Skip to main content

Is the Spike in Bridge Rounds Bad News?


July has already seen 6 start-ups reporting bridge rounds - marking a spike in the number of such deals in recent months. The list of companies includes MyTaxiIndia ($1 M from Nihon Kotsu), Quickli (AVG Group & 500 Startups), and AppsDaily ($2 M from Kalaari Capital, Qualcomm Ventures, etc).

What qualifies as a Bridge round?

A bridge round is typically one where the company raises a sum smaller amount of funding than during its previous round. The investors in the round are also typically existing investors who have chosen to extend the company "extra runway".

The following table - extracted from a post on Bridge Rounds by US VC Paul Martino - provides the highlights of such a round:




Most of the recent Bridge Rounds in India are taking place either between the Seed and Series A or between the Series A and Series B stages.

Is the Spike in Bridge Rounds a Cause for Worry?

Not Really. While it is quite clear that providers of follow-on funding have become choosier,  the fact that Bridge Rounds are now going through means that existing investors are willing to back start-ups with more capital.  

More Bridges to Cross?

Between July 2014 - June 2015, as many as 216 startups had raised Series A funding. Of these, only 20% have managed to raise follow-on funding. 


Between July 2014 -  June 2015, 120 startups had raised Seed Funding - of which only 25% startups have raised their Series A round.


More than 250 startups, which between them have raised over $600 million in Seed/Series A funding, are now "overdue" to raise new money (ie, it's now 12+ months since their last round). 

Would you like the complete list of start-ups that seem to be struggling with their Series A / B rounds? Contact Varatha at bizdev@VentureIntelligence.com or +91-44-42185180.

Any other feedback / suggestions? Chime in in the comments.

Venture Intelligence is India's longest serving provider of data and analysis on Private Company Financials, Transactions (private equity, venture capital and M&A) & their Valuations in India.

Popular posts from this blog

VC Interview: Shailendra Singh of Sequoia Capital India

In a recent interview to Venture Intelligence, Shailendra Singh discussed some of the firm’s newer investments in the early stage segment including in the online payments space, the progress at a few existing portfolio companies and the active role the firm is playing in helping its portfolio companies scale and succeed in India and globally. Prior to joining the firm in 2006, Singh was a strategy consultant at Bain & Company in New York and before that, an entrepreneur in the digital media industry.

Venture Intelligence: How does Sequoia go about identifying potential early stage investments in India? Is there anything different you are doing today than, say, a couple of years back?

Shailendra Singh: There is a lot more focus on technology investing and early stage investing. In general, as you might remember a few years ago, we were doing primarily growth investing but in the past 18-odd months, we have had a very strong focus on early stage and that’s continuing. In terms of how…

PE Investments down by 36% in Q1'20

Press Release
Private Equity-Venture Capital (PE-VC) firms invested $5.9 Billion (across 164 deals) during the quarter ended March 2020 - 36% lower than the $9.2 Billion (across 249 transactions) during the same period last year, according to data from Venture Intelligence, a research service focused on private company financials, transactions and their valuations. The Q1'20 investments were also 37% lower compared to the immediate previous quarter (which had witnessed $9.4 Billion being invested across 227 transactions). (Note: These figures include Venture Capital investments, but exclude PE investments in Real Estate).
The latest quarter witnessed 14 PE-VC investments worth $100 million or more, down from the 20 such transactions in the same period last year. The largest PE-VC investment announced during Q1’20 was the $567 million takeover of power generation company RattanIndia Power by Goldman Sachs and Varde Partners. The second largest investment was SoftBank Vision Fund…

Ambit tops League Table for Transaction Advisors to Private Equity deals in 2019

Ambit Corporate Finance topped theVenture Intelligence League Table for Transaction Advisor to Private Equity Transactions for the year 2019. Ambit advised PE deals worth $2.4 Billion (across 4 qualifying transactions) during the period. Citi ($1.1 Billion across 2 deals) and Avendus ($969 million across 12 deals) took the second and third spot. Edelweiss Financial Services ($758 million across 9 deals) and PwC ($708 million across 15 deals) completed the top five in 2019. 

The Venture Intelligence League Tables, the first such initiative exclusively tracking transactions involving India-based companies, are based on value of PE and M&A transactions advised by Financial and Legal Advisory firms.
Ambit Corporate Finance advised the $1.9 Billion buyout of Pipeline Infrastructure from Reliance Industriesby Brookfield Asset Management and the IFC and I Squared Capital-backedCube Highways' acquisition of Delhi-Agra Toll Road from Reliance Infrastructure (Reliance ADAG). Citi advise…

PE investments in 2018 crosses $33-B to set new all-time high

Big Ticket investments in consumer apps Swiggy & Byju’s dominates year-end activity, even as investments in Core Sectors slow down
Private Equity (PE) investments in India rose to their highest ever figure of $33.1 billion in 2018 (across 720 transactions), according to data from Venture Intelligence (http://www.ventureintelligence.com), a research service focused on private company financials, transactions and their valuations. While PE investments have already surpassed the previous high - $24.3 Billion across 734 deals in 2017 - in the first nine months of 2018, the mega investments in Consumer Internet & Mobile startups such as Swiggy and Byjus towards the year-end, helped the 2018 total vault by 36% year-on-year. (Note: These figures include Venture Capital investments, but exclude PE investments in Real Estate.) The year witnessed 81 PE investments worth $100 million or more (accounting for 77% of the total investment value during the period), compared to 47 such transac…

"Leveraged stock purchase led Arvind Rao to go astray": Forbes India

Forbes India has an article on the series of events leading to the recent controversial exit of Arvind Rao, Co-founder & CEO of listed Mobile VAS firm OnMobile.

On November 23, 2010, Arvind Rao, the 53-year-old co-founder and CEO of OnMobile, bought approximately 6 lakh shares of his company from the open market, representing a little over 1 percent of the company’s total shares....At Rs 277 a share, he had to pony up nearly Rs 16.5 crore to acquire them....So he went ahead and borrowed money to buy the shares, thinking nothing of the interest it entailed or the fact that he’d need to put up nearly half his existing shareholding as collateral...OnMobile’s shares continued to fall from those levels, while Rao’s interest payments ballooned.

...Motivated by OnMobile’s growth all these years, he had never paid much attention to his salary, most of which went towards the monthly rental on his sea-facing apartment in Mumbai and his BMW 7-Series, both paid directly by the company. He reque…