Conversations in the startup ecosystem have usually been abuzz around valuations and healthy exit multiples as among key focus areas for founders to create large digitally-enabled businesses. However, the ecosystem arguably lacked in enabling a vision to transform growing startups into institutions that could believe in operating decades after decades. Prime Minister Narendra Modi echoing this thought on Wednesday urged startups to create world-class products to set global benchmarks. “I have a message for startup founders. Don’t restrict yourself to valuations and exit strategies only. Think how you can create institutions that will outlast this century. Think how you can create world-class products that will set the global benchmark on excellence,” PM Modi said addressing the Nasscom Technology and Leadership Forum.
PM Modi also urged technology leaders to plan and work towards creating world-class products and global leaders to showcase India’s contribution in the technology domain across the world. “27 years from now when we will celebrate 100 years of independence, how many world-class products we had given, how many global leaders we had created, for this we will have to plan and work towards it now itself.”
According to a Nasscom report released on Monday, India had added over 1,600 tech startups in 2020 – the highest in three years. The annual Nasscom strategic report also noted that India has around 12,500 tech startups even as the overall technology sector grew 2.3 per cent year on year on the back of “rapid acceleration in digital transformation and tech adoption” The industry also saw 146 M&A deals in 2020, 90 per cent of which were digitally-focused while cloud adoption increased 80 per cent among companies during H1 FY2021 vis-à-vis H2 FY2020.
Prime Minister further highlighted the creation of an enabling environment for innovation and mentorship to promote ideas. “Today from Atal Tinkering Labs to Atal Incubation Centres, there is an environment being created for technology in schools itself…India is not short of ideas. It needs mentors who can help turn ideas into reality.” Investments in Indian startups had declined to over $11.4 billion in 2020 from $14.5 billion in 2019, according to the data shared by Tracxn. However, the fall in annual deal volume or the number of rounds was less severe as startups participated in 1,152 funding rounds in 2020 vis-à-vis 1,185 in 2019. The investments in 2020 were led by $800 million raised by Byju’s followed by $700 million secured by Walmart’s PhonePe, and $660 million invested in Zomato across multiple rounds.