Indian & global startup sentiment looks up brimming with ideas and hungry for finances

In spite of the pandemic and the havoc it has wreaked, the business sector in India and the world is bouncing back, with startups raking in moolah in popular as well as unusual sectors. Market sentiment too is rising, even as young entrepreneurs are on the rise, brimming with ideas and hungry for finances.

According to CII, the rise in global demand and trade has given scope for ambition in increasing India’s exports. “While the first quarter numbers show encouraging strength in exports, this would need to be sustained,” a CII blog post said.

In spite of the pandemic and the havoc it has wreaked, the business sector in India and the world is bouncing back, with startups raking in moolah in popular as well as unusual sectors. Market sentiment too is rising, even as young entrepreneurs are on the rise, brimming with ideas and hungry for finances

With 63 tech startups clocking a valuation of more than US $ 1 billion, the CII also expects India to have 100 unicorns by 2023. The change in the overall investment scenario can just be gauged from the fact that Indian startups drew a funding of US $ 6.5 billion in the second quarter of 2021.

According to analytics firm Global Data, last month, 828 venture capital funded deals were announced between January and July, with a total disclosed value of US$16.9 billion.

Many prominent Indian startups have also announced plans to list in the stock market, including payments giant Paytm. According to Grant Thornton Bharat Deal Tracker, India reported the highest number of IPO issues in over a decade with 18 issues amounting to US$ 5 billion.

Fundings Galore

The investment scene has been up for the past few months in India. Vaibhav Agrawal from Lightspeed Venture Partners told CNBC that factors such as improvement in infrastructure are leading to investors taking more risks on Indian startups.

The startup scene in India has been buzzing with activity this quarter. T-Hub, a pioneering innovation ecosystem, through its capacity-building initiative T-Tribe, graduated idea-stage startups from its MasterClass program in sectors like automobile and healthcare. T-Hub also partnered with Redberri Earth Foundation to boost the India-US startup ecosystem and provide market access program to both Indian and US startups.

Read more: India Q3 clocks record 597 deals worth US$ 30 billion: Grant Thornton Deal Tracker Report

Fund raises have been seen in both popular and unusual areas in technology.

Agritech robotics startup TartanSense, Brex for Bharat” startup IppoPay, and Healthcare AI startup Endimension raised funds during the quarter.

The ever popular Artificial Intelligence (AI) sector saw funds coming in for Deeptech SaaS startup NeuroPixel.AI, and robotics startup Ishitva led by Inflection Point Ventures, as well as AI-enabled content intelligence and creation platform Scalenut.

Another popular sector, especially post-pandemic is EdTech. The sector is raking in moolah. Bengaluru-based Playto Labs, Mentza, a startup focused on audio-based conversational learning raised funds Inflection Point Ventures. Among others are data-driven education platform ForeignAdmits and Ahmedabad-based EdTech startup Orphicy.

Significant developments have occurred in futuristic areas as people warm up to new fangled technologies. For example, the Orpat Group forayed into the IoT-enabled fans category, eyeing a 30% market share by end of FY22.

Read more: Market watch: Indian millennials are looking to buy 5G smartphones, local MBOs gear up

Cyient, an Indian multinational technology company focused on engineering, manufacturing, data analytics, and networks and operations, announced robust Q2 FY22 performance led by growth pillars. The company is also expanding is digital solutions portfolio for the aerospace industry with PPAP4Aero.

Deep tech startup Tooliqa Innovations, Gurgaon based EV Plugs, and the collaboration platform for API development, Postman, closed rounds.

SaaS is another popular sector, where investors are lining up. SaaS startup Everstage, Endiya Partners backed equity management platform Qapita, and Geospatial SaaS startup Attentive all raised funds.

Pentathlon Ventures, an early-stage B2B SaaS focused VC firm, announced final close of its first fund, which secured investments totalling INR 76 crore. They plan to invest in 20+ B2B SaaS startups in a year and make investments between INR 75 lakh and INR 3 crore on an average.

Global Market Sentiment

According to Facebook’s 2020 and 2021, State of Small Business reports, business closure rates are falling around the world in a majority of surveyed countries, which indicates that the small business recovery is underway.

Globally, 18% of small businesses said they were currently closed, down from 24% in February. However, of those businesses still operating globally, more reported reduced employment this time around, rising from 30% in February to 36% in July.

For some, the shift to online has been the difference between staying afloat or going under. While for others, digitisation has given a whole new lease on life

20% of women-led businesses were closed globally, compared to 16% of those led by men.

The usage of digital tools has spiked during the pandemic, the survey shows a rise to 88% of all businesses compared to 81% in February. More than 50% expect their use of digital tools to be permanent. For some, the shift to online has been the difference between staying afloat or going under. While for others, digitisation has given a whole new lease on life.

The Young Need Investment

Still, many small businesses are struggling with finances, with 60% stating they faced difficulty in paying business-related expenses, and about a quarter reported struggling to pay down loans or debt (26%), bills (25%), rent (25%), and employee wages (24%).

The world’s youth are very much showing interest in becoming entrepreneurs, as they brim with new ideas. However, they do need funding. In a recent Youth and Investment study, Maven Road, a business intelligence firm, analysed 3.8 million social media conversations and found that 65.3% of the data was produced by 18-35-year olds, indicating the growing interest of this audience in making investments.

The world’s youth are very much showing interest in becoming entrepreneurs, as they brim with new ideas. However, they do need funding

However, only 6.8% were able to make any mention of brands in the sector, which indicates a gap in companies’ efforts to reach this generation.

While organisations and governments are taking notice. For example, MeitY Startup Hub and Paytm have announced the launch of a programme to scale deep-tech startups. MeitY also launched its startup accelerator program SAMRIDH to fund and mentor 300 IT firms.

More is always welcome in an area that is building the future.