News Corp VCCircle Startup Summit, Mumbai - Investments, Shutdowns and Demonetization!

[VCCEdge]( [News Corp VCCircle]( Sharing with you the VCCEdge views of the recently concluded News Corp VCCircle Startup Summit - Mumbai Edition as well as a few statistics on the industry. Should you seek further information please feel free to reach out to Vijay Prakash Rai [(vijay.prakash@vccircle.com)](mailto:vijay.prakash@vccircle.com). The startup ecosystem has undergone much change in the past few months. It has swiftly moved from heavy inflow of investments to rationalized funding. 2015 was indeed a record year for startups, however, 2016 has seen a slump in funding and measured investor interest. The startup deal value recorded in 2016 was $ 1.6 billion across 1005 deals as compared to $ 2.6 billion from 1,300 deals in 2015. The impact of 2015 is continued in 2016 and hence we saw a lot of shutdowns and pivots in the last year. Several startups closed their main businesses and got into something entirely different while some changed tack to become leaner and fitter. A few others decided to implement the lessons learnt from their own failures or their rivals' success. As the euphoria of 2015- when investors were rushing to back startups in India faded away, 2016 turned into a year of funding rationalisation, shutdowns and focus on unit economics. And, of course, pivots. Whatever the reasons, the actual process of pivoting and shutting down is painful as it involves a different approach to business, layoffs and people movement. The investment tide that ebbed in 2016 may turn in 2017. 48 new investment funds have been launched in the last year by existing as well as new set of investors, thus, indicating the huge dry powder potential. Research by VCCEdge, the data and analytics arm of News Corp VCCircle shows that these funds are likely to garner over $ 6 billion over the next few months. Of the 48 funds identified by VCCircle, 25 have already raised $ 2.9 billion. Fintech & Demonetisation (Early Days) While investments dropped significantly, the fin-tech ecosystem recorded buoyant growth with burgeoning investor interest in 2016. Fin-Tech continued to rake in maximum investor interest in 2016. Fintech startups cornered 22% of the funding activity closely followed by Health-Tech startups with a share of 21%. However, by deal value Fin-Tech leads with a whopping contribution of 37% in 2016. Demonetisation may prove to be a boon for Fin-Tech companies since it has pushed cashless and digital transaction almost as a necessity. While the policy measure has adversely impacted the ecommerce companies with their cash-on-delivery (CoD) business suffering the most, fin-tech companies have benefitted from the move with the number of digital transactions peaking to record numbers. However, risk-averse consumer behaviour, poor infrastructure, literacy gaps and easing of cash in banks could lead to a slowdown in digital transactions. Closer to Home – Mumbai, Maharashtra Maharashtra's share in the deal total activity remained stable, although in absolute terms, both deal activity & value declined by 22% and 42% respectively, indicating the overall slowdown in funding. Mumbai and Pune continue to be epicenters of startup funding in Maharashtra in 2016 cornering 94% of number of deals and 99% of deal value. Mumbai cornered $ 232 million worth of funding from 151 deals in 2016; falling from 233 deals amounting to $ 418 million in 2015. Pune on the other hand showed an annual 69% increase in startup funding deals and a jump of 35% in funding value with $ 52.5 million raised by startups across 59 deals; thereby being one of the few startup hubs in India to buck the funding slowdown. VCCEdge is an online financial research platform of the VCCircle Network which is owned by the global diversified media, news, education and information services company - News Corp. VCCEdge offers information on mergers and acquisitions, private equity and venture capital transactions including deal terms, structures, deal amounts and valuations. It also contains entity information on all companies involved in the transactions including target companies, investors and advisors. [Download report]( For any information on our products, please contact Vijay Prakash Rai (vijay.prakash@vccircle.com, +91-9987526393). [vccircle]( A-83, Ground Floor, Sector - 2, Noida - 201301, Phone: 0120-4171111 Mosaic Media Ventures Pvt. Ltd., A-83, Ground Floor, Sector 2, Noida, UP 201301, India [Unsubscribe here](