Startup accelerators have arrived in India. That the top five start-ups nurtured at accelerators raised an aggregate of $10 billion shows how important their role is in the startup ecosystem.
A quarter of this was raised by them in 2021 alone.
The cumulative valuation of Top-5 startups from accelerators in segments such as fintech, hospitality, B2B retail and social commerce is put at $26.1 billion.
Here’s another data point that underscores their role – about 25 per cent of all the 6.5 lakh jobs created by DPIIT-recognised startups were generated by the startups nurtured by accelerators.
About 8 per cent of the 91 unicorns that India created so far were part of accelerators at some point of their journey.
The number of startups funded by accelerators has gone up significantly in the last 16 years. While 3-4 start-ups funded per accelerator per year in 2005, the number jumped to 20-25 a year in 2020.
Funding and talent building
The report — Start-up Accelerators: Engines of Economic Growth – showed how tech startup accelerators have come of the age and begin to play a vital role in shaping up startups.
Primus Partners, accelerator 9Unicorns, Startup Odisha and iStart Rajasthan, which prepared the report, conducted as survey to understand the role played by accelerator. About 250 startups took part in the survey.
About 80 per cent of the seed and early-stage start-ups in the survey picked ‘funding’ as their most. About 55 per cent of the survey respondents sought a slot in Y Combinator or TechStars, indicating that early-stage startups are keen to access the support provided by global accelerators.
The mentorship too is a key attraction for startups that want to join an accelerator.
“The year 2012 saw the beginning of the early wave of accelerators in India, and Venture Nursery (VN) was among the very first, attaining a 250x exit with OYO – validating the accelerator model for India,” Apoorva Ranjan Sharma, Co-founder and Managing Director at 9Unicorns, said.
“The focus of these accelerators is providing support to start-ups, from funding to talent building – we now see a lot of success stories coming out of accelerators in the country,” he said.
“All survey respondents deemed availability of networking opportunities as another key benefit provided by accelerators,” Sharma said.
About 90 unicorns (startups with a valuation of over $1 billion) and more than 200 soonicorns (which have potential to become unicorns soon) have generated more than 5 lakh jobs.
“Interaction between private and public stakeholders is central to the start-up landscape in India. State level support has vastly
improved the ease of doing business. Going forward, we expect the government to play a larger role in the acceleration of the start-ups at growth stage,” Shravan Shetty Managing Director of Primus Partners.
How they grew
As the startup ecosystem is getting strong in the country, the number of accelerators is growing exponentially in the last five years. From about 585 in 2017, the number of accelerator programmes went up to 900 in 2021. This is expected to go to 981 by 2025, growing at a compounded annual growth rate of 9 per cent.
Published on
March 17, 2022
