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Q3CY2021: A Quarter of Steady Funding and Growth for Start-ups

Q3CY2021: A Quarter of Steady Funding and Growth for Start-ups  

This year has been special for the start-up ecosystem from many perspectives:

  • Highest funding received in first 3 quarters of 2021
  • Highest number of unicorns added in 2021

Above 2 parameters are a strong indication of how start-up ecosystem is growing and strengthening its root with time. India start-up ecosystem is also becoming resilient to global turmoil and economic instability. Q3CY2021 again turned to be a strong quarter for the start-ups. Key highlights:

Funding:

  • Indian start-ups remain attractive, raised >US$ 6B in two consecutive quarters in CY21
  • 75% of the total funding driven by 14 large deals (> US$ 100 M) in 3Q CY21
  • 91% of the funding activity driven by growth and late-stage deals
  •  ~6% fall in Q3 CY21 deal value compared to Q2 CY21
  • ~50% of funding activity driven by late-stage companies. However, they represented just 9% by deal count

Deals

  • The number of deals closed in Q3 CY21 decreased by ~24% compared to Q2 CY21
  • ~6% fall in Q3 CY21 deal value compared to Q2 CY21
  • 75% deals by value were in the ticket size of US$ 100M or above
  • Lower ticket size deals dominate; 14 deals were of ticket size >US$ 100M compared to 19 in Q2 CY21
  • 69% of deal activity was driven by early-stage innovative start-ups (deal size remains small)

Business Model

  • B2C start-ups led the race in deal value: B2C start-ups raised over US$ 4.7B across 70 deals while B2B start-ups raised over US$ 1.4B across 51 deals
  • B2B observed average deal size of ~US$ 27M while B2C start-ups observed an average deal size of ~US$ 67M

Investors

  • Prominent investors 3One4 Capital, Sequoia Capital and Tiger Global have done 16+ deals across sectors
  • Tiger Global has majorly invested in 3 sectors- FinTech, Ed Tech and Retail Tech

Deeptech Focus

  • DeepTech start-ups raised ~US$ 80M across 18 deals in Q3 CY21
  • 15% of deals by volume catering to start-ups leveraging DeepTech solutions

Numbers above are good enough to represent another strong quarter for the start-up ecosystem. If India continues to see more such quarters, the definitely we can expect many new records in the near future.

For details please read a recently published report on NASSCOM PGA Labs Tech Start-ups: Quarterly Investment Factbook:

https://community.nasscom.in/index.php/communities/productstartups/nasscom-pga-labs-tech-start-ups-quarterly-investment-factbook-q3-cy21

 

 

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