Over the decades, legions of Indian businesses, big and small, have grown on the back of debt. But for startups chasing growth at all costs, debt is like a millstone around their necks. Unsurprisingly, in the past nine years, Indian startups have raised about $56 billion in venture capital, but only about Rs 3,300 crore ($481.3 million) in venture debt.
Now typically, venture debt lags behind venture capital in startup ecosystems around the world. But the scale of the disparity between equity and debt funding in India is also a sign of a lack of maturity and an over-reliance on venture capital.