their companies and come up with new avenues to generate value. The company has over 40 plus years of cross-industry experience and is also adapted for the public sector. The company also provides flexible delivery models for predictable and on-time execution.
Infosys Consulting Limited
Infosys Consulting – Infosys Subsidiary
This is another well-known international Infosys subsidiary that was established in Brazil in 2009. The company is said to have many offices in cities like Sao Paulo, Rio De Janeiro and Nova Lima.
Infosys Consulting helps its clients by providing business solutions, leverage technology, and global infrastructure. Their main vision is to show courtesy to their clients, employees including vendors, and society at large.
The company has so far been respectful and successful in Brazil and is also considered to be one of the fastest-growing subsidiaries of Infosys. With the help of this company, Infosys has managed to expand in the Latin American market which is important as the region has huge potential in the IT and enterprise applications market with a booming economy.
Kallidus
Kallidus – Infosys Subsidiary
Kallidus Inc, a US subsidiary of Infosys, is headquartered in San Francisco, California. The company is known for developing and providing mobile commerce and also helping its clients with digital marketing.
Kallidus is good at developing applications, websites and various other digital shopping experiences for devices like mobile, tablet, desktop, etc. It also helps its clients at all stages of the value chain including design, implementation and managed services for retailers.
Kallidus owns SkavaONE, which is a cloud-based tech platform well known for creating mobile commerce websites, mobile apps, online marketing campaigns and social media experiences for their clients.
This also includes services like Mobile commerce suite, in-store suite, digital commerce suite, and Skava studio. The company offers maximum flexibility in e-commerce integration with API, raw data adaptors in order to create an Omnichannel experience.
Noah Consulting LLC
Noah Consulting – Infosys Subsidiary
Noah Consulting, LLC is a global leader when it comes to management consulting services. The company helps oil and gas companies in managing, creating and deploying the information solutions for the business to generate value from their oil and gas assets. It focuses on providing the best data management, data warehousing, data integration, business intelligence, information quality and even data management solution.
The company has over 15 years of experience in delivering practical solutions to the most complex information challenges the industry faces. Noah Consulting has its headquarters in Houston, Texas with over 50-100 employees. The company has a deep knowledge of the industry, information strategy planning, data governance which is why it is one of the most important subsidiaries to Infosys.
Infosys is now a successful conglomerate known in more than 50 countries and popular among countries like India, the US, China, Australia, Japan, Middle East and Europe. The company has played a main role in the development of the IT Industry of the country and was pioneered by a lot of innovations.
The company is now a global leader when it comes to consulting, technology, outsourcing and next-generation services. They help their clients to always stay ahead in the industry by helping them attain the business trends by providing various solutions.
FAQs
What are the main services of Infosys?
The company is known for services like Business Consultation, IT and Outsourcing Services.
Where is the headquarters of Infosys?
The headquarters of Infosys is in Bengaluru, Karnataka.
Startup Acquisition is a process wherein big companies buy a small company/startup and has gained control over it by purchasing most or all of that company’s shares or assets.
There are several reasons why a company would want to acquire/buy a startup. If an entrepreneur is ready to sell off the business and move onto a new idea, the company needs a strategy to go through the entire acquisition process. There is a concrete process that will highlight crucial aspects of acquisition and how an entrepreneur can minimize the chances of failure.
For most of the companies or startups, getting acquired by another firm not only approves that the company is on a growth path in the respective industry but also bridges the financial gap that was trying to fill for quite some time. Acquisitions and mergers are exciting and challenging for entrepreneurs of engaging companies.
The UK business is highly active pertaining to Mergers and Acquisitions (M&A). There were almost 1,400 M&A deals during the first half of 2019 in all the major sectors like telecom, insurance, manufacturing, IT services, and wholesale industry.
Apple’s Largest Business Acquisition
Acquisitions come with many complicated steps and require a high degree of skills, expertise, and execution. Sometimes, an acquisition process can go wrong and end in failures. There are some megacorporations like Microsoft and Google,even they got the acquisitions wrong.
A walk-through on how to navigate the Startup Acquisition Process
Process of Startup Acquisition
If huge multinational companies want to acquire a particular startup, then the team has achieved quite a lot. For those who are looking to embark on the acquisition process in the near future, here’s a brief idea and process of what to expect.
Step 1: Initial Motivation and Consideration
The initial process starts when both companies identify their industry’s preferences and expectations. Next, set clear goals and expectations for the acquisition. The motive should not be just personal gains but some other factors as well that would impact the success of the business. The companies have to make sure that they’re financially as well as psychologically ready for this step.
Setting up exact pieces of the puzzle by acquiring businesses
Companies take years to build from scratch and there are countless personal sacrifices made by the founders, so the entrepreneurs should be certain about selling their business.
The questions asked to the selling companies are:
Why do you want to sell the company?
Can the acquirer be the right fit?
How exactly do you picture yourself with this acquisition?
Review and study these points individually and then move forward.
Points to be considered to sell the startups could be:
To work and grow the existing business.
To get access to financial capital.
Some personal factors like retirement, ill health, quitting the company, or family obligations.
Businesses for sale are listed in local magazines, directories and online portals. There is a real business deal landscape with technology where buyers and sellers can browse through a number of opportunities and opt for professional ones.
Step 3: Preparing for Due Diligence
Once the buyer and seller are mentally and financially ready for the acquisition, the next step is to get started with the due diligence, which is to consider the legal cases.
Most new entrepreneurs underestimate the power of legal and financial aspects of the acquisition process. The financial experts, lawyers & tax, and financial advisors have to be involved for a positive outcome.
Step 4: Hiring a Legal Counsel
Considering the entrepreneurs sincerely want to consider the business for purchase. Here are some factors to be paid attention to legally. The acquisition decision will have tax implications and both the party should consult an experienced tax professional to take care of these.
It is almost important for the buying company to check the new business with respect to applicable regulations, the common ones being Company Law, Labour Laws, and approvals by Banks or Financial Institutions which comes under Legal issues.
Step 5: Assemble a Finance Team
Assembling/hiring a financial team is the next step of the acquisition process. The acquisition process will require all kinds of financial reports, bank statements, which include revenue reports, financial schedules, expense accounts, and so on.
The accounting team may find it tough to function these requests while doing the daily accounting tasks. It is mainly advisable to hire a finance team that holds expertise in acquisitions.
Step 6: Prepare the Team for Acquisition
Now that every step has been cleared and studied carefully, the entrepreneurs need to inform their team about the acquisition of the company. A startup acquisition is a good news for most entrepreneurs, it may be otherwise with the working team. It is important to handle the team smoothly throughout the transition and make them comfortable.
Step 7: Seal the Deal
Once all of the above-mentioned steps are cleared, the parties need to select a date for sealing the acquisition deal. This is an important step to finalize the deal and start with the actual business acquisition paperwork, thus starting with a new company.
Step 8: Purchase Terms and Conditions
The terms and conditions of the post-transaction will be explicitly captured in the term sheet and then in a more detailed manner in the purchase agreement. There are important deals like deal structuring, setting up payment terms and conditions, warranties, post-deal involvement, and rights and obligations of the seller and the buyer are the most important considerations at this point.
Step 9. Post Purchase Advertisement
Once the deal is done and the businesses are set to operate the obtained ownership, it will become important to share information about this transfer of title with key stakeholders of the business such as creditors, customers, etc.
Conclusion
Preparing the team for a merge won’t be easy, despite the success. The entrepreneurs will encounter continuous resistance. However, the decision to do the best for the people and business will be enough providing the existing ones with leadership through the transition. The startup acquisition process is an interesting turn in both parties’ lives.
FAQs
What is startup acquisition?
Startup Acquisition is a process wherein big companies buy a small company/startup or has gained control over it by purchasing most or all of that company’s shares or assets.
What is meant by merger and acquisition?
A merger means the two or more separate entities have combined authority to control the new joint company and acquisition means taking control over all the authority of another company. Mergers and acquisitions are executed to expand a company’s reach or gain market share to create shareholder value.
What is the Process of Startup Acquisition?
Process of Startup acquisition includes the following steps:
Initial Motivation and Consideration
Sourcing
Preparing for Due Diligence
Hiring a Legal Counsel
Assemble a Finance Team
Prepare the Team for Acquisition
Seal the Deal
Purchase Terms and Conditions
Post Purchase Advertisement
Why does a startup want to get acquired?
There could be multiple reasons why startups want to get acquired by big companies. Some of them are:
Fund requirement: The company wants to get acquired in order to meet its fund requirements.
Debt clearance: Sometimes startups are under debt and they need money in order to clear their debt. So, they look for acquisition.
Recognition: The chance of getting identified by various people and companies increases once the startups get acquired.
Increase productivity: Startups become less productive after a particular point. Hence, getting acquired by big companies help them to increase their productivity.
A desire for exposure: Getting acquired by big companies gives the startup an opportunity to get the maximum amount of public attention.
2021 has been a rollercoaster for all of us, but it has been a watershed moment for the Indian startup ecosystem. Since January 2021, 119 merger and acquisition agreements have been completed, compared to 86 for the entire year of 2020. In 2020, this amounted to $1.3 billion in Mergers and Acquisitions; by 2021, the sum had risen to $3.8 billion. These are simply the agreements that have been made public; the bulk of them have not been made public, and their worth might be far more significant. And, given that we’re a month away from the end of the year, there’s undoubtedly more to come. Here are some of the top startup acquisitions to know about.
Here are listed some of the biggest startup acquisitions of 2021.
Acquisitions by Unacademy
Top Startup Acquisition – Unacademy Acquisition
Unacademy is an EdTech firm located in Bengaluru with a network of over 18,000 educators. It provides Live Classes, both free and subscription-based, for various professional and educational admission examinations. Unacademy has been on a buying frenzy recently.
Kreatryx, a platform founded in 2014 that provides videos, test series, and a postal tracking tool for GATE, CIL, SSC and ESE examinations, was acquired through a cash and stock deal in March 2020. Kreatryx continues to be run by its founder, Ankit Goyal. Unacademy gained a competitive advantage in the GATE and ESE exam prep markets due to the acquisition.
CodeChef
CodeChef, a platform for computer programming, algorithms, and programming competitions, was founded in 2009, was acquired by Unacedemy in June 2020. The acquisition is expected to aid the Facebook-backed company’s development of a coding skills segment for students.
PrepLadder
Unacademy paid $50 million for the acquisition of PrepLadder, a platform founded in 2015 which prepares students for postgraduate medical entrance exams. Unacademy’s prominence in the medical entrance examination categories was bolstered as a result of this move.
Mastree
Mastree, founded in 2019, is a K12 learning platform, which mainly focuses on core curricular subjects. It was acquired by Unacedmy for $5 million in July 2020. This acquisition bolstered the company’s position in the K12 education market. After a year of ownership, unacedamy shut down Mastree in September 2021. It also launched ‘Graphy’ in the same line. Users may utilise photos, videos, quizzes, and audio to study books and unique material.
Coursavy
Unacademy acquired Coursavy in September 2020 to improve its position in the Union Public Service Commission (UPSC) examinations category. Coursavy, founded in 2018, is a platform that offers live lectures, online courses and provides students with handwritten study notes. and comprehensive quizzes.
Scapic acquired by Flipkart
Top Startup Acquisition
Flipkart bought Augmented Reality (AR) company Scapic in November 2020, intending to make shopping on its platform more engaging. Flipkart did not reveal the financial terms of the acquisition. As part of the transaction, it absorbed the Scapic team.
It’s a part of Flipkart’s plan to offer more immersive camera experiences, virtual shops, and new ways for brands to advertise on the site.
EY is a leading provider of assurance, consultancy, strategy and transactions, and tax services worldwide. Spotmentor technologies, an end-to-end skilling platform that helps organisations discover skills necessary for the future of work, upskilling, and reskilling employees at scale, was acquired by EY India in November 2020 for an unknown price. It makes use of cutting-edge technology like artificial intelligence and machine learning to help organisations address crucial competence gaps.
Rekrut India acquired by upGrad
Top Startup Acquisition
UpGrad is a Mumbai-based online higher education ed-tech firm that offers data analytics, product management, entrepreneurship, and digital marketing courses. It was named the official education partner for the Startup India learning initiative by the Indian government in September 2016. Rekrut India is a firm that provides recruitment and staffing solutions to help businesses grow their human resources. Rekrut India was acquired by upgrad in December 2020 for an unknown sum. It is the first time that an ed-tech or recruiting business has completed a 100 per cent acquisition.
Rekrut India will continue to function independently following the acquisition.
Directly acquired by ClickIndia
Top Startup Acquisition
Clickindia is a classified website that makes it simple to find, buy, sell, trade, and communicate with others who share the same interests. Directly. Live is a software-as-a-service (SaaS) company that enables people and businesses to plan meetings by integrating its platform into their systems and allowing them to hold video conversations with one another. In March 2021, Clickindia bought directly. Live for an undisclosed sum in an all-cash acquisition.
Fleapo acquired by Stritmedia
Top Startup Acquisition
Stritmedia is a four-year-old Kolkata-based firm that specialises in advertising and news media houses and affiliate marketing.
In December 2020, it paid an unknown sum for Fleapo Pvt Ltd, resulting in the establishment of a new brand called Sinofled Pvt Ltd. Fleapo works in the software and application development industry. Apart from the acquisition, Strirmedia aims to invest about $100,000 in expansion plans, staff building, and the brand’s services department.
Cure.Fit bought Fitternity, a Bengaluru-based fitness aggregation platform, in February 2021. It’s also one of the country’s largest fitness facility aggregators. Cure. Fit is a health and fitness firm that provides digital and offline experiences in exercise, nutrition, and mental health.
Fitternity will continue to operate independently, allowing Cure.Fit to expand its Cult Pass offering. Cure.Fit has now acquired Fitternity for the sixth time. Cult was acquired in 2016, followed by Tribe and 1000 Yoga in 2017, Fitness First in 2018, and Onyx in 2021.
Samunnati Financial Intermediation & Services, based in Chennai, which provides financial solutions for the agricultural sector, announced on April 12th, 2021, that it had acquired farmer-centric Agri supply chain platform Kamatan Farm Tech, an agricultural-technology startup focusing on the farming logistics and supply chain segment. After agri-tech firms LivLush and Sabziwala, Kamatan was created.
Elevar Equity, an impact venture capital firm, financed both and combined their firms in March 2020.
According to a statement from Samunnati, the acquisition would enhance the company’s market connection outreach activities. Farmer Producer Organisations (FPOs), small merchants, and agro SMEs would interact with corporate customers through the new company.
DailyJoy acquired by Lenskart
Top Startup Acquisition
In April 2021, Lenskart, a Delhi-based eyeglasses firm that joined the unicorn club last year, bought DailyJoy, a food and necessities delivery business in Tier 1/2 cities like Lucknow and Hyderabad, to strengthen its technological stack and technical capacity.
The acquisition is only to bolster the Acquiree’s team strength and exploit its technological knowledge. To assist its expansion, Lenskart wants to make Hyderabad a centre for high-quality, consistent engineering.
GamingMonk acquired by The Mobile Premier League
Top Startup Acquisition
MPL is an esports and skill gaming platform based out of Bengaluru. In April 2021, it acquired GamingMonk, a Delhi-based esports broadcasting platform that conducts esports competitions on various platforms, including mobile, console, and PC. The competitors include FIFA, Counter-Strike, and Call of Duty, and they are all streamed. MPL has absorbed the whole GamingMonk crew.
FAQs
What is startup acquisition?
Startup acquisition is the process of buying a successful or evolving startup company that has gained grip in the market.
Ria Puneyani
