Investments

Bad press, portfolio stress, and govt scrutiny: Why Omidyar bid adieu to India

Nikhil Patwardhan

Gaurav Tyagi

December 13, 2023 | 11 Min Read

News that Omidyar Network India, one of the country’s most prolific early-stage investors, is gearing up to exit the country may have come out of the blue, but it shouldn’t come as a shock. Indeed, the catalysts for its departure go back as far 2021.

Key Takeaways

Omidyar Network India, one of India’s most active early-stage investors, has decided to shut down operations in the country
Although this came as a sudden surprise to some, Omidyar's co-investors have seen it coming for months
The VC called it a strategic decision at its parent’s level, but there are more reasons for it, including skirmishes with the government and bad press
Omidyar’s portfolio, too, has been a mixed bag. While it scored substantial returns on the likes of WhiteHat Jr and Tata 1mg, it lost millions on companies such as ZestMoney and Doubtnut

Yesterday—December 12, 2023—Omidyar Network India announced that it would halt all investment activity in the country going forward. The news came as a jolt to India’s startup landscape, which has come to regard the venture capital firm as a familiar friend. Indeed, since entering India back in 2010, Omidyar has backed some 70-odd Indian startups.

The firm—which makes both for-profit and not-for-profit investments, and is backed by eBay founder Pierre Omidyar’s Omidyar Group—explained its decision in an internal blogpost.

“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,” states the blogpost. “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.”

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