Indian Startup Ecosystem

1 Startup Ecosystem in India: Quick Facts

India has the 2rd largest startup ecosystem in the world; expected to witness YoY growth of 10-12%

~20,000 startups in India; around 4,750 of these are technology led startups

1,400 new tech startups were born in 2016 alone; implying there are 3-4 tech startups born every day

2 Growth Drivers for Startups in India

As per a survey report by Innoven Capital (survey of 140 founders); leading factors that make India appealing as a startup nation are-

  1. Cost of doing business
  2. Proximity to customers/vendors
  3. Size of domestic market

7 million college graduates per year; 55% of the youth prefer working in startups over corporates (as per a youth of the nation survey of 150K young Indians). Median age of founders: 31 years

Second largest consumer internet market in the world (overtaking China) with 462 mn internet users, 80% of these users are mobile based 

3 Sector & Location Trends

While eCommerce and Aggregators have become mature; Fintech, Edutech and Healthtech are emerging verticals

Bangalore, Mumbai and NCR top startup destinations with over 65% of the total Indian startups.

Bangalore has also been listed within the world’s 20 leading startup cities in the 2015 Startup Genome Project ranking. It is also ranked as one of the world’ s five fastest growing startup cities

4 Enablers of Startup Ecosystem


  • 280+ Incubators/Accelerators /Co-Working Space with 40% YoY growth
  • Tier 2/tier 3 cities are gaining traction, with 66% new incubators established


  • $4 bn poured into 1040 deals in 2016 – 55% decrease in deal value, volume increase by 3% from 2015
  • On an average, four startup deals were announced every weekday throughout 2016
  • Angel investments are on the rise, with a 20% increase in the active investors
  • Global investor such as Alibaba Group, Soft bank, Sequoia and Foxconn have started to invest in the Indian startup ecosystem

Corporate Connect

Enterprises are realizing the disruptive potential of start-ups and are thus, partnering/investing in them. As per KPMG 2016 CEO Survey; 37% of CEOs surveyed deem their organisations to be highly capable of connecting in a beneficial way with start-ups. Examples of corporate support:

  • Wipro has setup a $100mn fund to invest in startups
  • IBM is partnering with 100 Indian big data and IoT start-ups,
  • Apple recently acquired Tuplejump - an AI based startup from Hyderabad
  • Barclays has setup an fintech co-working space that looks at getting innovative products at a cost five times cheaper than carrying out internal R&D