Indian startups get 2nd highest VC funding among APAC countries during Jan-July: GlobalData

Indian startups stood next only to Chinese counterparts in terms of VC funding value among the Asia-Pacific (APAC) countries during January to July 2021, reveals a report by data and analytics company GlobalData.

This exhibits the fact that despite the third COVID-19 wave looming large and slow economic recovery, venture capital investors have reposed faith in the Indian startup ecosystem.

An analysis of GlobalData's Financial Deals Database reveals a total of 828 VC funding deals were announced in India during January-July 2021, with the total disclosed funding value of $16.9 bn.

Aurojyoti Bose, Lead Analyst at GlobalData, comments: "While some of the top key markets globally witnessed a decline in VC funding value in July compared to the previous month, India managed to showcase growth despite a decline in VC funding deal volume."

Bose said rising smartphone penetration and affordable mobile Internet have transformed India into a digital-first economy. As a result, tech startups are the biggest beneficiaries of this trend.

Bose said the GlobalData research shows India has the third-largest tech unicorn ecosystem in the world behind the US and China.

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"During the COVID-19 pandemic, VC investors are evincing interest in startups across themes such as e-commerce, social media and social networking, food delivery, edtech, and digital payments."

Some of the notable VC funding deals announced in India during January-July 2021 include $3.6 bn raised by Flipkart, $502m raised by Mohalla Tech (ShareChat), Zomato's capital raising of around $500m, and $460m raised by Think and Learn (Byju's).

The significant rise in VC funding has led to a record number of startups entering the unicorn (with a valuation of over $1 billion) club in India. As per the latest data, India has added a total of 25 unicorns -- the highest ever added in a single calendar year -- in the eight months of the year 2021, taking the total number of unicorn startups to 61 in the country.

This is way more than the National Association of Software and Services Companies (NASSCOM) estimate, which had claimed India could have 50 unicorns by the year 2021. The calendar year 2020 had seen over 1,600 tech start-ups and a record 12 unicorns emerging in the country.

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