Venture capital investments in Indian startups dropped to $2.2 billion in the first quarter of 2020, due to corrosive combination of global macroeconomic uncertainty and the ongoing crisis of Covid-19 pandemic, as per the latest edition of KPMG’s Venture Pulse report.
This figure is released in comparison to the $6 billion invested in by VC investors into Asia’s third-largest economy in the October-November quarter of 2019, as mentioned in the report.
Last year reported a record-breaking $14.5 billion inflow into India, spread over 909 deals.
“Initially, India was not as affected by Covid-19 in Q1’20 compared to China. Concerns related to the pandemic grew later in the quarter, due in part to the fact (that) India receives a significant amount of VC investment from international VC firms and corporates,” the report said.
The pandemic has damaged countries across the globe, forcing to observe lockdowns and crippling the global economy. .
“VC investors are already starting to ask the question, ‘How will your business be impacted by Covid-19?’ This is a question everyone will be asking for the next few quarters. Here in India, we are beginning to feel the full impact of the virus,” Nitish Poddar, partner and national leader – private equity, at KPMG India, said.