After hit by pandemic hard, start-ups on growth path: EY

K V Kurmanath Hyderabad | Updated on August 02, 2021

Pegs number of startups to touch 1-lakh mark with total funding of $150 b by 2025

The Indian start-up ecosystem, which has received a setback in the pandemic, is all set to make a come back. EY, a research and consulting firm, has said that the number of start-ups in the country is expected to cross the one lakh mark by 2025, doubling from the present 50,000 start-ups.

The total funding in start-ups is likely to increase to over $150 billion, with a total value creation exceeding $500 billion.

This will drive the number of unicorns (start-ups with a valuation of $1 billion) from the present 34 (with an aggregate valuation of $115 billion) to over 100 by 2025.

The total funding in start-ups had touched $63 billion at the end of first half of 2020.

“As the number reaches the one lakh mark, they will be able to create 3.25 million jobs in different sectors,” it said.

The consulting firm released a whitepaper on ‘Hyderabad – The new emerging start-up hub in India’ at the FinTech Festival India- Micro Experience (Hyderabad) in a virtual meet on Friday.


After witnessing a steady growth in 2018, 2019 and in the first half of 2020, the start-up ecosystem was expected to remain stable in terms of funding and investor interest. “But the pandemic has put a spanner in the wheel. With the funding winter coming in early, there’s a bigger focus on sustainability,” EY said.

“Start-ups in the country have some of the best market conditions to exploit as the reception of digital products and services is at a record-breaking high. Once the pandemic effect dies down, there's no stopping Indian start-ups,” it said.

The start-ups were witnessing a growth of 12-15 per cent till the pandemic hit them very hard.

The start-ups have come a long way in the country by creating 5.5 lakh jobs in the last six years. Over 30 States and Union Territories have declared their exclusive policies to promote start-ups.

Listing out measures taken by the Telangana government to promote start-ups, EY asked the State to devise a mechanism to identify and solve regulatory issues faced by start-ups. It also wanted the State to completely exempt from the ‘prior experience’ and ‘past turnover’ requirements in order to get public procurement works.

“The State should also enroll them in various acceleration programmes to connect them with investors and help them upskill their employees,” it said.

Published on August 02, 2021

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