The numbers are unambiguous—we’re living in the golden age of venture capital and private equity. From the numerous “unicorns” busy spending their way to scale to $100-million Series A rounds to the rise and fall of entire sectors overnight as venture money changes its fickle course, there’s no escaping it.
Venture capitalists (VCs) are happy staying in the background through all of this. They’re letting their investments—whether hits or misses—do the talking. Add to that the sheer number of investment announcements each day, it’s hard to observe patterns and understand tactics followed by venture investors.
We decided to change our vantage point and look at the VCs. To do so, we needed reliable data on the investments made by venture investors over a longer period—2017 to 2019 (till 15 September). We partnered with data-based research companies Zinnov and Tracxn to gather data for this story.
Here are five major trends we gleaned from the data.
2019: The year VC funds doubled down on India
It’s interesting to note that of the top 50 investors (by number of deals), 38% VCs invested in more rounds worth $10 million and above this year over 2018. This despite the fact that we’ve compared just over nine months of 2019 against all of 2018.
Note that the data only reflects the number of deals that a fund was part of, either as the lead or a participant.
Among newer investors, by far the most aggressive doubling down came from Falcon Edge Capital, a New York-based asset management company, which had made one deal in all of 2018. This year, it’s five deals in already. Apart from investments in unicorns like Ola (ride sharing and mobility) and Quikr (classifieds), Falcon Edge’s India portfolio has fintech (Mswipe), AI (Mad Street Den, vPhrase) and real estate.
B Capital Group, a fund backed by the Boston Consulting Group, typically invests in B2B companies in their early stages of expansion i.e. B and C stages. In the B2B space, they invested in packaging company Bizongo and trucking services provider BlackBuck. They are also investors in Mswipe, a point-of-sale (PoS) service provider.
Hillhouse Capital Group, a China-based hedge fund was mostly dormant with little investments before 2018. But this year, it has already participated in five funding rounds, including two massive rounds across B2B marketplace Udaan ($585 million along with Altimeter, Tencent etc.) and Cred ($120 million), which is a fintech-based loyalty company that facilitates credit card bill payments. (While our data is up till 15 September 2019, Udaan’s investment came in a month later.)
Where are venture capital stalwarts like Sequoia and Accel?