This year, India saw record startup dropouts from the Hurun India Future Unicorn Index 2024 -- 25 unicorns, 5 gazelles and 25 cheetahs. India is home to 67 unicorns, 46 gazelles and 106 cheetahs according to the recent rankings by the Hurun Research Institute. A significant drop in the number of future unicorns expected from India in 2024 as against 2023 signals difficult times for startups with the release of the ASK Private Wealth Hurun India future unicorn index 2024.

The Index gives a snapshot of the startup ecosystem of India. The institute produces the ranking by comparing startups founded post-2000 worth at least ₹1,670 crore, not listed on a public exchange according to the latest funding round valuation.

The list declared 152 Indian future unicorns from 31 cities. Of these startups, only 18% sell physical products and only 44% directly sell to businesses. These startups are particularly prevalent in providing financial services, business management solutions, education, and healthcare.

Next-door quick commerce app, Zepto, financial services company, InCred Finance, and tech-enabled logistics company, Porter turned unicorns this year. Porter bypassed being a Gazelle and directly became a Unicorn however unlike Zepto which received the unicorn status in just three years, Porter came into existence in 2014.

“There is an increasing focus on profitability and sustainable operating models, with 22 of the list entrants making profits in FY23”, Rajesh Saluja, CEO, of ASK Private Wealth. “More than 1.5 lakh people are employed by future unicorns. These are green shoots of tangible impact metrics,” he added.

While number of cheetahs has grown in the last 4 years, the numbers of gazelles have fluctuated. Companies such as Dunzo, Practo, and Rapido are some of the 25 future unicorns, 5 gazelles, and 20 cheetahs that were dropped from the list this year. Nevertheless, the list welcomes 38 new unicorns, 7 gazelles, and 31 cheetahs.

Online travel aggregator Ixigo was excluded from the rankings owing to its recent IPO, which got subscribed 98 times and got a 48% premium after listing.

The ranking aids investors, governments, aspiring entrepreneurs, and the international community. The list makes a distinction among unicorns (startups founded after 2000 with a valuation of US $1 bn), Gazelles (startups that are most likely to go Unicorn in the next three years), and Cheetahs (startups that could go unicorn in the next five years). Regulatory filings, feedback from other entrepreneurs, some of the active India-focused VC funds, and angel investors have been used to make the evaluation.

The research gives crucial insights on diverse aspects of startups, including investors, and the background of startup owners. Peak XV Partners continued to be the most active investor with 47 probable unicorns followed by Accel with 25 future unicorns. Bangalore for the second consecutive time became the future unicorn capital city of India.

“Amidst a funding winter, inflated pre-2021 valuations, and setbacks from companies like ByJu’s, the once golden startup ecosystem now faces a critical turning point,” said Anas Rahman.

“The economic slowdown has posed challenges for specific companies with 24% of last year’s Gazelles / Cheetah either falling off the list or being downgraded. Rising interest rates and geopolitical challenges have created hurdles for startups in raising capital.

Countries that are poised to generate unicorns in the next three years are the U.S. and China, accounting for two-thirds of the world’s identified Gazelles even when these nations constitute only a quarter of the global population.

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