3One4’s Siddarth Pai On The Sectors That Will Continue To Attract Investors

Due to the unprecedented economic slowdown, several experts have observed that funding in startups is going to be scarce this year. However, 3One4 Capital founding partner Siddarth Pai believes that startups in certain segments are showing promise and can still pull out money the deep pockets of the investors.

Speaking to Inc42’s CEO and cofounder Vaibhav Vardhan, in the first #StartupsVsCovid19 ‘Ask Me Anything’ session, Pai explained that most of the funding in the ecosystem comes from public markets. As the public markets are crashing around the world, the money flowing in the ecosystem has also reduced.

He emphasised that VCs raise funds from limited partners and institutions depending on public markets for liquidity and the market crunch directly impacts the startups at the end. “Around 30-40% of the total wealth accumulated by India in the last 10 years have been eroded in one week,” he added.

Shift In Edtech

This is surely one of the toughest time that Indian startup ecosystem has ever faced. Yet, the opportunities for some startups are still open. According to Pai, sectors such as edtech are going to gain the traction of many investors amid the lockdown. “Edtech is going to see a dramatic shift,” he added.

The trend of schools using technology to facilitate lessons is expected to continue in the future as well even after the coronavirus episode ends.

Remote Working Is Here To Stay

In the wake of the coronavirus outbreak, most of the companies in India and around the world have started to work from home. To ensure the efficiency and effectiveness of the work, these companies are now relying on remote working tools. “Work from home is going to become a reality for everyone,” Pai said.

As remote collaboration and team management tools evolve, businesses will find more uses for them. Pai said that investors will turn to the developers of these applications as work for home is here to stay. “Tools which can weave people together on a single dashboard and ensure that even if you’re not in the office, the operations are going on smoothly are going to be in demand,” he added.

The Future Is Healthtech

To clear some of the current panic, healthtech startups are stepping in and aiding the traditional healthcare system. Pai believes that some of these startups, which are conducting fundamental research in healthcare are going to take a lead in the next few months.

Besides research-based healthtech startups, Pai is also hoping that investors will turn to artificial intelligence (AI) leveraging healthtech startups. Using AI, startups are able to develop applications that can help in self-diagnosis, and in the discovery of potential drugs, vaccines, and antibiotics.

Moreover, these startups are also providing data-rich data points to allied healthcare segments like insuretech. He explained that many insuretech startups will be leveraging the datapoints of these companies to sell customised insurance products.