Indian startups are just like the mythical unicorn that flew high and reached the stars. This year, many Indian startups became unicorns. However, they chose to have their headquarters in India. Let's find out why this is a popular choice for Indian startup companies. Experts believe that the only reason Indian startups are able to choose to have their headquarters overseas is the ease of daily operations.
Let's learn more.
International attention has been paid to India's growing startup ecosystem. A report claims that India will rank 19th among the top 100 global startup hubs by 2021, up from 48th place in 2020.
The Most Valuable Unicorns of India With Headquarters Outside India
We will now be talking about Indian unicorns that have traveled abroad. It's fair to mention the most valuable unicorn companies.
Robinhood (USA)
Instacart USA
Roivant Sciences (Switzerland)
Automation Anywhere (USA).
Samsara Networks (USA)
Open, a fintech startup, became India's 100th unicorn last week. It was cause for celebration. Purplle, Physicswallah were two other startups that joined the unicorn club.
The number of small businesses that are incorporated in India is increasing. Some of the unicorns that emerged in 2022 or 2021 were actually founded outside the United States. Amagi, CommerceIQ Fractal Analytics Polygon, Hasura BrowserStack Chargebee InnovAccer and MindTickle are just a few of them.
Unicorns are a hot trend in India.
SaaS startups have seen a lot of growth, especially in the United States. They can also list outside India. BaskarSubramanian states that many Indian technology startups, especially those in B2B, are attracted to the US market due to its large market, higher demand, better margins and favorable customer behavior. Although engineering and product development traditionally depended on skilled, low-cost talent in India, the availability of funding and customer-facing expertise is much higher in the United States. Baskar Subramanian, the CEO of Amagi is a cloud-based SaaS technology company. It raised $95 Million in April. Amagi used to be headquartered in Bangalore, but now it has its headquarters in New York.
Ankur Mittal (Co-founder of Inflection Point Ventures), stated that other Indian startups choose to operate in foreign countries due to their favorable tax and regulatory policies. Incorporation abroad makes it easier to list abroad and gain access to foreign capital. A head office in a country can make it easier for startups to conduct their day-to-day operations, especially if they have many customers in that country. Subramanian believes that Indian startups can gain trust from customers, access technology ecosystem partners, and be able to realize their IPO ambitions. This will allow them to significantly increase their shareholder value.
This transition is also affected by the nature of the business. The managing partner of Unicorn Indian Ventures Mr. Bhaskar Majumdar says that this happens when there is uncertainty in the sector the startup operates in or the regulatory framework in place. This is why many crypto and gaming startups are located in the Emirates, Gibraltar and other desirable locations.
Let me give you an example.
Polygon is an Indian unicorn. It's an Ethereum Layer 2 scaling startup. Although it was founded in India, the founders had an idea about how they would structure the startup's compliance. It is now a global company because of this structure. This is why Polygon today is based in the Middle East, while the Polygon developer base is in other countries such as Belgrade, Switzerland, and others.
Inviting Unicorn Startups to Incorporate in India
Avijit Sharkar had hoped to launch a fintech company in the United States in order to access a wider market. He quickly realized the high costs of incorporation and the difficulty in obtaining visas. He stumbled upon Estonia's startup program on a whim and applied. Although he didn't need to travel to Estonia, he was able to get a virtual address in a matter of weeks. "I received my VAT number (value-added taxes) in 15 minutes. It is easy to do business. CapOne Research's Sarkar says, "Being incorporated here in Estonia allows me to easily hire foreign talent."
This is why Indian unicorns and startups are leaving India. It is now that they are being enticed to incorporate in India. Experts believe it is crucial to create an Indian business environment that encourages startups to list and incorporate in India. It is important to have an adequate pool of mentors and investors in a mature capital market. India's government is now aware of the importance of startups within the ecosystem. The government of India recognizes the value of startups and has shown a strong desire to support them.
Indian government amended listing rules to allow a variety of startups to go public in India. Indian startups are encouraged to set up shop in India. The govt also made a strategic shift to foreign IPOs, which allowed Indian-incorporated startups to seek out listings abroad.
Conclusion
Experts agree that the presence of overseas-incorporated businesses has minimal impact on the environment, and provides the same economic impetus. A startup can be created outside India and operate in India. This will benefit Indian citizens as well as the ecosystem.
However, we now see many startups and unicorn companies in India, as well as those incorporated in India, looking to enter the country to take advantage of the rich ecosystem and potential that exists here. This will in turn provide both economic and consumption opportunities.
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unicorns in india, unicorn company in india, startup companies in india, list of unicorns in india
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