By Azra Mufti
A recent report sheds light on the dynamic yet still developing nature of India’s startup incubation ecosystem. Jointly conducted by NSRCEL at IIM Bangalore and CREST at IIT Madras, the India Incubator Kaleidoscope 2024 report reveals that over 1,100 active incubators now operate across the country. This impressive number underscores India’s commitment to fostering innovation and supporting entrepreneurs at all stages. Yet, as India strives to solidify its position as a global startup hub, the report also highlights areas where further development is urgently needed.
The diversity of incubators across India’s major cities reflects the unique startup needs in different regions. For instance, Chennai leads in academic incubators, which account for 82% of the city’s incubator landscape. Meanwhile, Bengaluru and Gurugram are industry-focused, with incubators that make up 71% and 84% of their respective ecosystems. Notably, 45% of India’s incubators are concentrated in the Southern region, further solidifying its reputation as the powerhouse of Indian innovation.
Yet, while the density of incubators is rising, it remains significantly below global standards. India has only 0.8 incubators per million people— a stark contrast to the 8 to 10 incubators per million people in countries like the United States and China. Moreover, only 8.2% of Indian startups are currently incubated, and a mere 10% of incubators support a staggering 98% of these startups. These figures indicate an urgent need to activate underutilized incubators and expand the reach of incubation services, particularly to underserved regions and entrepreneurs.
The Positive Impact of Incubation on Startups
Incubation provides tangible benefits for startups, enhancing their chances of success by connecting them with essential resources. Incubated startups are 11.7% more likely to secure first-round funding within a year, and they file patents at five times the rate of non-incubated startups. Under the Atal Innovation Mission’s TIDE 2.0 framework, incubators are organized into three tiers—G3, G2, and G1—each with specific roles designed to build a robust and scalable ecosystem.
The framework’s structure allows G3 incubators, often affiliated with academic institutions, to focus on outreach in underserved areas, while G2 incubators provide large-scale training and support. At the top level, G1 incubators offer advanced resources and supervision, ensuring that startups in all regions receive adequate support. This tiered approach exemplifies India’s commitment to a comprehensive support system that nurtures startups from the ground up.
A Spectrum of Incubator Types: Serving Diverse Needs
Incubators in India are not one-size-fits-all; they cater to a variety of startup types and social objectives. Livelihood Business Incubators (LBIs), for instance, prioritize startups with a social impact, often supporting underserved communities through funding from NGOs, government bodies, and CSR initiatives. LBIs are critical in building social capital and addressing socio-economic disparities. On the other hand, Technology Business Incubators (TBIs) target tech-driven ventures, particularly those affiliated with prestigious institutions like the IITs and IIMs, providing access to cutting-edge research and industry networks.
Accelerators and Traditional Incubators: Balancing Speed and Flexibility
India is also home to several accelerators that focus on rapid growth. Programs like Techstars, Axilor Ventures, and Y Combinator India offer structured, time-bound initiatives that combine seed funding, mentorship, and investor connections. While accelerators often work on a compressed timeline, traditional incubators, such as the Indian Angel Network (IAN) Incubator and NASSCOM 10K Startups, provide long-term resources to startups across various industries. Together, these incubators and accelerators cater to startups’ diverse needs, ensuring flexibility in the paths available to entrepreneurs.
Beyond Numbers: The Need for Strategic Expansion and Inclusive Growth
Despite the impressive presence of incubators in India, the journey is far from complete. As the demand for incubation continues to grow, it is crucial to invest in regions with limited resources and support networks, enabling startups outside major cities to benefit from the incubation ecosystem. Additionally, efforts should focus on activating underutilized incubators and making incubation opportunities more inclusive, particularly for students, women founders, and those from marginalized communities.
Incubators have proven to be more than just physical spaces; they are catalysts for growth, innovation, and resilience. As India’s startup ecosystem matures, incubators must evolve in tandem, ensuring that the next generation of entrepreneurs can thrive on a global scale. By enhancing access to incubation, expanding resources, and fostering a culture of inclusive entrepreneurship, India can unlock its full potential as a global leader in innovation. The path ahead may be challenging, but the opportunities are boundless, and the future of Indian entrepreneurship shines brighter than ever.
Views expressed in the article are the author’s own and do not necessarily represent the editorial stance of Kashmir Observer
- The author works with Indian Institute of Management Jammu
Follow this link to join our WhatsApp group: Join Now
Be Part of Quality Journalism |
Quality journalism takes a lot of time, money and hard work to produce and despite all the hardships we still do it. Our reporters and editors are working overtime in Kashmir and beyond to cover what you care about, break big stories, and expose injustices that can change lives. Today more people are reading Kashmir Observer than ever, but only a handful are paying while advertising revenues are falling fast. |
| ACT NOW |
| MONTHLY | Rs 100 |  |
| YEARLY | Rs 1000 | |
| LIFETIME | Rs 10000 | |
