BENGALURU: The funding winter to some extent has thawed because of the ability of Indian markets to provide liquidity, said Rajiv Anand, Deputy Managing Director, Axis Bank. Speaking about start-up funding, he said the other big form of liquidity is Indian family businesses as they have become big investors in many start-ups.
The Indian markets have been able to provide a significant amount of capital to these start-ups either through family offices or from the markets, the situation is much better than what it used to be, he said at a media round table here in Bengaluru.
He added that India, in the last 6-12 months, has shown the ability to generate exits for PE and VC investors, and that in the US, venture capital and private equity players were not able to make exits due to various reasons and therefore the industry there choked and resulted in a reduction in the fund flow to the country.
Axis Bank hosted the fifth edition of Start-Up Social in Bengaluru on Monday. Axis Bank's New Economy and Financial Sponsors Group (NEGFS) offers dedicated banking services to start-ups and their investors. So far, it has built active relationships with about 700 start-ups.
Sanjiv Bhatia, President & Head of New Economy Group, Financial Sponsors and Multinationals Coverage, Axis Bank, said that they bank 67% of unicorns in the country and have more than a 40% market share of Series A and above funded start-ups.
Bhatia also mentioned that many start-ups are not burning as much cash as they used to and that the business model of these start-ups have matured and they are doing the right things in terms of being sustainable.
While its deposits from the start-up community stands at Rs 25,000 crore, lending is about Rs 2,000 crore. "We will continue to ensure that we are serving the start-up community as it is vibrant," Bhatia said.
In September, the bank launched new corporate credit cards for start-up founders. These cards will help entrepreneurs manage vendor payments, official expenses and so on. The bank said over 75 customers are using the cards at present.