By Prabhat Sinha – IT Expert & Amazon Bestseller Author of Innovate & Seize Your Success
In 2021, the second wave of corona caused great devastation, disrupting everyday life. But the year spent has been quite spectacular for Indian startups amid the corona epidemic. By mid-year, global investors started rallying in the Indian startup’s ecosystem, which continued throughout the years. Indian startups earned more than $42 billion in the past year, many times more than the total investment of $11.5 billion in 2020. According to global data, India is the third most preferred destination after the USA and China in terms of capital investment in 2021 and second only to China among Asia Pacific countries. Even our startup ecosystem has grown to 60,000 qualified startups, making us the third-largest in the world. Our startups have leveraged new technologies, created valuable solutions, and generated employment for the masses.
According to a recent report released by Orios Venture Partners, 2021 witnessed 46 startups sliding up to Unicorn status, which is more than half of our country’s total 90 unicorns so far. Unicorns are startups exceeding a market valuation of 1 Billion Dollars in common business language. Notably, four Indian startups, Flipkart, Zomato, Paytm, and OYO rooms, have even attained Decacorn status. Decacorn is another common business word used for startups that have crossed market valuation of 10 Billion dollars. Our startup ecosystem witnessed a startup quickly getting the Unicorn status in a matter of 6 months. Mensa Brands set a record and became the fastest startup to break into the Unicorn club. According to statistics, 40 percent of the more than 80 soonicorns were formed in 2021. Again Soonicorns are startups that can become unicorns soon.
There was a thrilling competition between fintech and e-commerce startups for grossing higher investment and achieving Unicorn status. In addition, other sectors like healthcare, crypto, social commerce, and proptech got their first startup unicorns in the year. With 250 plus investment rounds, the fintech sector was the preferred choice of investors; further, the industry got 12 new Unicorns, which includes – Digit insurance, Acko insurance, Groww, Cred, to a name a few. But e-commerce startups were nowhere behind and, with $3.6 billion in Flipkart, grossed the most significant investment of the year. Moreover, 10 startups from the e-commerce sector joined unicorn clubs, including Meesho, Mugalix, Licious, as notable names. In addition, health tech, Enterprise Technology, Consumer Services, and EdTech attracted many investors. Location-wise, Bengaluru, renowned as India’s Silicon Valley, yielded the highest number of 18 unicorns. Delhi NCR was second on the list with 14 unicorns, and Mumbai, India’s financial capital, was third with 8 unicorns.
First time in the history of India, multiple startups got acceptance from SEBI and the opportunity to raise funds through IPOs. Paytm’s $2.5 billion IPO was the country’s largest-ever IPO, but Zomato stole the show as the highest valued listed startup with a market capitalization of $14.8 billion. Thrilled with last year’s positive results, many big companies like LIC and MobiKwik are queued up for IPOs in 2022. The successful IPO of Nike, Zomato, Policy Market, etc., proves that startups get a suitable environment to grow exponentially in India’s open economy. That is why many famous investors like Sequoia Capital, Tiger Global, and SoftBank have started taking a serious interest in the Indian startup ecosystem.
Notably, investment in China last year declined to $54.5 billion from $73 billion in 2020. Contrary to that, investment in our country has surged to almost triple from last year. Undoubtedly, India as an investment destination and the Indian startup ecosystem have gained investors’ trust. Our country has a plethora of skilled talent ready to take any challenge on the work front. Most startup founders have excellent experience in their domain and industry, which helps them strive for success. Indian startup companies attained a new dimension of success last year with the Government of India’s Digital India initiative, availability of cheap internet, innovative thinking, and trust of global investors.
Overall, the Indian startup ecosystem’s growth has strengthened the entire economy. Despite the severe economic slowdown in the first quarter of last year, the Indian startup system kept the economy strong and created new dimensions of success. A decade ago, one billion dollars in a year was a big deal, but now every thirteenth unicorn of 2021 was Indian. Moreover, every eighth day, one Indian startup scaled up to unicorn status. Indeed, last year was a landmark for Indian startups, and hopefully, the new year will be better. More than 80 startups are racing to become unicorns; simply, we may get more unicorns than last year. Investing in startups will create growth opportunities for enterprises and employment in our country and strengthen the economy. Our country, India, is a country of diversities and attractive opportunities to grow and excel. Hence, there is a need for continuous and innovative efforts.