The funding freeze has been compounded by India’s move in April to step up scrutiny of investments from overseas investors
Samik Sarkar was managing to eke a profit out of his online apparel store before the coronavirus crisis hit India, forcing the 36-year old to reinvent his business overnight. “I started selling masks because that’s all I could sell,” Sarkar said. “I have salaries to pay.”
The rapid global economic slowdown, India’s coronavirus lockdown of 1.3 billion people and an exodus of venture capital are testing a start-up community that has quickly become one of the world’s biggest, raising a record $14.9 billion last year.
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The success of Indian e-tailer Flipkart, sold for $16 billion to Walmart in 2018, helped draw in billions of dollars in funding from global venture capital firms, while U.S. and Chinese tech giants stalked promising prospects.
But in just a few months much of that cash has vanished, with venture capital and private equity investment in India expected to fall by 45%-60% this year, EY estimates.
Source: ET CIO
