Why is there no Europe India corridor yet?

Over the last 18 months, I’ve made significant trips to London and it’s become one of my favourite cities in the world. I also relocated to London (yes, in the middle of the pandemic) in 2020 and so have had time to observe the ecosystem from up close.

There’s ofcourse multiple reasons for this, and after conversations with numerous people I have some hypothesis around why this is the case. But the Tl:dr version of this seems to be:

Institutional: While Europe has given the venture ecosystem a lot of LPs (especially in the impact investment space), a lot of this has been driven by developmental financial institutions like CDC, FMO, KfW, LGT etc. However over the last decade there’s been a lot of investor interest (initially by Rocket Internet via their venture builder model) and later through funds like Global Founders Capital, Kinnevik, Sofina, Hummingbird as well as talent incubators like Entrepreneurs First, Antler and the likes which have opened local chapters. In a recent Clubhouse discussion that I hosted, we also uncovered that over the last 24 months, a lot of Europe based family offices have started looking at India aggressively and opportunistically.

I’ve noticed that investor interest is typically one way (Europe -> India) and is more of capital infusion. This is in contrast to an ecosystem approach, where it's a 2 way thing. There is a serious lack of folks who are “ecosystem bridges” beyond a few individuals. A few folks who’re based in Europe get their deal flow via their alumni networks in India or places like Indian Angel Network, but for example you don’t really see syndicates out of Europe that are investing actively in India. This is clearly not because of lack of capital, since there’s enough HNIs in Europe with capital to deploy. And Indian investors often aren’t even aware of the work happening in Europe (say in deep tech), because perhaps there’s enough deal flow in India & US to keep them occupied. But Europe is pretty awesome for an angel investor, there’s definitely a lot more companies in SaaS that are in the $10M+ ARR mark and above, consumer is thriving, it’s literally the fintech capital of the world and looks like there’s potentially more M&A here and my hunch is there’s potentially better and realistic exit scenario here as well (this is my hunch, I’ll have to validate this).

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