Advice for Indian startups...!

Indian Commerce Minister Piyush Goyal’s recent criticism of Indian startups has stirred a hornet’s nest. At a startup event, he compared Indian entrepreneurship to China, urging entrepreneurs to prioritise sectors like electric mobility, AI, and automation, instead of quick grocery delivery and food apps. However, the backlash from Indian venture capitalists, startup founders and entrepreneurs, has been strong. For one, Indian startups have seen a 43 per cent increase in venture capital funding in 2024, up to $11.3 billion by some estimates. Secondly, they ask: Where’s the infrastructure or the policy support for brilliant ideas? On the other hand, there are others who point out that like it or not, the minister’s words have a ring of truth. Our panellists weigh in

Both tech innovation and service delivery, are needed

— Deepak Shikarpur,
Technopreneur and director, Kinetic Communications Ltd

The Indian startup ecosystem has experienced a remarkable surge in growth and impact, particularly since 2020. Startups contribute directly to GDP through innovation-driven productivity and indirectly by fostering ancillary industries. It has solidified India's position as the third-largest startup hub globally, after the US and China, with a significant number of unicorns (startups valued at over $1 billion). Early-stage funding has notably increased. The first quarter of 2025 alone saw Indian tech startups raise $2.5 billion, indicating continued investor confidence. There's a growing trend of startups emerging from Tier 2 and Tier 3 cities, contributing to inclusive growth and addressing regional challenges in sectors like agriculture, healthcare and education. The word 'startup' is new— entrepreneurship existed in India since ages. Even Infosys was a 'startup' once.

I consider entrepreneurship as a foundation. It’s a different mindset. Everyone can’t become an entrepreneur. This is where the mindset shift has to happen. An entrepreneur will look at a good and positive business model. Products and services are options. Some will focus on services, as it generates immediate revenue. Uber started with concept of connecting manufacturer with end consumer. Now, that concept is replicated in several domains. At the same time many entrepreneurs started developing new ideas which culminate in products. Current flavour is AI—every day, I come across at least two startups with AI-Tech. Government has started with many initiatives and tax rebates for Indian startups. Atal Incubation Center (AIC), accelerators, grants etc, are welcome steps.

Hence, in my opinion having a debate on what is good (tech innovation or service delivery) is meaningless. Both are needed and both are happening. Everything depends on business ideas, funding pattern and profile of founders.

Mindset change—from quick wins to long-term value

— Navtej Sawhney,
Award-winning restaurateur and chef

Piyush Goyal’s statement highlighting the difference between Indian and Chinese entrepreneurial focus is a wake-up call, we must take seriously. As an entrepreneur myself, I fully support his viewpoint, not to belittle Indian startups, but to urge us to aim higher.

It's true that many of India’s most funded startups in the last decade, whether Swiggy, Zomato, Blinkit or Dunzo, have primarily tackled last-mile delivery, convenience and consumption. These are valuable services, but they largely operate on thin margins and rely heavily on logistics, marketing and subsidies, rather than on breakthrough innovation.

In contrast, Chinese entrepreneurs have been tackling hard tech challenges: AI, robotics, semiconductors, electric vehicles and biotechnology. Companies like SenseTime, DJI, and BYD are examples of deep-tech ventures that started from scratch and are now global leaders. Their success didn't come from copying Silicon Valley; they invested in research and development, trained talent, and solved tough engineering problems.

India, with its massive IT talent pool and growing digital infrastructure, has every reason to lead in AI, space tech, energy storage and health tech. But, too often our brightest minds are channeled into creating the next hyperlocal delivery app, because it's seen as safer or more fundable.

We need to change the mindset, from quick wins to long-term value. We must incentivise risk-taking in deep-tech and create a culture that celebrates innovation over valuation.

Building deep-tech companies is harder, yes. But, it’s also what will make India truly Aatmanirbhar and a global leader in the 21st century. Let’s look at this as a challenge, not as a criticism, and push Indian entrepreneurship into the frontier zones, where it truly belongs.