Piyush Goyal values the Indian startup ecosystem at INR 3 lakh crore
- ByStartupStory | October 31, 2022
Union Minister Piyush Goyal praised domestic startups and estimated the ecosystem’s present value at about INR 3 lakh crore.
“It is certainly a wonderful accomplishment that we are probably 110 or more unicorns, as well as 75 or so soonicorns who are in the process of becoming unicorns. The last time we valued our startup ecosystem, it came to about USD 368 billion—roughly three lakh crores of rupees, according to a report from him.
He added that the government now has more than 80,000 startups registered.Goyal made the remarks while speaking to a group of faculty, staff, and former students from the National Institute of Fashion Technology, Indian Institute of Foreign Trade, National Institute of Design, among other institutions.
Goyal noted that over a million individuals were “directly engaged” by Indian companies, and he went on to say that “many million more” were “indirectly engaged” by the broader startup ecosystem.
He added that the government will launch a digitalisation effort to make all services available online and was working to improve patent offices. He discussed the numerous steps the government has taking to support startups in the nation.
The timing of Goyal’s remarks is unusual for Indian startups. Even though India claims to have a record number of unicorns, the actual situation seems a little depressing. While 2022 got off to a good start with hopes of building on the optimistic energy of 2021, things have not turned out quite the same.
In contrast to 2021, when the Indian startup ecosystem produced a record 44 unicorns, just 21 unicorns have been created in the first 10 months of 2022. In the first quarter, 13 firms reached the illusive billion-dollar valuation; but, by the second quarter of the year, just four startups remained. Only 4 startups became unicorns in the third quarter of the year 2022, underscoring the pitiful amount of investment that Indian startups have been able to raise.
The amount of funding has also dropped sharply, from $27.3 Bn in the same period last year to $21.6 Bn in the first nine months of calendar year 2022.Starting in the first quarter, financing figures gradually decreased over the following two quarters by half, indicating an ongoing decline in the Indian startup sector. The alleged funding cold, which is mostly driven by a cash shortage and a tightening of monetary policy globally, has caused businesses to postpone expansion plans in an effort to save money.
The ecosystem for startups in India has also been harmed by widespread layoffs. These new-age enterprises have launched a blitzkrieg of layoffs in an effort to increase profitability, and to date, they have let go of more than 15,200 employees.
Many of these firms have also come under fire for having a hazy road to profitability and heavy financial burn. These firms have been left floundering, searching for a lifeboat out of these rough waters, as losses mount and client acquisition costs soar.
Even while the government celebrates the achievement, numerous entrepreneurs have folded their tents and stopped trading, including edtech players Crejo.BYJU’S, among other companies, has scaled back operations and closed locations in about 60 different cities nationwide.
In addition to this, firms like Droom and PharmEasy have abandoned preparations to list on the market in light of the continued market volatility that has alarmed investors and destroyed a significant amount of investor money.
Indian startups are still growing despite the economic challenges facing the world. In terms of the number of unicorns, the nation presently ranks third worldwide, behind China and the US. Startups have been compelled to reconsider their approach and strive for more sustainable growth, nevertheless, as a result of the lingering recession.
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