India’s startup ecosystem has been badly hit by Covid-19 and while 15% of startups were closing their businesses due to lockdown, they are now back on track faster than expected. Apart from this, 7 unicorn startups have been received so far this year in 2020 and 4 of them have emerged as unicorns in the Covid-19 era. Since the start of the unlock process, digital startups have seen a boom and investors are hopeful that the situation will reach the first round of Covid soon.
Ty’s report describes the impact of Covid-19
Global NGO Tie Network in association with Global Management and Strategy Consulting firm Jinov has released a report titled ‘Covid-19 and the Antifragility of Indian Startup Ecosystem’. The report explains the impact of Covid-19 in the Indian startup ecosystem by studying various dimensions such as funding, mergers and acquisitions, impact on the sector, entrepreneurial and investor thinking and the changing market environment. This report has been supported by Cisco Launchpad, NetApp Accelerator and Lowies Innovation Lab. Tie is a global non-profit organization (NGO), which promotes entrepreneurship through mentoring, networking, education, incubation and funding. Its network is spread over 14 countries.
Digital medium increased business after unlock
In early 2020, the Indian startup ecosystem was the third largest in the world. However, due to the corona epidemic, the lockdown in March to June 2020 has affected it a lot. During this period, investment decreased by 50 per cent compared to before lockdown and about 40 per cent of startups saw negative impact. In addition, 15 percent of startups have been forced to shut down their operations due to Covid-19. After the start of the unlock process, the use of digital media has benefited sectors like education, health and commerce and on the other hand sectors like travel, hospitality and mobility are gaining momentum.
7.5 million direct jobs by the end of 2020
By the end of the September 2020 quarter, total investment and private investment in startups reached the earlier phase of Covid-19. Four Indian startups have emerged as unicorns in the Covid-19 era and are expected to achieve 8 unicorns by the end of this year. This number is approximately equal to 2019. Apart from this, 7.5 lakh direct and 26 to 28 lakh indirect jobs are expected to be generated from Indian startup ecosystem by the end of 2020.
Startup strengthens economic situation by reducing costs
According to Tie Delhi-NCR President Ranjan Anandan, Indian startups made changes in their business in a new way and most startups rapidly strengthened the economic situation while reducing their costs. According to Anandan, the digitally based segment has seen faster improvement than any other and it is ahead of the earlier phase of Covid-19.
According to Jinov CEO Pari Natarajan, despite the crisis arising out of Corona and the shutdown of some startups, many startups have played an important role in generating employment. He has hoped that by 2025, it will generate 15-16 lakh direct jobs.
According to Madhurima Agarwal, director-engineering program and leader of NetApp Accelerator, some sectors have been affected more than others, due to which positive changes like automation and digital transformation have been observed.
Shruti Karnan, head of Cisco Launchpad, said that startups have succeeded in turning disaster into opportunity despite challenges.
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