At the beginning of the second month of 2019, KPMG has released the latest report on the Indian startup ecosystem. It states that the number of startups in the country has gone up from 7,000 in 2008 to 50,000 in 2018.
This is 7.14X jump taken by the number of fledgling enterprises in the country that is backed by the explosion in the internet space, better literacy rates and exposure to the knowledge of entrepreneurship beyond the boundaries of the country.
This, as per the report mentioned in Business Line, has motivated people to strive for innovation in sectors, especially IT, AI, AR/VR, IoT, finance, food tech, healthtech, and agritech among others.
Another factor behind this development is the growth of the VC industry. A growth is reflected in the number of new VCs opening up, larger availability of funds, and a spur in offshore funding.
The government initiated Startup India movement as also helped along the process. The report reflects that passion for starting up has reached out to tier-II and tier-III cities like Kochi, Jaipur, Ahmedabad, Lucknow, Indore, Ranchi, and Patna as well.
Under the initiative, 14,565 startups were recognised, and the majority of them are based in Maharashtra. Mumbai, in itself, has been the seventh fastest growing VC hub in the world for the 2015-2017 period.
The Minister of Commerce and Industry in India, Suresh Prabhu, recently mentioned in a tweet that the government led Startup India movement has recognised 15,667 startups till Jan 2019. It also claims to be training 2.34 lakh startups in the learning and development module.
However, the same programme had a budget of Rs 10,000 crore to be allocated to VCs and till December 31, 2018, the govt had only been able to allocate 19 per cent of it. It aims to allocate Rs 3,300 crore by March 2019 altogether.
Considering that the general election of India is scheduled this year, a very little amount of the fund has been allocated. Moreover, there was no significant provision in the latest interim budget that directly motivated the startups as well.