Trivandrum: In a robust proof of rising investor confidence in Kerala-based startups, the fledgling enterprises in the state secured $551 million in funding since 2015, says the fifth Kerala Startup Ecosystem Report.
The Kerala Startup Mission (KSUM) report, which was released by Chief Minister, Shri Pinarayi Vijayan at ‘Huddle Global’, the two-day global Startup conclave, revealed that between 2016 and 2021 over 4,000 start-ups were launched in the state as compared to only 200 in 2015.
However, in 2021, the pace of new startup registrations in the state slowed down because of macroeconomic factors, such as the pandemic, economic slowdown and an atmosphere of uncertainty. But the state has now chalked out plans to cushion these hurdles by setting up 15,000 startups and creating 200,000 jobs in new and emerging technologies during the tenure of the current government.
The report says that early-stage investors (angels and accelerators and incubators) for Kerala’s hardware startups command a higher share (3 per cent) in venture capital (VC) investments as compared to Mumbai at one per cent, and Delhi-NCR 0.93 per cent.
Kochi, the commercial capital of Kerala, topped the list in terms of VC inflow accounting for 93 per cent, followed by Thiruvananthapuram at six per cent and others one per cent. Growth capital accounts for the highest share in Kerala’s VC funding while seed stage deals make more than two-thirds of the total funding deals pegged at 551 million dollars.
Fintech and SaaS (enterprise tech) startups are at the forefront of raising venture capital in Kerala. Together, the sectors accounted for 66 per cent of the total investments bagged by Kerala-based startups since 2015. Fintech startups accounted for 39 per cent of investments, followed by healthcare (26.7 per cent), enterprise tech (23.3 per cent), deep tech (4.6 per cent) and transport tech (2.9 per cent).
“Overall, venture capital investments in Kerala-based fintech startups stand at $32 million. Therefore, enterprise tech, primarily comprising SaaS startups, is the clear leader in investor confidence and venture capital inflow,” says the report.
It further points out that hardware startup funding is higher in Kerala than in any other Indian state. On the flip side, the report says only 11 per cent of startups in Kerala have a female founder.