Entrepreneur: A madman, a storyteller, visionary, believer, and not the one amidst the crowd. The one who visualizes his path and walks along by creating one.
Talking about Entrepreneurs, makes us look at the startups that have been built over the years with some of them increases exponentially.
With respect to India, the year 2020 saw a major setback in terms of economic growth causing a GDP contraction of 7.3% and leading to the highest-ever annual fiscal deficit at 9.5% for the fiscal year 2021. Despite the second wave, the markets witnessed a major comeback recovering a lot of what was lost in terms of stock market gains.
Along with this, the private equity markets saw robust growth in the year 2021 with a majority of the PE investors and VCs almost doubling their investments. There was an approximate investment of $15 billion in investments in the first half of 2021 alone. To put this in perspective, this was 50% higher than the whole of 2020 and 3 times more than the first half of 2020.
Overall, an investment of USD 77 billion in Indian companies in 2021, a jump of 62 percent over the previous year. These investments were across 1,266 deals, including 164 large deals worth $58 billion.
Top deals:
Indian Startups:
The year saw an addition of 44 unicorns or start-ups valued at over USD 1 billion, making India the third-largest home for such companies. The $23.4 billion invested into the Information Technology sector dominated the list of Unicorns.
The startup ecosystem saw a record investment of nearly $36 billion in 2021. One of the reasons for this was the growth in digitization due to the pandemic. UK-based Investment data platform Preqin estimates that venture and private equity investments increased three-fold during the year up from the $11 billion mopped up by Indian startups in 2020.
The majority of the investments that had happened were directed towards pre-IPO financing in companies such as Zomato, Ola, Paytm, etc.
Seed deals:
Funds such as Tiger Global, Falcon Edge, Sequoia Capital, Accel, Blume Ventures were among the most active investors this year. SoftBank, which is known for its larger-sized bets, invested more than 3 billion, making it the largest infusion in Indian startups by the Japanese investment firm in India in a single year.
To conclude, most investments were seen in sectors like web3/ crypto, SaaS, direct-to-consumer or D2C brands and fintech, business-to-business (B2B) commerce, edtech, and healthcare.
Though the funding raised increases the valuations for the firm that does not really go hand in hand with the profitability of the firm, it can also help for a great exit.
That being said, the major purpose of this was to know how accessible currently the market is for the early stage and in-market entrepreneurs to scale at a level that they visualize.
What do you think?
- Are the investments justified? Or it is just a valuation game?
- On the other end, how positive are you on the Indian startup ecosystem?
They made unique solution for India. Probably they will contribute to Dollars in our treasury & increase our raw materials import.
& has potential to be a important company.