In what could be considered as a great news for Indian entrepreneurs and startups, the Indian subcontinent has finally overtaken Israel to have the third have the third highest number of startup incubators and accelerators in the world. The news comes close on the heels of the Indian government's initiative to establish 30 incubators in educational institutions last year in the country.

According to a new report by IT industry body Nasscom and consulting firm Zinnov, titled ‘Incubators/Accelerators (I/As) Driving the Growth of Indian Start-up Ecosystem–2017’, the number of incubators and accelerators in India have grown by a whopping 40 per cent, with more than 40 new ones added in 2016 alone. That means, India now has more than 140 I/As at split across academic (51%), independent (32%), government supported (8%) and corporate (9%) categories.

For the uninitiated, while incubators are responsible for providing support across a startup's life cycle, accelerators are focussed more towards growth and acceleration of the startup. While the 140 figure has got India the third position, it still much behind the 1,500 I/As figure of the United States.

According to the Nasscom-Zinnov report, tier II and tier III Indian cities are also witnessing some major traction, with about 66 percent new incubators built in 2016. In addition to this, more than 30 new academic incubators have also been built in 2016, and the corporate accelerators are increasing by a good 35 per cent on an year-on-year basis with Bengaluru, NCR area and Mumbai emerging as the leading hubs. The report also talked about how most of the Indian I/As in the country currently have a technology (cloud, big data/analysis, and machine learning/artificial intelligence) as their focus.

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The report also threw light on the two emerging trends in the Indian incubator and accelerator ecosystem that could have a major impact on the Indian startup ecosystem. According to the report, partnership-driven and sector-specific incubators and accelerators are two of the most important I/As ecosystem trend. The past few years have seen government, industries and academia joining hands to set up sector-specific accelerators and incubators. Fore example, SBI and IIT-B have come together and set up an incubator especially for fintech startups.

The report also talked about how the several initiatives undertaken by the central and state governments is expected to spike the growth of incubators and accelerators in tier II and III cities. Also, with corporates now looking at startups for innovation, more and more sector-specific incubators and accelerators are expected to be established in the future.

"Our aim was not to create billion-dollar valuations, but build remarkable companies that solve problems," Sangeeta Gupta, senior vice-president at Nasscom, told TOI in an interview. He also added, "The Indian startup ecosystem is at a growing stage, where accelerators and incubators are also maturing along with the ecosystem."

The report also highlighted the limited time period challenge that I/As face for Incubation/Acceleration. According to the report, I/As find that the 3-4 months time period to incubate/accelerate is not sufficient for a startup to escalate its operations. In addition to this, the volume of startup applications in India is also growing at a high speed, which is making the whole process more time consuming and cumbersome to handle.

[Top Image: enlighten]

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