India has one of the world's fastest growing start-up ecosystems. The Indian technological landscape has seen tremendous growth in the creation of innovative start-ups, propelling it to the third-fastest growing hub for technology start-ups in the country. Let’s deep dive into understanding India's status as a global start-up hub, attracting investors, entrepreneurs, and corporations.

Over the last decade, India's start-up ecosystem has expanded dramatically, from a handful of tech companies to now thousands of innovative new ventures.

The internet has facilitated the creation of thousands of start-ups over the last decade that have tackled unique problems, transformed industries, and created new segments in the Indian technological landscape. Insights from deep data to influence strategic decision-making in governance, investment, growth, and other key aspects of the Indian start-up ecosystem

DPIIT Recognizes over 61,400 Indian Start-ups

The Economic Survey 2021-22 shows that the Department for Promotion of Industry and Internal Trade (DPIIT) has recognized more than 61,400 start-ups in India, with at least 14,000 being recognized during fiscal 2022. The survey is an annual economic report card that looks at the performance of various sectors and makes recommendations for future actions. It also includes a GDP growth forecast.

According to the survey, each of India's 555 districts had at least one new start-up, demonstrating that the number of start-ups in India has increased dramatically over the last six years, with the majority of them in the IT/knowledge-based sectors.

According to the survey, "Start-ups in India have grown remarkably over the last six years. The number of new recognised start-ups has increased to over 14,000 in 2021-22 from only 733 in 2016-17.”

India – World’s 3rd Largest Ecosystem

According to the Economic Survey 2021-22, with over 62,200 recognised start-ups spread across 636 districts, India has the world's third largest start-up ecosystem after the United States and China.

According to InvestIndia, India has 85 unicorns worth $287.89 billion as of January 28, 2022, whereas the Economic Survey only provided data through January 14, 2022. In 2021, 44 unicorns were born, with a total value of $90.67 billion, and four unicorns were born in 2022, with a total value of $4.72 billion. In today's world, one unicorn out of every ten is born in India.

Furthermore, the Indian start-up ecosystem has seen exponential growth in the last few years (2015–2021), with a 9-fold increase in the number of investors, a 7-fold increase in total start-up funding, and a 7-fold increase in the number of incubators.

Delhi Dethrones Bengaluru as the Start-up Capital of India

The start-ups are from 56 different industries, with IT services accounting for 13%, healthcare and life sciences accounting for 9%, education accounting for 7%, professional and commercial services accounting for 5%, agriculture accounting for 4%, and food and beverages accounting for 4%.

With increased smartphone penetration and the digitization of commerce in all aspects of life, household-name tech companies are contributing to India's unicorn boom. Aside from fintech, the unicorn universe is dominated by e-commerce grocery, SaaS, and marketplace players.

The Economic Survey 2021–22 revealed India's burgeoning start-up scene in space technology. The survey also found that the number of start-ups in the sector has increased from 11 in 2019 to 47 in 2021. Delhi has recently dethroned Bengaluru as the start-up capital of India. Between April 2019 and December 2021, over 5,000 recognised start-ups were added in Delhi, while 4,514 were added in Bengaluru. According to the survey, Maharashtra has the most well-known start-ups, with 11,308 in total.

More than 555 districts had a start-up last year. In 2016-17, only 121 districts had at least one new start-up.

While each start-up's path to becoming a unicorn is different, the average time for a start-up to become a unicorn is 6 months to 37 years. In 2021, Mensa Brands became a unicorn in just 6 months, making it one of Asia's fastest growing unicorns.

The four Indian start-ups that have become ‘Decacorns’ (companies valued at more than $10 billion) are Flipkart, BYJUs, Paytm, and Swiggy.

The survey also drew attention to the recent flurry of initial public offerings (IPOs) by new-age companies. It has been stated, “In AprilNovember 2021, Rs 89,066 crore was raised through 75 IPO issues, much higher than in any year in the last decade.”

In January, Indian start-ups received record investments of up to $3.5 billion in 130 deals, a decadal high in the midst of a global market downturn and an indication of sustained investor interest.

The total value of disclosed deals in January was six times that of the same month last year, when 75 deals worth $600 million were disclosed. According to the data, 65 deals worth $1 billion were closed by Indian start-ups in January 2020.

In Conclusion

While the first decade of the 21st century was focused on bringing India's cities and metros online, the last ten years have been focused on using the internet to create businesses and start-ups, as well as to pass the digital torch to rural India. India now has the world's largest working population, which start-ups are expected to capitalise on over the next five years.

More than 500 million people use the internet in the country. As a result, we can anticipate widespread adoption of blockchain, AI, IoT, and data analytics across a variety of technology sectors.

Nonetheless, India's start-up population will have surpassed 100,000 by 2025, resulting in the creation of over 3.25 million jobs. At the same time, total funding for Indian start-ups is expected to surpass $150 billion, with total value creation exceeding $500 billion. Once the pandemic's medium and long-term effects have subsided, there will be no stopping Indian start-ups.