If you have been following us, then you are aware of the unprecedented growth of the startup sector this year. Infact, Indian start-ups have raised over $10 billion from July to September 2021 this year, according to a PwC India report titled “Startup Perspectives – Q3 CY21.”
Industry estimates put the total amount of fundraising by Indian startups in the first three quarters of 2021 to exceed $24 billion.
That’s right, Indian firms have raised a record $10.9 billion across 347 deals in the third quarter of the year, marking the first time that investments have crossed the $10 billion mark in a single quarter. This amount is twice the amount of funding received in Q3CY20 and 41% more compared to April-June.
India is ahead of countries like China, Canada, and the UK in terms of creating unicorns during the third quarter. 10 Indian startups became unicorns in the third quarter, followed by seven in China and Hong Kong, and four each by the UK and Canada. However, it is the US that tops the table with nearly 68 unicorns in the third quarter of the year.
The overall number of unicorns also grew from 114 in CY21 to 371 in the first three-quarters of CY21.
Bengaluru and NCR have seen nearly 76-78% of the total funding activity in the first three quarters of both CY20 and CY21, and they are followed by Mumbai and Pune.
Additionally, more than 84% of the overall funding activity during the third quarter was focused on growth or late-stage deals, while 61% consisted of early-stage funding rounds.
According to the report, the fintech, edtech, and SaaS sectors accounted for nearly half of the funding activity in the third quarter, and the numbers speak for themselves. The growth of the fintech start-up is not new, given how the pandemic drove people to go online to manage their payments.
The fintech sector saw an increase of nearly four times in funds raised in the first three-quarters of CY21, over the first three-quarters of CY20. In fact, 53 deals were recorded in Q3 2021 and no less than six fintech firms attained the coveted “unicorn” status this year – Digit Insurance, Five Star Finance, Cred, Groww, Zeta, and BharatPe.
Next comes the edtech sector, whose growth has been fuelled by the shift to online teaching. As platforms like Zoom, Microsoft Teams, and Google Meet have become go-to places for online classes, edtech startups like Byju’s have grown by several times – decacorn Byju’s has become the highest valued startup in India, while Eruditus, Vedantu, and UpGrad have become unicorns.
The SaaS sector has grown and attracted the attention of global investors as well (Freshworks recently listed on the NASDAQ), while the comeback of the foodtech industry recorded the spectacular IPO of Zomato and the evolution of Rebel Foods into a unicorn. Additionally, the B2B e-commerce sector has seen an increase of nearly seven times in funding, while the D2C retail sector has grown as well.