Startups have drawn more attention recently, both in India and throughout the rest of the world.
Their numbers are growing, and they are now universally acknowledged as significant generators of
growth and employment. Startups can produce significant answers and serve as engines for socio-
economic development and transformation through innovation and scalable technology.
Over the past 20 years, the Indian startup ecosystem has experienced rapid growth. Although few
firms were formed in the 2000s, the ecosystem was still in its infancy because there were few active
investors and few incubators and accelerators. The late 2000s saw a few successful exits, and over
the past ten years, the number of startups has rapidly expanded and more support has become
accessible in all areas. Bangalore has emerged as India's main startup hub, but Mumbai, the National
Capital Region (NCR), as well as other smaller locations, are also seeing a lot of starting activity.
Startups are a part of a larger business ecosystem; they do not live in a vacuum. The development
drivers of the Indian startup ecosystem must therefore be understood in light of a number of
variables, including recent market trends, historical economic changes, the impact of technical
advancement, and shifting societal attitudes. The five main development possibilities and drivers
that emerged from the interviews are covered in this section.
Over the past 20 years, the Indian startup ecosystem has undergone significant change. The number
of actors has increased, and they now support entrepreneurs in many ways. As a result, the
ecosystem has substantially expanded and is currently maturing.
In the late 1990s, which concluded with the bursting of the dot-com boom, few startups had
previously emerged. At the time, there was little support infrastructure, little Internet access, and
limited broadband penetration. Slowly, throughout the course of the following ten years, additional
startups began to enter the market. Some of them did well, and some of them left. One turning
point was the significant investment the Bangalore-based e-commerce firm Flipkart received in
2009. The number of startups, as well as a variety of incubators, accelerators, and other support
organizations, rapidly rose in the years that followed.
Between 7200 and 7700 IT startups were founded between 2013 and 2018, which translates to a
base growth rate of 12 to 15 percent. InMobi, a Bangalore-based startup in the field of advertising
technology, was the first unicorn in India. Since then, more have been born; as seen in figure 2, there
are currently 19 unicorns. [xxvii] Currently, the highest valuable Indian startup is One97
Communications, the parent company of the payment system Paytm and the e-commerce site
Paytm Mall, valued at US$10 billion.
Access to outside funds also considerably grew concurrently. Large funds were established in India,
and investors from the US, Singapore, China, Japan, and the Middle East contributed foreign money.
A large amount of money was spent on firms that were nothing more than concepts during an early
financing boom, which led to enormous financial losses. After some funds closed and the market
was cleaned up, investing strategies changed to be more cautious. The situation started to get better
again in recent years. Government and CSR initiatives are also having an impact on the investment
More information is now available in the ecosystem thanks to the mistakes and experiences of the
first generation of Indian entrepreneurs. Some of these founders ultimately found success, which
encouraged many people to take similar entrepreneurial efforts. Additionally, over time, a sense of
camaraderie among those involved in the startup environment has grown. The Indian ecosystem has
grown tremendously in all aspects and has now reached a particular size overall.