The Financial Express | 3 January 2023
The year 2023 could, well, be the year of start-ups. Both founders and experts feel Indian start-ups and investors are ready to face global headwinds and build resilience in the future. A recent report by Redseer Strategy Consultants confirms this, when it says that India has significant room for growth in the public market cap compared to other countries and has a strong pipeline of over 80 IPOs of profitable start-ups over the next five years.
The funding winter could push the smaller start-ups to sell out to larger peers or revamp their cost structures by opting for retrenchments to improve the cash runway and bracing for down rounds in 2023. Investors also indicate that the new year could see more consolidation as more small- to mid-stage start-ups may find it harder to raise cash on favourable terms. Manu Rikhye, partner, Merak Ventures, in an interview with FE, said the funding crunch will drive more M&A activity in the new year as both founders and investors may rush to protect existing valuations.