Pune Startup Ecosystem: On Road To Become The Top Startup Hub By 2020

In 17th century it was the base of Chhatrapati Maratha Shivaji Maharajh. In 21st century, it’s the Oxford Of East – This is Pune (also known as Poona), the cultural capital of Maharashtra.

In recent decades, Pune has raised itself from its cultural and spiritual heritage to a well-established ecosystem for industrial growth.

Once known for its military establishments, it is now the third-fastest growing city in the Asia-Pacific region, after Bengaluru and Hyderabad, according to JLL’s City Momentum Index (CMI) 2017. The city offers a host of career opportunities in sectors such as manufacturing, automobiles, as well as IT and management. Also, it is considered a hub for education and research with internationally recognised universities and institutions, such as Symbiosis Institute of Management, Ferguson College, MIT (Maharashtra Institute of Technology) and more. Today, one can even find several greenfield facilities near Pune by leading automotive companies such as Tata Motors, Mahindra & Mahindra, Mercedes Benz, Force Motors and more.

The Maharashtra state ministry has recently made commitment to make Pune the number one startup hub in the country by 2020. Reportedly, The Pune Smart City Development Corporation (PSCDC) has set up a new subsidiary, Pune Idea Factory Foundation (PIFF), to cater to the startup needs of the city.

PIFF is currently guided by a four-member advisory board which includes NCL’s Dr. Raghunath Mashelkar, Bajaj Auto’s Rajiv Bajaj, 5F World Chairman Ganesh Natarajan, and Growth Story co-founder K Ganesh.

There are plans to expand the advisory team to 12 people and also bring together other incubators in the city, investors and mentors who can help and guide the startups.

As stated by Kunal Kumar, municipal commissioner, Pune Municipal Corporation to ET, “The foundation of Pune as a Smart City is built on three verticals -­ improving the quality of life by improving infrastructure and services, boosting the economy, and creating jobs and sustainability. Under all these heads, there will be a need for enterprises to create, support, and maintain services. We want startups to take up that challenge. This becomes an engine for growth and innovation keeps happening.“

Earlier in June 2016, Maharashtra CM Devendra Fadnavis also announced his plans to develop Pune as a startup hub. As he stated,

“The city has the right ecosystem and can beat Bengaluru as the startup capital of the country.”

All this points towards several intrinsic advantages Pune offers to lead as a prominent startup hub. Technology entrepreneurship culture, proximity to financial capital (Mumbai) and the active startup communities – have further played a crucial role in attracting the typical clutch of multi-billionaire investors to the city.

Notable Startups And Investments: 2017

As per an Inc42 report, 72 startups got funded between 2014-2016, with a total amount of $435 Mn. Pune, also outshined in 2016, termed as ‘winter year’ for startup ecosystem, raising over $250 Mn in funds across 45 deals as per an Inc42 analysis.

Ecommerce gained new heights in last few years, as startups like FirstCry and iCustommadeit secured million-dollar tickets. Also, the top investors in this period included IDG Ventures India, Kalaari Capital, New Enterprise Associates, SAIF Partners, Valiant Capital Partners, and Vertex Ventures.

2017 has come up with new hopes for Pune-based startups operating in the consumer Internet and technology segments. Q1FY18 has already brought in nine fundings so far to the tune of $96 Mn, in these segments as per an Inc42 analysis. This includes the whopping $56 Mn funding of market research company MarketsAndMarkets and $25 Mn raised by ERP solution provider Icertis.

As per Angellist, Pune is the base for over 1,200 startups.

Here is a quick overview of Pune-based startups/companies who have raised funding in 2017 till April 3, 2017:

AgroStar

Founded in: April 2013

Founder(s): Shardul Sheth, Sitanshu Sheth

Funding: In March 2017, it raised $10 Mn from Accel India, IDG Ventures, and Aavishkaar, in Series B round. In August 2015, it raised $4 Mn in a round led by IDG ventures.

It is an mcommerce platform for agriculture. The founders have built a technology platform and use data analytics and agronomy expertise to provide real-time solutions to farmers in India. It is a direct-to-farmer digital platform where farmers can procure quality agri inputs at fair price just by using a mobile phone.

MarketsAnd Markets

Founded In: 2010

Founder(s): Sandeep Sugla

Funding: In March 2017, it raised $56 Mn (INR 367 Cr) in a funding round led by FTV Capital and VC firm Zodius Capital. It was MarketsAndMarkets’ first institutional funding so far.

A global research and consulting firm, MarketsAndMarkets provides research services to 80% of global Fortune 1000 companies. It offers a cloud-based market intelligence platform that enables clients to take advantage of emerging opportunities.

Icertis

Founded In: 2009

Founder(s): Monish Darda, Samir Bodas

Funding: In March 2017, it raised $25 Mn in Series C funding round led by B Capital Group, Ignition Partners and Greycroft in partnership with e.ventures and Eight Roads Ventures. Earlier,  Icertis raised about $15 Mn in a Series B round of funding led by Ignition Partners, in  March 2016.

Icertis provides cloud-based, SaaS solutions for managing enterprise-wide contracts, be it buy-side, sell-side or employee contracts as well as ESOPs. The company’s flagship product – Icertis Contract Management (ICM) – can manage, sell-side, buy-side, and corporate enterprise contracts across the globe by leveraging the power of the cloud. The Bellevue-headquartered cloud enterprise software startup has offices in Pune and Mumbai in India.

Clodura

Founded In: 2015

Founder(s): Kapil Khangaokar, Sunu Engineer

Funding: In February 2017, it raised an undisclosed amount of Seed funding from unnamed investors.

A personal sales assistant, Clodura helps sales personnel understand their prospective clients/ leads in detail by analysing them with an intelligent algorithm on various data points, in real-time. Furthermore, it helps them fully understand their consumer.

TownScript

Founded In: 2014

Founder(s): Sachin Sharma, Sanchit Malik

Funding: In February 2017, it raised an undisclosed amount from BookMyShow, against a minority stake in the company. In February 2015, it also raised an undisclosed investment from a group of angel investors.

Townscript facilitates the ticketing requirements of small and medium events such as workshops, marathons, trips, college festivals etc. The startup enables event organisers to set up a registration and ticketing page via its website or app.

TaxSutra

Founded In: 2011

Founder(s): Arun Giri, Ameya Kunte, Arun Anant

Funding: In January 2017, it raised $366K (INR 2.5 Cr) from TV Mohandas Pai, V Balakrishnan (Chairman of Exfinity Ventures), along with former Wipro taxation head PV Srinivasan. Earlier in February 2015, the company raised $161K from a group of individual investors including V Balakrishnan and TV Mohandas Pai, former CFOs and Board Members of Infosys.

TaxSutra provides real-time news and case law analysis on the Income tax from ITAT, the High Court, and the Supreme Court. It also tracks important litigations, developments in Income Tax department, CBDT, and Finance Ministry. It runs six online subscription-based portals on direct tax, indirect tax, transfer pricing, corporate laws, and accounting/auditing standards, all targeted towards businesses.

Ethosh

Founded In: 2011

Founder(s):  Jitendra Dahale, Rahul Deshpande

Funding: In January 2017, Deepak Nathani, Cybage co-founder, picked up a 25% stake in the startup.

Ethosh offers visual and interactive communication solutions to organisations. The startup provides video solutions including interactive product experience, virtual and augmented reality, and visual technical learning.

SmarterHi

Founded In: 2014

Founder(s): Srini Narayanan, Pradeep Vasudev

Funding: In January 2017, it secured an undisclosed amount of funding from a Singapore-based investor for a minority stake.

The startup’s flagship product, Assertion, is a B2B security audit solution for large enterprises and contact centres. Assertion is a security and compliance system that aids its users to adopt a policy-oriented approach to communication systems security.

RML Agtech

Founded In: 2007

Founder(s): Vikram Gupta

Funding: In January 2017, it raised $4 Mn from IvyCap Ventures.

RML AgTech is a technology company providing an ‘Agri Decision Support Solution’ on mobile phones to farmers to enhance crop productivity and earnings of the farmers. The company has developed app-based solutions for every stage of farming – starting from soil testing, what to grow, how to grow, where, and when to sell for agriculturists.

Other startups which have been on an investors’ hit list recently are Pubmatic, Storypick.com, TripHobo, Swipe, Firebrand, Emberify, Trobe, EasyMeat, Plobal Apps, Chtrbox, Demyto and more. In addition, the list of notable startups which played a major role in making Pune a prominent startup hub and gained successful exits included Firstcry, TastyKhana.com (acquired by Foodpanda), Accompli, Zimbra, and Dhingana.

Read about the 14 Pune startups that have made it big.

The Evergreen Pune Startup Ecosystem

Pune was referred to in the past as a “Pensioners’ Paradise” since many government officers, civil engineers, and Army personnel preferred to settle down there after their retirement. Now, it is on the road to be the next startup paradise.

The city has reputed tech colleges, namely College Of Engineering Pune, Pune Institute of Computer Technology, Maharashtra Institute of Technology (MIT), and Vishwakarma Institute of Technology, producing a fresh crop of graduates each year. Furthermore, these esteemed institutes are taking up the onus to groom and mentor startups as well. The Maharashtra Institute of Technology (MIT) Pune has launched EDUGILD in June 2015 as an initiative to mentor edtech startups. It successfully completed its first batch in July 2016. In November 2016,  DesignGild, claimed to be India’s first Design-led startup accelerator programme and an initiative of the MIT Institute of Design (MITID), announced the launch of its first batch. The boot camp for these startups began from January 2017 in Pune.

Pune is also home to great communities like Open Coffee Club, Roundtables by iSpirt and Product Nation. TiECon Pune organised by TiE Pune, and an array of other events and workshops are helping the city to compete with more established hubs like Hyderabad, Delhi, Bengaluru, and Mumbai.

Read more about the Pune startup ecosystem builders from our earlier coverage here.

Editor’s Note

The debate is still on whether Pune can even be classified as a startup hub, despite the number of startups launching in the city. On one site, the infrastructure is absolutely right – with a growing and enthusiastic talent pool coming from its universities, and the presence of accelerators such as EDUGILD, DESIGNGILD, and communities such as TiECon Pune that are looking to strengthen the entrepreneur-investor nexus. However, as compared to more mature ecosystems in Bengaluru, Hyderabad or even nearby Mumbai, Pune has a lot of catching up to do – be it in terms of startups going global, investors marking money in companies and more. In recent years, Pune has shown tremendous potential with an unusual mix of early-stage entrepreneurs, established companies and enthusiastic culture. Will it live up to this potential of The Next Startup Hub, remains to be seen.