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Author: Vanshika Darbari, V year of B.A.,LL.B. from Maharaja Agrasen Institute of Management Studies, GGSIPU

In the Indian IT industry, particularly the startup environment, the year 2021 has been momentous. India is home to above 50,000 start-ups but only 33 of them till now have been able to manage entering into the Unicorn club and crossing the billion-dollar valuation. But, the year 2021 has seen a tremendous increase in the number of start-ups converting into unicorns. [1] Out of 72 total unicorns present in India, 33 of them have been given this status in 2021 itself. In a very short span of 2 weeks, five new businesses including Spinny, Mamaearth, Ecom Express reached a valuation of $1 billion or more. This is a one-of-a-kind feat in the domestic new age internet ecosystem, with record-breaking investment. Due to an unparalleled rate of business formation and technological innovation, India's corporate environment is experiencing a fundamental transformation.

The country is already rejoicing in the arrival of its new unicorns — Digit Insurance, InnovAccer, Five Star Business Finance, Meesho, Infra. Market, CRED, Pharmeasy, Groww, Gupshup, Mohalla Tech (parent company of social platforms ShareChat and Moj), Chargebee, Urban Company, Moglix, Zeta, BrowserStack and the latest ones - Spinny, Mamaearth, Ecom Express, etc. Despite the coronavirus pandemic, there were about 1600 new startups founded in the year 2020, taking to the number of startups in the country over 12500 according to the report by Nasscom and out of them more than 55 of the startups are potential unicorns(soon icorns). The market is optimistic about the prospects of these category leaders utilising technology to create new value, with almost a dozen unicorns in various phases of their IPO procedures. The ecosystem should continue to see a lot more good news in the coming 12-18 months.

In a country like India, where an ever-increasing number of people yearn for their own business, fantasising, and realising their dreams, the future for new businesses appears bright and attainable. In terms of venture capital money invested in companies, India has traditionally lagged behind the United States and China. According to researcher Preqin, the overall value of agreements in 2020 was $11.8 billion, compared to $143 billion in the United States and $83 billion in China. However, numerous companies have lately arisen in the South Asian country, indicating its potential. The market is optimistic about the prospects of these category leaders utilising technology to create new value [2], with almost a dozen unicorns in various phases of their IPO procedures. The ecosystem should continue to see a lot more good news in the coming 12-18 months.

Multiple factors are influencing the present startup boom in India, as well as how the increasing unicorn club is influencing the business environment and the economy in general. Some variables aid these companies in attaining the prestigious title of unicorn status-

➔ Private equity was not available to most businesses twenty years ago, but now private capital, sometimes known as risk capital, is available to all private businesses in India. So, if one has a daring concept and the ability to carry it out today, cash will no longer be a barrier; there are more than enough investors willing to back the right individuals.

  • India has progressed in leaps and bounds due to advancements in technology, internet access, and ubiquitous connection, all of which have helped individuals connect and build businesses. Technology is evolving at a rapid pace, and it is capable of not just fixing existing issues but also anticipating future ones.

  • Infrastructure development has been significant in the country, assisting in the economy's start-up and human resource development. India has over 10,500 engineering institutes and 39000 colleges, providing us with a significant demographic dividend. In the IT industry and other fields, India has the greatest number of qualified experts.

  • In the previous 10 years, there has been a lot of financial innovation. The government has adopted several measures, including the Atal Innovation Mission, which has helped to establish a thriving ecosystem of innovation and entrepreneurship in our nation, resulting in the birth of new entrepreneurs and a flood of unicorns flooding the Indian economy. Today is the result of the painful efforts that have been made by the regulators, government, and entrepreneurs for the last 10-15 years.

As a result, the entrepreneurial spirit, young exuberance, and capacity to realise that they are capable of entrepreneurial endeavours will be accelerated. Our economy is the fastest-growing in the world, and individuals can accept risk money from both within and outside the country. As a consequence, investors are ready to bet on strong ideas, and there are many of them. Not only recent graduates, but middle-level executives in prominent and well-paid corporate professions have been leaving their jobs or starting their businesses. To be fair, well-funded start-ups have been able to offer very attractive compensation, which is another aspect of corporate development.

In an interview, Rangarajan Krishan, COO of Five Stars Business Finance Limited, discussed what gives investors the confidence to take these hazardous risks at this critical moment in the pandemic. He believes that the fact that if the start-up has confronted this problem and has managed to stay afloat as well as develop its business, it is enough for investors to recognise the competence and potential of the company.

With the appearance of “Stand Up India,” “Make in India,” and “Start-up India,” India was able to achieve new heights in the economic world. We've made significant progress, taking bold decisions and initiatives, and improving policies. However, there is still optimism for greater progress to encourage start-up businesses in India. As a result, the government should make clearer rules, simplify the litigation, and our laws, which must ensure that they are strengthened in a manner that is fair and equitable to the capital provider and the provider of the capital and the provider of the service.

Just this year, 33 unicorns have emerged, demonstrating the strength of the Indian entrepreneurial spirit to demonstrate competence and power to effect reforms that benefit not only India but the entire globe.


1) Asmita Dey, “India added 33 unicorns in 2021 — highest ever”, (Fortune India, 14 October 2021) <> accessed at 21 November 2021

2) “Unicorns in India: 6 new Unicorns in 4 days marks historic boom for India Tech”, (Live Mint, 12 April 2021) <> accessed at 21 November 2021

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