Chinese tech crackdown is India’s win, venture capitalist says

(Bloomberg) – China’s crackdown on its tech industry means global investors seeking exposure to emerging markets will turn their attention to India, said Sumant Mandal, managing partner of the capital investor – American risk March Capital Partners.

Investors are now placing more emphasis on “government risk” when evaluating Chinese technology companies, Mandal said in a video interview. Indian startups in fields such as the internet and cloud software offer strong growth prospects but without a similar risk profile, said Mandal, co-founder of the Santa Monica, Calif., Based company.

Chinese regulators are restraining unruly internet companies in a campaign that spans everything from games to “money worship”, raising questions about their prospects for growth and profits. While India’s internet industry lags far behind China’s in terms of size, it has recently produced new billion dollar startups and initial public offerings at an increasing rate. “But the risk-return structure around China has changed” and investors from the United States, Europe, Asia and the Middle East are now looking to balance their portfolios by redirecting investments to its neighbor, a- he declared.

March Capital has a long history of supporting Indian startups and plans to increase these investments, he said. The coronavirus has changed consumer behavior in India, a boon for businesses handling e-commerce and digital transactions. The company manages more than $ 1 billion in assets, including a $ 450 million fund that closed earlier this year. Last month, March had two releases in India that accounted for nearly $ 6 billion in combined transaction value: online payment service BillDesk was acquired for $ 4.7 billion, just days after the introduction on CarTrade Tech Ltd. Mandal leads March’s investments in areas such as blockchain, network infrastructure, and software as a service, or SaaS. More than two dozen India-born SaaS startups have moved to the United States to successfully gain global customers and generate hundreds of millions of dollars in revenue, he said.

“Now there is more than one belief system around India,” he said. “The size of startups like Flipkart, Byju’s and BillDesk changes everything.

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