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Coronavirus impact: 40% start-ups face closure amid pandemic, says Nasscom

While 70 per cent of travel and transport startups reported suffering 40 per cent revenue plunge, 14 per cent of edtech, fintech and healthtech startups expect growth in revenue amid crisis

twitter-logoBusinessToday.In New Delhi Last Updated: May 19, 2020 | 20:42 IST
Coronavirus impact: 40% start-ups face closure amid pandemic, says Nasscom
India has been under lockdown since March 25Coronavirus impact: 40% start-ups face closure amid pandemic, says Nasscom

Nearly 70 per cent startups have funding of less than three months as fall in revenue hurts their sustainability amid coronavirus pandemic, a report said. The units in the business-to-customer segment have been majorly impacted due to the coronavirus crisis, said Nasscom's Startup Pulse Survey released on Tuesday. About 34 per cent of startups have seen revenue fall of over 80 per cent, it added. Nasscom had conducted the e-survey involving over 250 startups in April.

While 70 per cent of travel and transport startups reported suffering 40 per cent revenue plunge, 14 per cent of edtech, fintech and healthtech startups expect growth in revenue amid the crisis, the survey added. India is the third largest tech startup ecosystem globally with over 9,300 tech startups. The survey also said that nearly 30 to 40 per cent startups have temporarily halted their operations or are in the process of shutting down.

"However it is not all doom and gloom; more than half of the start-ups are looking to pivot to new business opportunities, diversify into growth verticals like healthcare, and enhancing focus on emerging tech like Artificial Intelligence, Internet of Things (IoT), Cloud," said Debjani Ghosh, President, Nasscom.

"To ensure that the Indian start-up movement and its growth trajectory is not derailed, coordinated support from key stakeholders is the need of the hour. Some of our key recommendations to the government include access to working capital, easing compliances and fiscal policy and funding support," she added.

In April, the survey by LocalCircles had said that 47 per cent  of Indian startups and small and medium enterprises (SMEs) have less than 1 month of cash left amid the ongoing coronavirus lockdown, a survey said. The startups and small businesses had also reached out to the government via various platforms to help them tackle the crisis.

Also read: Buses, autos, cabs open, malls, metro, flights shut; India COVID-19 cases-1,01,139

Also read: Taking HCQ for about 'a week and a half' to protect against COVID-19: Trump

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