77% of Indian Start-ups Embrace Advanced Technology: SAP

The report highlights the emergence of Tier II and III cities as crucial innovation hubs, with 40 per cent of tech start-ups originating from these regions

More than 77 per cent of Indian start-ups are currently channelling investments into cutting-edge technologies such as Artificial Intelligence (AI), Machine Learning (ML), Internet of Things (IoT), and blockchain, according to a report jointly released by SAP India and Dun & Bradstreet.

In addition, the report highlights the emergence of Tier II and III cities as crucial innovation hubs, with 40 per cent of tech Start-ups originating from these regions. These Start-ups capitalise on local talent and cost efficiencies to drive their growth and innovation.

The report underscores that this technology-driven evolution reinforces India’s global position as a leading startup hub, supported by strong corporate governance and a supportive regulatory landscape. In the digital transformation era, Indian Start-ups actively integrate advanced technologies to enhance operational efficiency, fuel growth, and elevate customer experiences. This trend underscores the rapid pace of technological adoption and innovation within India’s startup ecosystem, which now ranks third globally, following the United States and China.

Sanket Deodhar, Vice President and Head of Digital Natives at SAP Indian Subcontinent, emphasised that technology continues to play a pivotal role and serves as a critical differentiator for Start-ups aiming to transition from Gross Merchandise Value (GMV) to Gross Margin (GM) and establish sustainable business models. He highlighted the importance of transparent and trusted financial data in achieving these business objectives, underscoring technology's relevance across various growth stages and industries.

The report reveals that Indian Start-ups secured $2.77 billion through 326 deals in Q1FY24, driven notably by the e-commerce, fintech, and health tech sectors. Bengaluru stands out for its leadership in both funding raised and deal number, highlighting the regional dynamics within the startup ecosystem. Meanwhile, tier 2 and 3 cities are gaining prominence as emerging hubs of innovation.

According to the report, the adoption of cutting-edge technologies is revolutionising multiple sectors. In agritech, AI-driven drones and IoT devices optimise farming practices, boost yields, and lower labour expenses. 

AI enhances credit scoring, risk evaluation, and fraud detection capabilities within fintech. In edtech, AI, AR/VR, and gamification enrich personalised learning experiences and facilitate skills development. Meanwhile, telemedicine, alongside AI and machine learning, delivers real-time insights to improve healthcare delivery and operational effectiveness in healthcare.