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Tech Start-ups Sentiment Analysis: 150+ Founder’s Survey
Tech Start-ups Sentiment Analysis: 150+ Founder’s Survey

March 28, 2023

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Tech Start-ups Sentiment Analysis: 150+ Founder’s Survey

For tech start-ups, 2022 has been a difficult year. To better understand the state of the market, we polled more than 150 founders of Indian tech start-ups.

Indian start-ups have demonstrated resiliency by altering their business plans and placing more emphasis on operational effectiveness than on layoffs or shutting down operations. To boost business demand, they have also used partnerships and collaboration models, or even looked into expanding into other regions.

Investor sentiment and valuations are still a concern for many start-ups despite consistent revenue growth. This data is based on surveys and interviews with over 100 start-up founders from a range of funding levels and market segments.

Survey Highlights:

Challenges

  • For entrepreneurs, finding top talent has been the largest issue.
  • Extreme cash flow difficulties are also a result of low client demand brought on by the current recession
  • The founders seem to have accepted the change in valuations and finance availability as a normal aspect of doing business

Levers

  • Due to the limited scope for operational cost efficiency, funding growth has taken precedence.
  • Driven by the necessity to prepare for a new capital infusion and extend the runway.
  • Protection of present valuation while extending runway and preparing for new capital injection are the driving forces behind these decisions.

 

Hiring and Fund Raising:

  • As anticipated, financed start-ups have cut or reorganised their teams
  • All stages of start-ups continue to hire workers, but at a slower rate
  • Most start-ups either postponed fundraising or switched their attention to cultivating investor relationships in anticipation of a future fundraising round

2023 Expectations:

  • Start-ups are uncertain about future valuations, much like investors, but are preparing for the long-term
  • The majority of funded start-ups are more bullish and anticipate a valuation reset in 6 to 18 months.
  • Entrepreneurs are cautiously enthusiastic but less unsure about investor interest due to an increase in dry powder with VC/PE.
  • Funded start-ups appear to have a clearer view of investor interest, but they are less convinced about the pace of investments in the near future.

Immediate Business Priorities:

  • For funded start-ups, expanding the business and generating money are primary goals.
  • Unfunded start-ups are putting a higher priority on raising money and diversifying their sources of income, implying potential pivots.
  • Expense reduction is considerably less important, maybe as a result of initiatives in earlier months.

 


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