Reposting my twitter moment on the importance of Exits in Indian Innovation Ecosystem.
You can find the my twitter moment here : http://bit.ly/2EqLMkL
Today, we are an ecosystem with a lot of startups with very few exits. Our startup culture, founder psychology, and the system do not work well with failures. The lifecycle of startups and their founders is either incomplete or uncertain.
India has no visible startup bubble. If you add up all seed and angel funds alone deployed in India, it will constitute a large/mid size billion dollar venture firm with more failures and few average successes.
India has an exit bubble.
Innovation ecosystems are built by founders who got their exits and invested it back in building their ecosystem. Exits are crucial in building a startup ecosystem.
I was fortunate enough to meet @sijokuruvilla last week and he said
"The size of exits are so small in our country, that we find most founders exit only to start up again.
Driving exits in India will only drive the ecosystem forward and keep the cycle of innovation running.
Local innovation versus Global competition in India exists as a result of our regional advantage and ability to build companies bottoms up at a local level. This is also an important exit opportunity for homegrown startups who can tap on their global competition.
Opening up boundaries is crucial to building our innovation ecosystem further. This has resulted in gaining global mentors and following global best practices.
A VC’s business model is less about the money that goes into a startup than it is about what comes out.
It’s true that most companies fail to exit gracefully, and of those that do, surprisingly few exit by going public.
The majority of exits take place through M&A's.
We see exits where you acquire to hire talents who are great and they, in turn, build great products for you over a period of 18-24 months.
Example : @lookupHQ and @NowFloats, @fortyeighteast and @swiggy_in and almost all of @Timesinternet acquisitions.
We have also seen early stage exits in the likes of @GetLocoNow and @PocketAcesHQ where you acquire for product and IP, which later helps you boost your existing line of business.
There are also large corporations (@amazon, @facebook and @Google) and mid range companies (Like, @myntra and @flipkart, @BeCureFit and Cult/1000 Yoga) who raise money to acquire early-stage startups for group skills and founder IP, essentially makes them search firm for talents.
We do not know which are the best and most brilliant exits yet.
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