Infosys co-founder Nandan Nilekani has predicted that the number of startups in India will grow at an annual rate of 20%, reaching one million over the next ten years. Speaking at an event by Arkam Ventures, Nilekani emphasized the growing trend of employees from larger startups branching out to start their own ventures.
Currently, India has approximately 150,000 startups, but this number is set to surge as more entrepreneurs emerge from existing unicorns. E-commerce giant Flipkart is a prime example, with its former employees founding 44 startups as of February last year, with a total valuation of $25 billion.
“So far, around 100 unicorns have created close to 2,000 funded startups. A form of binary fission is happening, startups are leading to more startups,” said Nilekani, highlighting the ripple effect in India’s startup ecosystem.
India on Track to Become the Leading IPO Market
As startups scale and tap into the public market for capital, Nilekani expects India to become the most preferred IPO market globally by 2035. At present, India ranks as the second-largest IPO market, trailing only the United States. In 2024, India’s IPO market saw a record haul of $20.5 billion, driven by growing retail investor participation.
“This has been possible thanks to the dramatic growth in retail investor participation over the last few years. We have around 100 million unique equity investors,” he noted.
Citing data from the recent Economic Survey, Nilekani pointed out that monthly average gross SIP flows have more than doubled in the last three years, reaching ₹23,000 crore in FY25.
AI and Digital Infrastructure to Drive Growth
Beyond the startup boom, Nilekani also emphasized the importance of building open-source AI models tailored for India’s diverse languages and dialects. The goal is to create population-scale, low-cost, and high-volume infrastructure, similar to India’s current digital public infrastructure (DPI).
“This, along with a wider network coverage and cheaper smartphones, will help propel the number of UPI users from less than 500 million to 1 billion over the next ten years,” he added.
As India aims to accelerate its growth rate from 6% to 8% and achieve an $8-trillion economy by 2035, Nilekani’s vision underscores the critical role of startups, financial markets, and AI-driven technology in shaping the country’s economic future.