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  1. Of 5000 off tech start-ups in India, some 1000 are cloud based; here is transformation that lies in store

Of 5000 off tech start-ups in India, some 1000 are cloud based; here is transformation that lies in store

Of the 5000-odd tech start-ups that we have in India, nearly a 1000-odd are cloud-based. In H1 of 2017, they managed to shake off the lingering strains of a Siberian funding winter (experienced in 2016) to raise $250 million and cement their claim.

New Delhi | Published: January 1, 2018 3:57 AM
Chandrashekharan, NASSCOM Chandrashekharan, NASSCOM

Any mention of exponential growth in technology has to take start-ups into account. The young (and even the not-so-young) founders typified by grit and entrepreneurial spirit, often times look towards disruptive thinking to address complex problems. For instance, the spurt in aggregator/e-commerce models was a radical approach in its time, till the market turned into a red ocean. Invariably, entrepreneurs get a whiff of market imbalance and eke out opportunities accordingly, however daunting it may seem at the outset. In India (read Bharat), the facilities in healthcare, education, financial inclusion among others, remain woefully inadequate and require our immediate attention—if inclusivity is to be our destiny. The idea of addressing social challenges has resonated strongly, and today there are nearly 350 start-ups in this space including in clean-tech, agri-tech, energy-tech and crime prevention, besides the areas mentioned earlier. In particular, the “Solve for India” theme finds highest adoption in the areas of healthcare, education and financial inclusion. Access to these services (especially in the underserved sections of society) underscores a glaring market imbalance to posit the question: Can sustainable tech-based models help to bridge this gap?

To make a difference, the solutions have to be low-cost and scalable—a perfect recipe for deep-tech to take over. It is a liberating enough thought that even tier 2 and tier 3 city start-ups are in the fray and radical approaches continue to germinate in cities such as Udaipur, Coimbatore, Jaipur, Pune, Indore, Ahmedabad and Kochi. These rollouts are perhaps three years old and refreshingly expansive towards addressing the entire gamut of social issues which have perennially constricted inclusive growth. Also, over the previous year (2016) there has been a significant jump (from 16% to 20%) in their share of the total start-up base. While it may be still too early to pose any real threat to leader locations (Bangalore, Delhi NCR, Mumbai, Hyderabad, Chennai and Kolkata), it’s endearing to note that the democratisation process is under way and opening many more doors for the young and the spirited.

Predominantly, it’s the suite of advanced tech which has borne the brunt of this responsibility and particularly, it is Internet of Things (IoT), Analytics and Artificial Intelligence which have shown impressive breakthroughs. Thus, it brings us a step closer to the realisation that radical transformation may soon be a reality. Moreover, the world is inexorably moving from on-premise software to cloud-based platforms, and it is particularly gratifying, when seen through the lens of rapid adoption coupled with increased funding opportunities that have come by. Of the 5000-odd tech start-ups that we have in India, nearly a 1000-odd are cloud-based. In H1 of 2017, they managed to shake off the lingering strains of a Siberian funding winter (experienced in 2016) to raise $250 million and cement their claim!

Finally, nothing worthwhile can be achieved unless the ecosystem is adequately fostered by the primary participants—the government and large corporate entities. To be fair, the former does recognise this ecosystem which is evidenced by the fact that more than 30% of active start-up policies were launched post 2016. In this continued endeavour, the three areas where the government can make a huge difference are: Funding and incentive support, active promotion of industry-academia linkages and further simplification of some of the existing policies, particularly with reference to exits, including those around angel tax. It is also noteworthy that the Ease of Doing Business index has jumped by more than 40 ranks in less than 18 months. That the corporate-start-up collaborative model has worked well, is palpable—a 36% year-on-year increase in the number of accelerator / incubator programmes, is seen.

Arguably, this is the second wave of start-ups in which futurists look keenly towards expanding the outreach, beyond time-tested models. Social issues which have plagued our great nation for many decades and believed to be unsolvable (falsely?) do not overwhelm this new breed of start-ups one bit. On the contrary, they see this as a pathway to many more billion-dollar opportunities. Such executable ideas which are able to impact a billion lives, should they not occupy the same pedestal as companies with billion-dollar valuations?
If it be the road less travelled, then so be it!

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