“The year 2017 has been about market corrections and this trend is set to continue in 2018.”
An overall glance at the Indian tech startup ecosystem will exhibit a much finer picture: 100th position in terms of ease of doing business; 37th position on the global startup ecosystem comparison chart; several partnerships with the foreign governments to facilitate cross-border startup opportunities to the Indian entrepreneurs.. And the list continues.
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.”
While analysing the data, Inc42 DataLabs observed that if we remove the top five fundings of 2017 including the billion dollar cheques infused in the Indian consumer internet companies, the funding amount falls down to $6.46 Bn which is technically a rise of 38% in comparison to the funding raised in 2016.
Further investigation showed that around 12 startups raised $8.84 Bn through 19 deals, leaving almost 98% startups with 30% of the total funding amount. This, along with the observation of Seed and Series A crunch, suggested a growing funding vacuum in the ecosystem.
The Inc42 DataLabs’ tech startup funding report 2017 also suggested that with lesser startups being able to make it to Series A and many ‘me-too’ startups at the seed stage, the funding disparity will continue.
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.