130 Startups To Create 5000 Jobs and Likely To Raise $700 Million In 2016 [Report]

InnoVen Capital, a venture debt and specialty lending business has recently released its ‘India Startup Outlook Report 2016’.

The findings of the report are based on a survey conducted by InnoVen Capital, which captures responses from startups across industries and funding stages, to map the key trends, challenges and opportunities in the industry.

The report says that from a demographic angle, Delhi emerged as the most sought-after location for starting new ventures. Bangalore and Mumbai came next as preferred startup hubs.

An industry-wise analysis revealed that irrespective of funding stage, consumer internet and e-commerce are the most popular segments. From a hiring perspective, 97% startups felt they were likely to hire new employees where on an average 28% would be on the technology front.

The study shows that more than 5000 jobs are expected to be created by about 130 start-ups in the next 12 months.

Interestingly, the startups surveyed displayed significant gender diversity in their workforce. 41% of the VC-funded startups had women founders or CXO level executives, while this number stood at 31% for boot-strapped ventures and at 29% for ventures with angel funding.

44% of the VC Backed companies believe that access to equity is one of the greatest opportunities for the sector.

Overall, 65% of all companies felt current business and political conditions are better than last year and 76% expect next year to be even more favourable for startups.

In FY 2016, more than 50% bootstrapped startups and 45% angel funded startups expected to turn profitable whereas only 22% VC funded companies expected to turn profitable. On the funding side, ~130 companies are expected to raise $700 MM in the next 12 months.

As far as challenges are concerned, taxation, work ethics and regulation topped the list. 74% of bootstrapped and angel-funded companies were not aware of Angel Tax as per Section 56 of the Income Tax Act.  More than 70% respondents believed the Indian education system was not preparing future employees with the skills their business needed.

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