Airbnb is buying trust during the COVID-19 travel slowdown

Hello and welcome back to our regular morning look at private companies, public markets and the gray space in between.

Airbnb’s recent moves in the wake of a global travel slowdown are interesting and worth understanding in chronological order. What it details is a company spending heavily today to keep up its future health. Demand will return to the world travel market in time — how much, no one knows — and Airbnb wants to be a well-liked participant in the return to form.

Building off our last look at the company, we should understand how Airbnb intends to not only survive, but come out the other side of the pandemic with enough user trust to get back to work

An IPO promise

Indian online grocery startup BigBasket raises $60M

Indian grocery startup BigBasket has raised $60 million as it scales its business in the country to meet growing demand from customers stuck at home.

Alibaba and other existing investors including Mirae Asset and CDC Group participated in the bridge-round, Vipul Parekh, co-founder of BigBasket, told TechCrunch in an interview. Parekh said the startup intends to close a larger financing round in the next six to nine months.

The eight-year-old startup, which attained the unicorn status last year, has raised about $720 million in venture capital and debt financing to date, according to CBInsights. Indian news outlet Entrackr first signaled about the bridge-round.

Parekh said the startup is aggressively trying to hire more delivery personnel to service the ever growing demand from customers. New Delhi ordered a nation-wide lockdown last month, which has disrupted several businesses.

The volume of orders on BigBasket has surged by up to five times in recent weeks, said Parekh. But the startup is struggling to find enough people to deliver items to customers as many workers have moved to their hometowns or are cautious about working in the current environment, he said.

In the last one week, BigBasket has partnered with Uber and two-wheeler mobility firm Rapido to deliver groceries in parts of India. The startup, like several others, faced severe challenges last month after the 21-day lockdown was enforced as it worked with local state authorities to continue its delivery operations. At one time, it had over 400,000 inventories that it needed to ship but was sitting in its warehouses.

BigBasket operates in more than two dozen cities in India and offers tens of thousands of grocery products to customers. As far as securing inventories is concerned, Parekh said the startup is currently not seeing any issues.

BigBasket’s rival, SoftBank -backed Grofers has also seen a surge in volume of orders. The startup said this week that it delivered in 1 million homes in three weeks.

But despite the growth, Grofers co-founder and chief executive Albinder Dhindsa said online grocery still accounts for only 0.2% of the overall retail market. “I think at the end of this crisis we will probably reach 0.5%, but that is still an insignificant share,” he said.

Deliveroo, Graphcore and other big UK startups say they’re being cut out of COVID-19 lending relief

The U.K. government, like a number of other countries around the world such as the U.S., has stepped up its pace in providing relief in the form of loans for businesses being impacted by the coronavirus health crisis and the related shutdown that we’ve seen across the economy and life as we knew it. But startups in the U.K. are increasingly getting worried that they are being left behind.

An open letter to the Chancellor published today and signed by the U.K.’s biggest “scale-ups” — later-stage, highly valued, but still venture-backed (and often loss-making) startups such as Deliveroo, Benevolent AI, Citymapper, Graphcore and Bulb — urged the U.K. government to make room to provide lending options to companies like theirs.

They are specifically calling for a special task force to be created to consider how to build lending schemes for companies like theirs, as well as to alter the rules on the three big schemes that have already been announced to accommodate them, and give them the same access as other businesses.

The letter, which we’re publishing in full below, is not the first cry for help. Earlier this week, another initiative called SOS (Save Our Startups), also published an open letter asking for access to the same lending schemes that other businesses are getting. SOS includes dozens of smaller startups and a number of the VCs that back them.

The crux of the matter has been that startups backed with tens or hundreds of millions of dollars in funding from VCs to scale their growth have not been built or planned with profitability as a short-term or even medium-term goal. Many of them have so far eschewed public listings (and subsequent credit ratings, for starters) for longer in part because of the large amount of money available to them these days through the private markets — venture capital, family offices, private equity and so on — to grow.

All of that is predicated, however, on the continued health of the wider economy and consumer demand that helped nurture their businesses in the first place. The current public health crisis has thrown that model into disarray, and has meant that the growth these companies had expected will simply not be coming in the form that they expected, if it comes at all. VCs might pick up some of the slack — the biggest of these are still raising, and have in their hands already, huge funds and will step up to support their most promising portfolio companies. But we don’t know how long the effects of the coronavirus will linger, and most likely these startups, like other businesses, will need more.

Countries like France and Germany have accounted for this business disparity. They have created special provisions for lending to startups in response to the COVID-19 economic and social upheaval, and respectively there have been programs backed with $4.3 billion and $2.2 billion in government money put into place. But the three main U.K. initiatives that have been announced — Coronavirus Large Business Interruption Loan Scheme, the Covid Corporate Financing Facility and the Coronavirus Business Interruption Loan Scheme — have basic requirements that effectively rule out scaled-up startups from applying.

These include provisions around having established credit ratings for public companies (as in the case of the bigger loan schemes), or financing that is too small (as in the case of the smaller loan schemes), or the scaled-up companies have annual revenues that are too high (both the CBILS and CLBILS schemes have respective turnover thresholds of £45 million and £500 million).

In the meantime, the U.K. government has made small moves to encourage startups to continue building in a more focused way — for example, last week it announced £50 million in grants to businesses that are building better “resiliency” products to help companies better weather crises like this in the future. But for companies that regularly see revenues (and corresponding expenses and losses) in the tens and hundreds of millions, grants in the tens of thousands of dollars are like putting drops of water into the ocean.

But with startups accounting for some 30,000 businesses and some 300,000 workers in the U.K., and significant sums toward the country’s GDP and operations, it seems like a big problem to ignore for too long.

[letter follows below]

Dear Chancellor,

We greatly appreciate the significant steps that you have taken to help British businesses through the COVID-19 crisis. But as founders and CEOs of leading UK companies we are concerned that unless urgent changes are made to the current schemes then the high-growth UK tech sector will be put at risk.

As innovative companies we build technology and systems that transform sectors. For customers, we drive costs down, standards up and for society we create whole new categories of products and services. We are vital to productivity, clean growth and UK exports.

But unfortunately, the COVID-19 lending schemes you have put in place benefit established firms and do not help companies of the future such as ours.

The businesses we run serve millions of customers across the UK, and overseas. We are stepping up to help the country at this difficult time by helping tens of thousands of small businesses to continue operating, helping vulnerable customers get essential services and using innovative technology to give the NHS better tools to tackle the pandemic.

The high-growth tech sector has introduced innovative new products that have improved the lives of millions of customers in the UK and many more around the world. We have created huge numbers of high skilled jobs and we export across the globe.

Our sector will be crucial to helping the UK economy bounce back quickly after the pandemic. The UK tech community is a world class engine for innovation and growth, however, it has not yet received Government support, unlike our competitors in France and Germany.

Our companies have all invested in technology and growth rather than short term profitability, which means that we are currently unable to access the schemes which have been designed with longer-established businesses in mind. The current schemes that you have put in place – the Covid Corporate Financing Facility (CCFF), the Coronavirus Large Business Interruption Loan Scheme (CLBILS) and the Coronavirus Business Interruption Loan Scheme (CBILS) – are not accessible to our businesses.

We are therefore writing to ask you to urgently set up a taskforce meeting of leading tech businesses to work with you and your officials to find a way for high-growth tech companies to be able to access the lending schemes you have already established or new schemes if necessary.

As you said in your Budget speech earlier this year, to help Britain’s businesses lead the next generation of high productivity industries, we need to invest in the technologies of the future. The high-growth tech sector has a vital role to play in the future success of the UK economy, and we urge you to work with us to ensure that it is helped through the crisis and that the UK is still the best place in the world to build a tech company.

Confirmed Signatories

Ali Parsa, Babylon

Joanna Shields, BenevolentAI

Peter Smith, Blockchain

Hayden Wood, Bulb

Azmat Yusuf, Citymapper

Poppy Gustafsson, Darktrace

Will Shu, Deliveroo

Marc Warner, Faculty

Stan Boland, Five AI

Hiroki Takeuchi, GoCardless

Nigel Toon, Graphcore

Herman Narula, Improbable

Mom-focused content startup Motherly raises $5.4M as it expands into commerce

Motherly CEO Jill Koziol admits that it was a tough pitch when she and her co-founder Liz Tenety first tried to get investors on-board in 2015.

“We wanted to create a brand first and foremost,” Koziol told me. “We did not want to go and build a media company or a [direct-to-consumer] company or Facebook for moms — because spoiler alert, it’s called Facebook.”

Instead, she described Motherly as a company that sits at the “intersection” of all three approaches. It started out by publishing motherhood-themed content on its website and on social media (and more recently in podcast form), which in turn encouraged the audience of 30 million unique users to start “engaging with us and with each other.”

Now that there’s a big audience and a real community, the company is getting ready to launch the Motherly Store. And it’s announcing that it has raised $5.4 million in Series A funding.

Koziol described her approach as building a trusted brand “that’s woman-centered — not baby-centered — and expert-driven,” then using that brand to sell products. She said Motherly has reversed the strategy of direct-to-consumer startups that sell products, then add content and community to support those commerce goals.

“Everyone says we did all the hard stuff first,” Koziol said. “We’re showing the world that motherhood is not niche, that you can build a brand through content and then create the natural extensions out of that.”

Motherly screenshot

Image Credits: Motherly

The Series A funding was led by 8VC, with participation from Founders Fund, Muse Capital, AET and AmplifyHer Ventures.

“We’re long on millennial moms, and Motherly has demonstrated a unique ability to be at the center of this hyper-engaged market already,” Amplifyher’s Meghan Cross told me via email. “Its content has organically sparked a vibrant conversation, and commerce is the logical extension.”

Koziol, meanwhile, said that Motherly was able to build this audience with “virtually” no audience spend. That sounds particularly difficult given all the other parenting- and motherhood-themed content already online, but Koziol said that she and Tenety (a former Washington Post editor) are both millennial mothers themselves, and they realized that “in media brands across the board, motherhood was treated as cartoonish … everything was very baby-centered.”

She argued Motherly has succeeded so far because it’s aimed at a more educated and more diverse group of women, who are more likely to continue working after they have children.

And as Motherly moves into commerce, she said that will include both company-branded products (Sounds True is publishing the startup’s second book, “The Motherly Guide to Becoming Mama: Redefining the Pregnancy, Birth, and Postpartum Journey”), as well as a Motherly Store, which will offer a curated selection of products for moms, largely from smaller, direct-to-consumer brands.

Koziol suggested that these brands will benefit from access to Motherly’s audience (particularly as advertising costs have grown to unsustainable heights for many D2C brands), while moms will benefit from having a “credible” source who can help to “narrow down those choices.”

Of course, the landscape for media, commerce and parenting have all changed dramatically in the past few weeks thanks to the COVID-19 pandemic. But Koziol noted that as a “100 percent work from home company,” Motherly was better-prepared for this shift.

More broadly, she suggested that moms are going to need more help and support than ever — which Motherly is trying to provide, for example by offering its online birth class for free.

“This woman in our audience has been layering roles on for years,” Koziol said. “And we what we are now seeing, in addition to carrying the mental load of parenthood disproportionately and being a full-time bread winner, you’re layering full-time child-care and homeschooling. These are three different jobs.”

Daily Crunch: Airbnb raises another $1B

Airbnb turns to private equity for new funding, WhatsApp takes new steps to fight disinformation and another potential COVID-19 vaccine enters human trials. Here’s your Daily Crunch for April 7, 2020.

1. Airbnb turns to private equity to raise $1 billion

Airbnb said Monday that it has raised $1 billion in debt and equity from PE firms Silver Lake and Sixth Street Partners, even as the online rental marketplace has seen its business plummet due to the COVID-19 pandemic.

Terms of the deal were not disclosed. It’s also unclear how this funding might alter Airbnb’s previously shared plans to go public.

2. WhatsApp introduces new limit on message forwards to fight spread of misinformation

The Facebook-owned instant messaging service said that any message that has been forwarded five or more times will now face a new limit, preventing a user from forwarding it to more than one chat or contact at a time.

3. A second potential COVID-19 vaccine, backed by Bill and Melinda Gates, is entering human testing

The Inovio DNA vaccine candidate works by injecting a specifically engineered plasmid (a small, independent genetic structure) into a patient so that their cells can produce a desired, targeted antibody to fight off a specific infection. DNA vaccines, while available and approved for a variety of animal infections in veterinary medicine, have not yet been approved for human use.

4. CNN has acquired Canopy, a privacy-focused content personalization engine, for its upcoming news platform

CNN isn’t talking much yet about its new project, currently codenamed “NewsCo,” except to say that it is a “news and information platform connecting users to trusted sources, storytellers and creators across a wide range of topics.”

5. How SaaS startups should plan for a turbulent Q2

TechCrunch spoke with Matt Murphy — who spent 16 years at Kleiner Perkins before joining Menlo Ventures in 2015 — late last week, discussing how startups should plan for what could prove a difficult Q2 and how churn expectations should adapt as the economy changes. (Extra Crunch membership required.)

6. Foursquare merges with Factual

The terms of the deal were not disclosed. The merged company will keep the Foursquare moniker, and Foursquare CEO David Shim will remain at the helm, with Factual’s founder and now-former CEO Gil Elbaz joining Foursquare co-founder Dennis Crowley as a member of the board and executive team.

7. The US is formalizing Team Telecom rules to restrict foreign ownership of internet and telecom assets

Team Telecom, a mostly informal working committee of the Departments of Defense, Homeland Security and Justice, has been quietly tasked with evaluating and maintaining the security of America telecom infrastructure in concert with the FCC. That informal arrangement is disappearing, as the administration published a new executive order formally instantiating Team Telecom as a legal process for reviewing applications for telecom licenses, deals and other requests made to the FCC.

The Daily Crunch is TechCrunch’s roundup of our biggest and most important stories. If you’d like to get this delivered to your inbox every day at around 9am Pacific, you can subscribe here.

Securitization platform Cadence surpasses $125M deal volume and raises $4M

Securitization is a critical function of the modern financial system. Banks “package” individual loans, say a mortgage or an auto loan, into a group with similar characteristics and sell them to other investors. That gets the debt off the originator’s balance sheet so that they can offer more loans, while also offering private investors alternative investment opportunities to buy up.

Despite the scale of the market — the trade association SIFMA’s research shows that the volume for asset-backed securities reached more than $300 billion in 2019 (excluding mortgages) — much of that structuring remains relatively ad hoc, with structuring agents and buyers constantly seeking each other out.

Much in the way that real estate and startup crowdsourcing platforms democratized access to those alternative investments, Cadence wants to expand access to securitized products while increasing the velocity of transactions for originators and lowering prices. Founder and CEO Nelson Chu said that “our job is to bring transparency and efficiency to this market and through all the various things that we do.” The company operates on top of the Ethereum blockchain network.

Founded in 2018 and launched publicly in 2019, the New York City-based capital markets startup has now structured $88 million in notes across 76 offerings and 12 originators according to the company. The firm’s public leaderboard shows that the largest originators were Sellers Funding with more than $23 million and Wall Street Funding with almost $26 million in transaction volume. Chu said that “I think we are the 21st largest structuring agent the United States in 2020 so far,” which is not a bad place to be for a young startup in a massive multi-trillion dollar market.

In addition to that $88 million volume processed on the company’s retail platform, Cadence also structured a $40 million whole business securitization with FAT Brands, the owner of restaurant chains like Fatburger and Yalla Mediterranean. The company notes that the structuring reduced the company’s interest costs by $2 million.

The company has hit a number of milestones over the past two years. It closed a seed round of $4 million in December led by Revel VC, with Revel’s Thomas Falk, Navtej S. Nandra, former President of E*Trade, and portfolio manager Oliver Wriedt joining the company’s board.

In addition, back in 2019, the company said that it also became the first digital asset company to launch a digital asset ticker on Bloomberg Terminal and also the first to join the Bloomberg App Portal. It also secured the first financial debt rating for a digital asset.

The company has a variety of revenue streams from different areas of its platform. It takes transaction fees on each deal, but also derives revenues from hosting data related to the performance of the underlying loans. Given the company’s technology stack, it has better and more verified data about how the underlying assets that back each security are performing, giving all investment holders a much more robust look at the health of their portfolio.

Longer term, Cadence’s goal is to move to a mostly SaaS model for originators and buyers. “We can be very, very beneficial to every single counterparty involved when we become that,” Chu said, adding “we essentially are Switzerland … because our incentives are all aligned.”

I asked about how the company is responding to the COVID-19 situation, and Chu said that as the world saw in the 2008 global financial crisis, “there are pockets of opportunity here that we continue to find, and we allow retail, accredited investors to get access to that.” Chu gave the example of game developers waiting on payments from Apple and Google who need short-term loans to cover costs.

In addition to Revel, other investors in the seed round included Morgan Creek Digital, Nimble Ventures, Argo, Tuesday Capital, Manatt, and Recharge Capital.

Bringg nabs $30M to expand its delivery logistics platform used by Walmart and others

Over the last several years, delivery services have become a key component of how retailers, or anyone selling or distributing products and services, do business. Now, with a global health pandemic in full swing keeping people indoors (and away from physical storefronts), delivery has become an essential must-have if you want your business to stay alive. Today, a startup called Bringg, which helps companies build and run delivery operations, is announcing a growth round of $30 million to meet expanding demand for its services.

Tel Aviv-based Bringg already counts giants like Walmart, McDonalds and Coke among its customers, and most recently introduced a last-mile delivery platform called BringgNow aimed at small and medium businesses to mobilise and manage their own and third-party fleets of delivery people.

The funding, a Series D, is being led by Viola Growth, with Next47, Salesforce, OG Tech Ventures, and GLP (all previous investors) also participating.

It brings the total raised to around $83 million, and while Bringg is not disclosing its valuation, for context, PitchBook placed its last valuation ($25 million Series C in January 2019) at $214.7 million. Its revenues have been on the rise over the last year and Guy Bloch, the CEO, said in an interview that it’s definitely an up round.

“The company is growing very fast, and closing a round in ‘corona times’ says a lot,” he said.

Indeed, Bringg’s funding is coming at a key time for the delivery and logistics sector overall.

Delivery services, and businesses based around offering them, have been on an expansion tear over the last several years fuelled by the rise of the on-demand economy. But the past several weeks — where consumers have been staying at home to slow the spread of the coronavirus pandemic, staying away from going outside; and businesses have been severely curtailing operations to limit people congregating in enclosed physical spaces — have turned all growth modelling on its head.

Those that already delivered as part of their service (for example take-out food or groceries) are seeing unprecedented levels of demand, and businesses that have never had that option now are finding that offering customers a delivery service is the only way to stay in business.

“We have been building the company on a vision of the market that we believed would come in a couple of years’ time, say between 2022 and 2025,” Bloch said. “Now it’s just happening in front of our eyes, right now. We are being pulled into a vacuum.”

Alongside businesses seeing huge demand for delivery options — with that being the only way to deliver their products and services in some cases — Bloch and Bringg’s founder Lior Sion (who had previously helped to build the tech underpinning Uber competitor Gett) both noted that another significant shift has been among consumer preferences.

Trust had been a big gating factor in the growth of delivery services, something that is now moving significantly and may never go back to the way it was before, something that will mean that Bringg’s current surge of business — growth 24% just in the last week — will be sustained even after COVID-19 (hopefully) subsides.

“Delivery will never be 100% but this is about offering a better experience,” Sion said. “Now with for groceries, restaurants, and other services, people are being exposed to using them when they hadn’t before. Or, they used to use one service, but now are realising what happens when that disappears, and they are now using more than one. They will say to themselves, I need to diversify.”

Bringg’s platform essentially gives businesses — it works with obvious customers like retailers, restaurants and grocery stores, but also large distributors, field service providers and healthcare companies — an end-to-end offering to manage their delivery operations. These include tools (AI-based or otherwise) not only to optimise and understand where and how much stock exists, but to route it in the most efficient way to sync up with online ordering platforms to make sure stock and services and people can get to who needs them. The last-mile services both work with retailers’ existing fleets of vehicles and people, but also brings in third-party services to complement that when needed.

While a lot of what Bringg is doing has been focused on for-profit businesses, the startup has been doing its own part to give something to the wider volunteer effort that we’ve seen surging throughout the tech industry. In its case, it’s working with local government organizations pro bono to help mobilise people to deliver goods to those in need, and has essentially opened its door to any and all other non-profits needing help. (Contact them if this applies to you.)

The bigger picture is that Bringg is bringing (sorry) something to everyone, at a time when we really need it, but will be relying on that model for years to come, even without a crisis hanging over us.

“We’re living in a ‘delivery economy’ and the latest market upheaval brought on by COVID-19 will only expedite this new reality in which brands won’t be able to afford to do business without this kind of solution” said Eran Westman, Partner at Viola Growth, in a statement. “Bringg enables brands to take full control of their data, increase customer satisfaction, and ultimately their revenues. We believe this market has major expansion potential and that Bringg, with its exceptional vision and execution, is ripe to take leadership, which is why we decided to lead this round.”

“Today with COVID-19 keeping consumers homebound, delivery is not a business differentiator but a critical logistics model, keeping businesses afloat. Our latest investment demonstrates our belief in the value Bringg delivers to the market, providing businesses of all sizes the capabilities to connect logistics data across different silos and optimize their operational models for rapid, convenient delivery service,”  said Matthew Cowan, General Partner at Next47, in a separate statement.

Agritech startup DeHaat raises $12M to reach more farmers in India

DeHaat, an online platform that offers full-stack agricultural services to farmers, has raised $12 million as it looks to scale its network across India.

The Series A financial round for the eight-year-old Patna and Gurgaon-based startup was led by Sequoia Capital India. Dutch entrepreneurial development bank FMO, and existing investors Omnivore and AgFunder, also participated in the round. The startup, which began to seek funding from external investors last year, has raised $16 million to date and $3 million in venture debt.

DeHaat (which means village in Hindi) eases the burden on farmers by bringing together brands, institutional financers and buyers on one platform, explained Shashank Kumar, co-founder and chief executive of the startup, in an interview with TechCrunch.

The platform helps farmers secure thousands of agri-input products, including seeds and fertilizers, and receive tailored advisory on the crop they should sow in a season. “We have built a comprehensive database of crop tests to offer advice to farmers,” he said.

DeHaat, which employs 242 people, also helps them connect with 200 institutional partners to provide farmers with working capital, and when the season is over, helps them sell their yields to bulk buyers such as Reliance Fresh, food delivery startup Zomato and business-to-business e-commerce giant Udaan.

DeHaat today operates in 20 regional hubs in the eastern part of India — states such as Bihar, Uttar Pradesh, and Jharkhand — and serves more than 210,000 farmers, said Kumar.

Shashank Kumar, Amrendra Singh, Adarsh Srivastav and Shyam Sundar Singh co-founded DeHaat in 2012

The startup has developed a network of hundreds of micro-entrepreneurs in rural areas that distribute agri-input goods to farmers from their regional hubs and then bring back the output to the same hub.

“We have an app in local languages and a helpline desk that farmers, many of whom don’t own a smartphone, use to reach out to us and explain their pain points and needs,” he said.

DeHaat does not charge any fee for its advisory, but takes a cut whenever farmers use its platform to buy agri-inputs or sell their crop yields.

The startup will use the fresh capital to extend its network to 2,000 rural retail centres, on-board more micro-entrepreneurs for last-mile delivery and reach 1 million farmers by June of next year, said Kumar. DeHaat is also working on automating its supply chain and developing more sophisticated data analytics, he said.

At stake is India’s agriculture market that is worth $350 billion and serves nearly 100 million small and independent farmers, said Abhishek Mohan, VP at Sequoia Capital India, the VC fund that writes more checks than anyone else in the country.

“This industry is on the brink of a massive transformation thanks to ease of regulation, farmers getting organized and increasing penetration of smartphones. DeHaat is leveraging these trends to build the next-gen product in agricultural supply chain,” said Mohan in a statement.

“The tipping point that led to Sequoia India’s decision to partner with them was the field visit, where the farmers expressed how proud they were to be associated with a platform they felt truly worked in their favour. This impact and deep brand loyalty stems from the leadership team’s razor-sharp focus, deep empathy and fine execution,” he added.

India’s Swiggy raises $43M to expand to new businesses

Indian food delivery startup Swiggy has bagged an additional $43 million as it looks to expand to new businesses.

Existing investor Tencent and new players Ark Impact, Korea Investment Partners, Samsung Ventures and Mirae Asset Capital Markets financed the new tranche, which is part of Swiggy’s ongoing Series I round. In February, the Bangalore-based startup had raised $113 million from Prosus Ventures, its largest investor, and others as part of the current round.

The new round, which pushes five-year-old Swiggy’s total raise-to-date to $1.42 billion, values it at $3.6 billion, a person familiar with the matter told TechCrunch. Tencent has led today’s tranche with about $19 million of investment, according to figures disclosed by Swiggy to the local regulator.

The announcement follows New Delhi government’s three-week lockdown for its 1.3 billion people in a bid to contain the spread of the coronavirus outbreak. The lockdown has disrupted several businesses including food delivery. As firms grapple with disruption, many are beginning to explore new categories to serve customers. Swiggy, which is operational in 520 cities, has expanded to grocery delivery in select parts of the country. (Swiggy expanded beyond food delivery last year.)

A Swiggy executive said the company, which raised $1 billion in December 2018, is looking to build a “sustainable path to profitability.”

In a statement, Rahul Bothra, CFO at Swiggy, said the company has “built a sustainable food delivery business over the years while solving various customer pain points. As we continue to strengthen and expand our services that offer unparalleled convenience to our consumers, we are humbled by the faith shown by our investors year-on-year and welcome the new investors on board. Our focus remains to execute on our vision while building a sustainable path to profitability.”

Swiggy’s rival, Zomato, has also picked up capital in recent months. In January, the 11-year-old firm raised $150 million from Ant Financial. The company’s top executive said then that it was close to raising another $450 million in a matter of few days. The company has raised an additional $5 million since — a spokesperson did not respond to a request for comment.

Both the firms have seen the volume of their daily orders drop from more than 5 million to under a million in recent days. But the disruption is not unique to either of them so long-term investors remain bullish.

The exit of Uber from India’s food delivery space earlier this year — after selling its local food business to Zomato for $206 million — has made the market a duopoly play. At stake is a $4.2 billion opportunity, according to research firm Redseer.

Insight closes $9.5B fund to help support portfolio companies through the pandemic

We’re now several weeks into what has become a very big dip for the global economy due to the coronavirus pandemic, but amidst that, we are seeing are some notable pockets of investment activity emerging that will help shape how the future startup landscape will look. Today, one of the biggest venture capital firms in the world announced the closing of a huge fund, money that it will use in large part to help its portfolio businesses weather the storm.

Insight, the firm that has backed the likes of Twitter and Shopify and invests across a range of consumer and enterprise startups (400 in all), today announced that it has closed a fund of $9.5 billion, money it will be using to support startups and “scale-ups” (larger and older startups that are still private) in the coming months. Investments will typically be between $10 million and $350 million, “although larger transactions are also possible,” the company said.

“First and foremost, we want to acknowledge the current climate and the hardships being felt across the globe,” said Jeff Horing, Insight Partners’ founder and MD, in a statement. “We are thankful and humbled by the support of our investors which enables us to continue to deliver world class resources during turbulent economic times. Fund XI gives us continued flexibility to provide the combination of capital and operating support that suits the different needs of every software company in a dynamic world.”

This fund, numbered XI, brought in a number of returning backers alongside new investors, and it is record-sized for the company. It also appears to have been oversubscribed, since back in November when it was launched the fund was estimated to be worth just over $7 billion. All the more impressive, too, is that it closed just this week, at a time when many startups are starting to feel the pinch of a business downturn, and are either laying off staff or freezing hiring to curtail costs, leading investors to get a little shaky.

Insight’s fund is a signal of two themes. One is that there are, even now, some silver linings, where particular business areas are seeing huge surges of activity (videoconferencing to connect all the people now sheltering in place at home; those helping keep food delivery operational; entertainment streaming companies; and those focusing on medical research or telehealth are just five categories seeing a positive impact; there are more). This fund will help Insight invest in these opportunities to help these businesses grow to meet the demand.

The second theme is a little less upbeat but still important, and that is the fact that there are a number of very promising ideas out there that have already been backed by VC money, which will not survive the current economic crunch without some support. VC money will likely be used in a very targeted way to help in those situations, alongside more fiscal belt-tightening and other funding means (for example, loans that the U.S. government will be issuing via the CARES act to help small businesses get through lean times brought by the coronavirus pandemic).

Indeed, a spokesperson said Insight will be “hyper-focused on supporting its portfolio companies” with ongoing and near-future funding.

We’ve reached out to see if we can get more detail on how new investments, versus reinvesting in existing portfolio companies, will figure in future funding, and we’re also asking if there are specific categories that are of particular interest at the moment. We’ll update this post as we learn more.

“Since our first investment 25 years ago, the global software ecosystem has matured even as it continues to innovate, spurring Insight’s own innovation in sourcing, and our data-driven partnership approach to working with ScaleUp companies as a minority or buyout investor,” said Managing Director Deven Parekh. “We are grateful that through economic cycles and unprecedented circumstances, Insight Partners remains a sought-after institutional platform for supporting next generation software companies.”

In a separate letter to investors, Horing and Parekh also noted the complicated climate of the moment — which includes not just the challenge of VCs raising funds right now amid a climate of LPs also feeling the crunch, but also the fact that not all startups will be able to rely on all their investors to support them through these challenging times. Tough decisions will need to be made at all levels.