With fewer funding options, start-ups should focus on sustainable business models: Report

New Delhi, July 20 (KNN) According to experts, start-ups need to come up with more economically sustainable business model and aid themselves from the situation created by decline in funding amid global economies facing disruptions, reported ZeeBiz.

A PwC India report recently said that the Indian start-up ecosystem reported the lowest six-month funding in the last four years in the first half of calender year (CY) 2023 at USD 3.8 billion across 298 deals -- a decline of nearly 36 per cent as compared to H2 CY22 (USD 5.9 billion).

Rohit Arora, Founder & CEO, Biz2Credit, said the slowdown in funding, influenced by economic conditions and enterprise valuation impact, presents challenges for start-ups seeking significant up-rounds.

He said the foreign investments in India's start-ups have significantly dropped by 72% in 2023.

“As we navigate these dynamics, it becomes crucial for investors to prioritize post-investment strategies and for start-ups to focus on sustainable unit economics,” he said.

In last couple of years, global economies have experienced large scale disruptions, which has shaken up the VC PE world, said Akhil Saraf, Founder and CEO of proptech firm Reloy.

“Investors are now approaching deals with caution due to past experiences with unsuccessful ventures. High cash burn ventures are struggling in this macro environment,” he said.  (KNN Bureau)