Fear of Missing Out (FOMO) whirlpool – a problem for Indian Startups?
Many marquee Indian startup investors have revealed their investing thesis and mindset in COVID webinars. We heard about their wins, less frequent than the consistency of Tendulkar, Virat, or Dhoni!
Oversupply of startups, incubators, and investor networks is influencing investment.
Everyone wants to do a startup. Many founders carry the badge of working in a startup, with impressive qualifications.
Every startup is after large markets.
Few Inv networks are democratizing startup investment by lowering ticket size. Organized as profit-making businesses they take money from entrepreneurs for capital raising. Unshackled from rewards of future performance (unlike VCs) they push investment opportunities. Their metric of performance is the number of deals done.
With current income as a motivator, these neo-investment groups do shallow investment appraisal, underplay risk justifying it as an implicit feature of startup investment.
For them, investment is an algorithm – large market, team, idea – asking investors to spread risk, and be patient to get that one elusive winner. They don’t even share investment analysis before asking for an investment commitment.