Apart from the more controversial news, *cough* it’s been a quiet Q4 in the Indian startup ecosystem. In other news, Q4 saw 87 deals in the angel space with an average funding of $433k. Do note that the numbers came down to 87 as compared to 141 in Q3. Below, we’ve put together some interesting highlights below that might tickle the founder/investor fancy.
1. Sector Numbers:
The focus is always to build a great solution. However, it’s worth paying attention to what problems investors are interested in solving. This graph displays the number of funded companies vs fundraising companies across 19 most populous sectors.
If you didn’t catch it:
– Enterprise Software, Education and Healthcare are the top funded sectors in regard to the number of deals.
– Those same sectors also have the smallest gap between demand and supply of angel funds.
– Sectors like Analytics, Fintech and IoT showed greater supply than the demand while the likes of Media & Entertainment and Travel & Tourism still remain under-funded. We wonder why.
2. Market Type:
Who is the end consumer of your product? How much of an impact does this have on your fundraise?
In this graph, we compare the fundraising trends in Q4 between B2C and B2B companies.
– 60% of the deals that happened in quarter 4 were B2C- 45% of the companies looking to raise funds were B2B and hence the demand continues to be more for B2B
3. Stage of the company
As we’ve seen over the last few years, on big check mark for investors is where you are as a company. This means fact checking your market entry, the adoption of your product/service or what kind of growth you’ve gained.
Your ask changes based on the stage of your product.
Obviously, startups with early revenues get more attention than beta launches and startups with beta launches do better than proof of concept. So, don’t discount this part of your #startupjourney. Would you have invested in Tesla when it was in an ideation phase? Another attempt at an electric car?
In this graph :
– Most of the ‘Steady Revenue’ companies raised a bridge struggling to raise a VC round.
– More than 65% of the deals happened at Early Revenue stage
– Early revenue stage companies continue to dominate the market with the smallest gap between funded and fundraising.
– Around 15% of the fundraises happened at Beta/POC stage.
Hope this post got some cogs turning. Stay tuned for more #LVinsights and let us know if you have any questions, reach us at firstname.lastname@example.org
Happy Fundraising, you got this!