Investors High in Spirits as Q3 Witnesses 200% Increase in Investments Compared to Last Year
Contrary to the expectations, COVID-19 has provided a great opportunity for startups to thrive in various sectors. In spite of the lockdown, the second quarter had witnessed a 338 percent jump in the startup funding as compared to Q2 of 2019.
Despite challenges caused due to the corona virus, top investors like Sequoia, AngelList, Y Combinator, Matrix Partners, and Inflection Point Ventures continue to back startup ecosystem in India. The investors have not only adjusted themselves as per the new normal to overcome the lockdown barriers, but also have launched various programs to support Indian startups.
As a result, the Q3 has observed 201% surge in investments as compared to 2019. The startups have raised nearly $550 million this week with Ed-tech leading the fundraise arena, followed by segments like grocery, health care and online pharmacy.
The July-September quarter has raised $14.90 billion in 316 rounds up from $4.94 billion in relatively higher 447 rounds in the same quarter last year. From $5.08 billion raised by startups across 401 deals in Q1 2020, the funding has been up 193 per cent for the quarter ending September 30, 2020.
Startups operating in the B2C sector such ad Byju’s, Zomato, Unacademy, Eruditus, Vedantu were leading the charts in terms of Q3 investments. The majority of funds were invested into late stage with 61 rounds including $14.10 billion, while $605 was invested in early stage startups. The seed rounds bagged around $126 million in 180 rounds.
Indian startups have shown a significant growth in the past few months. India has been classified as the third-largest startup ecosystem across the globe. Apart from investors, the government as well has been launching various initiatives to aid the Indian startups and help them to introduce new solutions to the old problems, innovate, grow and flourish without being affected by the current effects of the pandemic.