Nearly one-third of applications came from Bengaluru, followed by New Delhi/NCR (17%) and Mumbai (11%), Hyderabad (9%), Chennai (6%), with Kolkata and Pune accounting for 5% each. The percentage of women entrepreneurs remains low, with only 7% of applicants having a woman co-founder on board.
A large number of startups from a wide range of sectors applied. E-commerce continues to dominate, accounting for 25% of applicants’ areas of focus, followed by enterprise software (20%), agritech (19%) and big data/analytics (16%). At a broad level, we see significant usage of and focus on big data analytics, machine learning (15%) and AI (13%) in a bid to build the next billion-dollar opportunity. (Note: respondents were allowed to choose multiple area of focus so the total is >100%. E.g. an e-commerce company may be significantly leveraging ML and AI to improve user experience.)
Funding and access to investors remain a challenge
Fund-raising remains the key challenge for Indian startups, with 52% of our respondents saying it is their biggest challenge, followed by marketing and sales (39%). Interestingly, access to investors came in third, with 34% calling it their biggest challenge. Other challenges included customer acquisition and access to the right mentors. (Note: respondents stack ranked choices, so the total is >100%.)
Bootstrapping is still the most common way of starting up
We see the applications we received for TECH30 as a proxy for the state of the funding, especially for early-stage companies. While 71% of startups who applied are bootstrapped, 10% had received some form of angel/seed funding, and 6% were funded by accelerators and incubators. Policy changes are yet to begin reflecting, with only 1% of applicants being funded by the government and 3% through bank loans. VC-funded companies too comprised only 3% of total applications.
YourStory Research estimates peg the total number of tech startups in India at 30,000, with around 3,000 unique companies having received some type of funding (Seed/Angel or PE/VC).
Entrepreneurship remains an attractive career option
India’s entrepreneurs continue to come from ever more diverse backgrounds. A quick glance at the TECH30 applications provides a glimpse into the backgrounds of early-stage entrepreneurs. Entrepreneurs with no prior work experience (straight out of college) account for the single-biggest chunk (19%), while another 6% of applicants had risen to Director-level or more in corporates before starting up; for 12% of applicants, their current venture is not their first, all of which reflects that starting up remains an attractive career option for both fresh graduates and mid-career professionals.
An engineering background no longer seems a pre-requisite, with 25% of all applicants having an MBA, and only 14% having an engineering degree. And for those who’re wondering, 17% have a degree from an IIT and/or an IIM.
While nearly three-quarters of applicants have multiple founders, 26% have been set up by solo founders, an indication that entrepreneurs aren’t afraid of going it alone.
Here are the final TECH30 startups.
For us, all TECH30 companies are winners. However, at the event, the jury had to pick three, and they went with Crofarm, ACPAD and OnGrid. AutoVRse won the audience poll. A big thank you for everyone who voted.