IAN Ties Up With Caspian Debt To Bring Debt Funding To Early Stage Startups

Indian Angel Network on Monday (January 13) announced that it has signed a memorandum of understanding (MoU) with Caspian Debt to bring larger fund access to early and growth stage startups.

Avishek Gupta, investment director, Caspian Debt, said that they plan to further Caspian Debt’s goal to ensure that no professionally managed startup goes without debt funding required for scaling.

In addition to supplying capital support, the two entities will jointly conduct various educational events to improve awareness about various funding options and structures available to entrepreneurs and empower early-stage startups across the country. These include workshops, seminars, open hours among other such events.

As part of the MoU, the two parties will also be responsible for organizing knowledge exchange and cross referrals for the IAN and Caspian portfolio companies.

Padmaja Ruparel, cofounder at IAN said, “As we enter a brand-new decade, we are resolved to build on our past performance and support an even greater number of Indian startups. Currently, India is home to more than 30 unicorns. Through the concerted efforts of key industry players and the government, India has the potential to ramp this number up to 50 within the next half-decade.”

By the end of the 2010-2019 decade, the Indian startup ecosystem had hit a series of milestones in its journey to global domination, while the number of deals went over the 5K mark with approximately 2,984 unique startups funded. It is to be noted here that the total capital inflow (2014-2019) in Indian startups crossed at $50 Bn in 2019.

DataLabs by Inc42 has noted that startups are grasping higher deal value with the average ticket size of funding recording its historical peak of $21 Mn in 2019, so naturally, the ecosystem is going into 2020 with great expectations.

However, in 2019, the seed stage funding continued to fall. With $252 Mn in funding, seed-stage deal value fell by 44% (compared to 2018) as only 306 seed funding deals were recorded.

When it comes to early-stage seed funding, the Indian startup ecosystem is going through a slowdown. The ruling government has boasted about setting up an INR 20K Cr seed fund by 2024 on multiple times, but with early-stage angel and seed investment drying up, the government’s ambitious plan looks unsustainable at this time.

At present, there are over 416 venture funds who have focus on the early-stage startups in India. The marquee VC funds like Kalaari Capital, Tiger Global Management, Accel Partners India, Sequoia Capital India, Blume Ventures, Nexus Venture Partners among others are already working in parallel with angel networks, HNI’s and corporate investors; and aggressively trying to bridge the gap between early-and late-stage ecosystems.