Investors Need To Identify Early Stage Gems To Chart Growth Roadmap: Sanjeev Bikhchandani

SUMMARY

Info Edge founder and vice executive chairman Sanjeev Bikhchandani has emphasised that investors need to identify early-stage gems to capitalise on the next wave of disruptive startups

Speaking at Inc42's MoneyX 2024 event, he suggested that investors adopt a patient approach while investing in unlisted companies and early stage funds

Citing the example of foodtech major Zomato, Bikhchandani said one of the reasons Info Edge invested in the startup was because of its founder Deepinder Goyal, despite it being a high-risk bet at the time

As the world’s third largest startup ecosystem signals the arrival of a funding spring, Info Edge founder and vice executive chairman Sanjeev Bikhchandani has emphasised that investors need to identify early-stage gems to capitalise on the next wave of disruptive startups.

During an interaction with Inc42 cofounder and CEO Vaibhav Vardhan at MoneyX 2024 on September 26, Bikhchandani suggested that investors adopt a patient approach while investing in unlisted companies and early stage funds.

“They just make five early stage investments and then think that early stage doesn’t work. So, I’d say, build a portfolio,” the Indian business magnate said.

The Info Edge founder listed three critical points behind the decision to invest in Zomato – founder Goyal, Zomato’s team, and the startup’s potential to create a category.

Notably, Zomato secured a seed funding of $1 Mn from Info Edge back in 2010. Info Edge currently owns over 13% stake in the foodtech giant.

Bikhchandani’s comments come at a time when investors are directing a large chunk of their investments towards early-stage startups, demonstrating their confidence in the sector’s long-term prospects.

In August, Gujarat-based micro venture capital firm Volt VC launched its early-stage focused maiden fund with a target corpus of INR 45 Cr. Dubbed ‘Volt VC Fund-1’, will focus on pre-seed investments in consumer-focused businesses across sectors like D2C, B2C and B2B2C models.

Earlier this month, early stage venture capital firm z21 Ventures marked the first close of its $40 Mn Fund II at $20 Mn (INR 167 Cr).

As per Inc42 data, seed-stage funding rose 23% to $589 Mn in the first six months of 2024 from $479 Mn in H1 2023.

Meanwhile, early-stage investments are expected to further pick up at a rapid pace moving forward. About 93% of over 50 startup investors surveyed by Inc42 see 2024 as a turnaround year for Indian startups.