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B2B tech start-ups in India have more than tripled at 3,200 in 2018 from about 900 in 2014, largely on back of digital transformation of enterprises, financial institutions, hospitals, government, SMEs, among others, according to a study. This has improved the investor sentiment in the sector after funding into B2B start-ups witnessed a whopping 364 per cent growth at $3.7 billion in 2018.
The study, titled ‘B2B Tech Startup Ecosystem and Role of Corporate Accelerators in India’, was done by NetApp, a leader in data management and hybrid cloud, in partnership with Zinnov, a global management consulting firm. It provides data-driven insights into the growth of B2B tech start-ups and the upsurge in funding and the corporate accelerator programs in India over the last five years.
Ajeya Motaganahalli, Senior Director and Leader, NetApp Excellerator, said, “It is encouraging to see the entrepreneurship explosion across the start-up universe. This shows the credibility that the accelerator programs can add to many start-ups.”
Sanjay Nath, co-founder and Managing Partner at Blume Ventures, said, “The B2B start-up wave in India has just begun. Corporates are more open to collaboration with start-ups, VC firms are more interested in the B2B startup world, and technologies like AI and IoT have proliferated faster into the ecosystem, compared to B2C. This combination of corporate support, B2B focused VC funds, and rise of advanced technologies will drive the wave forward.”
According to the report, 70 per cent of these B2B tech start-ups are in the space of enterprise tech (41%), fintech (19%) and healthtech (9%). The other segments include software as a service (SaaS), customer relationship management (CRM), alternative lending, expense management, medical internet of things, and artificial intelligence enabled predictive platforms such as 3D printing, blockchain and Robotics process automation (RPA).
Segregating over 800 of the B2B tech start-ups as ‘advanced tech start-ups’, the study indicates their annual growth at 60%, much ahead of the 20% number for the entire tech start-up space (B2B, B2C).
The growth of corporate incubators and accelerators are also acting as catalysts in the growth of tech start-ups, it added. Currently, there are over 50 such corporate accelerators and incubators in the country with a 34 per cent market share and global accelerators hold 66% of the share.
Pari Natarajan, co-founder and CEO, Zinnov, said, “There has never been a better time to be a technology entrepreneur in India than now. The incredible rise in the number of B2B start-ups as a percentage of the total tech start-ups from 26% in 2014 to 43% in 2018, is a testament to this. An intense growth of accelerators and incubators is the much-needed shot in the arm for Indian start-ups to spread their wings across the length and breadth of the country, encouraging tier 2 and 3 cities to come up.”
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