2021 Global Startup Ecosystem — Shifting Landscapes
The past year has been exceptionally disruptive, and it has dramatically altered the way we work and interact. Last year, Covid-19 defined the rules of the game. Startups pivoted their products, sought new sources of funding, and, in all sorts of other ways, did their best to stay alive.
As the economy slowly but surely recovers, entrepreneurs and investors are looking ahead to next year’s startup landscape. US startups raised roughly $240 billion as of Sept. 30, dwarfing 2020’s full-year total of $166 billion, according to figures from Pitchbook, the venture-capital database. Much of the funding in 2021 has gone to tech startups. Tech is one of the few sectors still delivering massive returns amid inflation fears, supply-chain chaos, and economic disruptions from the extra-contagious delta variant of covid-19.
The VC landscape is changing. Pitchbook estimates that traditional venture funds have about $221 billion in cash on hand to invest, compared with the $350 billion that nontraditional startup backers like hedge fund Tiger Global and private-equity firm SoftBank are prepared to invest in startups. Interestingly in the United States, Enterprise software startups account for nearly half of the venture capital funding doled out so far in 2021.
The inflows of capital and the continued migration of talent around the globe mean that VCs are going to have to get creative in how they source deals and where they source them from.
Chinese technology companies lost around 30 percent of their market cap in the past six months. As investors turn jittery over the prospects of Chinese equities, some may want to look for alternatives in the Emerging Markets universe. India, with the second-largest internet consumer base after China, is one of the key markets.
Fundraising by Indian startups crossed $10 billion in a three-month period for the first time in July-September 2021 as investors — global and local — remained bullish on the prospects of India’s internet economy amid a pandemic-induced surge in digitalization.
New-age companies in India snagged a total of $10.9 billion across 347 deals in the third quarter of calendar year 2021.
The Global Startup Ecosystem Report 2021 was recently published and it’s a deep dive into the startup landscape of the world. The report, which was done by Startup Genome and the Global Entrepreneurship Network, GEN, shows that North America dominated the Global Rankings and as much as 50 percent of the Top 30 ecosystems were from the North American region. Asia represented 27 percent of the Top 30, and Europe — 17 percent. It was also noted that the global startup economy is worth over $3.8 trillion in Ecosystem Value.
________________________________
