While a COVID-19 vaccine by early next year appears quite probable, Indian tech start-ups are also seeing a recovery. The findings of National Association of Software and Services Companies (NASSCOM) latest report 'Start-up Pulse Survey II' indicate almost 50 per cent of tech start-ups are looking to reach pre-COVID revenue levels by next six months. With nearly 43 per cent tech start-ups having runway for more than six months compared to only 8 per cent between April and May, the revenue acceleration and funding have improved the cash availability for such start-ups. "The Indian start-up ecosystem has set a global benchmark in remaining resilient during this disruptive year, setting an example for other industries across the globe to follow and learn from how Indian start-ups converted challenges into opportunities," says Debjani Ghosh, President, NASSCOM.
Not only are tech start-ups seeing a longer runway but also, they are looking to build more sustainable operating models. Adopting multiple short and long-term strategies, nearly 72 per cent tech start-ups are enhancing their product offerings and investing in deep tech solutions that enable automation and analytics for their clients. Also, around 60-70 per cent of tech start-ups are either expanding to newer verticals, building partnerships or enhancing existing solutions, says the report. "A Large tech start-ups pool, strong innovation focus and entrepreneur's zeal have been the growth drivers of this ecosystem. We are pleased with the way the ecosystem has been supportive of each other during these difficult times and hope that the industry keeps intact its robust zeal to further contribute to reviving the economy," adds Ghosh.
While sectors such as edtech, healthtech, SaaS and SMBs are drawing investor attention and seeing faster recovery, nearly 30 per cent of B2B start-ups have recorded a rise in revenues over the last five-six months. With pandemic making deep-tech even more pervasive, 40 per cent of deep-tech-focussed start-ups have built AI-based solutions and over 60 per cent of agritech and health-tech start-ups have focussed on AI-based solutions.
However, NASSCOM says for start-ups to sustain growth momentum there is also a need for optimisation of operational metrics and they should look at expanding or pivoting towards growing or upcoming verticals.