VC Investment Down(YoY) 70%, IT-ITeS Still Preferred Destination
It looks like venture capital investments are very much coincided with the equity market movements. The turbulence in equity markets has seen its effects pan out to VC inflows in India as investments in jan-jun period is down 71% to $117 million compared to $413 million a year ago.
Between January and June this year, venture capital (VC) deals also fell to 27 from 67.IT and IT-enabled services (ITeS) companies accounted for 52% (around 14 ) of the VC deals,in value terms the investment was to the tune of $75 million, or 63% of the total deals. Among ITeS investment, online companies attracted 57% of the investment.
Some of the deals between jan-june this year:
- Reliance Technology Ventures, NetOne Systems, Sequoia Capital and others invested $15 million in mobile broadband gateway provider Stoke Inc.
- JAFCO Asia and VenturEast invested $12 million in si2 Microsystems Ltd, a semiconductor firm.
- Intel Capital and Helion Venture Partners. invested $6.5 million in Global Talent Track.
- Nexus India Capital has invested $5 million in New York-based classifieds firm OLX
Venture capital was majorly bullish on financial services, healthcare and education apart from IT-ITeS .Early-stage deals accounted for two-thirds of the investments and 57% in value.
Venture Capital Industry in recent past has become very opportunists as they come out of woods when the economic barometers turns positive whereas they should be looking at more investment in turbulent times so as to support the startup ecosystem and their own aspirations.
The venture capital investment would surely see an uptick in later part of this year as many new private equity deals has also started to buzz the street. The capital inflows may also see tremendous up move as India was able to immune itself from the economic recession played out in US and other developed countries.
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