India-focused VCs raised $3 billion in 2020, 40% more than in 2019

India–focused venture capital (VC) funds raised $3 billion in funding in 2020 — the highest in the last five years and almost 40% greater than the war chest they raised in 2019, a report on the Indian VC investment landscape released by Bain & Co on Wednesday

https://economictimes.indiatimes.com/tech/funding/india-focused-vcs-raised-3-billion-in-2020-40-more-than-in-2019/articleshow/81537345.cms

Sequoia Capital, Elevation Capital, Falcon Edge and Lightspeed Venture Partners were among the marquee investors that closed funds for India investments last year.

Through India Venture Fund VII ($525 million) and India Growth Fund III ($825 million), Sequoia alone accounted for about 40% of the money raised.

Rather than dampen investment activity, the pandemic gave it a boost. There were around 520 active VC funds in India in 2020, compared to around 480 in 2019 (and around 400 on average in 2017 and 2018), the report showed.

But VC exits were affected by the pandemic, declining to $1.3 billion in 2020 from $4.4 billion in 2019. One-third of the exit value came from ed-tech and around one-fifth from food-tech—both sectors that flourished during the pandemic.

“… the exit outlook remains positive for the next few years as most of the top VC funds’ portfolios are yet to reach maturity—2020 saw a gap of 1–2 years on average between the funds’ average holding period and portfolio age today. This, along with improved economic climate post-pandemic, will likely lead to recovery in exits going forward,” the report said.