By popular demand, I’m releasing another edition of my “Top 10 [Location] Startups to Watch in 2019”. This time I’ll be focusing on Indian Startups.
If you’d like to catch up on other startups to watch:
Each of these posts explores the unique characteristics of each startup market, ranging from the funding sources, past successes/failures, and growth trajectory.
India’s Startup Environment
India is an incredibly unique environment for startups and entrepreneurship in general. First, China is a major factor in the funding and control of many Indian startups. In 2015, Alibaba invested in Paytm through its affiliate Ant Financial. In 2017, Tencent took major stakes in Flipkart and Ola.
Japan is also a serious provider of funding in India. Japanese giant Softbank has invested over $8B in startups in the country, with a goal of $10B by 2024 that now looks surprisingly conservative.
India’s startup environment also has a major dichotomy between highly funded companies and those struggling to raise capital.
You may be surprised to learn that India is currently home to 26 unicorns (startups valued over $1B) with 5 new unicorns joining the club in 2018 (the most on record for a single year in India).
Although this post won’t dive deep into any of India’s 26 unicorn companies, if you’re interested in learning more, Inc42 has put together a comprehensive 2018 Year in Review for each that I’d highly recommend: What Were Indian Unicorns Up to This Year?
Similar to China, India has powerful demographic and economic trends driving growth in not only its startups, but also country-wide for the economy. India’s economy is growing at a very healthy annual rate of 7.2%.
Although the definition of the “Indian middle class” is contentious among researchers, the growth of technology, consumer luxuries, and quality of life is not up for debate. Just one quick stat to show how fast things are changing: There are more than 450 million smartphone users in India today, vs. just 86 million five years ago.
Startup funding in India reached a high water mark in 2015 before retreating for several years. In 2017 and 2018, funding eclipsed 2015 levels, led by many of the major unicorn investments mentioned above.
According to Inc42 Datalabs, Indian startups raised $9.6B in 2018 (up to 12/22/18) across 717 deals, compared to $13.5B across 885 deals in 2017.
The 2017 funding total was heavily skewed by Flipkart, Ola, and Paytm, who raised a collective $6.5B across four total rounds of funding.
Free Press India
The Indian Wire
How Did I Choose This Top 10?
As you’ve seen, India has an incredibly healthy startup environment and rapidly growing economy. I had to dig pretty deep to find startups you (very likely) haven’t heard of.
However, many of these startups will be household names over the next few years and not just in India!
The Top 10 Indian Startups to Watch
- Ask Arvi: Insurance via Chatbot
India’s life insurance sector is the biggest in the world with over 360 million policies and is expected to increase between 12–15% over the next five years. The country’s insurance market is expected to quadruple in size over the next 10 years from its current size of $60 billion. (Source)
Ask Arvi has positioned themselves as a technology layer on top of all major Indian insurers. At worst, they will be a great acquisition target for any of those massive companies.
Offices In: Mumbai
Total Funding: Not disclosed
2.CoWrks: WeWork for India
CoWrks is a leader in the rapidly expanding India co-working industry that includes large players like Awfis and Innov8. While there are many players in the space, the demographics and geographics of India mean that we’ve just gotten started.
Co-working heavyweight WeWork has 23 locations in India, with a presence in Mumbai, Gurgaon, and Bengaluru. Look for WeWork to start acquiring the most successful Indian co-working players, CoWrks included.
Locations In: Delhi, Mumbai, Bengaluru, Chennai, Hyderabad
Total Funding: Not disclosed
3. Doctor Insta: Teledoc + ZocDoc + CVS for India
Doctor Insta’s business model is simple. They’re an aggregator of many disciplines of medicine and provide video or phone “visits” through their mobile app.
If needed, they can refer patients to US doctors for a second opinion or to an in-person visit or test. Additionally, they can fulfil prescriptions through their pharmacy, making them a great one-stop shop and one poised to grow rapidly in 2019.
Offices In: Gugugram
Total Funding: $7MM
4. Flock: Slack Competitor, Founded in India
Flock isn’t shy about it: they are a direct Slack competitor. A simple glance at the screenshots of their product on their website certainly confirms this.
Why put Flock on my top 10 list then?
Every company that has gone heads up against Slack has failed miserably (see HipChat, Jive, Microsoft Teams, etc.)
First, price. Flock comes in 64% cheaper than Slack. For price sensitive teams and startups, this is MAJOR.
Second, Flock has built a strong following in not only India, but throughout the world with over 100k companies using their enterprise chat app. While this pales in comparison to Slack, it makes them a viable competitor (and a great acquisition target).
Offices In: Bengaluru, Mumbai
Total Funding: $45MM
5. Overcart: Return Management
US-based return management platform Optoro has raised over $244MM since its founding in 2010 and has a valuation near unicorn territory.
Overcart is early in its journey, but is trying to bring the same inventory optimizations (and impressive growth) to India.
Offices In: Gurugram
Total Funding: $3MM
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