Top 5 favourite start-up sectors in India
No doubt, it is a point of concern for the budding entrepreneurs and want a entrepreneurs. Investors have reached high figures of investment. Investors are now reshuffling their portfolios, analyzing each start-up more closely and betting their money more consciously. We are ranking start-up sectors according to the funding amount received so far or Investor favourites. So, lets explore Investor’s top 5 favourite start-up sectors.
The point to remember here is that we are talking about ranking start-up sectors according to the funding amount received, which is not synonymous to the performance or profit earning business. The amount of investment in one sector might me more because of the capital-intensive nature of business and high cost of operations. The ranking has been done on the volume of investment.
Investor Favourite One : e-commerce shopping companies
This has emerged to be the investor’s most favourite startup sector. Total investment made so far in this sector is around $ 8-9 billion and the sector includes more than 50 companies. Companies like Flipkart, Snapdeal , Paytm have bagged the most of it. Top seven investors of e-commerce hold more than 50% share. Investors have bet their money on multiple companies. With Tiger Global having investments in Shopclues, and Flipkart, Ratan Tata in Paytm and Snapdeal, Alibaba also in Paytm and Snapdeal. However investing in competitors and backing competitors is another point of interesting discussion, which could be taken up in another article.
Investor Favourite Two : Buying Assets Property and Cars
With total funding amount of $ 1.2-1.5 billion this sector stands at a distant second place to ecommerce shopping sector. Housing.com, 99 acres , Indiahomes, MagicBricks , CommonFloor , CarTrade, CarDekho, Carwale. The above nine companies only account for around $700 million alone. The rest of the investment being in 20 other such companies selling assets like house, property, car, mobiles etc online.
Investor Favourite Three : Riders Solution
Taxi Aggregator-Ola, Zoomcar, Meru Cabs, Uber has made an investment of $ 1 billion in India. These are the major players in taxi aggregation business.
Ride Sharing– Apart from above, this sector also includes companies offering self-drive services- Carzonrent which is one of the oldest cab provider in India, Bla-Bla car (Paris based) long distance sharing company, Zoomcar .
Bus Aggregator-Another segment in the same sector is the bus aggregator companies- rBus, Trevo, and shuttle.
Investor Favourite Four : Wallet and Bill Payment
Paytm, PayU, MobiKwik, Freecharge (got acquired by Snapdeal), Oxigen, Airtel Vodafone + Bank’s apps. Indian users are strongly biased towards Cash on delivery. 55-60% payments in online marketplaces are done via cash on delivery. Moreover, Indian e-commerce rarely uses international payment gateways like PayPal the major reason being the lack of support for rupee based online commercial transaction and support for only credit card transactions. So, many Indian companies see scope in this area and are moving at a very fast pace specially after 11 companies got a license from RBI.
Investor Favourite Five 5: Connecting Dinning Places
Zomato, Food Panda, Tiny Owl, Swiggy. These food tech companies are still being one of the favorites of the investors, now seeing a downfall in investor’s interest as we can witness some of them shutting down (Dazo), some not able to make up to the next level of funding round (SpoonJoy, Etalo, Freshmenu), Many of them laying off their employees (Zomato and Tiny Owl). According to Tracxn (Startup Data Tracker Company), out of 31 food tech companies who raised money in 2015, only 5 were able to make it to the next level.
Hinted towards the startup bubble saying, “Me-too companies with weak teams and no differentiation will not get funded. The binary situation of will-not–get-funded is coming up very fast.” Said by Investors