StartUp Deals Slow, But Smart Investors Around To Buy
The largest deals in the first quarter of 2016 were of $150 million each included that by a female founder. E-commerce website Shopclues co-founded by Radhika Aggarwal as well as Big Basket, the online grocer picked up funding. According to a report by KPMG-CB Insights, this is the third consecutive quarter which saw a decline in investments.
With mounting investor hesitation and concerns of overvaluation, Indian investment continued to decline in Q1’16. Deals slipped 4 percent while funding fell 24 percent as VC-backed startups raised $1.2B on 116 deals
2016 has had a good start with government taking the lead on Startup India Stand Up India. Make In India too reflected spotlight on how boost entrepreneurship in the country. The report isn’t testimony to the euphoria around the startup space, however there is hope investment will pick up in the remain three quarters of 2016. The report further adds:
Desire for ‘smart capital’ coming to the fore. Over the past several months, startups across Asia – particularly in India – have begun looking for more than VC funding; they are looking for investors that understand their business model and who can help support and shape their business strategy. Startups see this ‘smart capital’ approach as an important way to gain both experienced insights and access to markets. While such an approach has always existed, the growing uncertainty in the market is making more startups realize the importance of having knowledgeable investors.
In addition, investment in e-commerce and digital internet companies have been on the rise over the
last few quarters, and is set to continue especially for niche business & operating models, backed by entrepreneurs with a successful history cites the report