Startups backed by PE, VC created over 26 lakh jobs in 2019; technology-led solutions touching people in remotest areas of country: Report

New Delhi: Startups backed by private equity and venture capital investors created more than 26 lakh employment opportunities in 2019, an increase of 27 percent from the preceding year, according to a report. Such startups had created 20.5 lakh direct and indirect jobs in 2018 and 16.5 lakh employment opportunities in 2017. “Private equity or venture capital (PE/VC) investments are not only creating direct and indirect jobs, but also bubbling up newer fast-growing job segments such as professional services, freelancers, delivery and driver partners,” the report noted. [caption id=“attachment_4377229” align=“alignleft” width=“380”] Representational Image. Reuters[/caption] The report was prepared by Indian Private Equity and Venture Capital Association (IVCA) in partnership with Zinnov, a global management and strategy consulting firm. It noted that technology-led solutions are touching the lives of Indians in the remotest corners of the country and also across income segments because alternative investment funds are focused on Indian market too. The report was developed to understand the value created by venture capital and private equity investors through technology and technology-enabled startups in India. It analysed the role of VC/PE investors, dimensions in which they are creating value for the country and their impact on job and wealth creation. The venture capital investing space in the country has been constantly evolving, with the year 2019 witnessing nearly 500 deals worth $2.1 billion. “Further, the coming up of several new VC funds and the successful raising of new rounds by old funds reinforces the investors’ confidence in the domestic market. This is a testament to the substantial amount of wealth, jobs, and development that have been created,” IVCA President Rajat Tandon said. “Continuing with the current pace, support, and interest from policymakers and the investors, revolutionary times are ahead,” he added. Zinnov CEO Pari Natarajan said the importance of entrepreneurship, investments, technology and innovation to turbocharge India’s growth is undeniable, with start-ups and investors at the centre of it all. “The cumulative valuation of the start-up ecosystem has witnessed a colossal increase in the last 6 years – as much as 15 times since 2014, to touch $141-149 billion in 2020. This value has created a virtuous cycle of wealth creation and distribution across stakeholders in the ecosystem, thus putting India on its goal to become a $5 trillion economy by 2025,” Natarajan added. Small and medium businesses are increasingly relying on start-ups to adopt digitalisation to drive revenues, productivity and efficiency at scale, the report added.