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40% Indian tech startups have suspended work due to coronavirus: Nasscom

Revenue declined by more than 80 per cent for about 34 per cent such companies, says online survey.

Startups | Startup India | Coronavirus

IANS  |  New Delhi 

Fintech, startups

As many as 90 per cent tech in India have reported a decline in revenue and about 30-40 per cent have suspended operations or will close down because of the pandemic, said a Nasscom survey on Tuesday.

Revenue declined by more than 80 per cent for about 34 per cent of such companies, said the 'Start-up Pulse Survey' conducted online and involving over 250 in April.

While 70 per cent of travel and transport reported suffering 40 per cent revenue decline, 14 per cent of edtech, fintech and healthtech startups expect growth in revenue amid the COVID-19 crisis.

The month-long survey further revealed that 70 per cent startups have runway less than three months, with those in the business-to-customer segment majorly affected.

About 60 per cent of B2C startups are facing business closure, according to the report.

"However it is not all doom and gloom; more than half of the start-ups are looking to pivot to new business opportunities, diversify into growth verticals like healthcare, and enhancing focus on emerging tech like Artificial Intelligence, Internet of Things (IoT), Cloud," said Debjani Ghosh, president of Nasscom.

"However, to ensure that the Indian start-up movement and its growth trajectory is not derailed, coordinated support from key stakeholders is the need of the hour.

Some of our key recommendations to the government include access to working capital, easing compliances and fiscal policy and funding support," she said.

The responses were analysed considering various parameters like growth stages, revenues, employees strength, revenue, verticals, etc.

The report stressed on the need of integrated central-state initiatives on procuring "Made in India" start-up products and solutions.

With over 9,300 tech start-ups, India continues to be the third largest tech startup ecosystem in the world.

First Published: Tue, May 19 2020. 19:18 IST