PE and VC funding stood at $48 billion in 2019, but Venture Capitalists began 2020 with $7 billion left to invest

• Private Equity and Venture Capital funding reached a new high in 2019 at $48 billion, said a report by Indian Private Equity and Venture Capital Association and Ernst & Young.
• The increase in investments comes even when the Indian economy was facing a slowdown.
• A big chunk of increased volumes came from SoftBank – which made investments in OYO, Delhivery, Grofers among others in 2019.

Private Equity and Venture Capital funding reached a new high in 2019 at $48 billion, according to a report by Indian Private Equity and Venture Capital Association and Ernst & Young. This is in spite of the fact that India was in the throes of a slowdown last year.

While the deal value increased by 28%, deal volume went up by 35% year-on-year.


“The growth in infrastructure sector more than compensated for the decline in traditional PE/VC investments (in sectors excluding infrastructure and real estate) that recorded a decline of 3% on a year-on-year (y-o-y) basis in terms of value,” said the IVCA and EY report.

However, a report by Bain & Company states that Indian VCs alone were left with a whopping $7 billion to invest, as they began 2020. “Despite the global economic climate, India’s startup and VC ecosystems continue to thrive as investors take a long-term view based on the country’s growth potential. They see the current slowdown as more cyclical than structural,” the annual report stated.

Startups take the cherry on the cake

Indian startups raised a whopping $7.9 billion in 2019, a 22% jump from the $6.5 billion raised in 2018. Deal value increased by 61%, with 610 deals in 2019 as compared to 378 deals in 2018.

Startups formed 16.4% of the total PE/VC funding and a big thanks for the rise in volumes goes to SoftBank – the Japanese investment firm which made investments in OYO, Delhivery, Grofers among others in 2019.

The biggest deals were SoftBank’s investment in OYO, Grofers along with Udaan and Delivery which brought them into the unicorn club.



Over the last five years the Indian startup ecosystem has diversified into newer areas. According to the report, until five years ago, investments in startups were dominated by technology and e-commerce sectors.

“In terms of number of deals, the share of e-commerce and technology in the start-up investment space has declined from 62% in 2015 to 35% in 2019. On the other hand, the share of financial services in the total number of start-up deals has increased from 7% in 2015 to 16% in 2019,” said the report.

The opportunity only gets bigger in India. According to a Goldman Sachs report, the Indian internet industry will be worth $160 billion by 2025 – three times its current value.

Indian VC firms are looking at the right investments that will place them in a sweet spot by 2025. According to a KPMG report, VC investments in India are is set to remain strong through the first quarter of 2020.

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2020 is the time to bet on India’s internet industry which will be worth $160 billion in 5 years