“It’s different this time.” That’s the common refrain of the optimists during every funding craze in the digital economy. Pick any year — 1999, 2007, 2014-15 or 2021. Ultimately, a market correction catches up, playing out in a familiar fashion.

The striking thing about the current surge is that it is more broad-based, with India’s retail investors putting higher sums of money into startups. There are three other reasons that actually make it different and give a sense of the stakes involved if things go downhill.

Late-stage tech funds: A slew of wealth and asset management players such as IIFL, Edelweiss and Kotak have raised funds dedicated to investing in mature startups, with the expectation that they will go for an IPO soon in a bullish capital market. These funds are pooling capital from thousands of ultra-high-net-worth investors. We wrote about how quickly UHNIs were signing cheques to get exposure to startups in July.

Since then, the funds have backed players like Byju’s, Ola, Licious and upGrad at peak valuations. But as the IPO market comes under pressure, the question is: do the funds with a typical five-year lifecycle have enough time? “They will likely sit tight for now. They may also try to go for earlier-stage startups, and not companies that have already topped (in terms of valuations),” said an investor tracking the developments.