The Advance of the Indian Unicorns

With the 3rd largest ecosystem for startups globally, India is on its path to becoming a global unicorn hub. As of 29th December 2021, India was home to 84 unicorns with a total valuation of 

$274.17 Bn. Out of these, 42 unicorns emerged in 2021 alone. Finding opportunities across diverse sectors -IT, healthcare and life sciences, education, professional & commercial services, agriculture, food & beverages, and so on, these unicorns are catalyzing India’s integration into global value chains with global impact.

Despite Covid-19 playing havoc with the Indian economy, these unicorns leveraged changing consumer behavior and adapted themselves to cater to the needs of the customers. Startup-friendly government policies, a thriving digital payments ecosystem, a large smartphone user base, and digital-first business models helped them grow and prosper in spite of the pandemic. With new-age technologies such as artificial intelligence, the internet of things, data analytics, big data, robotics, etc. on their side, these unicorns attracted funds from investors from India and around the world.

Steps taken by the government to boost domestic and foreign investments in India - like the reduction in corporate tax rates, improving the Ease of Doing Business, FDI policy reforms, reduction in compliance burden, policy measures to boost domestic manufacturing through public procurement orders, etc.- showed its results and India saw an unprecedented rise in FDI in 2020-21. The country registered the highest ever annual foreign direct investment (FDI) inflow of $81.97 billion (provisional figure) in the financial year 2020-21, according to the Ministry of Commerce and Industry. 

The computer software and hardware sector attracted the largest share of FDI inflows at 19 percent, followed by the service sector at 15 percent. 

In Q3 2021, 23 funding deals in the Indian startup space with ticket sizes equal to or more than $ 100 million were observed. Out of these, 4 deals were sized at more than $ 500 million.

A PwC report said that USD 35 billion were raised by Indian startups in over 1,000 rounds of funding in 2021, which was 1.5 times higher than the previous year. Edtech, SaaS, and Fintech sectors witnessed the highest activity. Growth and late-stage deals comprised 85 percent of the total funding attracted by the startups in 2021.

Tiger Global emerged as the most active investor in Indian unicorns, with exposure to 39 unicorns. Among the top five, Steadview Capital at fifth has exposure to 14 unicorns. Eight investment firms have exposure to at least five unicorns each.

Mensa Brands, founded by Ananth Narayanan earlier in 2021, made a new record by becoming the youngest Indian unicorn when it achieved the coveted valuation within 6 months. CRED, founded by Kunal Shah in 2018, became the youngest fintech unicorn in April. 2021 also saw investors’ unicorn search go beyond just the metros and Tier-I cities when Jaipur-based CarDekho became India’s first non-metro unicorn.

With globally relevant products, startups are now looking to go global. A survey conducted by TurningIdeas Ventures in December 2021 revealed that over 42% of startups are looking to expand and tap into global markets in 2022 and over 64% of these startups are in the enterprise SaaS space. The survey covered around 100+ startups across different domains and at different stages from ideation to scale-ups.

Finding the right talent is essential for these unicorns and startups to fuel their ambitions and international expansion holds the promise of not only providing new markets but also an opportunity to access high-potential global talent pools.

So with funds at their disposal, these unicorns are now hiring and looking for the right talent across the globe to help them reach the next level. According to an EMA study conducted in September 2021, unicorns have hired close to 150,000 executives over the last three quarters. It shows that an additional 125,000 executives were going to be hired over the next two quarters. The majority of hiring, up to 70%, was for technology roles alone, with a focus on talent like full-stack developers, data scientists, solution architects, and principal engineers. Top recruiters during the period were companies in edtech, fintech, e-commerce, and logistics - the sectors which gained the most from the pandemic as online purchases of goods and services grew exponentially.

As India becomes more and more comfortable with using technology and digital adoption rises, the thirst for talent among the unicorns is only set to grow. Are you ready to fuel Startup India’s next level of growth?

Register Now to explore opportunities in India.