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Only 8.3% of startups are successful in getting funding! Here’s why

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Only 8.3% of startups are successful in getting funding, says an annual report on Indian venture capital and private equity on startups released by IIT-Madras.

Presenting the ‘Inspiration and Momentum for the Gladiators’ report at TiECON 2016 organised by TiE Chennai on Saturday, Thillai Rajan, professor, department of management studies, IIT-Madras, said while the big picture of the Indian startup system was breathtaking with over Rs 1,11,700 crore being invested in the period 2005-2015 and 16% annual growth in startups being funded, there still isn’t enough capital for startups in the country.

Rajan also expressed concern over the low proportion of startups getting funded in India as compared to the global standard. While the ratio of founded to funded companies globally was about 36 – 52%, the ratio for Indian startups was 5-11%, he said. For example, the percentage of global startups that are able to successfully raise capital in the grocery technology, healthcare and consumer healthcare and smart home and home improvement are 41%, 52% and 36% respectively. The corresponding percentage for Indian startups are 5%, 10% and 11%.

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