Tech Shorts
Since 2014, the number of B2B tech startups have more than tripled from 900 to over 3200 now, says the NetApp-Zinnov report on B2B tech startup ecosystem.

Thanks to startups like Freshworks, GreyOrange, etc leading the way, B2B tech startups have more than tripled (from 900 to 3200+) since 2014. This is according to a report titled, ‘B2B Tech Startup Ecosystem and Role of Corporate Accelerators in India’ by NetApp, a leader in data management and hybrid cloud, in partnership with Zinnov, a global management consulting firm.

The report states that the growth can largely be attributed to the spurt in the need for digital transformation of enterprises, financial institutions, hospitals, government, SMEs, etc. Adding fuel to their success is the growing investor interest - the investment in B2B startups touched US$3.7 billion in 2018, a steep rise of 364% from 2014.

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

The report also looks at the growth of advanced B2B tech startups. These are startups that dabble with 3D printing, blockchain and robotic process automation. Segregating over 800 of the B2B tech startups as ‘advanced tech startups’, the study indicates their YoY growth at 60%, much ahead of the 20% number for the entire tech startup space (B2B, B2C). More than 76% of the tech share belongs to the top trio: Data Analytics, Artificial Intelligence and Internet of Things. Other futuristic technologies such as blockchain and 3D printing are not just being adopted by enterprise tech, but also fintech, health-tech, industrial-tech, clean-tech, manufacturing and nanotechnology startups.

The reason behind the spurt in growth in B2B startups in India, the report says, is a number of favourable conditions.  

Bangalore is the top city for B2B tech startups followed by Delhi NCR and Mumbai, all accounting for about 60% of all B2B tech startups. Presence of huge number of MNCs, access to technology, extensive talent pool, plus a strong presence of incubators and accelerators are key to the consistent startup growth in Bangalore (800+), whereas top institutes like IIT Delhi and Delhi University have fostered startups in various verticals across Delhi and NCR (550+). Mumbai (400+) being the financial hub, is home to the largest fintech startups. With flexible economic policies, state government support and access to various industries, Hyderabad, Pune and Chennai accounting for 500+ startups collectively are posited as the growing startup hubs of the country. 

“The B2B startup wave in India has just begun. Corporates are more open to collaboration with startups, VC firms are more interested in the B2B startup world, and technologies like AI and IoT have proliferated faster into the B2B ecosystem, compared to B2C. This holy combination of corporate support, B2B focused VC funds, and rise of advanced technologies will drive the wave forward,” Sanjay Nath, Co-Founder and Managing Partner at Blume Ventures, said.

Currently, there are over 50 corporate accelerators and incubators in the country, focusing on technologies such as AI/ML, Big Data, Cloud, Blockchain, Cyber Security among others. These include the likes of NetApp, Cisco, Target, Intel and Swiss Re. While global accelerators hold a majority with 66% of the share, 34% of the pie comprises of Indian companies. Varied in their philosophy, the accelerators have an aim to offer support in the form of market access, mentorship, investor connects and access to product platforms.

Alluding to the vital support that corporate accelerators provide, Ajeya Motaganahalli - Senior Director and Leader, NetApp Excellerator, NetApp, said “It is encouraging to see the entrepreneurship explosion across the startup universe. At NetApp Excellerator, we’ve facilitated numerous go-to-market opportunities, helped startups secure several million dollars in funding and have formed 7 global strategic alliances in the two years of our operation. This shows the credibility that the accelerator programs can add to such startups."