100X.VC, a prolific early-stage venture fund, is bullish about the Indian start-up ecosystem in 2023. The customer purchase intent is not plagued in any manner, and business remains insulated, claims the fund. Despite a tough 2022, this year is likely to birth a bevy of new start-ups that will be more “cash-conservative” and “revenue and growth-focused”.
Sanjay Mehta, Founder & Partner, 100X.VC says, “India has a significant local growing consumer demand. Hence, it will not be impacted by the impending global recession. In 2023, we will be experiencing India, where new start-ups will be unlimited in supply.”
This will, of course, pose a challenge for investors, who were already tigething their purse strings in the funding slowdown of 2022. Mehta reckons investors will have to “eliminate” more than “select” start-ups. “Investors who can apply quality filters pick winners in the start-up world while investing in 2023 will be able to see their portfolio shine with outlier returns by 2030,” he says.
2022 also brought about a spate of layoffs across the start-up economy. According to 100X.VC, this could be a positive for “well-funded start-ups which now have access to a new pool of brilliant people”.
Some of the sectors to watch out for this year include enterprise software and SaaS, D2C, EVs and electric mobility, QSR, Future of Work, generative AI, agritech, digital health, blockchain and Web3, and security, compliance & privacy.
The fund also reckons this year could see further growth in the inflow of Corporate Venture Capital (CVC), with more large corporations seeking out start-up investments to access new technologies or business models, or simply to diversify their portfolios. “CVC models can provide start-ups with capital, resources, and expertise and corporations with access to new technologies, business models, and talent,” 100X.VC stated.
Earlier in 2022, 100X.VC signed an MoU with HDFC Bank to collaborate on start-up support. As part of the deal, HDFC bank will assess 100X.VC-recommended start-ups for investment and loan extension opportunities. “Under this programme, we will jointly nurture emerging start-up ideas, cultivate them with 100X.VC first cheque seed capital and HDFC Bank’s banking services and access to credit seamlessly,” Yagnesh Sanghrajka, Founder and CFO at 100X.VC, said in a statement.