Despite layoffs, IT sector still has a reason to cheer – Here's why

New Delhi: Despite reports of massive layoffs across the IT sector, there is still a reason to cheer! IT apex body Nasscom in a report said that India added about 1,000 technology start-ups in 2017.

India has retained its position as the third largest hub for entrepreneurship, the Nasscom report added.

Bengaluru, Delhi/NCR and Mumbai retained their position as the key start-up hubs, with 20 percent of the start-ups emerging from tier-2 and tier-3 cities across the country, it said.

The Nasscom report said that the mortality rate of start-ups in India is 30 percent to 35 percent every year. In the last five years, 5,000 start-ups were launched, including an addition of 1,000 such ventures this year.

Among the verticals, health-tech, fin-tech and e-commerce have seen a rapid rise in the B2B (business-to-business) segment, signifying maturing growth.

Similarly, health-based technology start-ups are 320, with 28 percent annual growth and attracted $160-million funding in the April-September period, which is an increase of 129 per cent in the same period of 2016.

With 167 percent growth, funding of the start-up ecosystem led by unicorns stood at $6.4 billion till September.

Releasing a joint report on the `Indian Start-up Ecosystem - Traversing the maturity cycle`, at the ninth annual edition of Nasscom Product Conclave, Nasscom Chairman Raman Roy said despite tough competition from Britain and Israel, India retained its momentum as a vibrant landscape for start-ups.

"The Indian IT industry is renowned for pioneering innovation and the start-ups arena is no different. Our country is one of the fastest growing start-up landscapes, with the participation of every major accelerator, investor and angel group from the world over," Roy said.

Noting that the ecosystem was ripe for healthy growth through verticals and innovative business model, Roy said the Indian landscape was brimming with innovative ideas, which need guidance to accelerate, scale-up and funding.

"With 40 percent of start-ups in the B2B segment, its share in the tech start-up funding is 30 percent, thanks to corporates, which are supporting them with 50 collaboration programmes, 20 accelerators and 40 investors," said Roy.

Fin-tech start-up base is about 360, indicating 31 percent annual growth, with $200-million funding in the first half of this year, recording a whopping 135 percent annual growth.

With Agency Inputs