Investments in Indian startups has increased rapidly in 2015.According to a research conducted by Your Story on Indian Startup Funding, Indian startups has raised $1.7 billion from investors in the first quarter(Q1) of 2015 with an average of two startup funding per day which is 300% more when compared withQ1 of previous year. With 147 deals in startups between January and March India has broke the records of China. Payments and consumer web sectors are the main interests of startups and they together account half of the funded amount. The other half is spread across mobile, e Commerce and Software as a Service (SaaS) companies.
As the number of startups increase many Big Venture Capitalist (VC) have come up to support them. Sequoia Capital is the most active VC of the quarter in Asia Pacific region as they have made investment in 32 deals among which 13 deals are in India. Tiger Global has made investment in 9 Indian startups and IDG Ventures have made investments in seven deals in India.
A common observation is that the investment made by VC firms in the form of seed and bridge capital is increasing over years and the investors are more likely to receive fund from firms even with no revenue but more users and tractions. Based on the number of deals seed capital contributes, 53.2% of the total investments and private equity deals account to 29.8%. Series A investments were 8.50% and series B funding stood at 4.30%.Series C investments were 2.80% of the funding, the rest 1.45% was invested as series D, where these series indicate different in growth stage of startups.
In the last quarter Gurgaon and Noida were the top destination for investments flow in India and Paytm, the startup that raised the highest fund in this quarter is from Noida. It is followed by Bangalore with an investment of $346 million and Mumbai with $295 million funding. Other startups that raised highest funds from VCs includes million and Ujjivan Financial which raised $96 million. An analytics startup company Manthan Software raised $60 million and the Big data startup Antuit’s funding was $ 56 million. NewsHunt raised a $40 million round in Series C.
The main mergers and acquisitions of Q1 include OLA which acquired TaxiForSure. Unicommerce and Exclusively was acquired up Snapdeal.The mobile ad network Adquity was acquired by Flipkart. Twitter an international startup has acquired ZipDial which is its first Indian acquisition. Also with the realization of talent as the new cash many startups are in the fight for the acquisition of talented people. Paytm and Quikr, were added to the Indian unicorn club as their value covered a billion dollar.
The startups in Q2 has gained an extra momentum as along with VCs the government also raised their support understanding it would help in the development of the country.
