Indian startups may raise up to $12 billion this year: Peak XV’s Anandan

Indian startups are expected to raise $8-12 billion this year, up from $7 billion last year, Peak XV managing director Rajan Anandan said on Monday.

Speaking at the StartUp Mahakumbh event in New Delhi, Anandan said India’s startup ecosystem is the most vibrant in the world, while noting that the average annual investments flowing into Indian startups jumped from $8-10 billion before 2021 to $60 billion in 2021 and 2022 combined..

“Last year, it was $7 billion, which people said is low. It could have been zero because basically six years of funding came in two years. This year, we are well on track to $8-10 or $12 billion. We are going to have an ecosystem which is going to have $10-12 billion in a few years and it will go at natural pace that it should,” Anandan was quoted as saying by Press Trust of India.

Organized by the central government to promote the startup ecosystem in India, Startup Mahakumbh is being held at Bharat Mandapam in New Delhi from 18-20 March. The gathering unites startup founders, venture capitalists, and policymakers.

Speaking at the event, Amitabh Kant, the former chief executive of government think tank NITI Aayog, raised the issue of transparency and government regulation of startups.

Kant said startups must adhere to a self-regulating ecosystem to bring in transparency and ethical behavior as chasing valuation at all costs sometimes leads to misgovernance.

He also batted against regulatory intervention if India wants to create a vibrant startup movement as “government regulation stifles innovation.”

“Startups must adhere to a self-regulating ecosystem governance as this will bring in transparency, ethical behavior in our startup ecosystem,” he said.

While India has been able to create the third-largest startup ecosystem in the world, the challenge before the country now is to make it the number one nation of startups in the world in the next five years.

Department for Promotion of Industry and Internal Trade (DPIIT) secretary Rajesh Kumar Singh said a dedicated policy for deep tech startups is in the final stages of inter-ministerial discussion and will be rolled out soon.

Singh also urged startups to convert their innovation into intellectual property rights for the benefit of the nation and themselves.

“Extensive research and development is the answer for that and the government is creating a separate dedicated deep tech startup policy. The policy paper is now in the final stages of inter-ministerial discussion. We hope to bring it forward soon. We will move towards creating funds of funds. Hopefully you will see a separate window for deeptech startups,” Singh said.