Inc42 DataLabs发现，2018年第一季度，BrowserStack、Icertis、Lendingkart、NestAway、Pine Labs,、Global Sports Commerce (GSC)等晚期投资轮创企收获了5000多万美金的融资，每家累积资产达5亿美元。此现象从本质上表明3%的创企囊获了本季度50%的总投资，再次验证了Inc42 DataLabs在《2017年第三季度印度科技创企融资报告》中首次提出的"融资空白"现象。
However, post the 2016 funding winter, the industry experts in the Indian tech startup ecosystem have become wary of even the slightest of the highs and lows in any segment. The Inc42 DataLabs observed this trend and clearly highlighted in its Annual Tech Startup Funding Report 2017, that “only a handful of startups that will be able to crack through to late-stage fundings will dominate with big ticket size rounds, given the fact that investors have lesser options to bet on.”
With the closing of the first quarter of 2018, it’s time for us to corroborate our predictions and tally our present observation of the funding scenario for 2018.
India Tech Startup Funding Q1 2018: An Overview
In accordance to the data collated between January-March 2018, the tech startup funding deals were found to have increased by 20% while the deal amount fell by a staggering 50% in comparison to the previous quarter.
The QoQ trend shows, the number of funding deals in Q1 2018 was 42% higher than the previous quarter, but it’s 19% low since Q1 2017. Further, in terms of amount, the numbers have fallen drastically; a fall of 99% as compared to Q4 2017, and 56% as compared to Q1 2017. The numbers show an all-time low compared to the first quarters of the last three years.
Inside The Funding Stages: Seed Fund Crunch Shows Sign Of Recovery
The aberration from the spray and pray policy of investment observed during the years of 2015 and 2016, continues into 2018. Investors are more constrained and are relying on sustainability metrics and profitability for making an investment.
On the bright side, the trend of seed funding crunch seems to be making a fair recovery in Q1 2018. Although the number of deals in seed stage is still 18% lower than that of Q1 2017, the numbers have increased by 43% as compared to Q4 2017.
A similar recovery is observed in Series A stage. The number of deals has in fact increased by 22% as compared to Q4 2017 providing some relief to the burgeoning Series A crunch observed since mid-2016.
Another interesting observation we made when we look at the amount in all stages is, while the amount in seed stage has grown 3.5X as compared to the last quarter (Q4 2017), there still lies a significant fall in the late stage funding growing to 81% in Q1 2018.
A Deep Dive Into The Sectors: Fintech & Healthtech Continues To Top The Chart
The tech startup funding trend in each sector continues without many digressions. Fintech and Healthtech continue to top the chart with 30 and 25 deals respectively. As compared to Q4 2017 the number shows a dip in Q1 2018, however, that can be attributed to the overall funding low in this quarter.
Interestingly, the tech startups in the enterprise application and service space are getting attention in terms of funding and together the two sectors garnered 33 deals and $269 Mn in amount.
In Q1 2018, the Inc42 Datalabs observed that late stage startups like BrowserStack, Icertis, Lendingkart, NestAway, Pine Labs, Global Sports Commerce (GSC) received more than $50 Mn tickets each cumulating to $500 Mn. This essentially suggests 3% of the startups that were funded account for 50% of the total funding this quarter, reaffirming the “Funding Vacuum” Inc42 DataLabs first reported in its Indian Tech Startup Funding Report Q3 2017. The following pie gives us a complete funding landscape of the sectors in Q1 2018.
Having A Look At The Geographical Segmentation
Bengaluru remains the top destination for the Indian tech startups. Around $400 Mn funding was made through 69 deals in Q1 2018. RazorPay, HackerRank, Zoomcar, Capillary Technologies and NestAway were able to secure ticket size of more than $20 Mn. Despite topping the list, in this quarter (Q1 2018) total funding for Bengaluru startups are at an all-time low since Q1 2015. Trailing Bengaluru are the cities of Delhi/NCR, Mumbai and Hyderabad.
Mergers & Acquisition Trends: Setting The Table For The New Play
In any sector, the ongoing amalgamations have the power to overthrow the existing market leader. In most cases, such deals set an option for quicker and easier exits for both the startups as well as the early-stage investors.
Once posed as a system where the powerful one gobbles up the smaller or the weaker one, mergers and acquisitions are now observed as a means to combine their synergies and gain a dominant position amidst the cut-throat competition.
Furthermore, with the change in startup funding philosophy and saturation of sectors like ecommerce and consumer services, exits and M&As are observed to have gained momentum in the Indian tech startup ecosystem. However, since Q2 2017, the numbers have been falling till Q4 2017. In Q1 2018, we observed an increase in M&As by 17%. With market correction happening in the ecosystem, this trend is expected to grow further.
The Investor Landscape
Finally, coming back to the proposition of changing investment strategy amongst investors, this could be confirmed by investigating the investor data collated by the Inc42 Datalabs. The number of unique investors has been falling since 2016 till Q4 2017. Q1 2018 observed a slight growth in the investor participation by 5%.
Having a look at the type of investor participation in the funding rounds in Q1 2018, the Inc42 Datalabs observed that the trend has been the same as that of 2017. Angels are receding and corporates and venture capitalists are to the rescue.
The first quarter of the year 2018 is about to fold its arms. With the overall observations made around the Indian tech startup funding from last year, it would be fair for us to assume that the assumptions of trends made in 2017 are yet to be confirmed or debunked.
Further, the recovery in growth stage funding adds more hope for the Indian startups. However, it is yet to be seen what the year holds ahead for the Indian tech startup ecosystem as a whole.