4 startups gained unicorn status amid COVID-19 pandemic, ecosystem recovering faster: Report
While around 40 percent of startups were negatively impacted, 15 percent of startups were forced to discontinue operations due to the COVID-19 pandemic between March to June 2020, says TiE-Zinnov report
Oct 14, 2020 / 09:24 PM IST
Four Indian startups gained the unicorn status amidst the COVID-19 pandemic and four more are expected to join the club in 2020, said a report by TiE Delhi-NCR and Zinnov.
The report titled 'Covid 19 and Antifragility of Indian Startup Ecosystem' also suggested that 75 percent of startups are gradually recovering post the nationwide lockdown, while 30 percent have pivoted to newer markets for alternative revenue streams.
The report claimed that the startup ecosystem is expected to create 7-7.5 lakh direct jobs and 26-28 lakh indirect jobs by the year-end.
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The report said while around 40 percent of startups were negatively impacted, 15 percent of startups were forced to discontinue operations due to the COVID-19 pandemic between March to June 2020.
Indian startups experienced a decline in overall funding by 50 percent during the lockdown as compared to pre-COVID levels, the report added.
"The decline was even more prominent in seed and early-stage investments. There had been a 48 percent y-o-y decline in funding by CY Q2 and 37 percent decline in the number of deals in CY Q2. And, the industry saw more than 55 percent y-o-y decline in seed and early-stage funding in CY Q2 2020 and 38 percent y-o-y decline in funding in early-stage startups," said TiE Delhi-NCR president Rajan Anandan while presenting the report in a digital conference.
He added that a significant decline in late-stage funding was also experienced. However, in 2019, India became the third-largest startup ecosystem in the world. India had 26 unicorns till January 1, 2020, and the startups received $14.5 billion funding.
The report pointed out that Indian startups did see a gradual recovery from the month of September 2020. The sectors which saw a positive growth include education, healthcare, and commerce. While travel, hospitality, and mobility were negatively impacted.