As many as 11,500 startups would come up in the country employing over 2,50,000 people by 2020, according to key findings of industry body Nasscom's (National Association of Software and Services Companies) India Start-up Report 2014.
Unveiling the findings in Bangalore on Wednesday, Nasscom President R Chandrashekhar said 300 VC/PE (venture capital and private equity) and 225 angel investments deals amounting to over US $2 billion had been made in the country.
Chandrashekhar said over 20 mergers and acquisitions worth US $1 billion were done in the past three years.
As many as 3,100 startups are currently operating in the country, which is the third largest base in the world, the Nasscom President said.
Moreover, over 800 startups are being set up anually, he told reporters at the eleventh edition of the organisation's annual flagship Product Conclave in the capital city of Karnataka.
Earlier, the industry body launched its three-day annual flagship Nasscom Product Conclave 2014.
The conclave builds on the fast growing product and startup ecosystem in the country and provides a platform to engage with thought leaders in the product space and discuss issues of common interest, Chandrashekhar said.
The event will also discuss issues of network with startups and partners to create a common framework for the future of the product startup ecosystem in India, he said.
The three-day conclave will feature over 225 international and national speakers and showcase of 120 plus product companies the organisation's President said.
The Nasscom top Emerge 10 companies will also be showcased on the sidelines of the conclave, Chandrashekhar said. "These success stories are a mixture of burgeoning product innovations and exciting new solutions."
The growth of the software product industry in recent years has signalled a transformation - in the country and across the globe.
With increasing numbers of online active users becoming consumers of e-commerce solutions and related marketplaces, domestic startups are building global digital solutions to capitalise on this rapid growth, he said.
Hyper-growth, capital availability and acquisitions are the leading drivers of the growing startup ecosystem in the country, he added.
Home-grown start-ups are well positioned to address the entire Asian market opportunity and also expand beyond the US and European region, Chandrashekhar said.
"The Indian startup ecosystem is rapidly evolving driven by an extremely young, diverse and inclusive entrepreneurial landscape. This is leading to emergence of focused domain solutions for verticals like healthcare, agriculture, and education," he said.
An additional driving force is a four-fold increase in access to capital through venture capitals, angel investment and seed funding is allowing domestic entrepreneurs to work on building tailor-made products for their customers, he added.
Simultaneously, Nasscom needs to work on addressing challenges on creating supportive government policies in terms of ease of doing business, tax incentives, participation in government contracts, availability of risk capital, he added.
Nasscom will continue to actively engage with stakeholders across to address these challenges, Chandrashekhar said.
"Scaling up, Design and Growth Hacking are the key priority for startups today. On the innovation front, it is imperative to increase collaboration and partnerships for product companies with platform players, IT Services, Global MNCs and CIOs," Nasscom Product Council Chairman Ravi Gururaj said.
The 2014 conclave will showcase interesting technologies that are evangelising the product space and that are poised to become ubiquitous across both the consumer and industrial fabric of our society, Gururaj said.