India’s Venture Debt Report 2022, released by Stride Ventures, reveals that the year 2021 saw 111 firms acquiring funds via debt, of which 91 companies were categorized as unique.
Bengaluru reportedly saw the highest number of venture debt deals, making up 40% of all such transactions, and then followed by Delhi NCR at 27% and Mumbai at 18%.
As reported by YourStory, Fintech is now expected to be the most “active” sector in securing debt followed by consumer and AgriTech. This, according to a survey carried out by Stride Ventures, a venture debt company based in India. The survey highlights the mindset of entrepreneurs and VC companies and also anticipated trends of venture debt in India.
India Venture Debt Report 2022 – carried out across company founders and venture capitalists – outlines the fast-evolving use-cases of venture debt as a viable asset class. It reveals that all founders of growth-stage firms are certain of acquiring venture debt when compared to early-stage founders (85.7%) and late-stage founders (66.7%).
Ishpreet Singh Gandhi, Founder, Stride Ventures, remarked:
“Venture debt has seen exceptional growth and has emerged as an important asset class over the years. The startup ecosystem, which is flourishing in India, will play a key role in creating multiple opportunities for venture debt to scale further.”
Gandhi added:
“Through our distinctive ‘India Venture Debt Report 2022’, our aim is to showcase the rise, developments and outlook of the venture debt ecosystem while creating awareness amongst founders about the several benefits of raising funds through venture debt in tandem with equity.”
Here are notable findings from the update:
- Last year, a total of $538 million of venture debt was disbursed (compared to $271 million back in 2020).
- The Fintech industry saw 28% of all venture debt transactions, which is reportedly the highest among all sectors (last year). It was followed by consumer at 21% and B2B commerce at 16%. The Fintech sector acquired most of the investments at 47%.
- Firms which are in Series D and later stages secured the highest number of deals (31) securing $250 million last year and then followed by Series A stage firms which acquired around $112 million.
- The average ticket size of venture debt deals last year stood at $5.85 million.
- The average equity funding secured by venture debt backed startups in 2021 came in at $126 million.