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Investing in startups: what are VCs looking for in 2023?

Where will they deploy their cash? Before knowing where they will deploy their cash, right now, it is better to ask when they will start redeploying it.

VCs are looking to invest in disruptive innovations and in start-ups that are successfully penetrating their various geographic markets.

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2023 Trends

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In 2023, according to a CB Insights study, Indian tech will be in the spotlight (along with other topics like AI in general, longevity, menopause, scent tech, super apps, etc.), even though there was a slowdown in funding amounts in Q1 2023 ($3 billion raised versus $12 billion in Q1 2022).

In 2022, Sequoia launched a $2 billion India fund. That same year, Accel and Lightspeed each raised over $500 million for India and Southeast Asia. The Indian fund Fireside Ventures also closed a $225 million fund, and Tiger Global Management is also set to commit significant amounts to India.

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The advantage of the Indian market

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There are already some great success stories of foreign VCs in India:

Accel invested $1 million in Flipkart in 2010 (an e-commerce company in Bangalore) and sold its stake in 2018 to Walmart. A capital gain of nearly $1 billion.

Do you know any French VCs investing in India? Well, no! And neither do I!

You might say it's far, it's complicated, there are several languages... OK, maybe, but American, British, German, and Japanese VCs are already there.

Anyway... Fortunately, Super Capital will tackle the issue head-on.

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Which sectors should you look at in India?

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• Climate and clean energy: 70% of the country's electricity still comes from coal.
• Fintech and financial inclusion
• B2B digitalization (small businesses...)
• Agriculture
• Deeptech

There you go, now we just need to accelerate!

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Need more advice on where to invest? Don't hesitate to contact us. At Super Capital, we have a VC fund but we also manage a community of business angels.