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B2B startups jump 4x to 3,200 in 2014-18, attracting investments worth $ 3.7 billion

The number of business-to-business (B2B) startups has jumped four times to 3,200 in 2018 from 800 in 2014, enabling faster growth of the ecosystem, attracting investments worth USD 3.7 billion from USD 797 million, during the period, says a report.

twitter-logo PTI        Last Updated: May 7, 2019  | 16:59 IST
B2B startups jump 4x to 3,200 in 2014-18, attracting investments worth $ 3.7 billion
In percentage terms, the growth in the number of B2B startups within the total tech startups ecosystem rose from 26 in 2014 to 43 in 2018.

The number of business-to-business (B2B) startups has jumped four times to 3,200 in 2018 from 800 in 2014, enabling faster growth of the ecosystem, attracting investments worth USD 3.7 billion from USD 797 million, during the period, says a report.

However, this has been mostly centered around Bengaluru, Mumbai and Delhi-NCR, says a report by Netapp, a leading player in data management and hybrid cloud services, and global management consulting firm Zinnov.

The concentration of this ecosystem in to these three cities can be largely be attributed to the spurt in the need for digital transformation of enterprises, financial institutions, hospitals, government, SMEs, the report said.

In percentage terms, the growth in the number of B2B startups within the total tech startups ecosystem rose from 26 in 2014 to 43 in 2018.

The study called for an intense growth of accelerators and incubators for the domestic startups to spread their wings, encouraging small town to come up in the innovation space," the report said, adding corporate incubators and accelerators are emerging as the backbone of startup tech with currently over 50 corporate accelerators and incubators.

The report observes that 70 percent of these B2B tech startups are in the space of enterprise tech (41 percent), fintech (19 percent) and healthtech (9 percent), with software as a service, customer relationship management, alternative lending, expense management, medical internet of things, artificial intelligence enabled predictive platforms being some of the other segments.

While global accelerators hold a majority with 66 percent of the share, 34 percent of the pie comprises of domestic companies.

The unicorns in B2B may not be as many as B2C but exits are likely to happen faster in B2B and from funding perspective, the internal rate of return is more positive, says the report.

A unicorn refers to a privately held tech startup valued at USD 1 billion or more.

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