2023 VC roundup: Where will the sharks put their money?

Deep-tech driven ideas will win big on investor money, while embattled sectors, including edtech and medtech still have venture capitalists’ faith, various incubators and investors told Republic Business.

CEO of IIM Bangalore Incubation Centre for Startups & Entrepreneurs, NSRCEL Anand Sri Ganesh said, “The startup ecosystem is seeing a resurgence in early-stage entrepreneurship. Deep-tech driven ideas are fuelling innovation in areas like climate-tech, healthcare, fintech and enterprise tech.. Technologies across drone & robotics, AI-ML and generative AI, IoT, and edge computing are seeing very interesting applications.”

The Global Partnership for Artificial Intelligence (GPAI) Summit concluded last week saw startups in healthtech and geo mapping win big. Companies Qure AI and Drona Maps were first and second position holders at the AI Gamechanger Awards held during the closing ceremony of the Summit, of which India is the lead chair in 2024.

Ganesh added: “We are seeing innovation equally across business models targeting global markets and large domestic opportunities. While the energy in SaaS remains, we are also seeing a surge in consumer brands especially those with an Indic proposition. It is also refreshing to see a re-emergence in the ed-tech space across K12 and higher education spectrum.”

Founder and CEO of Assiduus Global Inc Somdutta Singh said the education sector is experiencing a digital revolution, accelerated by the global shift towards remote learning.

She noted, “VCs are strategic in their choices, betting on sectors that not only address current market demands but also demonstrate the potential for sustained growth and adaptability.”

Singh also bet on the sustainability and CleanTech space, which aligns with the growing global commitment to address climate change and promote sustainability.

Tanul Mishra, CEO of Afthonia Lab Pvt Ltd, said: “The world has recently begun its recovery from the pandemic, but it feels like progress is precarious. Globally, we're witnessing widespread layoffs and cost-cutting measures, casting a shadow of uncertainty. While these measures may seem severe in the short term, they are geared towards fostering stronger companies with a dual emphasis on profitability and growth.”

The current landscape allows for stronger positions in the cap table, and careful evaluation can identify teams displaying resilience and innovation, she added.