Kae Updates of the Quarter (Jul-Sep 2024)

Foreword (Angels spread their wings again, startups rejoice; GoI fancies Space Tech; 2024 is the year of IPOs)

Before we get into industry updates for the quarter, we are delighted to share that Abhishek Srivastava , former Founding Director of Endiya Partners, has joined our team as a General Partner. We welcome him to our team!

As is the tradition in every election year, the main budget was announced in July for FY25. A longstanding desire of investors and startups alike was to abolish the angel tax, which has finally come to fruition in this budget. The government has also set up an INR 1,000 cr fund for space tech startups, which shows its huge vote of confidence for this sector and the development of the startup ecosystem overall.

A delightful update this year overall is the increase in IPOs and the promise for more in the near future. India is leading the global IPO market with 227 transactions amounting to $12.2 billion in the first eight months of 2024, driven by a strong market sentiment and a robust macroeconomic environment. Ten new-age tech companies have listed on the exchanges so far this year, such as Go Digit General Insurance, FirstCry, Unicommerce, TBO Tek, Ola Electric, Awfis, and ixigo. Startups which have filed their DRHP include Swiggy, MobiKwik, and BlackBuck.

Indian startups doubled funding year-on-year (YoY) to $3.4 Bn in Q3 CY24. Indian startups had raised approximately $1.7 Bn in the corresponding period last year and nearly $3 Bn in Q3 CY22. The overall deal count jumped to 262 in this quarter, up almost 28% from 205 deals in Q3 2023. Startups like Zepto, PhysicsWallah and Rapido were the mega deals in Q3 2024. Seed-stage startups raised $360 Mn in Q3 2024, a 126% jump from $159 Mn in Q3 2023. However, deal count fell 3% YoY to 125 across seed stage.

Portfolio Buzz In The Media

Addition

RecommerceX specializes in processing industrial waste to recover critical materials and useful by-products that serve as raw materials for its customers. The company’s innovative material recovery technology not only aids in the decarbonization of supply chains but also significantly reduces the dependence on raw materials. It operates across various categories, including plastics, metals, and e-waste.

We're delighted to have led this seed round alongside Accel, and are excited to see the startup's growth!

Qure.ai is a breakthrough AI solution provider that is disrupting the radiology 'status quo' by improving health outcomes. Qure taps deep learning technology to provide autonomous interpretation of radiology exams like X-rays, CTs and Ultrasound scans.

Through our Winners Fund II, we have invested in Qure.ai ’s Series D round, led by Lightspeed and 360 ONE Asset, with participation from Merck Global Health Innovation Fund.

Beyond the $$

SuperAGI platform is a combination of System of records software and System of action AI agents for enterprises across functions. The team released SuperSales , an AI sales agent that works 24×7 to find and engage with prospects without the hassle of hiring.

Its latest research on SuperCoder 2.0, an advanced autonomous coding system, was globally ranked in the top 5 submissions on the SWE-Bench Lite benchmark.

Zetwerk’s (India’s largest on-demand manufacturing network) co-founder Srinath Ramakrrushnan featured in the prestigious ET 40 Under Forty 2024 List.

Wysa is an advanced conversational AI chatbot for mental health. It has partnered with USAID, Jhpiego, and Villgro to equip adolescent girls in India with the skills they need to navigate life's challenges, especially those related to sexual and reproductive health

Traya provides a holistic treatment for hair loss by targeting its root causes. The team won the 'Best Use of YouTube by a Brand' award at Mad Over Marketing’s Mommys 2024 for their exceptional and relatable content centred around hair loss.

Kae Updates

Blogs

We’ve fleshed out our series “AI-ming for the Stars ” further, focusing on both consumer experiences and enterprise functions:

1. Part 3: Designing the Future – How GenAI is Transforming Interface Design: Smartwatches, rings, voice activation devices- a lot is happening on the interface front, making AI an integral part of our lives. What does the future hold for interfaces? Is India ready to adopt these trends or will there be some adjustments required? Natasha Malpani Oswal takes us through how AI-driven interfaces are transforming consumer behaviour.
2. Part 4: Agentification of Application Layer: What are AI agents? How are they helpful? How can agentification be used across different functions? This blog by Veenu Choudhary sheds light on this and where the opportunity is presently to build in this segment.
3. Part 5: Redefining Play: How GenAI is Transforming Gaming: GenAI is revolutionizing the gaming industry, creating more immersive, personalized, and intelligent experiences. There is a monumental opportunity to lead a new wave of technological advancement here. Natasha Malpani Oswal covers the gaming opportunities in India and the world.
4. Part 6: The Future of Travel – How GenAI is Revolutionizing the Travel Industry: This blog by Natasha Malpani Oswal explores how GenAI is revolutionizing the travel industry through personalized itineraries, dynamic pricing and immersive experiences. The future of travel is here, and GenAI is the way forward.
5. Part 7: Love in the Age of AI: How GenAI is Transforming Dating: AI is transforming the dating landscape, offering advanced matchmaking, enhanced security, and personalized journeys. We explore how GenAI is shaping the future of online dating in this blog by Natasha Malpani Oswal
6. Part 8: The Future of AI in Companionship – Shaping the Next Frontier in Human-Technology Interaction AI-driven companions are redefining human-technology interactions, offering emotional support, mental health resources and personalized experiences. We explore how AI is shaping the future of companionship in this blog by Natasha Malpani Oswal.
7. Part 9: The Future of Search and Discovery: How GenAI is Transforming the Landscape GenAI is revolutionizing search and discovery, moving beyond traditional search engines to offer contextual and personalized experiences. In this blog by Natasha Malpani Oswal, we explore how AI-driven platforms are changing how we find information and interact with the digital world.
8. Part 10: How GenAI is Revolutionizing Healthcare: From Drug Discovery to Digital Health The biotech and healthcare sectors are on the brink of a major transformation, thanks to the integration of GenAI. This blog by Natasha Malpani Oswal explores how GenAI is making a profound impact on healthcare across verticals.

Industry Stories and Events

1. Abhishek Srivastava participated in MoneyX by Inc42 as a speaker on the panel “SaaS in the AI Era”. He spoke about the SaaS landscape in India, how Indian companies are leveraging AI to scale, and how such startups can attract and retain the best talent.
2. Sunitha Viswanathan participated in a story by The Established which talked about why VCs are bullish on India's beauty industry.
3. Gaurav Chaturvedi spoke with Sramana Mitra on her 1Mby1M Roundtable about Kae Capital, our focus on the application layer of AI, our present AI investments and how we view the sector's present state and overall potential.