Funding in Q4 of FY 2013-14 of technology related companies in India was robust. Over Rs. 2500 crores was raised by these companies. Delhi/NCR tops the list with the amount of funding over 800 crores with Mumbai and Bangalore in 2nd and 3rd place respectively. However, the funding received by different cities is not directly correlated with startup activity as few companies who received the major chunk of funding distort the real picture. The major chunk of funding has gone towards E-commerce companies with over half the total funding amount received by them. For more details, please see the link
This is a good sign for entrepreneurial activity in India. The government is also realizing the importance of entrepreneurial activity in wealth creation, as it is reflected in the reforms taking place in different domains. The new companies act allows for one person companies as well as dormant companies which is a big boon for startups as they tend to change course and modify the business model after company incorporation. For more details, please see the following link . The government is increasing the awareness of the Credit Gaurantee Fund Trust Scheme (CGFTS). For more about CGFTS, please see the following link
However, let us not forget the external factors aiding the startup boom. Cheap funding promoted by the Fed Reserve is helping fast-growing sectors the most. Already, there is talk of a bubble in technology stocks with loss making companies launching red hot IPOs. The latest technology company to list on NASDAQ is Weibo Corp., the Chinese microblogging service There is general consensus in the business and government community on the importance of supporting startups and we welcome the government initiatives on the same but valuation of startups should be taken with a pinch of salt.
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