Bengaluru startup ecosystem better than Hyderabad: Experts

HYDERABAD: The startup ecosystem of Hyderabad has still a long way to go to be on a par with that of Bengaluru or New Delhi, experts, who participated in the recent Global Entrepreneurship Summit, told Express. In spite of the encouraging atmosphere provided by the state government, there is a huge scope for improvement, they said.

A report by Tracxn last year ranked Hyderabad among the top five startup cities in India. In the first half of 2016, 155 startup companies in New Delhi did a business of $ 917 million and 129 startups in Bengaluru sealed deals worth $ 489 million. In contrast, 17 startups in Hyderabad sealed deals worth $ 4.5 million.
Also, the ‘Indian startup and funding chart’ by Track.in has 48 startups in November 2017 that received funding, of which only two are from Hyderabad whereas 27 are from Bengaluru and New Delhi.

Neha Viz, co-founder of early-stage startup accelerator, Z Nation Labs, said, “There is lack of business acumen among startup entrepreneurs of Hyderabad. They are not good at conducting business, mainly due to lack of good mentorship. Another problem is that they lack good communication skills. The problem is not with language. Some of the startups here have really good products to offer but they are unable to pitch it to investors.”

Sanjay Enishetty, MD and CEO of 50K Ventures, says, “There are three pillars required for a strong startup ecosystem _ industry segment, which is corporates coming forward and encouraging startups, the presence of strong venture capital-private equity (VC-PE) network and the third is government support. Hyderabad has been getting good government support but only for the past three years.

Corporate giants that emerged out of Bengaluru, like Infosys or Wipro, had laid the foundation for startups in the city as far back as 1980s, fostering startup culture. Leaders from these companies started venture funds and even invested in or owned accelerators. In Hyderabad, the companies that came in were already established and are yet to take interest in startup ecosystem here. Moreover, Hyderabad has just around 15

VC networks which is not even close to the number in New Delhi or Bengaluru.”
Amit Mishra, co-founder of The Angel Network, says, “The T-Hub initiative of the state government is good but there needs to be strong quality check of startups being incubated there which, I think, is missing. With the number set to increase with Phase-2 of the incubator, the benchmark for quality must increase.”