Delhi NCR & Bengaluru Beat Global Bigwigs, Now Rank in Top 10 Startup Cities Globally
HexGn released a study of the funding trends in the global Startup ecosystem in 2019; the team analyzed over 60,000 deals and one million data points for the report. Globally, the total funding for technology Startups this year dipped by 22 percent to $293 billion from $375 billion in 2018, with a 27 percent drop in deals.
India Grows while Global & Asian Funding Declines
Asia is bearing the brunt of global slowdown with Startup funding in Asia, dropping by a whopping 56% from $158 billion to $83 billion. Despite the turmoil, Investments in Indian Startups grew by 18% to $14 billion in 2019, defying the global Startup funding downturn. India has performed better both in the number of deals as well as funding in value terms. While the number of Startup deals in India fell by only 15% (down 27% globally and in Asia), Startup funding in value terms rose by 18% (down 22% globally and down 56% in Asia).
Delhi NCR & Bengaluru among “Global Top 10 Cities for Startup Funding” for 2020
Cities have always been central to the Startup ecosystem because of entrepreneurial culture, acceptance of failures, easy access to investors and people. It takes time and an amalgamation of enterprising people, tech-savviness, an investor with risk appetite, and in some cases government encouragement for such centers to emerge, India is doing well on this front too, for the first time, we have two Indian cities, New Delhi and Bengaluru, debuting in the HexGn “Global Top 10 cities for Startup funding”. This is no small feat, considering that quite a few global heavyweights didn’t make it, including Hong Kong, Berlin, Boston, Paris, and Shenzhen.
India also joins a select group of only three countries, with more than one city in the top ten along with the US and China. Bengaluru moved up one rank from 11th in 2018 to 10th in 2019. However, the biggest surprise has been New Delhi, which leapfrogged Bengaluru, to debut for the first time in the top 10 at the 6th place. The emergence of New Delhi as the new Startup capital of India has been steered by the likes of Paytm, Oyo, and Zomato, among others. New Delhi attracted $7.4 billion in Startup funding compared to $4.4 billion attracted by Bengaluru.
Indian Startups Attract Funding Across Sectors
While E-commerce has customarily been the sector to attract the most funding in India, this year, too, it has continued its strong march, attracting $2.2 billion in funding. Transportation and Logistics Startups, riding on the success of bike-sharing, mobility, and freight aggregators, have gathered pace in 2019, attracting funding of over $2.4 billion. However, Fintech remained the leader garnering over $4.1 billion in funding, given the huge potential of the Sector and thrust towards transparency and digital payments from the Government of India.
The Indian Government’s push for digital payments and globally acknowledged initiatives like the UPI is probably the most significant game-changer in Fintech and a model system for other countries to follow. Many Global players, including Google, have been urging their home countries to adopt a system similar to the UPI payment system. As per HexGn, this was one of the most significant initiatives launched by any government across the globe in digital payments. With new initiatives, like FASTag for digital highway toll collection, Emergence of UPI payment system, and a continued increase in Digital transactions, it means that Fintech will remain the Sector that will see the considerable interest in 2020 as well. Although all seems spot-on, Indian Startups in emerging technologies like Artificial Intelligence, Blockchain, and Cybersecurity attracted minuscule investments both at the seed and Series A stage in 2019.
Top Ten Startup Cities for 2020
In the 2019 annual Startup report, HexGn announced the Top Ten Startup Cities for 2020. In the order of global ranking, they are, San Francisco Bay Area, New York, Beijing, London, Shanghai, Delhi NCR, Singapore, Los Angeles County, Hangzhou, and Bengaluru. These top ten cities from five countries, the United States, the United Kingdom, China, India, and Singapore, account for 58 percent of global funding, signifying its standing.