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BW Businessworld

Covid 19 Pandemic: A Blessing In Disguise For Startups

The Indian startup ecosystem has been prospering despite the pandemic wreaking havoc on the nation's economy.

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In this unprecedented time when each industry trying hard to survive, the startup sector has grown many folds with new entrants and investment for existing players.

India has around 50,000 new businesses in India in 2018; around 8,900 – 9,300 of these are tech-driven small businesses 1300 new tech small businesses were brought into the world in 2019 alone inferring there are 2-3 tech small businesses conceived each day.

India is a developing economy and an enormous market of underserved/unserved clients. With numerous government drives set up the Indian startup ecosystem is relied upon to observe YoY development of 10-12%. Upheld by favourable demographics India has a functioning and flourishing startup environment.

In the first four months of 2021, Indian startups have raised $7.8Billion, which is around 70% of the overall investment raised by startups in 2020.

The Indian startup ecosystem has been prospering despite the pandemic wreaking havoc on the nation's economy. Within 6 months of 2021, we have 15 new companies that have entered into the unicorn club. As the NASSCOM report had earlier expressed that India will have 50 unicorns before 2021 ends, however, we have effectively outperformed that number.

Sectors that beat Others  

Startups funding touches new heights in 2021, almost every startup sector has received massive investment from domestic & overseas investors. But some sectors topped the list in terms of fundraising.

Fin-Tech Sector:

“With digital spreading and growing throughout the country, including remote areas with the pandemic, BANKIT has been able to increase its customer base and agent network. More agents have joined the our network as more and more people are looking for banking and financial services in their vicinity. More businesses have joined hands with us and we enable them website and app technology to provide essential 18+ banking and financial services under one roof in their proximity. The pandemic has proven to be a boost to digital adaptability and encouraged people to get online services and thus acted as a blessing in disguise for tech startups like BANKIT.” Mr. Amit Nigam, COO & Executive Director of BANKIT said, 

Fintech keeps on overwhelming the Indian startup funding scene by raising about 22% of the capital inculcated for this year. The sector has raised more than $2 Bn in 2021 until this point, addressing a 4X increment from $495 Mn brought up in the first five months of 2020.

Fintech has become a significant part of the worldwide economy. All monetary tasks were finished through paperwork only, as paper-based mediums were viewed as the most secure. However, with the expansion of technology, the internet has arisen as the preferred platform for monetary exchanges. It's essentially a monetary industry made out of companies that use technology to make monetary services more productive.

Ed-Tech Sector:

COVID-19 left no choice for universities to go online. UGC was forced to bring in a new regulation to do 40% of a regular degree online and it is here to stay. This scenario has enabled large number of university students to do courses, certification, mentorship and battleground on ImaginXP MyCoach. The investors are seeing this unique opportunity. Our investors are speaking to university owners and students to take feedback that makes them invest quickly - Shashank shwet founder and CEO, ImaginXP

Edtech startup that raised $1.3 Bn addressing a 2.9X climb from earlier years' $447 Mn. The sector was driven by Edtech titan BYJU's that raised $460 Mn and turned into the second most valued startup in India.

While businesses were changing their techniques to conform to the tumult caused by COVID-19, Edtech startups prepared for their stage under the spotlight.

Health-tech Sector:

"Covid has accelerated the digital transformation of Healthcare Industry esp. Indian Pharma, Device and Diagnostic Companies and MediSage has been at the forefront of change. As physical interactions between medical reps and doctors came to a grinding halt during lockdown, MediSage facilitated over 1.2 million digital interactions between Healthcare Companies and Doctors. Such digital interactions have not only aided in having quality scientific discussion between healthcare participants but has also enabled Companies to personalize their engagement with doctors backed with data driven insights. Interestingly, 73% of doctors in our panel indicated that they now prefer digital interactions to physical interactions, a trend which has become common in the western world." Mr. Bhagwat Dhingra, Founder, MediSage 

The COVID-19 pandemic immensely affects the Indian healthcare services industry. Although the unprecedented crisis put an enormous focus on the fragile medical infrastructure, it additionally offered openings for a few health tech businesses. With the pandemic aroused development in health tech, startups in the sector are again drawing in the attention of investors.

The COVID-19 crisis has necessitated the need for seamless information sharing and greater collaboration among various stakeholders within the healthcare ecosystem. The pandemic has forced hospitals of all sizes to upgrade their existing IT infrastructure by moving from a point solution to the cloud to dismantle data silos between different departments and enable mobile health and virtual support. KareXpert's transformative platform-based approach coupled with cloud-native, mobile-first, AI-ready approach was envisioned many years back, but the pandemic has certainly accelerated wide-scale adoption of our product. Our solutions have already been implemented in many hospitals and we plan to onboard 100,000 hospitals in the next 5 years. According to our internal research, the digitization Index at 95% hospitals in India is at level 1, with 7 being the highest. We at KareXpert are enabling these untapped markets to make hospitals become globally competitive from a digitization perspective. Nidhi Jain, Founder & CEO, KareXpert

Presently with the sector turning stable because of growing technologies/innovations to battle COVID-19, funding has gotten pace, to such an extent that health tech companies have brought $234.4 million up in the primary quarter of 2021, surpassing the aggregate sum for the entire of last year by 14%.