B2B back in focus as Indian VC funds rework playbook

Domestic venture capital (VC) funds are preparing strategies for investments in business-to-business (B2B) startups in marketplace, manufacturing, enablement, and maintenance, repair and operations (MRO), as the B2B space gets lucrative due to higher order values, a positive margin profile, ability to turn profitable early and the market size itself.

A shift of supply chains away from China, government’s production-linked incentive schemes for manufacturing and the ability to still take on a sizeable market share in spite of the presence of incumbents are leading to several entrepreneurs wanting to start up in the space, investors and bankers looking at the segment said. This has led VC funds to actively build their own thesis around the space and back opportunities.