In recent times, investors are increasingly looking at getting the fundamental metrics right like profitability, unit-level of economics, customer acquisition cost, and are only then willing to pump capital.
Financial technology startups regaling to the requirements of enterprises are progressively catching investor attention. Multiple companies have managed to snap large-sized investments in the Business-To-Business (B2B) financial services space over the last two years and few are looking to raise fresh rounds in the current financial year.
Within the B2B space, Fintech is transforming into a remunerative area for the investors community and Indian startups are appealing to global funds. However, these startups typically take longer to scale while catering to niche business requirements and have a slower growth rate. Nonetheless, on the positive side, they usually develop a resilient technology platform and have the capabilities to scale globally at a faster pace, and can turn profitable with a minimal amount of funding compared to consumer startups.
Venture capitalists and other investors are more concentrated on the rate of addition of new businesses, revenue growth from existing clients, and their adhesiveness.
Many of these enterprises are trying to solve structural glitches and if they succeed in doing the same, they will be able to create entry barriers for others. Multiple deals related to the same have been witnessed during contemporary years and this will result in the augmentation in the number that is mirroring the evolution of the ecosystem.