INDIA- the start-up hub?

The Narendra Modi government had launched the Start-up India, Stand Up India campaign as soon as BJP came into power. It announced few measures like simplifying the regulations, offering some handholding, a few tax breaks, and a fund-of-funds to rev up the start-up engine. In 2016, only a handful of start-ups survived.

Background

Start-ups largely live and die by the amount of funding it receives. Over the past few years, there has been a significant increase of investment that doubled in 2015. But this growth slowed down in 2016. The number of start-ups receiving funds came down by 21% and the amount of funding’s received by start-ups in later stage fell by almost 50%.

Analysis

In 2017, Indian tech start-ups raised about $1.46 billion in funding. This is a 25% jump in the number of deals and 122% rise in total funding, compared to the last quarter of 2016.

2016 was a difficult year with a decline in fundi      ng. However, the first quarter of 2017 has sown considerable signs of recovery. Some of the big-ticket deals include Paytm, Delhivery, and Ola.

Bengaluru has emerged as the top city both in terms of deals and investment.  

Assessment

Our assessment is that, the Indian start-up ecosystem might be taking off. It has still several challenges to address including funding, evolving technology and innovation.