Friday, April 19, 2024
Outlook India
Outlook Business

Late-Stage Funding In Indian Start-Ups Drops By 52% Decline In 2022: Report

Early-stage start-ups raised $1.3 billion, $2.5 billion and $2.8 billion in CY20, CY21 and CY22, with average ticket size of deals around $4 million

Late-Stage Funding In Indian Start-Ups Drops By 52% Decline In 2022: Report
POSTED ON January 12, 2023 12:56 PM

Venture capital (VC) equity firms have dry powder worth $590 billion globally, PricewaterhouseCooper (PwC) reported. A majority of this fund was to be invested in the calendar year (CY) 2021 and CY22. 

According to PwC, dry powder refers to the amount of committed but unallocated capital a firm has on hand. It is an unspent cash reserve that is waiting to be invested.

The build-up of dry powder is due to a market pullback by VC funds that are picky about their investments. The focus is on companies that have strong unit economics and a path to profitability, it added.

The Indian start-ups raised $24 billion between January and December last year across 1,021 rounds. The average size of the deals is said to be around $23 million. Though the late-stage funding has decreased, early-stage funding went up by 12 per cent.

The report also suggests that early-stage start-ups have raised $1.3 billion, $2.5 billion, and $2.8 billion in CY20, CY21, and CY22. The average ticket size of the deals is around $4 million. 

The late-stage funding saw a sharp rise in CY21 standing at $12.6 billion which was more than three times the amount that was infused in CY20 ($3.7 billion). In CY22, this number plunged to reach $6.5 billion. 

The city-wise trends revealed that the majority of the funding came from metros such as Bangalore, National Capital Region and Mumbai. 

The top five sectors that attracted funding were software as a service (SaaS), FinTech, Logi and AutoTech, EdTech and direct-to-consumer (D2C), contributing approximately 71 per cent of the total funding in CY22 in value terms. Funding in SaaS start-ups grew by 20 per cent in CY22 versus CY21, making it the most-funded sector of CY22.

  • Related Articles

    Google challenged that order before the Supreme Court, which agreed to hear it on Monday

    Google Fails To Get Interim Relief In App Store Case

    The two companies will bring together employer-sponsored benefits with the option to use Cost Plus Drugs as part of their plan

    Billionaire Mark Cuban's Pharmaceutical Start-up Partners With RxPreferred

    NPCI in a circular said it has been receiving requests for allowing non-residents to use international mobile numbers for transacting in UPI

    Non-Residents From 10 Countries Will Soon Be Able To Use UPI For Fund Transfer: NPCI