India produced 14 Unicorns in Q4 of 2021 and is among the top five Unicorn producing countries in the world. However, less mature VC markets, including Vietnam, Indonesia and the Philippines also saw new Unicorns being birthed during the fourth quarter as start-ups in these countries attract investment, says a KPMG report.

During Q4, 2021, India saw 14 new unicorns ranging from healthtechs PristynCare and CureFit, to insurtech Acko General Insurance, home rental platform NoBroker, and digital credit platform Slice. The breadth of the new unicorns highlights the growing depth of India’s start-up ecosystem and the maturity of start-ups across a range of sectors, said the report, titled Q4’21 Venture Pulse Report – Global trends.

The number of unicorn companies continued to explode in Q4’21, with 126 unicorns globally. Of this, 76 were from the US and 14 from India. However, a range of less mature VC markets saw new unicorns birthed during the quarter, including Vietnam (Sky Mavis, Momo), Brazil (CargoX, Olist), Mexico (Clara, Merama), Indonesia (Kopi Kenangan, Ajaib), and the Philippines (Mynt) — highlighting not only the increasing diversity of the global VC market, but the growing size of start-ups attracting investment in all corners of the world.

Kopi Kenangan is a coffee chain in Indonesia, while Mynt in the Philippines and Sky Mavis in Vietnam are in the FinTech and blockchain sectors respectively.

Unicorn companies globally continued to account for a significant amount of VC investment in 2021, with a number of existing unicorns raising large rounds in Q4’21, including J&T Express ($2.5 billion), Lacework ($1.3 billion), Thrasio ($1 billion) and N26 ($900 million), the KPMG report said.

Arun Natarajan of the Chennai-based Venture Intelligence said the diversification of foreign capital away from China due to the government's clampdown on large tech companies as well as the ban on crypto, is benefiting start-up ecosystems in a number of other countries.

Sequoia Capital India was a pioneer in covering SEA, with its early investments in GoJek (2015) and Tokopedia (2014), which are now Unicorns. It also opened up a strong local presence in the region (in Singapore). Now other VCs, including Lightspeed Ventures, is following Sequoia's lead and leveraging their India offices to cover the SE Asian region as well, he said.

Following the record number of unicorn births in 2021, there are high expectations for India’s stable of unicorns to grow even further in 2022, as rapidly maturing companies in a range of sectors attract larger investments. Fintech, edtech, and ecommerce are expected to remain hot areas for VC investment, although all three sectors could also see some consolidation as smaller players look to gain scale or are acquired by their larger and better capitalised counterparts, the report said.

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