2018 witnessed a tectonic shift in funding. Indian start-ups raised more money from Venture Capital (VCs) than Indian IPOs did through their Initial public offering. History has witnessed the fact that in India, listed companies with stocks in the share market have always been on news limelight and the hot topic of discussion. But for the first time in history, Indian start-ups stole the limelight.
IPOs v/s Startups.. And the Startups won!
While IPOs raised around $5 billion (Rs. 34,117 crores) in 2018 through investments and public offerings, startups in India raised a whopping $6.55 billion (around Rs. 44,940 crores) through several series of funding. While the IPO funding dropped below half in 2018 as compared to 2017 that of start-ups doubled.
Oyo rooms, Swiggy and so many more..
Startups like Oyo Rooms and Swiggy alone raised $1 billion each in 2018. Oyo Rooms is now larger than the top 4 listed Hospitality companies put together. It is expanding to China as well, while Swiggy is supposed to give all restaurant chains a run for their money.
Surviving and Thriving..
The sudden increase in start-up funding seems to be because of the cycle in which the said startups currently exist. A decade ago as well, there were a lot of ideas and a lot of new startups and they managed to raise sufficient funding. But most of them failed. Subsequently, the act of funding startups has become much more intelligent in terms of return on investment from the VC’s point of view.
Not just that, the startups that survived and grew are now huge companies and are still showing tremendous growth. This interests Venture Capitals from all around the globe to invest in Indian start-ups. International VC funds show an uptick in investment and this seems to fuel the success of the new, cutting-edge start-ups in their race to far outrun the conventional, listed companies in the times to come.