I came across this rather misleading article by a New Investor in town, that India has a Series A drought. I think its a bit sensationalist and misleading and drinks a bit of his own coolaid and shifts blames on others, but I’d agree with the article on one count – Yes there is a drought.
I am going to start this off on the right foot. This whole venture funding phenomenon is about at the best 15 years old in India. Whenever i sit with the guys who really understand business and even remotely talk about the things we talk about – they give me a dazed and confused look. You know why? Venture capital is nothing more than a bank – a bank which specializes in lending to private companies. I cant think of a single self-respecting business man who built his business based around what the money lender thinks he should do. If Startups today are talking about funding – as their only big milestone – there is no one to blame but the loud-mouthed investors who have positioned themselves to be the focus point for these early stage entrepreneurs.
Now coming back to the topic. We see the following happening in India:
1. Compared to 7 years ago, everyone knows what a Startup is.
2. Mainstream media has accepted Starting up as a perfectly acceptable choice of career – they are dedicated shows and show hosts who think they are celebrities.
3. Almost every well known Investor (Startup Bank) has an office in India.
4. Angel Investment is on the rise and its raising angels in the country right now. I seem to be bumping into more angels than Entrepreneurs sometimes – its scary.
5. The Govt causes a fuss from time to time but predominantly has stayed out of what they dont understand.
So What’s missing?
Are there great ideas? Yes
Are there great teams? Yes
Are teams bootstrapping/saving up/ getting a bit of money to get off the ground? Yes
Is there ample Series A happening? Yes, but Not Yet at scale
Are there exits happening? Not Nearly