As per the report by NASSCOM, India is the fastest growing and the third largest ecosystem for startups. Driven by factors like enormous funding, emerging technology and booming domestic market Indian startup ecosystem has taken off. From 3,100 startups in 2014 to a forecasted estimate of more than 11,500 by 2020, this is not a subtle trend. It’s revolutionary and it’s already changing the lifestyle of Indians.
The first signal came from the growth of the software product industry in recent years in India and across the globe. With more and more people becoming the consumers of e-commerce solutions, Indian startups are providing global digital solutions to take benefits of the growth. Increased growth opportunity, availability of capital and opportunity for acquisitions are the greatest drivers of the growing startup ecosystem in India.
Another important factor leading to spurge in the number of start-ups in the country is increased capital access through VCs i.e. venture capital. Angel investment and seed funding are opening the doors to Indian entrepreneurs to build tailor-made products for their customers.
Rising interest of foreign investors in India can be attributed to many reasons but the most significant one is the mobile revolution and related consumer growth.
Big investors throughout the world are watching these start-ups closely and are funding Indian innovation. The following are some of the biggest foreign investment in recent times:
- TGM is the top investor in startups in India during the first four months of 2015. Indian startups have featured in 18 of its 26 funding rounds globally in 2015 so far.
- Tiger was among the top investors in India at $422 million in 2014.
- Russian investor Yuri Milner-led DST Global, followed Tiger investing $352 million.
The process of investment and exit has become smoother providing ground for increased acquisitions. In 2014, around 43 startups were acquired. Some of the prominent mergers and acquisitions of startups are:
- Housing.com was in news for acquiring Realty BI
- MakeMyTrip Limited announced the acquisition of the travel planner Mygola
- Snapdeal acquired FreeCharge to build the most impactful digital commerce ecosystem
It should be noted that the average valuation of an Indian startup is $2.3 million. 43 percent of product and digital organizations are focused on the global market. With characteristics like these the Indian startup ecosystem looks very promising. It is set to take the baton of development in the subcontinent and win over the world creating history.