Tech babies: With 1,300 added last year, India now has 27,000 active startups
Virendra Pandit
New Delhi: India, the third largest technology startup ecosystem worldwide after the US and China, added more than 1,300 active startups in 2022, taking the total tally to nearly 27,000.
With 23 unicorns in 2022, the South Asian nation also added the second-highest number of unicorns in the world, the National Association of Software and Service Companies (Nasscom), in collaboration with Zinnov, said in a report on Wednesday.
Also, the potential pipeline of unicorns expanded to over 170, growing at a pace equivalent to 2021.
“Despite the current downturns, opportunities abound for innovative companies that are leveraging emerging technologies to create actionable impact while prioritizing business fundamentals over their growth,” said Debjani Ghosh, President, of Nasscom.
Despite the headwinds, while total funding in 2022 dropped 24 percent over 2021, the annual investments at USD 18.2 billion were higher than the pre-pandemic levels of USD 13.1 billion in 2019.
The year 2022 also witnessed a significant investment focus on non-unicorns and unique startups.
Almost 1,400 unique startups received funding in 2022, 18 percent higher than in 2021. The report said that 47 percent of startups raised their first round in 2022.
Both early-stage (USD 5.9 billion in 2022) and seed-stage (USD 1.2 billion) investments grew between 25 and 35 percent over 2021.
In 2022, tech startups in the seed-stage secured 1,018 investments.
Late-stage investments bore the brunt with a decline of 41 percent in deal sizes greater than USD 100 million, because of considerable correction in the global public markets.
“What is remarkable is the ecosystem’s maturity, where founders are intentionally prioritizing profitability over the valuation and investor trust, despite macroeconomic variables at play. This will pave the way for growth in 2023 and beyond,” said Pari Natarajan, CEO, Zinnov.
Technology startups are expected to continue increasing innovation and deep-tech adoption, particularly in areas related to Sustainable Development Goals (SDGs) that require complex solutions, the report said.
