India will have 122 new unicorns in 4 years: Hurun Research report

In just one year, the number of such startups has increased by 65%

India will have 122 new unicorns--startups valued each at more than $1 billion--in the next two to four years, according to the ASK Private Wealth Hurun India Future Unicorn Index 2022.

Hurun Research Institute’s ranking considers Indian start-ups founded in the 2000s, valued at least $200 million, and not yet listed on a public exchange. The index has classified companies as would-be unicorns (those founded after 2000 and valued at least $1 billion), gazelles (those most likely to become unicorns in two years), and cheetahs (start-ups that could go unicorn in four years).

“In just one year, the number of unicorns has increased by 65 per cent, the number of Gazelles has increased by 59 per cent to 51, and the number of Cheetahs has increased by 31 per cent to 71,” said Anas Rahman Junaid, MD and Chief Researcher, Hurun India. “Probably, the pandemic has accelerated the disruption of traditional businesses and fostered the emergence of start-ups.”

A majority of the prospective unicorns sell software and services, and only 17 per cent sell physical goods. As many as 37 per cent are business-to-business sellers, while 63 per cent are consumer-facing.

Hurun Research identified 122 future unicorns in 25 Indian cities. Bengaluru continues to be the unicorn-capital of India with 46 unicorns. Delhi-NCR and Mumbai are in the second and third spots, with 25 and 16 unicorns.

“India has emerged as the third-largest ecosystem for start-ups after US and China,” said Rajesh Saluja, CEO and MD, ASK Wealth Advisors Pvt Ltd. "The country saw a record 44 start-ups turning unicorns in 2021."

However Junaid of Hurun India said there are some global economic concerns that could affect the valuations and capital-raising abilities of Indian start-ups’. Additionally, he said that some Indian start-ups are implementing layoffs and cost-cutting measures, fuelling speculation of an ecosystem downturn.

“We believe there could be a short-term blip in the growth story,” said Junaid. “But the Indian start-up ecosystem's long-term potential remains resilient."

He said the pressure felt during the valuation process and the increased inspection of deliverables could help broaden the system's foundation.

The report defines a Gazelle as a start-up created after the year 2000 and that has the potential to become a unicorn within two years. The Gazelles on the Hurun index are projected to be worth between $ 500 million and $ 1 billion. The Gazelle pack is led by Shiprocket, a five-year-old logistics tech startup, followed by Zepto, Turtlemint, Ather Energy and Vivriti Capital.

India has 84 unicorns, 51 Gazelles, and 71 Cheetahs, as against 51 unicorns, 32 Gazelles, and 54 Cheetahs in the 2021 index. India’s future unicorns are currently worth $ 49 billion, with an increase of 36 per cent as compared to last year. As many as 17 Gazelles and 7 Cheetahs, from last year’s index, hit unicorn valuation this year.

Key highlights of ASK Private Wealth Hurun India Future Unicorn Index 2022:

India will have 122 new Unicorns in the next 2 to 4 years.

The country now has 84 Unicorns, 51 Gazelles and 71 Cheetahs, as against 51 Unicorns, 32 Gazelles and 54 Cheetahs in 2021 Index.

India’s future Unicorns are currently worth $ 49bn, with an increase of 36% as compared to last year.

17 Gazelles and 7 Cheetahs, from last year’s index, hit Unicorn valuation this year.

Bengaluru continues to be the start-up capital of India. 

Bengaluru is home to 46 probable Unicorns followed by Delhi NCR (25) and Mumbai (16).

E-commerce, FinTech, and SaaS comprise 43% of the index.

Sequoia is the most active investor followed by Tiger Global.

Companies featured in the index employ more than 82,300 people.