Here are five startups which managed to raise funds before the capital crunch hit them
- Despite slowdown in capital raising, spiked inflation and hiked interest rates India saw a notable growth of 28.6% in funding value in April this year.
- This is much more than as compared to other countries like the US, UK, and China, as per GlobalData report.
- The Indian startups raised $12.1 billion through 672 venture capital (VC) funding deals announced during January-April 2022.
AdvertisementIn spite of many global events like a war and inflation, Indian VC funding in April grew 28.6% despite a decline in deal volumes, as per a report by GlobalData. In fact, it was able to attract more funding than countries like US, China and the UK, it said,
Indian startups raised $12.1 billion through 672 VC deals between January-April 2022, the report said. However, these deals were announced and closed before India and the Fed cut interest rates making money ‘meager’.
Tighten your belts say investors
In a recent report, Sequoia Capital which invested in 30 unicorns in India including Byju’s, spoke of profitability in a letter to its investee companies. It advised belt-tightening and spoke about the increasing cost of monetary flows and its impact on funding.
However, a few startups could manage to raise funds before this capital crunch hit them. “The trend suggests that investors continue to remain bullish on promising startups with good ideas as some of these were successful in raising sizable capital,” said Aurojyoti Bose, lead analyst at GlobalData.
Some of the notable VC funding deals announced in India during April include —
|Verse Innovation (Josh)
|Tech4Billion Media (Chingari)
|Roppen Transportation Services (Rapido)
According to Business Insider’s calculations, Indian startups laid off 6,900 employees in the first four months of 2022. In May alone, unicorns like Vedantu and Cars24 fired over 1,200 employees.
Additionally, no company entered the unicorn club last month whereas in April 2021 eight new companies joined the list. The startup market has been witnessing an upward trend for the last 18 months and “now for a few months it looks a little slow”, explained Gaurav VK Singhvi, cofounder of investment firm We Founder Circle.
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