22 January , 2022 Fdiindia
Indian Start-ups Raise a Record $24.1 Billion in 2021: Study
NASSCOM (National Association of Software and Service Companies) and Zinnov conducted a joint study and found that Indian start-ups raised an unprecedented figure of $24.1 billion in 2021, double the levels before the COVID-19 pandemic.
The study titled ‘Indian Tech Start-up Ecosystem: Year of the Titans’ mentioned that 2,250 start-ups were added in 2021, an increase of more than 600 than the number of start-ups added in the previous year.
“Start-ups raised USD 24.1 billion in 2021, a two-fold increase over pre-COVID levels. In comparison to 2020, there was a 3X increase in the number of high value deals (deals greater than USD 100 million), demonstrating investor confidence with a pool of active angel investors of 2400+ and a readiness to take significant risks,” said the study.
The report further elaborated that while the U.S. remains the leading source of foreign direct investment (FDI) in Indian start-ups, the contribution and participation of other nations is also rising. About half of the total deals had at least one India-domiciled investor.
“In the last decade, the ecosystem has played a key role in growing direct and indirect jobs, providing 6.6 lakh direct jobs and more than 34.1 lakh indirect jobs,” the study further added.
The sectors that saw the most significant rise in employment were edtech, supply chain management, BFSI (banking, financial services, and insurance), logistics and mobility, retail and retail tech, and food tech.
As per the study, 11 start-up IPOs raised more than $6 billion from public markets. The start-up ecosystem’s cumulative valuation doubled in 2021 compared to 2020 at an estimated figure of $330 billion, showcasing the development and recovery capability during the pandemic.
“The performance of the Indian start-up ecosystem in 2021 has proved the resilience and dedication being put by multiple start-ups across segments….With record-breaking funding, an increase in the number of unicorns, jobs being created in the near term, the Indian start-up ecosystem’s future looks even brighter going ahead in 2022,” said Debjani Ghosh, president, NASSCOM.
Indirect jobs have also bounced back with the support of e-commerce, freelancers, and service industries.