All Roads Lead To Bangalore For VCs
TECHINASIA: Which is the startup capital of India? That has been an ongoing debate in recent times, with the three frontrunners – Bangalore, Delhi, and Mumbai – all staunchly staking their claim to the title.
In the sheer number of startups and accelerators, Bangalore is way ahead. Delhi is home to some of the biggies, including Snapdeal, Zomato, and Paytm. And Mumbai, being India’s financial capital, is where the money is, with most institutional VCs based there. But now, many of them are realizing the advantages of moving closer to the action – and that is Bangalore. The latest VC to set-up shop in the south Indian tech city is Matrix Partners.
This global VC with US$3 billion under management has been active in India since 2006. Its Indian arm has about US$470 million under management. So far, it has been operating out of Mumbai, and today, it announced a new office in Bangalore. Vikram Vaidyanathan, managing director of Matrix India, will be relocating to the city.
“We are also establishing a free entrepreneur space for startups to ideate and develop their business. We plan to host a few events at this space and request domain experts in the ecosystem to partner with us to organize events that help very early entrepreneurs and startup enthusiasts,” says Vaidyanathan, in the company announcement.
Matrix has been one of the most active investors in Indian consumer internet startups. Some of its bets that made it big include ride hailing app Ola, doctor search engine and marketplace Practo, and mobile app Newshunt.
Delhi-based accelerator TLabs is also betting on Bangalore, expanding to the city last December. “We want to work with world class teams to build the next big business together. With the expansion and funding increase, we can work with more evolved startups, and we can offer them more help to reach their goals,” Abhishek Gupta, head of TLabs, had said while announcing the move.
It’s not just investors who are seeing the merit in moving from Mumbai to Bangalore. Startups like Ola, Freecharge, and Quikr are some of the biggies who did it.
“We want to double our technology and product team. It would have probably taken us 18 to 24 months in Mumbai, but in Bangalore we should be able to grow quicker,“ Pranay Chulet, founder and CEO of Quikr, said in December last year when it announced the move. “We are hungry for growth and its hard to find technology professionals in Mumbai,” he said.
Apart from the larger tech talent pool, Bangalore has a more vibrant entrepreneurial ecosystem, and the real estate prices aren’t as high as they are in Mumbai. So for entrepreneurs, this city always made perfect sense.