Nearly 65 per cent of startup
executives and founders believe that the Indian startups are in a technology
bubble, while 18 per cent feel that the bubble was close to bursting soon, a
study by venture debt and specialty lending business, InnoVen Capital, said.
executives and founders believe that the Indian startups are in a technology
bubble, while 18 per cent feel that the bubble was close to bursting soon, a
study by venture debt and specialty lending business, InnoVen Capital, said.
The India Startup Outlook Report 2017
highlights the perspective with responses from over 170 startup leaders across
bootstrapped as well as funded ventures.
highlights the perspective with responses from over 170 startup leaders across
bootstrapped as well as funded ventures.
The study said that 63 per cent of the
respondents, who attempted to raise funds in 2016, confirmed that they had an
unfavourable funding experience with almost half of these not being able to
raise any funding and the rest raised either a sub-optimal external round or a
bridge round.
respondents, who attempted to raise funds in 2016, confirmed that they had an
unfavourable funding experience with almost half of these not being able to
raise any funding and the rest raised either a sub-optimal external round or a
bridge round.
The respondents believe that in 2017,
more companies with robust business models followed by more exits is most
likely to improve investor sentiment. The least likely factor to better the
funding environment is Indian unicorns raising more money at a higher valuation,
the report added.
more companies with robust business models followed by more exits is most
likely to improve investor sentiment. The least likely factor to better the
funding environment is Indian unicorns raising more money at a higher valuation,
the report added.
“The startup outlook report is
part of our continued effort to understand and communicate the nature of the
Indian entrepreneurship ecosystem. In this report, we explore the mood and
outlook of Indian startups given the recent budget, cautious investor climate
and an uncertain global economy.” Ajay Hattangdi, Group COO and CEO India,
said.
part of our continued effort to understand and communicate the nature of the
Indian entrepreneurship ecosystem. In this report, we explore the mood and
outlook of Indian startups given the recent budget, cautious investor climate
and an uncertain global economy.” Ajay Hattangdi, Group COO and CEO India,
said.
Ninety four per cent startups are
looking to raise funding in 2017, with VC-backed companies aiming to raise a
median of USD 12.5 million, the report pointed out. The average expectation on
how long it could take to close the round is 4-5 months.
looking to raise funding in 2017, with VC-backed companies aiming to raise a
median of USD 12.5 million, the report pointed out. The average expectation on
how long it could take to close the round is 4-5 months.
Difficulty in raising equity funding
was voted as the top business challenge, followed by difficulty in managing
talent and market creation. However, the respondents were uncertain whether
fundraising will be more challenging in 2017 or less.
was voted as the top business challenge, followed by difficulty in managing
talent and market creation. However, the respondents were uncertain whether
fundraising will be more challenging in 2017 or less.
Overall, almost 75 per cent of the set
supposed that the startup ecosystem in 2017 will be driven by entrepreneurs,
whilst 26 per cent voted that investors will play the pivotal role.
supposed that the startup ecosystem in 2017 will be driven by entrepreneurs,
whilst 26 per cent voted that investors will play the pivotal role.
