Indian start-up ecosystem to grow 2.2x times in next 4 years: Nasscom
Despite a perception that the nation’s start-up ecosystem has slowed down in the last year, India has emerged as the third largest start-up base with ventures are poised to grow 2.2 times to reach 10,500 by 2020, says a report.
India is in the third position just behind US and UK, and nearly 1,400 new start-ups are expected by end of 2016, up by 8-10 per cent from last year, revealed the ‘Indian Startup Ecosystem Maturing – 2016’ report by Nasscom-ZINNOV.
“The start-up landscape in the country is becoming the epitome of innovation, with companies bringing out solutions that are aimed at solving locally relevant issues,” said Nasscom Chairman C P Gurnani.
“Nasscom believes that the contribution by start-ups have been growing at a rapid rate and the landscape has a huge potential in terms of business stability, revenue growth and further innovation,” he added.
The report was launched on the sidelines of Nasscom Product Conclave 2016 in Bengaluru today in the presence of Gurnani; R Chandrashekhar, President, Nasscom; Ravi Gururaj, Chairman, Nasscom Product Council and Pari Natarajan, CEO, Zinnov.
The report finds that metros like Bengaluru, NCR, and Mumbai continue to lead as the major start-up hubs in the country.
In terms of vertical growth, investors are looking at domains like health-tech, fin-tech, and edu-tech.
With a total funding of approximately USD 4 billion, close to 650 start-ups were funded signifying a healthy growth of the ecosystem, the report said.
According to the report, the number of tech start-ups in India is expected to grow by 10-12 per cent to over 4,750 by the end of 2016.
“Technology start-ups are creating a new identity for India and its technological prowess. They are defining the way the world operates making life better and easier for people and businesses alike. Our start-up report is a testimony to the potential of the start-up landscape and the scope of growth and opportunity that India presents,” said Nasscom President, R. Chandrashekhar.
With this impetus, India will become home to over 10,500 start-ups by 2020, employing over 2,10,000 people, reveals the report.
It added that there is a 40 per cent increase in the number of active incubators and accelerators in 2016 with impetus from government and corporates.
Over 30 new academic incubators have been established under the government’s ‘Start-up India Stand-up India’ initiative this year, and tier-II/III cities have established 66 per cent of the new incubators, it added.
“The start-up landscape is undergoing great churn with fast-paced changes happening across the board. Owing to focused funding and a growing need of scaling up capabilities, Indian entrepreneurs will continue to attract global attention due to a perfect mix of talent, technology, traction and transactions,” said Chairman Nasscom Product Council, Ravi Gururaj.
The report also reveals an increased interest from student entrepreneurs this year. A growth of 25 per cent has been witnessed in 2016 with over 350 start-ups being founded by young students.
With regard to investments, the report states that investors are increasingly looking at opportunities in start-ups in areas other than online retailing.
Ventures in Fintech, Healthtech, Edutech, data analytics, B2B commerce and artificial intelligence, are seeing interest, said the report.