Preqin has released a report highlighting India's increasing role in global venture capital, noting a significant rise in assets under management for India-focused VC funds. Despite recent declines, the long-term outlook for venture capital in India remains positive.
According to Preqin, assets under management (AUM) for India-focused venture capital (VC) funds have increased significantly over the past decade, rising from $5.5 billion in 2010 to $44.8 billion by the end of 2023. This growth has contributed to VC funds representing 36% of total private capital AUM in India, up from 14% in 2010.
Global economic challenges have led to a decrease in investor confidence in the VC sector, resulting in a drop in deal activity from 2,249 transactions in 2021 to 961 in 2023, with total deal value declining from $40.2 billion to $13.7 billion. Nonetheless, according to Preqin's report, India continues to rank second to Greater China in terms of deal value within the Asia-Pacific region, indicating potential for future investment.
India’s exit market has remained relatively stable, with exit values averaging around $4.6 billion annually from 2022 to 2023, despite a general downturn in the global exit environment. Factors such as increased retail investment, interest from global funds, and improved corporate balance sheets are contributing to a more favorable landscape for exits.
India’s economy is rapidly growing, driven by strong GDP growth, favorable demographics, extensive infrastructure investment, and economic reforms that attract global private capital. According to Preqin reports and data, private capital assets under management (AUM) have more than tripled over the past 15 years, reaching a record $124.3 billion by the end of 2023.
Preqin was founded in 2003 and serves over 48,000 clients worldwide. The company employs 500 researchers and more than 1,500 staff across its 15 global offices. It specializes in delivering data and insights on alternative assets to enhance decision-making within the finance sector.