Vaibhav Agrawal, partner at the India subsidiary of CA-based Lightspeed Venture Partners, outlines three reasons why so much venture capital is flowing into Indian companies
- A noticeable improvement in India’s infrastructure has enabled startups to create more value and scale up their businesses quicker.
- The pandemic shifted a lot of day-to-day consumption online which improved cost of production per unit of goods.
- India is at a stage where a slew of startups have announced plans to list in the stock market.
“We are just seeing higher order values. For example, in e-commerce there is a higher frequency of ordering in food commerce companies,” Agrawal said. “That is just giving a lot of confidence to investors worldwide. All of this is creating just the ‘perfect storm’ that’s allowing everyone to take more risks, from early stage investors to late stage,” he added.
Analytics firm GlobalData headquartered in London, England said that as many as 828 venture capital funded deals in India were announced between January and July 2021, with a total disclosed value of $16.9 billion. That marked a 40% jump in deal value compared with all of 2020.
