The early part of the year 2019 hasn't brought cheers to the Indian startups, as the first three months has registered a drop in startup investments. As per startup data platform, Tracxn, Jan-Mar quarter of the calendar year (CY) 2019 has witnessed a drop in total deal value from $3.2 billion to $2.4 billion, which is 25 percent less than the preceding quarter (Oct-Dec 2018). Moreover, the number of deals has also stumbled around 17 percent to 187 rounds in the first quarter of the running calendar year from 224 rounds in the last three months of the calendar year 2018.
The Financial Express has reported that irrespective of lower funding in the initial part of the running year, the deal volume has increased. Some of the major rounds of funding in the Indian startup ecosystem during first three months of 2019 include, Delhivery's $413 million round led by Softbank, Ola securing $300 million from Hyundai and Kia, $150 million raised by Bigbasket from Mirae Asset and Alibaba, $100 million raised by OYO from Didi Chuxing, CarDekho's raising $110 million from Sequoia, Capital G.
Experts are of the opinion that the investors are avoiding to participate in mid-stage deals, Rohit Chokhani, Principal Founder, White Unicorn Ventures said "Late-stage deals show that a handful of companies are getting a larger share of the money while at early-stage there is not much left even though the number of deals is high. At mid-stage investors aren't investing as they see investing for even a small stake at late stage a sure shot bet that they can sell it at a higher price ahead rather than taking a risk at the mid-stage."
Notably, the decrease in funding is witnessed across all the stages of when last quarter and Q4 2018 are compared. The first quarter of the calendar year 2019 registered $326 million investment in 134 rounds vis-a-vis Q4 FY208 where nearly $547 million was invested in 166 rounds. A similar drop is also seen in the mid-stage funding where $587 million was pumped in across 33 deals in Q1,2019 as against $738 million that was poured in 44 deals Q4 previous year. Even in the late-stage funding, the capital infusion was $500 million less than in the last quarter of 2018. In recent times, Binny Bansal, Flipkart co-founder has among the top angel investors in India. His portfolio has grown in the last few years with investments in 29 companies across sectors.
