VCs still flock to IT-ITes sector, despite sluggish growth rate
Even as India's information technology and IT-enabled services (IT-ITes) industry has witnessed sluggish growth in 2012 with ongoing macro concerns in its biggest markets, the sector is still the favourite destination among venture capitalists (VC) to park their funds.
In the last twelve months, the sector accounted for 65% of the overall VC investments in the country with the emergence of new buzz words like big data, software as a service (Saas) and analytics.
The IT-ITes sector attracted 136 investments, the highest among sectors, worth $388.11 million in 2012, according to data from Venture Intelligence, an investment research firm.
Companies in the areas of online services, enterprise software, IT products and services and mobile value-added services (VAS) received almost 90% of the overall funding for the sector.
Among the top VC investments in the technology space during the period include AbsolutData Research and Analytics, a data analytics services firm attracting funding of $20 million from Fidelity Growth Partners India, followed by online fashion retailer Yebhi.com raising $18 million from Qualcomm Ventures, the VC arm of Qualcomm Inc, Nexus Venture Partners and Catamaran.
Cloud-based software provider Capillary Technologies managed to rope in $15.5 million from Sequoia Capital and Norwest Venture Partners, while Bangalore-based analytics solutions provider Manthan Systems raised $15 million from Norwest.
Venture Intelligence pointed out that the average deal size in the IT-ITes space was about $2.85 million.
“The conventional IT services will attract only minimum VC funding
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