With Metaverse and Web3 gaining traction in India, around 55% founders believe that these spaces are good opportunities for the startup ecosystem, while 17% feel that these are not big trends with the startups, a survey by venture capital firm 100x.VC states.
The “India Sentiment Outlook Survey” which includes views of 475 Indian founders across different sectors and 75 investors participating in early-stage ventures, has parameters ranging from business growth, fundraise outlook, key source of funds and first cheque.
While around 76% of founders are bullish on business growth in the 2022-23 fiscal, 24% of them are bearish on their expectation for business growth. The survey adds that the factors leading to the growth include a conducive market environment, quality of businesses and an increase in angel investment activity.
For 49% of the founders, fundraising has improved significantly in the post-pandemic scenario. However, 23% feel that it will be extremely difficult and 28% noted no change. The findings underline that the Companies Bill will provide additional support to entrepreneurs and clarity on corporate structures and governance.
Over plans on fundraise, around 52% of the founders' plan to raise funds in the next three months, 26% in the period of 3-6 months, 15% in 6-12 months and 7% in more than 12 months. They prefer working with angel investors, venture capitalists and angel networks.
The findings also highlight that 52% of investors plan on investing in less than five companies in the next 12 months, 37% want to invest in 5-15 companies and 11% say they will invest in more than 15 companies in the next 12 months.
Based on the survey, VCCircle took insights of some of the founders and co-founders across segments:
Kavvya Prasad, founder, Lumos Labs
The Indian Web3 community has been active since the early days of its development. This has led to developers discovering and experimenting with the technology’s initial features that have only become more diverse with time. A number of traditional sectors, if not all, have been disrupted by the various solutions provided by Web3 including finance, real estate, entertainment, investments, payments, etc, and the advancements in this space are still coming up.
Aniket Jindal, co-founder of Biconomy
Despite the broad sell-off in the crypto space in May and volatility in the macro-economic landscapes, there is still long-term bullishness in India’s Web3 and Metaverse ecosystems. With increased education around blockchain technology and DeFi, more institutional and retail investors are seeing the need for fiscal alternatives to capturing and preserving value.
Pratik Gauri, Co-founder & CEO of 5ire
The development of Web3/Metaverse is a direct response to the needs that were felt and not met. Thus, the result of developing those technologies. It is important to remember that a Web 2.0 company like FB rebranded itself to lead the Web3 and Metaverse revolution, so it is something that will seem impossible to live without in a few years like the smartphone.
Aman Singh, Co-founder of GradRight
Startups in certain sectors, with good business models, will continue to grow, do well and maybe emerge as stronger players in these tough environments. The main driver for this growth will be great products that have focused hard on the customer experience and value. Companies whose growth was driven by throwing more people into the game will find it hard to continue as operating losses could pile up significantly, in absence of steady revenue.
Ajay Chaurasia, vice president- Business, Product and Marketing at RupeeRedee
Indian startup ecosystem has played a decisive role in playing the role of catalyst for innovation across the world. Though the last six months had an exacerbating impact on the startup funding, considering the outbreak of global issues including war between Russia and Ukraine, recession in the US. After the pandemic, a majority of new startups identified market gaps that are solving issues for customers so we will definitely see more funding coming in.
Sujata Pawar, co-founder and CEO at Avni
The Indian startup ecosystem is set for hyper growth over the next few years. The biggest driver will be the central and state governments who are now taking aggressive steps to promote entrepreneurship in their respective states. New age consumers are tech savvy and are willing to experiment with new brands. Investments have jumped overall in the ecosystem post-pandemic. The company bill will definitely benefit startups as it will bring more transparency in the eco-system.
Kajal Malik, co-founder and chief strategy officer at PickMyWork
A negative impact on funding is usually an opportunity for the startups to focus on growth with better RoI. The focus on revenue is always good news for the entire ecosystem. Post-pandemic has been a good time for startups. A couple of months is too small a time to measure, but the general trend of growth will continue.
Ishpreet Singh Gandhi, Co-founder at Stride Ventures
There's a strong push on the government to create conducive infrastructure. As we propel the startup ecosystem, concentration on electric mobility and financial technology infrastructure-oriented companies are in focus. We typically prefer businesses definitely with the sound business model, because we like to believe generally all the startups are possibly targeting large addressable markets, a sound business model with right healthy unit economics talking about profitability over time are the businesses which will be in work at least for the next three to five quarters.
