EvolutionX Debt Capital makes maiden investment in PharmEasy parent firm

Debt financing platform's investment amount was not revealed; it will make equity infusion later

EvolutionX Debt Capital, a growth-stage debt financing platform, has made its maiden investment in API Holdings, the parent company of PharmEasy, India’s largest online pharmacy.

The investment, of an undisclosed amount, is part of a sequence of planned capital raises and it will be followed by equity infusion in the company in the near-term, said Siddharth Shah, chief executive officer and co-founder of API Holdings.

“This collective capital raise will optimize the capital structure as well as improve the net debt position and financial strength of the company, ensuring a clear runway to profitability,” he said.

Capital markets are muted and access to private capital for tech start-ups is narrowing, so founders and shareholders are seeking less dilutive forms of capital to extend their cash runway and avoid raising equity capital at lower valuations, said Rahul Shah, partner and co-head leading investments in India and Southeast Asia at EvolutionX, which is founded by DBS and Temasek.

“EvolutionX’s philosophy centres on investing in category-leading technology companies led by promising founders and backed by reputed investors. We are thus excited to partner with Siddharth, where the continued journey of PharmEasy to build India’s largest digital healthcare platform aligns strongly with our goals to accelerate the digitisation of Asia’s economy,” said Rahul Shah.

Over the next few years, EvolutionX aims to build a strong pipeline of investment opportunities and provide amortising term debt facilities with ticket sizes of $20–50 million along with warrants or convertible instruments, the firm said in a statement.

The company will invest in technology companies in consumer, education, financial services, healthcare, logistics, and industrial development in India, China, and Southeast Asia.