Indian startup ecosystem witnessed a 108 per cent overall growth in the total amount of funding from $2 billion in 2017 to $4.2 billion this year, as per NASSCOM. However, there is a steep decline in the amount of funding raised at the seed stage
Speaking to the reporters at the launch of NASSCOM report on the “Indian Startup Ecosystem – Approaching Escape Velocity” in NASSCOM’s Product Enclave, Debjani Ghosh, president of NASSCOM says, “India is becoming a startup hub. Opportunity for growth is enormous, which we had never seen in our lifetime. Challenge is how fast a company wants to transform.”
Entrepreneurs and founders launched more than 1,200 startups across the nation this year which includes 8 unicorns. This takes the total number of startups to 7,200 in India. The seed stage funding of Indian startups declined from $191 million in 2017 to $151 million this year to date.
“In terms of overall funding, it is a good story. However, we are seeing a continuous decline in seed stage funding of startup companies. If you fall at the seed stage, innovation is hit. It is the area, which needs protection,” Ghosh said.
According to the NASSCOM report, advance technology startups including AI, ML, Big Data and Cognitive Intelligence startups has increased by 50 per cent in numbers since last year. After witnessing a slowdown in 2016-2017, the startup ecosystem has finally gained back momentum and is expected to grow at a much higher rate than earlier.
The startups in India has created 40,000 new jobs and led to the three fold increase in indirect jobs. Investment in startups has increased by 100 per cent in comparison to 2017. The funding deals in the late stages have witnessed a major growth of around 250 percent from $847 million to $3 billion.
Startups that were in buzz include enterprise software, health, fintech and edtech. Startups from artificial intelligence, data analytics and internet of things space are witnessing fastest adoption in the market. AI startups witnessed a 120 per cent growth in fundings and raised $150 million in 2018.
The report says that around 400 startups including Ola, the cab aggregator, Zomato, the food delivery and restaurant table booking firm, Byju’s, the online edtech startup, OYO, the travel hospitality startup and WittyFeed, the viral content platform have expanded globally this year.