Enter your email to read this article
Read news on any topic, in one place, from publishers like The Economist, FT, Bloomberg and more.

Where do India’s unicorn startups come from?

India will have 75-100 unicorns by 2025, the report says. Photo: iStockphoto

While the Indian tech ecosystem is gaining prominence, the number of unicorns—startups valued at over a billion dollars—have risen in tandem. Once rare, and hence named after the mythical creature, these companies are now emerging faster than ever. A report from venture capital fund Iron Pillar, pointed out some interesting trends about these unicorns:

— While India has 30 tech unicorns today, 21 of these were created in 2018 and 2019, with Bangalore and Delhi-NCR housing over 75% of these firms. Mumbai and other cities account for 3 and 4 unicorns respectively.

—Some of the large unicorns since 2018 include food delivery firms Swiggy and Zomato, hoteling startup Oyo Rooms, payments firm PhonePe, and fantasy gaming startup Dream11.

—India will have 75-100 unicorns by 2025, the report says, adding that while sectors like ecommerce and fintech saw the initial wave and the maximum number of unicorns, it has diversified since. Today, unicorns are coming up in spaces such as social networks, data analytics, logistics technology, and education, among others.

—While the early unicorns, such as Flipkart and Ola, were consumer facing and India-focused, emerging unicorns are showing different trends. Of the 30 unicorns the report cites, 17 are consumer and India facing. Six are business-to-business or enterprise focused in India, while seven are B2B for global markets built from India.

—The sector is also a huge determinant in how much capital a firm needs to become a unicorn. B2C-Indian firms need on an average $206 million to achieve a billion dollar valuation, while B2B-Indian firms need $131 million to reach the same valuation, the report says. B2B Global firms need $97 million, the least of the lot. The last includes companies such as Freshworks, Billdesk, and Druva- now mostly US-based firms but which started in India.

—Indian startups are do not significantly rely on just some late stage investors to become unicorns, the report says. A deep capital pool is available, beyond the traditional heavyweights such as SoftBank, Alibaba, Tencent, Naspers and DST and Tiger Global. Others include Goldman Sachs, Hillhouse Capital, Premji Invest, Temasek, Steadview Capital and Warburg Pincus, among others.


Related Stories
Fallout of Softbank’s big reality check
Late last year, several senior executives in India’s startup ecosystem were approached by Japanese conglomerate SoftBank Corp. The company had launched its gigantic $100 billion Vision Fund in 2017 and had identified India as one if its main markets. It was seeking to hire accomplished leaders in financial services, retail,…
From analysis to the latest developments in health, read the most diverse news in one place.
In Depth: Southeast Asia Becomes Region’s Next Tech Battleground
Gojek-Grab rivalry of 10,000 motorcycles on streets of Jakarta mirrors China’s online services wars several years ago as investors pour in billions
Ping An’s Money-Losing Fintech Unicorn Eyes U.S. IPO
OneConnect’s net loss has continued to widen this year, but as a share of revenue, it has been shrinking since 2017
Norwest Venture Partners raises largest fund yet at $2 billion
Mumbai: Norwest Venture Partners, a venture and growth capital firm, on Friday said it has closed its $2 billion global fund - its 15th and largest so far- targeted at consumer, healthcare and enterprise sectors in North America, India, and Israel.
SoftBank’s Vision Fund In Talks To Invest In EquipmentShare, A Construction Startup With A Twist—Operating Profits
SoftBank's Vision Fund wants to make construction tech startup EquipmentShare its newest unicorn-making investment, in a shift from its previous playbook: operating profits.
One place to find news on any topic, from hundreds of sites.
NFL playoff picture: Where do Packers stand coming out of the bye week?
The Packers didn't get help in Week 11, but they are still in good shape coming out of the bye week.