Indian startups raised about $12.8 billion across almost 1,350 funding rounds from financial specialists a year ago. Despite the fact that deal value and volumes in 2020 were lower than those in 2019, the new year is relied upon to bring a sea change. Despite a drop in deal volume and in overall investments, numbers are still surprisingly solid for a pandemic-hit year. When the Coronavirus emergency had started in March 2020, the public markets fell across the world and financial specialists froze private ventures. India had put restrictions on investments from China. Between March and June, when a cross country lockdown was imposed, deal-making stayed suspended. However, as the lockdown finished, deal-making picked up at a high pace, particularly in the subsequent half. By the end of 2020, almost a dozen startups had become unicorns—the most in any year.
What were the Reasons for Funding to Stay Up?
Macro factors played an important role. The surge in public markets led by the US assisted to shore up investors’ confidence. Low-interest rates likewise permitted speculators to maintain risk investment funding. The biggest reason was that Coronavirus set off a speeding up of digitization across different sectors. Digital education, enterprise software, content, and logistics were the biggest beneficiaries, while sectors such as cab and bike aggregation and financial technology struggled to attract capital. Probably the greatest fundraisers included $660 million by Zomato; $500 million by Byju’s; $300 million by Firstcry; and $225 million by Dream11.
Where does RIL Fit amid this Funding Scenario?
Reliance Industries Ltd (RIL), which raised a mammoth $26 billion a year ago (excluded from the Tracxn information) for its digital and retail ventures, has become a significant part of India’s internet ecosystem. A large number of the buyer facing services may roll out this year. RIL has just purchased a few startups and is competing with occupants in a wide range of sectors.
What does 2021 look like for Startups?
Until further notice, startup funding may keep on being solid because of the glut in the available capital. Till covid disappears and everything gets normal, sectors like digital education, content, and software will grow. Others like consumer transportation will get just when the pandemic is generally finished. Speed of vaccination program, the fate of the proposed initial public offerings by leading startups, the performance of organizations that have raised huge funds, and the strength of consumption would determine the funding, going ahead.
Initial Public Offerings (IPOs) are the sacred goal for startups. Yet, apart from a couple of exemptions like Makemytrip and Indiamart, Indian startups have neglected to open up to the world. Organizations have assembled feeble business plans that yielded huge, expanding misfortunes consistently. A modest bunch of profitable firms like Freshworks, Druva, PolicyBazaar, and Delhivery has reported designs to list their offers sooner rather than later. On the off chance that they can pull off successful IPOs, it will mark a turning point that will prompt more capital for Indian startups.
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