{"id":44583,"date":"2024-05-07T01:13:54","date_gmt":"2024-05-07T01:13:54","guid":{"rendered":"https:\/\/news.talkwithrattan.com\/index.php\/2024\/05\/07\/unicorn-sightings-become-rare-as-vcs-shun-that-leap-of-faith\/"},"modified":"2024-05-07T01:13:55","modified_gmt":"2024-05-07T01:13:55","slug":"unicorn-sightings-become-rare-as-vcs-shun-that-leap-of-faith","status":"publish","type":"post","link":"https:\/\/news.talkwithrattan.com\/index.php\/2024\/05\/07\/unicorn-sightings-become-rare-as-vcs-shun-that-leap-of-faith\/","title":{"rendered":"Unicorn sightings become rare as VCs shun that leap of faith"},"content":{"rendered":"
\"Unicorn<\/div>


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New unicorn sightings<\/a> among early-to-mid-stage startups have become rare as the \u2018leap of faith capital<\/a>\u2019 is missing even as there is a flurry of activity in late-stage companies<\/a>, several venture investors<\/a> and startup founders<\/a> told ET<\/a>.<\/p>\n

Early-stage deals are happening across sectors but some of the largest investors are still mainly backing established startups through new funding or secondary deals ahead of potential IPOs, they said.<\/p>\n

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\u201cThe big investors like SoftBank<\/a> and Tiger Global<\/a> are the ones who take a series C or series D company to unicorn<\/a> and help them scale really fast with a big cheque. That disrupts the market. That kind of investment<\/a> is yet to be seen even as deal activity has picked up,\u201d said a growth-stage fintech entrepreneur, who requested not to be identified.<\/p>\n

A top fund executive said he is still going through the same list of companies to evaluate before writing a bigger cheque.<\/p>\n

Entrepreneurs said no big startup has emerged over the last one year except perhaps Zepto<\/a>, which is riding the quick commerce wave currently.<\/p>\n

Only two startups \u2013 Perfios<\/a> and Ola founder Bhavish Aggarwal\u2019s Krutrim AI<\/a> \u2013 have become unicorns this year so far, and the number was the same for the whole of 2023.<\/p>\n

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Discover the stories of your interest<\/h3>\n<\/div>\n
<\/span><\/span><\/div>\n<\/div>\n<\/section>\n<\/div>\n


Privately held startups valued at $1 billion or more are called unicorns. <\/p>\n

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\"RareETtech<\/span><\/figure>\n<\/div>\n

\u201cMost of the companies we have evaluated in the past\u2013we are going back to them,\u201d said a senior executive at one of the tech funds with several unicorns in its India portfolio. \u201cSo, there is a sense of scepticism, given we passed on them once already.\u201d<\/p>\n

Writing big cheques for new firms is still a longer process amid gradually improving investment sentiments, this person said.<\/p>\n

According to data from Venture Intelligence, 10 late-stage deals happened last month compared to four in April 2023. The amount invested in these deals stood at $410 million as against $109 million a year ago, as per the data.<\/p>\n

PharmEasy\u2019s down round funding<\/a> led by Manipal group<\/a> chief Ranjan Pai<\/a>, Kore.ai<\/a> and Pocket FM<\/a> are among big deals this year till date.<\/p>\n

ET has been reporting about big-ticket deals being finalised across well-known startups<\/a> like Lenskart, Purplle, Rapido, HealthKart, Innovaccer and others.<\/p>\n

Investment fund SoftBank is expected to invest in a new round at existing portfolio firm Meesho<\/a>, as first reported by ET. Tiger Global may also cut a small cheque through a mix of primary and secondary share sale.<\/p>\n

\u201cMeesho raised big capital before the pandemic also,\u201d a top consumer investor told ET. \u201cApart from Zepto<\/a>, no other major consumer startup has been there really,\u201d the person added.<\/p>\n

ET reported on April 29 saying Zepto explored a merger with Flipkart<\/a> but is going ahead with plans to raise at least $300 million<\/a> from financial investors amid a significant spike in demand seen on quick commerce platforms for both grocery and non-grocery items.<\/p>\n

Not out of the woods
<\/strong>
Several industry executives said the money being pumped in new deals is still largely restricted to fast-growing and profitable companies. This activity too is starting to take place after almost 18 months since the funding winter<\/a> set in in the country.<\/p>\n

\u201cA lot of ventures are still fixing the economics and those companies will then be able to raise significant capital to scale up their operations,\u201d said another investor who is reviewing deals currently.<\/p>\n

Total venture funding<\/a> across stages for the January to March quarter stood at $1.97 billion, down from $3.2 billion a year earlier, data from Tracxn showed.<\/p>\n

Early-stage startups \u2013 including the ones set up by former senior executives at large unicorns \u2013 have been able to raise capital from investors over the past few months.<\/p>\n<\/div>\n


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Source link <\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

New unicorn sightings among early-to-mid-stage startups have become rare as the \u2018leap of faith capital\u2019 is missing even as there is a flurry of activity in late-stage companies, several venture investors and startup founders told ET. Early-stage deals are happening across sectors but some of the largest investors are still mainly backing established startups through […]<\/p>\n","protected":false},"author":2,"featured_media":44584,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"tdm_status":"","tdm_grid_status":"","fifu_image_url":"https:\/\/img.etimg.com\/photo\/88591548.cms","fifu_image_alt":"","footnotes":""},"categories":[607],"tags":[24228,18136,2794,382,45636,44218,45631,20276,45630,15662,45634,15661,15660,9322,31873,45637,7139,45633,21546,2797,45629,45628,12088,32476,45635,45632,14688],"amp_enabled":true,"_links":{"self":[{"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/posts\/44583"}],"collection":[{"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/comments?post=44583"}],"version-history":[{"count":1,"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/posts\/44583\/revisions"}],"predecessor-version":[{"id":44585,"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/posts\/44583\/revisions\/44585"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/media\/44584"}],"wp:attachment":[{"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/media?parent=44583"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/categories?post=44583"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/tags?post=44583"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}