Indian startups and the startup ecosystem are growing at a rapid pace. The landscape is undergoing a transformation. 77% of startups are now seen investing in artificial intelligence (AI), machine learning (ML), Internet of Things (IoT), and blockchain. This shift is highlighted in a recently released SAP India report in collaboration with Dun & Bradstreet, which highlights the critical role of advanced technologies in the Indian startup ecosystem.
Indian startups are shifting their focus from initial focus on gross margin (GMV) to now focusing on profitability and sustainable business models.
Sanket Deodhar, vice president and head of digital native, SAP India Subcontinent, said the technology remains fundamental and will play a key role as a key differentiator to help startups achieve these business goals.
India’s startup ecosystem is currently robust. It ranks third in the world with 300,000 startups, of which 113 are unicorns. The shift towards unit economics marks a major evolution in the business landscape. Adoption of enterprise applications integrated with advanced technologies like AI and ML is considered essential.
Moreover, investments in AI and related technologies are not limited to metros. In 2023, tier 2 and tier 3 cities have emerged as innovation hotspots. These cities account for 40% of the total tech startups. Chandigarh, Jaipur, Madurai, Indore, Kochi, Warangal, Hubli, Raipur, Visakhapatnam, Guwahati, and a few others currently account for 15% of India’s tech talent pool.
Meanwhile, the rise of deep tech is also contributing to their success: by 2023, around 25% of technology startups will have adopted deep tech. Deep tech is increasing operational efficiency and bringing about major advancements in various fields.
