ET Startup Awards 2022: C-suite huddle on ET’s Startup Awards night on tech winter

The panel, comprising Nithin Kamath, founder and CEO of Zerodha; Kalyan Krishnamurthy, CEO, Flipkart Group; Harsh Jain, cofounder and CEO, Dream Sports; Sumer Juneja, managing partner, India & EMEA, SoftBank Investment Advisers, and Smita Deorah, cofounder and co-CEO of edtech unicorn Lead, will discuss the current state of the startup and technology economy amid a highly uncertain period for the industry globally. Deorah is the winner of the Woman Ahead category at ETSA 2022. They will assess the impact of what is perhaps the first big downturn in over two decades for the technology world after the Dotcom bust of 1999-2000.

The Indian startup ecosystem is feeling the reverberations of the global tech turbulence wrought by inflationary pressures and high interest rates, which have pummelled technology stocks since the start of the year.

These factors, along with a possible recession in Europe and the US, have pushed Big Tech firms like Meta Inc, Alphabet Inc, Amazon Inc, among others, to cut costs after two years of a bull run propelled by the Covid-19 pandemic when consumption largely moved online. Facebook-parent Meta laid off 11,000 employees last week, among the largest such retrenchments in the tech industry.

Indian technology stocks, too, have faced pressure, with the likes of Paytm, Policybazaar, Delhivery, Nykaa and Zomato seeing their share price erode by 70-80% since their listing.

The investor skittishness has been reflected in private capital inflow as well, with funding for Indian startups down to $2.7 billion for the quarter ended September 30, compared to nearly $12 billion during the same period last year, according to data provider Venture Intelligence.

This is in stark contrast to 2021 when Indian startups racked up big-ticket financing rounds, with a record over $40 billion being infused into the ecosystem, according to a report by Orios Venture Partners.

This year, several startups – especially across the Indian edtech space – have announced austerity measures and layoffs, anticipating delays in funding rounds.

The ‘funding winter’ has also led to several prominent global venture funds cautioning portfolio firms to tighten their belts as the capital squeeze is expected to worsen in the coming months.