Cheap money is done, and profits are sexy again, but it's still a great time to start up in India, investors say
There were 14 Indian unicorns anointed in the first three months of 2022. And then none in April, and May managed to throw up one, according to the unicorn tracker by Venture Intelligence, a data insights company that tracks the Indian startup ecosystem.
On May 12, Masayoshi Son, CEO of Japan’s SoftBank Group, one of the biggest investors in India’s startup ecosystem, said the strategy ahead would be one of “defence”, after the world’s biggest tech investor—that has backed several Indian unicorns—reported record losses at its Vision Funds in the first three months this year.
Inc42, an Indian startup news and analysis site, collected its own and other media reports to show that close to 8,400 people have already been laid off in the last three to four months by Indian startups, including five unicorns, by the end of May.
“Flat is the new up, and down is the new flat,” says Mohanjit Jolly, a partner at the PE and VC firm Iron Pillar, recalling one of his favourite phrases during downturns. Startups that were expecting an uptick in valuation will now be okay with raising money at existing valuations, and some will also find themselves accepting lower valuations to ensure their funding goes through.
“There will be turbulence ahead,” he says.