Angel investment platforms in India have strived to build a strong startup ecosystem while helping with real growth for the Indian economy. In 2021, the average deal size was approximately $25.7 million for close to 1091 deals. This was a good YoY rise from the average deal size of approximately $12.4 million for nearly 809 deals in 2020. This growth ensured that investors platforms, especially angel investors and startup investing platforms in India, started 2022 with positive outlooks.
Trends, Prospects and Issues
Despite the general fear and investing apprehension during and after the pandemic, individual investors and angel investing platforms in India are working towards a persistent and focussed growth of their portfolio businesses, aiding with major business issues - streamlining human resource planning, keeping an eye on the sales forecast, charting out creative initiatives for revenue generation and so on.
This solidarity shown by startup investing platforms in India pushed entrepreneurs to raise significant funds from major angel investment platforms, leading to a rise in deals. Angel investors are diversifying their portfolio for a higher bandwidth that allows more domain-agnostic requests and ensures a healthy return ratio.
Additionally, the pandemic and post-pandemic startup investing in India brought in a key parameter for evaluating prospective startups - innovation, acclimatisation and sustainability during critical conditions, such as a pandemic. Thus, due diligence will be one of the key trends for angel investing platforms in India.
This due diligence brings in a greater preference for community investing. Collective angel investing platforms in India - angel networks, groups, integrated incubators - connect the right matches of investors and businesses, thereby ensuring an expert collation of curated opportunities. This is a great solution for the financial and informational deficit of individual investors and the lack of investor platforms or opportunities for businesses.
Further, integrated incubators, such as Venture Catalysts, help individual investors benefit from the collective expertise of a network - experienced investors, entrepreneurs, and many more - to circumvent prevailing issues, ensure due diligence and find the right investment opportunity, especially the right entry and a profitable exit.
When it comes to a good entry, the overall deal flow is not a major challenge. However, finding quality deals and choosing wisely has been a conventional issue that may persist for investor platforms. Similarly, finding a profitable exit by ensuring a good market appetite for their portfolio of businesses and securing considerable VC and private equity funding at the right stage, will be another persisting challenge.
Angel investor platforms further need to ensure that the promoter isn’t diluted by resisting the urge to buy too much equity at the early stages, thereby leaving an attractive chunk for prospective investors.
Conclusion
2021 saw the global economies begin their post-pandemic recuperation, with the Indian startup ecosystem and startup investing platforms in India showing strong recoveries. Major startups such as Nykaa, Zomato, etc., got publicly listed. A slew of startups became Unicorns. Shows like Shark Tank revolutionised the startup ecosystem in India, making it aspirational and accessible for investors and businesses alike.
Thus, the maturing investment environment and the success stories of startups have democratised and mainstreamed Indian angel investor platforms, building a vibrant and buzzing community and reaffirming the interest of angel investment platforms in India in the Indian startup ecosystem.
