Over 53% Tech Startups to Reach Pre-Covid Level in Less Than 6 Months: NASSCOM
As per the findings of the NASSCOM Start-up Pulse Survey II, revenue acceleration and funding has improved the cash availability with startups. 43% of tech start-ups have a runway for more than 6 months;
While India continues to take rapid strides towards digital disruptions across sectors, Indian tech startups are now witnessing a gradual road to recovery, states Startup Pulse survey II, titled “INDIAN TECH START-UPS – On the Road to Recovery”. NASSCOM revisited its first tech startup pulse survey, conducted back in April – May 2020. It aimed to understand what the current perspectives are; what has changed and what the next 6 months look like for the tech start-up ecosystem in the country.
As per the findings of the NASSCOM Start-up Pulse Survey II, revenue acceleration and funding has improved the cash availability with startups. 43% of tech start-ups have a runway for more than 6 months; compared to 8 per cent in the earlier survey. Covid-19 has accelerated digital adoption and tech startups can leverage this opportunity with enterprise and SMB clients for product adoption. Greater focus on the shift to online has also created new business opportunities.
There has been an increased interest from VCs and funding agencies to invest in seed-early stage start-ups. Government initiatives such as Atmanirbhar Bharat, digitalisation of India, a greater focus on sustainable business models is attracting VC interest for Indian tech start-ups. Almost 25% of the surveyed start-ups have been able to raise funds or find prospective investors as compared to 7% in the earlier survey. Sectors like Edtech, Healthtech, SaaS, SMB continue to attract investor interests.
Key Facts & Figures
• 4 start-ups became unicorns despite the pandemic• 30% of B2B start-ups record rise in revenues.
• 2.5X growth in tech start-ups seeing 3+ months runway compared to SPS-1
• 20% more tech start-ups lift hiring freeze
• Edtech, Fintech and Healthtech start-ups registering faster recovery
• Product diversification is the new normal for startups
• Tech start-ups see a longer runway since the start of the pandemic
Sharing her thoughts, Debjani Ghosh, President, NASSCOM, said, “The Indian start-up ecosystem has set a global benchmark in remained resilient during this disruptive year. Setting an example for many other industries across the globe to follow and learn from how Indian start-ups converted challenges into opportunities. A Large tech start-ups pool, strong innovation focus and entrepreneur’s zeal have been the growth drivers of this ecosystem. We are pleased with the way the ecosystem has been supportive of each other during these difficult times and hope that the industry remains its robust zeal to further contribute to reviving the economy.”