TLDR:
India retained its position as the second-largest destination for venture capital and growth funding within the Asia-Pacific region in 2023. Despite facing challenges, the VC landscape in India showed resilience, with a shift towards traditional sectors like healthcare, retail, and financial services. Overall, investments declined by 65% globally, reaching $9.6 billion in 2023. Tech-first sectors maintained dominance, but investor focus also shifted to traditional sectors with strong fundamentals. Electric mobility and generative artificial intelligence gained momentum as emerging themes.
Summary:
According to a report by Bain & Company and the Indian Venture and Alternate Capital Association (IVCA), India remained the second-largest region for VC investments in the Asia-Pacific region in 2023. Despite a challenging year, the VC landscape in India showcased resilience and adaptability. The investment focus shifted from tech-first sectors to more traditional industries like healthcare, retail, and financial services.
Investment activity globally witnessed a decline of 65% in 2023, with total investments amounting to $9.6 billion compared to $25.7 billion in the previous year. Tech-first sectors like consumer tech, fintech, and software/SaaS continued to dominate, capturing nearly 60% of funding. However, there was also a noticeable drift towards traditional sectors with strong fundamental tailwinds such as banking, financial services, insurance, and healthcare. Emergent themes like electric mobility and generative artificial intelligence gained prominence.
Electric mobility saw a significant increase in funding, indicating growing investor interest fueled by the ecosystem’s maturity. The report also highlighted that global investors are likely to remain optimistic about India as an investment destination due to its promising sectors and themes that are expected to attract investor attention in the future.
