Chennai is very close to breaking into the top 100 startup ecosystems globally. It recorded a massive jump from 31 places to rank 102 in the Global Startup Ecosystem Index 2022. The vibrant ecosystem that has been built in the past few years has helped the city emerge as a major global destination for startups, industry experts say.
Two cities – Pune at number 90 and Hyderabad at number 97 – entered the top 100 for a total of 5. Pune saw an improvement of 14 places and Hyderabad saw an increase of 9 points.
Bengaluru at 8 (two places); New Delhi at 13 (one up) and Mumbai at 17 (down one) are the other three cities in the top 100 rankings issued by Israel-based StartupBlink, an emerging environmental map and think tank.
The report said that India’s Tier 2 ecosystems have all experienced healthy growth. Few of the Asia Pacific ecosystems such as Brisbane (101) and Chennai (102) come close to making the top 100.
Reasons for improvement
The reason for Chennai’s improvement is an increase in Quality Score which reflects the increase in attracting ecosystem entities, high impact startups – unicorns, and exits. This puts Chennai on a path to overtake Pune and Hyderabad if growth continues, the report said.
Chennai is widely known as “the program as the service capital of India,” said Arun Natarajan, founder of Venture Intelligence, a research firm that tracks PE-VC and M&A transactions in India. The IIT-Madras Incubator Center is among the best business incubators in the country to promote startups in the field of deep technology.
Furthermore, deep tech startups from IIT Madras such as speech technology startup Uniphore; start-up of the Ather Energy electric vehicle; Stellapps Dairy Technology Company; He said that drone startup Detect and space technology startup Agnikul — made waves across the country and even around the world. He added that there is a healthy coexistence between start-ups and mature companies – making the ecosystem more stable.
Pairing with Natarajan on Chennai’s vibrant ecosystem, Ramkumar Ramamoorthy, partner at Catalincs, a technology advisory firm, said Chennai is gaining momentum in the startup world.
This is due to the presence of an ecosystem that plays at a large scale – entrepreneurship promoting bodies such as TiE and The Chennai Angels; Government support through the Foundation Fund for the Emerging Sector; Enabling policies with built-in financing mechanisms such as the FinTech Policy; Domestic PE funding from the likes of TVS Capital, innovation labs, and research parks set up by educational institutions.
For a long time, industry watchers have been blaming Chennai for the lack of an adequate social environment, including bars, golf courses and theme parks, among others. It is no longer the case.
For example, more than 100 bars have popped up in Chennai in the past 18 months or so. This silent revolution, he said, makes Chennai more prepared for start-ups in the new era, whether at the intersection of industry and technology, or in deep tech.
India – tops the chart
In South Asia, India retained its position as the best country in the startup ecosystem and improved its global ranking by one place to the 19th place. The Indian startup ecosystem is a regional leader in innovation and is showing positive momentum from three positions since 2020. India also ranks first for startups in South Asia.
India is an ideal place to locate startups in the fields of education, transportation and food technology. As the country’s most popular industry, there are a sample of 1,364 education startups in India, 654 transportation startups in India, and 507 food technology startups in India, on the StartupBlink map, according to the report.
India has 32 cities in the 100-1000 range. Goa and Patna saw the highest increase in rankings in India, 272 and 218 places respectively, ranking 500 and 522. In total, 37 Indian cities were ranked in 2022, placing India 7th globally in terms of the number of ranked ecosystems per capita, According to the report.
Startups will be the engine to transform India’s informal economy into a transparent one, which will allow the government the tax resources to eventually make India the superpower it has the potential to be.
For this to happen, the public sector will have to choose the best and most intelligent to be in the task of developing the start-up economy and strategizing.
Given that India has good relations with most of the world, we are optimistic about its opportunity to continue growing and assuming a greater role in the global startup ecosystem. The report said that when considering India’s primary advantage of having an educated and young English-speaking population, the potential of the country is enormous.
June 18 2022