Omidyar Network India, which spun out as a separate entity from the parent company in 2019, is shutting down operations in the country. The group will no longer make new investments and plans to phase out from the market by the end of the next year.
“After several months of deliberation, it has been decided that Omidyar Network India will stop making new investments and will completely transition out of the market by the end of 2024. Over the next two months, the board and leadership team will assess how best to manage the organization’s portfolio while recognizing the long and trusted partnerships that the Omidyar Network India team has built,” the group said in a statement.
YourStory first reported about the development.
Backed by eBay founder Pierre Omidyar, the local unit focused on startups based in India. It has made investments in several noted startups like Tata 1mg, Bounce, Centa, CloudSek, DealShare, Kiwi, Otipy, Doubtnut, and more. It recently led the $6 million round in
Digivriddhi Technologies, a fintech start-up serving the dairy industry.
A TechCrunch report said that the investor had about $673 million of cumulative assets in India.
The group said the decision to shut down was “heavily informed by the significant change in context and the growth in the economic landscape that the India-based team has experienced since first making investments there in 2010.”
“Today, there is more Indian led philanthropic and venture capital than ever before, the country has a vibrant start-up sector, and several funds now have a middle and lower-middle income focus as part of their investment strategy. From its outset, the Omidyar Network India team identified these system shifts as critical to impact and worked diligently to help catalyze this change,” it added.
Even as the statement does not objectively elaborate the move, an easy guess is that its portfolio companies are not yielding desired results. For instance, Doubtnut was acquired by Allen Career Institute for $10 million in what’s widely believed as a stress deal. Doubtnut had raised $50 million in different rounds of fundings. On the other hand, its hyped bets Bounce and Dealshare are yet to find stable business models.
The overall startup space has been pretty much intense of late with several companies taking drastic measures to survive – job layoffs, controlled expenses, and more. Firms like ZestMoney have also shut down amid the so-called funding winter.
It is worth noting that the Omidyar group has come under scanner of the Indian government over alleged unauthorized foreign funding. In 2021, Omidyar Network International was among the group of 10 American, Australian and European NGOs that were barred from funding.
Update: 2:00PM IST; December 12 2023: Contents of this article have been updated with the official statements from the Omidyar Group.