Dotcoms Once More

Business Today, June, 2007

Dotcoms Once More

Last year, venture capital (VC) firms are estimated to have invested more than $32 billion globally. What's significant about that number, apart from its absolute size, which is more than 3 per cent of India's GDP, is the fact that it represents the highest VC investment in the last five years. In fact, some sceptics fear that the investment figures are rising to the bubble levels 10 years ago. But it is unlikely that things will turn out as bad as they did the last time around. VCs have become much more cautious, and no one has money anymore for ideas that only exist on PowerPoint slides.

In India, too, dotcoms made a strong comeback in 2006. Compared to just two investments in 2005 worth $17 million, there were 27 investments worth $166 million. What...

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