Venture Capital - Nepal

  • Nepal
  • Nepal is projected to see a Total Capital Raised in the Venture Capital market market reaching US$83.7m in 2024.
  • The Later Stage market is expected to dominate the market with a projected market volume of US$38.5m in 2024.
  • In global comparison, the United States will lead in Capital Raised, with US$264,500.0m in 2024.
  • In Nepal, the Venture Capital market is rapidly evolving, with a focus on tech startups driving innovation and attracting investor interest.

Key regions: Europe, United States, United Kingdom, Australia, Brazil

 
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Analyst Opinion

The Venture Capital market in Nepal has been experiencing significant growth in recent years, driven by various factors such as increasing entrepreneurial activity and government initiatives to promote startups and innovation.

Customer preferences:
Entrepreneurs in Nepal are increasingly seeking venture capital funding to fuel their business growth and expansion. This is primarily due to the limited availability of traditional funding sources such as bank loans, which often require collateral and have stringent requirements. Venture capital provides a more flexible and accessible source of funding, allowing entrepreneurs to scale their businesses quickly and take advantage of market opportunities.

Trends in the market:
One of the key trends in the Venture Capital market in Nepal is the rising number of startups across various sectors. This trend is fueled by a growing entrepreneurial culture and an increasing number of young and ambitious individuals starting their own businesses. These startups are often in sectors such as technology, e-commerce, and renewable energy, which have high growth potential. Another trend in the market is the emergence of local venture capital firms and angel investors. Previously, most venture capital funding in Nepal came from foreign investors. However, the local investment ecosystem has been developing rapidly, with the establishment of several venture capital firms and angel investor networks. This has led to increased investment in local startups and a more vibrant entrepreneurial ecosystem.

Local special circumstances:
Nepal's geographical location and its status as a landlocked country present unique challenges and opportunities for the Venture Capital market. While being landlocked limits access to international markets and resources, it also creates a sense of resilience and self-reliance among entrepreneurs. This has led to the development of innovative solutions and business models that cater to local needs and constraints. Furthermore, Nepal's young population and increasing internet penetration have also contributed to the growth of the Venture Capital market. The youth demographic is more open to entrepreneurship and technology, creating a favorable environment for startups and venture capital investment.

Underlying macroeconomic factors:
The Venture Capital market in Nepal is also influenced by macroeconomic factors such as GDP growth, inflation, and government policies. Nepal has been experiencing steady economic growth in recent years, which has created a conducive environment for startups and venture capital investment. The government has also introduced policies and programs to support entrepreneurship and innovation, including tax incentives for startups and the establishment of incubation centers. In conclusion, the Venture Capital market in Nepal is witnessing significant growth due to increasing entrepreneurial activity, the emergence of local venture capital firms, and supportive government policies. Entrepreneurs in Nepal are increasingly seeking venture capital funding to fuel their business growth, and the market is evolving to meet their needs. The unique circumstances of being a landlocked country and the young demographic contribute to the vibrant entrepreneurial ecosystem in Nepal.

Methodology

Data coverage:

Data encompasses B2B and B2C enterprises. Figures are based on the amount of capital raised, the average of deal size and the number of deals.

Modeling approach / Market size:

Market sizes are determined through a combined top-down and bottom-up approach, building on a specific rationale for each market segment. As a basis for evaluating markets, we use data from OECD, annual financial reports of key players, industry reports, third-party reports, publicly available databases, and survey results from primary research (e.g., the Statista Global Consumer Survey). In addition, we use relevant key market indicators and data from country-specific associations, such as GDP, CPI, number of small and medium-sized enterprises (SME), new businesses registered (number) . This data helps us estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the relevant market. For example, the S-curve function and exponential trend smoothing are well suited for forecasting digital products and services due to the non-linear growth of technology adoption.

Additional notes:

The market is updated twice a year in case market dynamics change. The impact of the COVID-19 pandemic and the Russia-Ukraine war is considered at a country-specific level.

Overview

  • Capital Raised
  • Average Deal Size
  • Global Comparison
  • Number of Deals
  • Analyst Opinion
  • Methodology
  • Key Market Indicators
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