Start-ups in 21st Century – Pros and Cons in a Developing Economy

Abstract

Indian start-ups have flourished over the last decade thanks to the country's supportive business climate and government programs. From a meager 7,000 in 2008 to 50,000 in 2018, the number of start-ups increased by 7.14 times, according to a report by KPMG released in February 2019. After China and the United States, India has the third greatest ecosystem for successful start-ups worldwide. In 2019, Indian start-ups raised nearly $11 billion, a 55% increase in value and a 30% increase in transaction volume from 2018. The aggregate employee benefit expenditure of Indian start-ups was $1.25 billion, an increase of 33% from the previous fiscal year, which is another measure of value-adding investment. The US-India Strategic and Partnership Conference projected that Indian start-ups will bring in over $21 billion in investment, resulting in 550,000 direct and 1,400,000 indirect employment. Before the COVID-19 breakout, business professionals were optimistic about India's potential to become the dominating start-up center of the globe.