scorecardTiger Global overtakes Sequoia as the top investor in Indian unicorns in 2021, cracks 15 deals this year so far
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Tiger Global overtakes Sequoia as the top investor in Indian unicorns in 2021, cracks 15 deals this year so far

Tiger Global overtakes Sequoia as the top investor in Indian unicorns in 2021, cracks 15 deals this year so far
Business5 min read

  • Sequoia was rated as the top investor in Indian unicorns in August 2020.
  • Tiger Global picked up pace, with nine unicorn deals in the first half of 2021.
  • Indian startup ecosystem is poised to have 150 unicorns by 2025.

The Indian startup ecosystem is undoubtedly at its prime at the moment, with an undisrupted flow of capital and unicorns in 2021 so far. The country has witnessed the entry of 15 startups into the unicorn club and there is one thing that the startup ecosystem cannot stop talking about — investor Tiger Global.

A unicorn, in startup parlance, is a private company valued at or over $1 billion.

The New York-based investment firm, which almost went relatively quiet in India since 2016, has significantly picked up its pace to deploy capital this year. Tiger Global, has made some major investments this year -- mostly unicorns and soonicorns (startups likely to enter the unicorn club soon) -- and has risen above ranks to be one of the top investors of 2021.

In fact, it has overtaken Sequoia Capital as the top investor in India’s unicorns, in terms of number of deals. Sequoia has invested in 18 of the 52 Indian unicorns and was titled the top investor in Indian unicorns last year by a Hurun report. Meanwhile, Tiger Global is backing 25 of them, making it an investor in almost 50% of the Indian unicorns.

This year, alone, Tiger Global invested in 9 of the 15 startups that entered the Indian unicorn club. Sequoia invested in five such new unicorns.

Tiger Global had been aggressively chasing the Indian market since 2010, but slowed down its pace in between 2016-2018. The company, which cracked 40 deals in India in 2015, only invested in seven startups in 2016, five in 2017 and eight in 2018. Top management changes, with the departure of former partner Lee Fixel, in 2019 slowed down the investor’s pace in India. Seems like Tiger Global is back to its aggressive stance in the Indian market once again, cracking one deal after another.

Tiger Global was one of the first big venture capitalists (VC) to be successful in India and showed that exits could happen, Kabir Kochhar, partner at Anthill Ventures, told Business Insider. Notably, Tiger Global received a $3.3 billion exit from its investment in Flipkart, but its Indian investment streak slowed post 2018 and that allowed other VCs to overtake Tiger.

Kochhar added, “Being among the first VCs to drive value, write big cheques and show significant exits, things have been quiet in the last few years and they have ceded the mantle other top tier VCs such as Sequoia, SoftBank and Naspers. Their recent multi-billion dollar fundraise has fuelled their desire to make up for missed opportunities of investing in emerging unicorns over the last few years. Tiger has gone back to its famed aggression and lightening quick decision making and is on a tear in India and globally. It's encouraging to see their bullishness in the Indian VC ecosystem. They’re back and will be a significant player in the evolution and scaling up of the next generation of Indian startups."

Outside of the unicorn club, Tiger Global has set its eyes on some of the prominent startups in India. This includes retail financing startup Progcap, insurtech startup Plum, blue collar recruitment platform Apna and multi-brand car workshop platform GoMechanic.

It had also led one-year-old microblogging platform Koo’s $30 million round last month, amidst Twitter’s trouble with the Indian government. Now, it is said to be in talks with payments platform BharatPe to lead the three-year-old startup’s unicorn round.

The part hedge fund, part equity fund has invested in 118+ companies across the globe this year, taking its total portfolio to 400+ companies with an assets under management (AUM) of $65 billion. According to a Crunchbase analysis, Tiger Global’s investment has grown 10 times compared to 2020.

The report further adds that Tiger Global led or co-led $10.5 billion worth venture rounds in 2021 till June, doubling the figures compared to full year 2020. Sequoia Capital, on the other hand, led or co-led $4.1 billion worth deals this year till June. Sequoia has invested in 1,500+ companies and has an AUM of more than $38 billion.

The disparity between Tiger Global and Sequoia Capital’s AUM and portfolio size is simply because of the stages they both focus on. While Tiger Global mostly looks into later stage and post-initial public offering (IPO) deals, Sequoia has spread its wings across seed to later stage deals.

This makes Sequoia capital’s portfolio much bigger than Tiger Global, but its AUM is lower due to size of these deals. Sequoia also runs its accelerator programme Surge through which it invests in about 50 early-stage startups in southeast Asia annually.

SoftBank Vision Fund, which too makes later stage deals like Tiger Global, is a close second. The Japanese conglomerate has led or co-led about $8.6 billion worth venture rounds globally this year till June. In India, Meesho, Zeta and FirstCry have been its investments this year. Overall, it has invested more than $90 billion in nearly 200 companies.

Both Sequoia Capital India and Tiger Global declined to comment on the queries regarding their investment deals in India.

India is currently the third biggest startup ecosystem in the world, with over 55,000 startups that have raised $70 billion between 2014 to 2020. As per the data shared by the Department for Promotion of Industry and Internal Trade (DPIIT), the country has at least one startup from 586 districts of the total 739 districts.

A business will be considered as a startup, according to the Indian government, up to a period of 10 years from the date of incorporation. Each of these startups should not have a turnover of more than ₹100 crore.

Thanks to Tiger Global’s investments streak this year, India seems to be set to meet its ‘100 unicorns by 2025’ deadline much faster. According to the latest Praxis and 256 Network’s report, India will now be able to see 150 unicorns by 2025.