In 2021, the investment of Indian start-ups reached US $36 billion, twice as much as that in 2020 From Touch
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With the growth of novel coronavirus pneumonia epidemic demand, India venture capital ecosystem in 2021 gained nearly $36 billion in venture capital, setting a new record. PreQin, a UK based investment data platform, estimates that venture capital and private equity investments received by Indian start-ups this year have tripled year-on-year, much higher than the US $11 billion in 2020.
According to the data as of December 20, the seed round of Indian start-ups dominated this year, with nearly 396 transactions totaling US $70586 million of investment, while 166 round a financing totaled US $1.67 billion. However, according to prequin, most of the investments are pre IPO Financing for companies such as zomato, Ola, policybazaar and paytm, with a total of $5.58 billion in the first 10 transactions.
In addition to the surge in the number of transactions, Indian start-ups have also raised more money than in previous years because venture capital funds have increased their bets on early high growth companies. Therefore, enterprises can obtain higher valuation. In successive rounds of financing, their value often doubles or even quadruples.
Alok Goyal, founder and investment partner of stellaris venture partners, an early venture capital firm, said: “valuation is a reflection of investors’ exit expectations. It has been proved that Indian enterprises can have a complete venture capital cycle in 2021. Zomato, nykaa, policybazaar and other companies have raised people’s expectations on the scale of exit, thus improving the valuation.”
Goyal also issued a warning and pointed out: “the market has the habit of overreacting in both bull and bear cycles. What we see now is the bull cycle response. Don’t be surprised if there is a bear market in the future.”
Goyal attributed the significant increase in capital inflows to high growth companies to a combination of factors, including higher global liquidity and the relatively greater attraction of investing in start-ups compared with other asset classes. “We expect the upward trend in 2021 to subside, but the long-term trend will continue in 2022,” he said
Tiger global, Falcon edge, Sequoia Capital, accel, Blume ventures and other funds are the most active investors in Indian start-ups this year. Softbank, known for its large-scale bets, invested more than US $3 billion, becoming the largest capital injected by the Japanese investment company into Indian start-ups in a year in India.
India’s “unicorns” (start-ups valued at $1 billion or more) have increased by dozens this year. Nearly 40 companies have joined the “unicorn” club, and six “unicorns” were born in just four days in April. But not just “unicorns” The company and other high growth companies have also carried out several rounds of financing this year, indicating the positive willingness of investors to support leading enterprises.
Cred, ofbusiness, growth, cars24, lous, spinny, infr The valuations of companies such as market, good gramm group and pristyn care have increased several times in the past year.
Vaibhav Agrawal, partner of Lightspeed India, said: “In 2021, we have experienced strong positive changes in the quality of the founding team, market depth, unit economy and the opportunity to exit through the open market. Therefore, investors at all stages feel relieved, willing to write larger cheques and take more risks.” The company invested in new “unicorn” companies such as sharechat and Apna in 2021.
A top Unicorn founder who raised funds three times this year said: “the founder’s equity is diluted less, and this cash can be of great use in difficult times.” With this capital support, startups can act quickly, implement their strategies and achieve exponential growth.
Most investors said that the dominant industries in 2021, such as Web3 / cryptocurrency, SaaS, direct to consumer or D2c brand, as well as financial technology, business to business (B2B) business, education technology and health care, will also continue to attract more funds next year.
Pranav Pai, co-founder of venture capital fund 3one4 capital, said: “the economic cycle will repeat, but it is important that Indian entrepreneurs have the opportunity to get the funds they need to approach their vision of becoming a market leader. They are also taking this opportunity to strengthen their balance sheets and prepare for the resilience they need to cope with a correction.”
Kashyap chanchani, managing partner of rainaker group, Mumbai investment bank, said that most mature start-ups now have special enterprise development teams, and exit through sale is the real choice for founders. “Until two years ago, most startups would exit through M & A because they lacked options,” he said
For a while, when Indian entrepreneurs talked about IPO, it was not seen as a real choice, but 2021 changed that. This year marks a major change in how technology enterprises use the open market, and most of them have also received the support of open investors.
Smaller start-ups such as game company nazara technologies went public this year, but the real leader is zomato, which lays the foundation for at least six top start-ups to apply for IPO in India. The founders said zomato’s excellent performance this year led them to reconsider the IPO timetable.
Other companies such as policybazaar, nykaa and paytm have raised nearly $2.5 billion from open market investors. Lightspeed’s Agrawal predicts that this momentum will also continue until 2022. “India’s founders are among the best in the world. In 2022, we saw a great opportunity for India to build for the world through new categories of software such as cross-border commerce, financial technology, cryptocurrency and PLG and infrastructure,” he said
Read more from Netease Technology: PreQin: private equity funds received a total of US $107 billion in 2017 PreQin: the global pet market will reach US $326 billion in 2028 PreQin: private equity investment in China’s health care industry increased significantly PreQin: private equity industry completed US $406 billion financing in 2017 PreQin: secondary market financing of US $29 billion in the first three quarters of 2017 PreQin: 2016 Private equity portfolio funds invested US $26 billion PreQin: global real estate funds raised US $118 billion in 2018 PreQin: private debt raised more than US $100 billion in 2018 PreQin: only 1 / 5 employees in the alternative asset investment industry are women PreQin: women account for only 1 / 5 of the fund’s jobs PreQin: the total amount of venture capital in North America increased by 29% year-on-year in 2020 PreQin: Q1 in 2021, private investment in Asia Pacific Region PreQin: 81% of natural resource investors plan to increase investment or maintain the current level in 2018. PreQin: Q3 hedge fund net inflow in 2017 was US $19.2 billion. PreQin: natural resource fund financing in 2018 was US $93 billion
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