Incubators and accelerators grew by 40% in 2016; supported startup ecosystem

Per a new report from Nasscom, the number of domestic incubators and accelerators (I/A) have increased by 40% in 2016 acting as a support mechanism for the startup ecosystem. While incubators provide support across the start-up life cycle, accelerators are focused on the growth and acceleration stage. The country has more than 140 I/As at present split across corporate (9%), independent (32%), academic (51%) and government supported (8%) categories. While most of the I/As are focused on technology and machine, the Tier II and Tier III cities accounted for 66% of the new I/As started in 2016.

Other new trends also featured in the report. The I/A ecosystem is shifting toward partnership-driven and sector-specific push. Academia, industries and the government are coming together to set up sector-specific accelerators and incubators such as GE’s global healthcare accelerator, Pfizer and IIT-D’s incubation accelerator for healthcare start-ups or SBI and IIT-B’s incubator for fintech start-ups.

Additionally, the short 3-4-month period for incubation/acceleration is cited as a major challenge for the industry. Besides, the volume of start-up applications is quite high in India, making the process tedious and time consuming as compared to the US where benchmarks are well defined.