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7 factors that boosted funding growth in 2021 and the way forward

The 2021 Indian startup funding bonanza continues. This year, startups have, so far, raised almost $20 billion in funding, saw 20 new unicorns, and witnessed two IPOs — Zomato and Nazara. And it’s only August.

In July alone, the Indian startup ecosystem raised almost $10 billion (including a mega-round of $3.6 billion raised by Flipkart), and added three new unicorns to its cap. This is almost equal to the total funding raised in the first six months of 2021, and more than the entire amount raised in 2020.

This increase in capital inflow is largely due to growing investor confidence in a more mature Indian startup ecosystem with more seasoned returning entrepreneurs, amidst a rise in more global innovations and solutions being built.

With more and more startups leveraging the ‘pandemic induced opportunity’, investors are not shying away to take risks and invest large sums of money in Indian startups. This year has seen an increase in interest from global investors like Tiger Global and SoftBank.

According to Sanjay Mehta, Partner at 100X.VC, with India getting an amazing number of unicorns in H1, investment returns have soared for investors, revealed 100X.VC’s 2021 Sentiment Outlook research. This niche circle of investors got really big winners and have profited disproportionately, creating a flywheel effect, resulting in more investments in the early-stage startup ecosystem.

“This H1 funding has marked a historic high point for Indian investors,” he tells YourStory.

Rahul Chowdhri, Partner at Stellaris Venture Partners, adds that India has always held the promise of a large online user base, talent pool, and early-stage investor support.

“But what changed dramatically in the last 6-12 months is the fast pace of tech adoption in customer’s life, recognition of the value that tech startups are creating by the public market, as well as low cost of capital globally coupled with limited alternate attractive geographies or asset class,” he says.

Here are 7 key factors boosting investor and founder confidence in 2021.

Rise of 2x/3x entrepreneurs

The Indian startup ecosystem has matured faster in the last few years, particularly due to the emergence of startups founded by 2x/3x entrepreneurs.

During the pandemic, we have seen these entrepreneurs pivoting to new models as well as launching new startups with innovative models.

“These founders are already experienced and know how to scale-up and this is exactly the reason why the ticket-size for early-stage funding is getting larger,” says Anuj Golecha, Co-Founder at Venture Catalysts.

For example, Jupiter, started by fintech veteran Jitendra Gupta, raised funds even before its launch. There are plenty of examples of such founders exiting their existing scale-up companies and launching new startups.

Change in consumer mindset

As Alok Mittal, angel investor and Co-founder at Indifi Technologies and Plaksha University, explains — the pandemic accelerated the digitisation of many industries, particularly lending, education, finance, and healthcare. This is deepening the consumer internet markets in India, driving the funding momentum.

Further, the lockdowns have pushed even Gen X consumers to look for digital options. Be it payments, medicines, consultations, or even ordering groceries — even consumers in Tier II and III areas are looking for online alternatives to solve for their daily needs.

Deeper digital inclusion across businesses

From traditional legacy businesses to SMBs, student entrepreneurs to corporates, everyone has one common agenda — get the right tech stack integrated at the right place at the right time. This also brings scalability, thereby making future collaborations easier and less expensive.

Manish Singhal, Founding Partner at Pi Ventures, said, “The pandemic provided a massive push to startups involved in improving automation and digital environments, fuelling funding into these companies. Also, Indian companies, especially backed with differentiating tech, are able to solve global problems with ease. That opens up the funding channels from across the globe.”

Global talent at the door

If vision is important for setting the direction, a good team is a must for reaching the destination. Except for a few industries that operate purely on physical labour, making the employees’ presence compulsory in the office, the pandemic opened up opportunities for many to reach out and grab talent across the world.

For instance, Indian enterprise tech companies have been hiring experts in blockchain, data analytics, AI, IoT, and more, from the US, the UK, Israel, Egypt, and other areas.

Greater networking opportunities

Lockdowns haven’t stopped networking at all. In fact, the pandemic saw the rise of digital networking platforms like Clubhouse, Lunchclub, TapChief, CoffeMug.ai, among others. Events, too, shifted online, allowing attendees from across the globe to converge and network with like-minded individuals.

These changes made it easier for entrepreneurs to network with investors; the process became less time-consuming and cheaper.

Push towards global scalability and exit model

Growth and late-stage companies are now looking to build globally scalable products. Several companies have been exploring markets like the US, the UK, Israel, Abu Dhabi, and many Middle Eastern countries to extend their client network.

Further, late-stage companies are now looking for IPOs, signalling good exit opportunities for investors. Options like special purpose acquisition companies (SPACs) are further investors’ attractive exit routes.

Alok Mittal said, “The pandemic has created a fresh cycle of liquidity injection globally, and hence, there are large pools of capital trying to find productive opportunities. This clearly seems to be driving the public market activity, which is fuelling private market activity to an extent where most VCs are now doing “angel” stage deals with relatively broad-based funnels.”

More avenues of funding

Sajith Pai, Director, Blume Ventures, emphasises that due to the maturity gained by the Indian startup ecosystem, a lot more money is coming in from family offices, entrepreneurs, and entrepreneurs themselves, who have done well. Some of this money is being used to fund early-stage startups, or even mid to late stages.

“Also, we are fundamentally in an easy money regime led by quantitative easing, the need to boost the economy — led primarily by the US. Structurally, a lot of money is getting into the stock market, into financial assets, and some of it is also finding its way into private markets,” he adds.

The way forward

Rahul of Stellaris highlights that the pandemic has changed customer behaviours dramatically across the board — from the rise of remote work, use of live video, AI penetrating our lives to a rise in the passion/creator economy, tech adoption by SMBs, move towards online entertainment/ education/health/finance, cross border commerce, and more.

“Founders who understand and build solutions to capture these changes will continue to attract investments,” he adds.

From an overall investors point of view, the need for higher investment returns is also forcing a lot of US folks to invest in emerging markets, which explains why PE/VC in emerging markets is a big draw. Some of this money is finding its way into the Indian markets as well.

Going forward, more 2x/3x entrepreneurs are expected to come up with new ventures in the next two years. Also, the rapid rise of the domestic investor community is creating a robust ecosystem in the Tier II and III areas.

“These domestic investors have been infusing massive capital into the ecosystem for the last 3-4 years, compared to almost negligible amount earlier,” Anuj adds.

The way forward will certainly continue to be attractive and the money regime is expected to be easy for a long while.

“Unless that gets tight, we are not going to see any challenges. We are also starting to see a lot of the startups do well, and witnessing an IPO boom. So, money will continue to circulate in the Indian startup ecosystem as founders/CXOs plough back money. All of this is only good news for the startup founder going forward,” Sujith concludes.

Edited by Saheli Sen Gupta

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Tesla Left Out Of White House Event Featuring Top Carmakers. Elon Musk Says…

Tesla last month reported its first-ever quarterly profit above $1 billion on record deliveries. (File)

Washington:

Tesla, the global leader in electric cars, was excluded from the White House event Thursday where US President Joe Biden unveiled a big push for zero-emissions vehicles.

“Yeah, seems odd that Tesla wasn’t invited,” Elon Musk tweeted about the event that featured legacy American carmakers General Motors, Ford and Chrysler’s parent company Stellantis.

The irascible entrepreneur has been a pacesetter in the industry, and Tesla last month reported its first-ever quarterly profit above $1 billion on record deliveries.

But he also has a rocky record in relations with workers at his factories, including firing a union organizer and tweeting anti-union comments, which lead to a lawsuit by the United Auto Workers labor group.

Asked whether the snub was related to Tesla’s non-union status, White House spokeswoman Jen Psaki told reporters the invited companies “are the three largest key players of the United Auto Workers. So I’ll let you draw your own conclusion.”

But she said the Biden administration welcomes the efforts of all manufacturers working on electric vehicles, including Tesla.

“I would not expect this is the last time we talked about clean cars, the move for electric vehicles, and we look forward to having a range of partners in that effort,” Psaki said.

Interviewed on CNBC, Transportation Secretary Pete Buttigieg said he did not know why Tesla was excluded.

Musk responded by sharing a meme that read: “I’m not saying it’s sabotage. But it’s sabotage.”

(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)

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Touring in France post-Brexit ‘a puzzle’

Tankus the Henge frontman Jaz Delorean describes crossing the Channel for the first time since Brexit rules were introduced in January as “a bit of a puzzle”.

The band says their European dates usually add up to around six months each year but a combination of Covid and Brexit has dented their chances to play as many gigs abroad.

This is their video diary of their recent French tour.

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Jan 6 a ‘violent attempt’ by ‘terrorists’ to hold ‘power’: Biden

Biden spoke at a bill signing ceremony awarding the Congressional Gold Medal to police for valour during the Capitol riot.

President Joe Biden said the attack on the US Capitol on January 6 by supporters of former President Donald Trump was an insurrection by “terrorists” aimed at overturning “the will of the American people”.

President Biden’s words, some of his strongest yet about the Capitol riot that are now under congressional investigation, came as he signed a bill at the White House awarding the Congressional Gold Medal to officers of the Capitol Police and Washington, DC, Metropolitan Police for valour.

“My fellow Americans, let’s remember what this was all about,” Biden said of the siege.

“It was a violent attempt to overturn the will of the American people, to seek power at all costs, to replace the ballot with brute force. To destroy, not to build. Without democracy, nothing is possible. With it, everything is.”

The medal is the highest honor Congress can bestow. Biden and Vice President Kamala Harris held a ceremony in the White House Rose Garden to sign the bill, which was passed unanimously by the US Senate earlier this week.

Many officers were beaten and injured that day as the violent mob of Trump’s supporters pushed past them to break into the Capitol and interrupt the certification of Biden’s 2020 election victory. Some of them, including four who testified at a House hearing last week, have spoken about the lasting mental and physical scars.

‪President Joe Biden gives ceremonial pens to Abigail Evans, daughter of late US Capitol Police officer William Evans, after signing a law awarding Congressional Gold Medals to the United States Capitol Police, Washington Metro Police [Jonathan Ernst/Reuters]

The law will place the medals in four locations — Capitol Police headquarters, the Metropolitan Police Department, the US Capitol and the Smithsonian Institution.

The US District of Columbia’s police department announced this week that two more police officers who responded to the January 6 riot at the United States Capitol have died by suicide, bringing to four the number of known suicides by officers on duty at the building that day. The circumstances that led to the two deaths announced this week are unknown.

Another officer of the Capitol Police who had been attacked by protesters died of a stroke after the incident. More than 100 police officers were injured, some of them seriously.

A special committee of the US House of Representatives charged with probing January 6 heard testimony last week from four officers who faced off with rioters.

The hearing capped months of debate in Congress about launching an independent, bipartisan investigation modelled after that created in the wake of the 9/11 attacks.

“I was grabbed, beaten, tased – all while be called a traitor to my country,” Metropolitan Police Officer Michael Fanone recounted in emotional testimony.

“I was at risk of being stripped off and killed with my own firearm, as I heard chants of ‘kill him with his own gun.’”

US Capitol Police officer Michael Fanone testifies before the House Select Committee investigating the January 6 attack on Congress [Oliver Contreras/Pool via Reuters]

US prosecutors are offering plea deals to a group of six people accused of forming a “shield wall” of stolen police equipment as they battled officers in the US Capitol on January 6, a federal prosecutor told a court hearing on Thursday.

At a status hearing for six defendants facing felony riot charges, Assistant US Attorney Melissa Jackson told US District Judge Trevor McFadden that prosecutors had made plea offers to accused rioters who used police riot shields and batons to attack uniformed officers guarding the Capitol.

Crowd members could also be “overheard planning and implementing a rotation of rioters to have the ‘fresh’ rioters up front” to form a “shield wall” to stop police from using pepper spray.

One of the defendants, Christopher Quaglin, is accused of spraying police with a chemical irritant. Court records indicate Quaglin and two other related defendants remain in pre-trial detention.

The plea deals offered to the group are the latest which prosecutors have made to a growing number of defendants facing charges related to the January 6 riot.

More than 535 people have been charged with taking part in the violence, when supporters of then-President Donald Trump stormed the Capitol in an attempt to stop Congress from certifying Democratic President Joe Biden’s election victory.

Trump falsely claims he lost the election because of widespread electoral fraud.

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Richard Branson’s Virgin Galactic Restarting Space Tickets From $450,000

In July, Virgin Galactic founder Richard Branson beat Blue Origin owner Jeff Bezos to space. (File)

Washington:

After flying its founder Richard Branson to space, Virgin Galactic is restarting ticket sales beginning at $450,000, the company announced Thursday.

The new price is about double the $200,000 to $250,000 paid by around 600 people who previously booked seats on Virgin’s spaceship, as the company looks to cash in on the success of last month’s fully-crewed test flight.

Its next flight will come in September and involve members of the Italian Air Force, a paying customer.

“We are excited to announce the reopening of sales effective today,” said CEO Michael Colglazier in a statement, with first dibs going to people on a waiting list.

“As we endeavor to bring the wonder of space to a broad global population, we are delighted to open the door to an entirely new industry and consumer experience.”

In July, Branson beat Blue Origin owner Jeff Bezos to space in a battle between the billionaires.

There will be one further test after the September mission, but after that their calendar for launches has not been revealed.

The offerings for customers will include a single seat; multi-seats for couples, friends or family; and a full-flight buyout.

The spaceplane was originally designed to carry six crew, but last month’s flight, which was described as “fully-crewed,” had just four — suggesting this is the current number.

The company has predicted it will eventually run up to 400 flights per year, and two seats are up for grabs in a prize draw, with registrations open until September 1.

Virgin’s space experience involves an air-launched spaceplane, VSS Unity, that takes off attached to the belly of a massive carrier plane from a runway at Spaceport America in New Mexico.

After gaining altitude, the spaceplane detaches from its mothership and ignites its rocket engine, ascending to beyond 50 miles (80 kilometers) above sea level.

Passengers unbuckle and experience a few minutes of weightlessness before the plane glides back to the runway to land.

The company has come under fire for its carbon footprint, which is roughly equivalent to a transatlantic flight but for far fewer people. It has said it is examining the possibility of offsetting its emissions.

(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)

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California To Mandate COVID-19 Vaccines For Health Workers

SACRAMENTO, Calif.: California will require all of its roughly 2.2 million health care and long term care workers to be fully vaccinated against the coronavirus by Sept. 30.

Democratic Gov. Gavin Newsom said last month he would require health care workers to either be vaccinated or submit to weekly testing.

But the new order issued Thursday by the California Department of Public Health does not give health care workers a choice. It says all must be fully vaccinated by the end of September.

California is averaging 18.3 new coronavirus cases per 100,000 people per day. The delta variant is causing most of the new infections.

Disclaimer: This post has been auto-published from an agency feed without any modifications to the text and has not been reviewed by an editor

Read all the Latest News, Breaking News and Coronavirus News here

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Juventus apologise for racist Twitter post appearing to mock Asian people

The Bianconeri Women’s account posted an image of Cecilia Salvai making a gesture mocking Asian people

Juventus have apologised for posting a racist image on Twitter.

The Juventus Women’s team shared an image of defender Cecilia Salvai wearing a cone as a hat and slanting her eyes with her fingers, which follows harmful, long-standing caricatures of people from Asia.

The only caption that accompanied the picture was of a face between two hands to replicate Salvai’s expression.

What has been said?

The tweet was condemned as racist and eventually deleted before the Bianconeri account posted an apology.

It read: “We sincerely apologise that our tweet, which was not meant to cause controversy or have any racial undertones, may have offended anyone.