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smiling businesswoman, two businessman in background
smiling businesswoman, two businessman in background

India startups poised for massive growth as sector bets on bullish trends


Sandhya D'Mello

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Nikhil Kamath, Co-Founder,Zerodha
Nikhil Kamath, Co-Founder,Zerodha

Published: Mon 15 Aug 2022, 12:00 AM

India has emerged as a strong and resilient nation even while its peers are facing global uncertainty. The nation has emerged as the third largest ecosystem for startups globally with over 74,400 DPIIT-recognised startups across 653 districts of the country as of July 2022.

India ranks second in innovation quality with top positions in the quality of scientific publications and the quality of its universities among middle income economies. The innovation in India is not just limited to certain sectors. We have recognised startups solving problems in 56 diverse industrial sectors with 13 per cent from IT services, nine per cent healthcare and life sciences, seven per cent education, five per cent each from professional and commercial services, agriculture and food and beverages, points out Invest India.

Nikhil Kamath, Co-Founder, Zerodha, said: “Against an uncertain global environment, geopolitical volatility, supply chain disruption, and economic uncertainty, India emerges as a preferred investment destination for VCs due to its relatively positive macroeconomic environment and demographics. The sectors I expect will be poised for growth are Fintech, and Climate Tech (including agri-tech). In addition, I see the new-age startups gaining traction, be it in the space of e-commerce, social commerce, or gaming. The pessimism will be short-lived as Indian fundamentals are strong and returns on investment are relatively more robust than peers both in public markets and the startup sector.”

Richard Pattle, Co-Founder and CEO, True Beacon
Richard Pattle, Co-Founder and CEO, True Beacon

The Indian unicorns are flourishing in the fast-paced and dynamic economy of today. These startups are not only developing innovative solutions and technologies, but are generating large-scale employment. Till FY 2016-17, approximately one unicorn was being added every year. Over the past four years (since FY 2017-18), this number has been increasing exponentially, with a whopping 66 per cent year-on-year growth in the number of additional unicorns being added every year.


Unicorn is a term used in the venture capital industry to describe a privately held startup company with a value of over $1 billion. And what triggered the unicorn rush during 2021? While work from home during the pandemic fueled the growth of digital businesses in India, the incident also resulted in a long unicorn list. Mainly three factors, a thriving digital payments ecosystem, large smartphone user base and digital-first business models, have come together to attract investors. Tech companies, which have become household brands, are contributing to the unicorn boom in India, as smartphone penetration and digitisation of commerce in every aspect of life has increased manifold during the pandemic. Besides Fintech, e-commerce grocery, SaaS and marketplace players are contributing the most to the unicorn universe.

India is home to 105 unicorns with a total valuation of $338.5 billion. Out of the total number of unicorns, 44 unicorns with a total valuation of $93 billion, were born in 2021 and 19 unicorns, with a total valuation of $24.70 billion were born in 2022.

Richard Pattle, Co-Founder and CEO of True Beacon, said: “Global HNIs and UHNIs, who invested in India have done comparatively better — Indian markets have outperformed all the major global indices — in part because of the robust startup ecosystem in India. India continues to compete globally and GIFT City is quickly establishing itself as a leading financial hub. Fourteen months ago, GIFT City had a global investor— invested in equity markets in the US, the UK, Germany, Japan or India, most markets have underperformed with the exception of India, which is the only major equity market in that list to have returned a profit, even taking into account the depreciation of the rupee, and other markets have lost between five and 35 per cent in dollar terms. I envision Gift City, quickly establishing itself as a leading global financial hub due to the resilient startup environment in India and robust regulations.”

Siby Sudhakaran, Founder, Startup Middle East and Achieverati, Secretary-General, IBPC Dubai
Siby Sudhakaran, Founder, Startup Middle East and Achieverati, Secretary-General, IBPC Dubai

The year 2021, 2020, and 2019 saw the birth of the maximum number of Indian unicorns with 44, 11, and 7 unicorns coming each year, respectively. Covid-19 has caused a great amount of socio-economic suffering globally, but it is during this time when the resilient Indian entrepreneurs have worked effortlessly to not only contribute to the economy, but to also contribute towards Covid-19 relief efforts. In 2020, we witnessed the birth of more than 10 unicorns. ‘Its raining unicorns’ has been the motto of the year 2021 with 44 unicorns pumped in the ecosystem and many 'soonicorns' waiting in line.

Dr. Apoorva Ranjan Sharma,Co-Founder and President,Venture Catalysts Group
Dr. Apoorva Ranjan Sharma,Co-Founder and President,Venture Catalysts Group

Geographically, the centre of India's high-tech industry, Bengaluru is India’s unicorn capital with the largest number of unicorn headquarters, followed by Delhi (NCR) and Mumbai. While we see unicorns active in Tier I cities, this ecosystem is not restricted and is proliferating across the country till the last district. Traditional sectors such as e-commerce, Fintech, supply chain and logistics, internet software and services do dominate the arena, but a strong wave of unconventional sectors such as content, gaming, hospitality,data management and analytics, etc., are making their place on the list.

While every startup has its unique journey towards becoming a unicorn, the minimum and maximum time taken by a startup to become a unicorn are six months and 26 years, respectively. Mensa Brands took only six months to become a unicorn in 2021, making it one of fastest unicorns in Asia.

Siby Sudhakaran, Founder, Startup Middle East, and Achieverati, Secretary-General, IBPC Dubai, said: “An important learning from hosting over 735 startups during Expo 2020 Dubai, was that the founders were looking at Dubai for market exposure, expansion, and investments in the region. Startup Middle East is an initiative to bring together entrepreneurs and stakeholders to foster the startup ecosystem and act as a bridge between India and the UAE. India is a shining beacon for the unicorns and startup ecosystem. We are home to over 100 unicorns and the world’s largest incubator in T-Hub; it is only a matter of time before we will be leading the world in this space. We, at Startup Middle East, are committed to playing an active role as a catalyst.”


In 2021, India witnessed the birth of 44 unicorns with a total valuation of $93 billion. Bengaluru, Delhi NCR, and Mumbai continue to be the top cities preferred as unicorn head-quarters in 2021. Unconventional sectors and sub-sectors marked an entry into the unicorn space including, NBFCs, conversational messaging, cryptocurrency exchanges, D2C, cloud kitchens and many others.

Indian unicorns are also exploring the public listing avenues as a next step to realise the growth potential. Some of the big unicorn names that offered an IPO include Zomato, Nykaa, PolicyBazaar, Paytm and Freshworks, while many are already in line such as Delhivery, Mobikwik and CarDekho.

Today, one out every 10 unicorns globally have been born in India. Overall, 2021 has experienced an exponential boom when it comes to startups entering the unicorn club. This is a testament to the vibrant startup ecosystem present in India.

Till date, 2022 has witnessed the birth of 19 unicorns with a total valuation of $24.7 billion. Dr. Apoorva Ranjan Sharma, Co-Founder and President at Venture Catalysts Group, said: “Indian startup ecosystem will be ranked number one globally as it continues to evolve very rapidly in the next three years. We are expecting to see 1,000 Unicorns and $1trillion startup economy in the next three years. More than 940 startups raised nearly $20 billion in the first half of 2022 against $10 billion in first half of 2021. More merger and acquisitions, consolidation and exits may happen in India in 2022. We are anticipating spurt in Agritech, Consumer Packaged Goods and Fintech.”


The robust nature of the Indian startup ecosystem is evident in 2022 year-to-date when, as per a YourStory Report2, in H1 2022 891 funding deals were recorded, 82.8 per cent higher in comparison to H1 2021 (541 deals). Over $17 billion funding was raised by startups, 1.8x of funding raised in H1 2021 ($9.4 billion). Sequoia Capital India has been the most active investor, followed by Tiger Global Management, Kunal Shah (Founder, CRED), Better Capital, Inflection Point Ventures, LetsVenture, Accel, Blume Ventures, 9Unicorns, and Alpha Wave Global.

Leading sectors inviting funding include FinTech, EdTech, e-commerce, social network,food-tech, logistics and supply chain, media and entertainment, D2C Brands, SaaS, and healthtech. Fintech, EdTech and e-commerce accounted for 19.7 per cent, 9.4 per cent and 6.2 per cent of total funding.

Additionally, there also has been a shift in the traditional way of funding, wherein startups are now looking at exercising alternate routes such as crowdfunding, revenue-based financing, venture debt, bank loans, etc. Startups such as Zerodha, which have been bootstrapping since inception are changing the unicorn funding norms and promoting independence and revenue generation since the early stages. Since the onset of Covid-19, an unconventional trend observed is the new entries to the unicorn club without any billion-dollar ticket size investment.


The global startup ecosystem is witnessing a shift as the world is increasingly realising the potential carried by the startups. We are gradually transitioning from the age of unicorns to the age of decacorns,a company that has attained a valuation of more than $10 billion. As of May 2022, 47 companies worldover have achieved the decacorn status. India has four startups namely, Flipkart, BYJU’s, Nykaa and Swiggy, added in decacorn cohort.

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