EvolutionX Debt Capital, the growth-stage debt financing platform launched by Temasek and DBS, has made its first investment in API Holdings, India’s largest digital healthcare platform, at an undisclosed amount.
The investment marks the first of a few planned capital raises and will be followed by equity infusion, Siddharth Shah co-founder and chief executive of API Holdings said in a statement on Monday.
API Holdings, which owns and powers the PharmEasy brand and marketplace in India, has over 6 million transacting users, 150,000 active pharmacies, and 1,800 hospitals. It also administers over 21 million tests annually.
Since its launch in late 2021, Singapore-headquartered EvolutionX has expanded to Mumbai and plans to establish a presence in China next year. It seeks to support the growth of Asian technology startups by providing an alternative source of debt financing
EvolutionX seeks to provide an alternative source of debt financing to enable growth-stage technology companies to scale faster and expand into new markets, by leveraging Temasek’s investment expertise and DBS’ global banking networks.
The company notes that growth debt bridges and extends the cash runway for startups until the next financing round or exit event while also helping founders and investors minimise dilution of shareholding.
It aims to build a pipeline of investment opportunities and provide amortising term debt facilities with ticket sizes of $20 million to $50 million over the next few years in a range of sectors in the Indian, Chinese, and South-east Asian markets.
These sectors include healthcare, education, logistics, industrial development, and financial services.
“As capital markets continue to be muted and access to private capital narrows for tech startups, founders, and their shareholders are increasingly seeking less dilutive forms of capital to extend their cash runway and avoid raising equity capital at lower valuations,” explains Rahul Shah, who was recently appointed partner and co-head of EvolutionX’s Indian and Southeast Asian investments.
He was previously head of corporate debt investments for South Asia at British International Investment.
Meanwhile, Calvin Cheng has been appointed partner as well as co-head to oversee EvolutionX’s investments across China. He was formerly a managing director and the head of technology and growth banking group at East West Bank (China).