Over 90 per cent of start-ups will go on a hiring spree this year, with 28 per cent of the jobs being allocated to strengthening their technology teams, a report released by InnoVen Capital said.
"More than 5,000 jobs are expected to be created by 130 start-ups in the next 12 months," the report said. The report surveyed 130 startups across stages of funding and found that 41 per cent of venture-capital-funded startups had women founders or CXO-level executives, the number dropped to 31 per cent for boot-strapped ventures and 29 per cent at the angel-funding stage. Bootstrap is a situation in which an entrepreneur starts a company with little capital. An individual is said to be bootstrapping when he or she attempts to found and build a company from personal finances or from the operating revenues of the new company. An angel investor is an investor who provides financial backing for small startups or entrepreneurs. Angel investors are usually found among an entrepreneur's family and friends. A venture capitalist either provides capital to startups or supports small companies that wish to expand but do not have access to equities markets. Venture capitalists are willing to invest in such companies because they can earn a massive return on their investments if these companies are a success. Private equity firms mostly buy mature companies that are already established. Private equity firms buy these companies and streamline operations to increase revenues. Venture capital firms mostly invest in start-ups with high growth potential.
The report said these 130 companies are expected to raise $700 million this year.
The firms surveyed, however, said that even though hiring may be healthy, 72 per cent believed that the education system isn't training students to match the skill set needed right now.
The report stated that customer-focused e-commerce companies will continue to flourish. "In FY16, more than 50 per cent bootstrapped startups and 45 per cent angel funded startups expected to turn profitable whereas only 22 per cent venture-capital-funded companies expected to turn profitable," the report stated.
This may be helped by 76 per cent of the companies think that next year the political environment will play a part and make it even better for business.
Crowdfunding may also start to find its feet in India with "more than 50 per cent of bootstrapped companies exploring or are interested in crowdfunding".