(Bombay) For Sumit Gupta, the year 2021 turned out to be excellent: he turned 30, he got married, and the value of CoinDCX, the startup which he founded in India, has exceeded one billion dollars.
After working tirelessly in the midst of a pandemic to finance and develop CoinDCX, a cryptocurrency platform, his team finally took a few days off to celebrate the event on a beach in Goa, on the west coast of India.
“It was really good for everyone,” says Mr. Gupta. “Our trip has been very, very exciting. I have learned a lot. India’s future looks bright ”.
In total, 44 Indian companies acquired in 2021 the envied status of “unicorn” (startups valued at $ 1 billion or more), benefiting from a surge of interest from international investors.
“With persistence, it is entirely possible to create a unicorn in India,” said Gupta, who said the country, the world’s fifth-largest economy, “is full of opportunity.”
Foreign funds have invested more than $ 35 billion in startup India in 2021, three times more than in 2020, according to data collected by the analysis platform of technology companies Tracxn. Money is flowing in all innovative sectors, from finance to health and gambling.
Chinese companies have long been the favorites of foreign funds. But a recent round of regulatory tightening led by Beijing to curb overheating in the internet sector has lost billions of dollars in stock market value to giants like Baidu, Alibaba and Tencent.
In turn, investments in startup Chinese companies have shrunk from $ 73 billion in 2020 to just $ 54.5 billion in 2021, according to an analysis by GlobalData.
This disaffection benefits India, another market of more than a billion inhabitants which benefits from an army of entrepreneurs with a high level of education and increasingly solid digital infrastructures.
Record of IPOs
“India is 13 or 14 years behind China in terms of the size of its market,” said Siddharth Mehta, founder of the investment firm Bay Capital Partners. “The digital market in India is less than $ 100 billion today, but it could easily reach 1000 or 2000 billion in 10 or 15 years,” he predicts.
Among the groups showing growing interest in India are the Japanese giant Softbank, which invested $ 3 billion in the country this year, the Chinese Tencent and Alibaba, and the US funds Sequoia Capital and Tiger Global.
“I believe in the future of India. I believe in the passion of young entrepreneurs in India. India will become great, ”prophesied in early December the founder of Softbank, Masayoshi Son.
India also experienced in 2021 a record number of IPOs of startups, like those of the Zomato meal delivery app or the Nykaa beauty products platform whose founders have become billionaires.
The good performance posted by the Bombay Stock Exchange, which took 125% between April 2020 and October 2021, and a profusion of stock market applications are prompting more and more Indians, mostly young, to embark on the market. online investment.
A trend which is not without risks, warn experts, according to which many new firms could turn out to be grossly overvalued.
The online payment company Patym, which has yet to make any profit, has lost 40% of its value since its listing on the Bombay Stock Exchange in November, the largest of 2021 in India.
And the influx of capital into the technological sector does little to solve the basic economic problems of a country where poverty remains immense. Many of the nearly 10 million young people who enter the workforce each year survive on unstable and miserably paid odd jobs.
A problem that white-collar workers in the high-tech, a sector in which the demand for skilled workers exceeds supply.
The startups, the cases full, snatch the best talent by dangling high salaries, stocks and even motorcycles and tickets to cricket matches.
“Recruiters keep calling,” said a candidate who did not wish to give his name. “Salaries have swelled since last year and it looks like everyone is recruiting. People change jobs all the time ”.