Industry leaders believe startups are laying the foundation for the Bharat of the future

On National Startup Day, startup founders and industry leaders reflect on how startups have reshaped the Indian economy and the potential that lies ahead.

Pooja Malik

Bhuvana Kamath

Industry leaders believe startups are laying the foundation for the Bharat of the future

Tuesday January 16, 2024,

8 min Read

Today is National Startup Day—a day to celebrate the spirit of entrepreneurship in India and the accomplishments of innovators in the country’s thriving startup ecosystem.

Initiated by Prime Minister Narendra Modi in 2021, National Startup Day recognises the growth of the startup community and its contributions to the Indian economy.

YourStory spoke to founders and industry leaders who reflect on the impactful contributions of startups over the years and their role in the days ahead.

The world is finally waking up to India’s potential, assert entrepreneurs. They are gung-ho about the opportunities in the country and believe that the world will soon run on innovations that arise in India.

Rise of global enterprises

Vara Kumar Namburu, Co-founder and CTO, Whatfix, a digital adoption platform, says the evolution of the internet and technological skills has resulted in global enterprises emerging out of India.

“Today, market size is no longer a hurdle, as software products developed in India find markets across North America, Europe, the Middle East, and Asia-Pacific,” he says.

With a steadily expanding talent pool, startups are now taking on difficult software product development problems, solidifying India’s position in the global IT industry.

Naveen Tewari, Founder and CEO, InMobi Group, a marketing and monetisation technology provider, envisions India writing software for all products across the world. His optimism stems from the “unparalleled digitisation journey” that India has undergone till now.

“No other country, including the First World countries, has undergone digitisation like we have. We have talent, people, and drive. We are the land of opportunities, and the world will soon run on products innovated and built right here,” he says.

Today, an increasing number of entrepreneurs are refusing to settle for the ordinary and are “laying down a new brick for the Bharat of the future”, he avers.

Growth and funding

India registered over 1 lakh startups in 2023 under the Startup India initiative of the Government of India—a remarkable jump from just 450 startups in 2016. Several Tier II cities have emerged as new entrepreneurial centres in India, which is the third largest startup hub globally.

In the last decade or so, the Indian startup ecosystem has seen the emergence of several category leaders in untapped markets—including Freshworks, Swiggy, Paytm, and Nykaa.

“The ability to provide game-changing solutions is not just a pursuit, it’s a commitment to rewriting the code of possibilities for a billion dreams. Buckle up, for the journey has just begun,” remarks Shashank Randev, VC Founder, 100X.VC.

However, the ride so far has not been without its fair share of challenges, especially with respect to funding. Startup funding slowed down last year due to various factors such as inflation, escalating interest rates, geopolitical tensions, and apprehensions about a looming recession.

In such a scenario, the role of venture capitalists and angel investors becomes essential as they help India become a leading global startup hub, says Sandeep Kumar, Founder and CEO, Baatu Tech.

Despite the funding winter, founders are optimistic of the future.

“Due to global macroeconomic factors, new investments have slowed, and investors are now pursuing a smaller pool of high-quality companies. These investors currently possess a record amount of dry powder and are actively seeking opportunities for deployment. This bodes well for the Indian startup ecosystem,” says Namburu of Whatfix.

Harshvardhan Lunia, CEO and Founder of fintech startup Lendingkart, is hopeful that the funding winter will soon pave the way for a sunnier season of investments.

“We have stepped into an era where technology, collaboration, and purpose-driven entrepreneurship will propel our ecosystem to even greater heights. While we might continue to face challenges, we must remember the best way out is always through, as Robert Frost said, and success belongs to those who persevere,” says Lunia.

Around $5 billion in fresh capital was raised by existing and new funds in 2022, creating a $20 billion surplus for early-stage companies, and the demand for venture debt funding increased significantly to $1.2 billion, says Rahul Gupta, Founder and Managing Partner, ValuAble, a purpose-led venture debt fund.

“This suggests a positive upturn for new-age companies in 2024, strengthening India's wealth generation capabilities. The challenges of previous years have led founders to focus on sustainable business models and investors to actively participate in governance for long-term profitability,” he adds.

Building a scalable business

Industry leaders share some valuable lessons for early-stage startups to build a scalable business. Achieving product market fit and chasing initial success is critical, they emphasise.

Being diligent is key to identifying risks at an early stage and addressing them, points out Pankaj Shroff, CFO, Porter, a tech-based logistics company.

“We must have one eye on the runway and another on the cash burn. Ensure that you always have at least six months’ runway as a buffer. In the initial stages, one should raise capital whenever it is available to maintain this buffer,” he urges.

Shroff also asserts that the focus should be on being compliant, building scalable processes, and having a transparent communication plan for emergencies.

A great investment landscape, strong gains on VC investment, government initiatives, and a resilient growth market are important for startups to flourish, notes Lunia.

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Role of government initiatives

The government’s supportive policies for startups have significantly eased the journey for founders now, compared to a decade ago. India's journey in digitising public infrastructure, through initiatives such as the UPI, account aggregation, and ONDC have set a global precedent in secure digital payment systems and collaborations.

“As an entrepreneur, I am thankful for the consistent support extended by the Government of India to our entrepreneurial landscape. The government’s visionary initiatives, exemplified by programs like Digital India, act as ideal launchpads for Indian entrepreneurs,” says Nishith Rastogi, Founder and CEO, Locus.

The success story of ONDC (Open Network for Digital Commerce) is particularly inspiring, demonstrating how startups can transform entire industries.

Jay Prakash Co-founder and CEO of Silence Laboratories, remarks on the nation’s commitment to nurture an ecosystem of technology and entrepreneurship.

“As we advance, the focus on privacy and secure data collaboration becomes increasingly critical. The rapid digital transformation in India necessitates a paradigm shift towards 'privacy by design’–integrating privacy at the foundational level of technological development,” he says.

Driving disruption and innovation

In the ever-expanding digital landscape, startups across industries—from FMCG, robotics and logistics to pharma, biotechnology, agriculture, defence, and beyond—are rethinking the boundaries of innovation, setting the tone for others to follow.

“These innovative ventures are propelling aspiring entrepreneurs to unprecedented heights, reshaping societal and economic development across diverse domains,” says Yuvraj Shidhaye, Founder and Director, TreadBinary, a consulting firm.

“Over the last decade, there has been unprecedented growth and impact of many startups in various sectors and domains, revolutionising business as we know it,” says Zaiba Sarang, co-founder of iThink Logistics.

In particular, startups in the electric vehicle (EV) sector have emerged at the forefront of transformation and progress, driving India’s narrative in the new age.

Such startups have acted as catalysts, steering India away from its traditional dependence on fossil fuels, says Akash Gupta, Co-Founder and CEO, Zypp Electric.

“EV startups have revolutionised the industry by introducing innovative concepts like battery technology, charging solutions, and affordable electric vehicles. This has led to economic growth and eco-conscious living. By driving sustainability, startups are shaping the future of mobility,” he says.

In the healthcare domain too, several startups are introducing transformative solutions to address pressing challenges, giving birth to innovative approaches to patient care.

“Today, we find ourselves on the brink of a healthcare revolution where technology converges with compassion,” says Amol R Deshmukh, Founder and CEO, MedRabbits, a health-tech startup.

Drone technology is also making significant strides in the country, enhancing capabilities across sectors.

Ease of regulations and incentives for innovations intended to encourage more players in the drone ecosystem is crucial, says Prem Kumar Vislawath, CEO and Founder, Marut Drones.

“For true innovation and inventiveness to come about, startups need to have an environment where they can take risks. Visionary policymaking is the need of the hour,” he adds.

In the pursuit of innovation, efficiency and excellence, Indian tech startups have started embracing ground-breaking technologies such as AI (artificial intelligence) and machine learning in recent years.

About 70% of startups in India invest in AI to enhance their product capabilities and internal efficiencies, notes Shashank Dubey, Chief Revenue Officer and Co-founder at Tredence, a data science and AI solutions company.

Aspiring entrepreneurs should use AI to solve last-mile problems across industries—transitioning from conceptualisation to execution, he adds.

“This approach drives value to clients by recognising challenges where AI can provide practical and sustainable value. The goal is to cultivate a value-based vision integrated into the last mile of user experience.”

As startups step into another year of impactful moments and milestones, they must find ways to contribute value to the country and cherish the journey along the way.

Tushar Khurana, Co-Founder, Perfora, an oral care brand, puts it succinctly: “Startups are not just businesses; they are a journey of resilience, learning, and daring greatly. Embrace failures, celebrate small wins, and remember, it’s the journey that shapes your success.”

Edited by Swetha Kannan

Montage of TechSparks Mumbai Sponsors