Venture capital (VC) and private equity (PE) funding for Indian startups in the artificial intelligence sector has seen a dramatic decrease with deal sizes shrinking, notwithstanding the buzz around the country's potential as a major AI hub. Data from research agency Traxcn, which tracks PE/VC investments, shows that total funding for AI startups in India, which started with a bang in 2022 at $599 million, dropped sharply in 2023 to $168.4 million - a decrease of over 71 per cent.
Jerry Rao has been carefully building up a string of investments through the angel investor route ever since he sold a majority stake in MphasiS to EDS for around $350 million. Rao is understood to have invested in atleast 20 companies in India ranging from wine firms to legal process outsourcing. According to a statement from NEA, Jerry Rao and Amit Sharma have joined NEA India to expand its scope of operations.
Unperturbed by the tax benefit restrictions proposed in this year's Budget for venture capital investments to certain sectors, US based VC fund New Enterprise Associates has lined up $200 million to be invested in the country.
The newly-formed entity which will list on the NYSE as Eros STX Entertainment Corp, will remain listed on the New York Stock Exchange, with headquarters in both Mumbai, India, and Burbank, California, and has also got $125 million in fresh funding. The merger will not change the structure of Eros's Indian arm which is also listed on Indian stock exchanges.
People move from investment banking to growth equity or from venture capital to growth equity or entrepreneurship, depending on what's attractive at different points of life.
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