adminneComparison: US Vs. Indian Startup Ecosystem

eComparison: US Vs. Indian Startup Ecosystem

eComparison: US Vs. Indian Startup Ecosystem

The Indian startup ecosystem has grown into the third largest startup landscape in the world. While the US is still the startup capital of the world, the Indian market has experienced many parallels with its American counterpart. The numbers we’ll discuss in this comparison post will be between 2015 and 2016. These numbers usually increase each year so we expect them to increase this year and next year as well.

Below, we’ll lay out some facts and figures that compare the United States and India to see where they’re alike and where they differ:


India and the United States represent the second and third most populous countries on Earth. Trailing behind China, India and the US rank second and third respectively. India has a population of 1.19 billion and the United States is a distant third with 311.1 million people. This means that India has approximately 4x as many people as the United States. This will be an interesting fact to keep in mind as we get into the  comparison of startups between the two countries.

Number of startups

As of 2015, the United States had approximately 10 times as many startups as India. The US came in at approximately 47,500 startups while India came in around 4,300. Based on population sizes, that means for every one Indian startup there was 300,698 people. In the US, for every startup, there’s approximately 6,758 people.

Number of investors

The two types of investors we’ll look at are Angel Investors and Venture capitalists. The number of Angel Investors in India was only approximately 300 while the number of Angel Investors in the United States was over 300,000. The number of  Venture capitalists in India was ~156 with total VC funding of approximately $6.5 billion. In the US, there over ~1,300 venture capitalist with over $47.3 billion invested.

Incubators, accelerators and coworking spaces

India is also 3rd overall in the number of startup incubators and accelerators, after China and the US. As of last year, India had 140 incubators and accelerators putting it just past Israel. This still leaves India a distant third behind China and the US. The United States has approximately 1,500 incubators and accelerators.


A “unicorn” is a startup with a valuation of 1 billion dollars or more. This valuation either comes from relative value compared to prior investments (post money valuation) or market capitalization (public market stock value). India had only 10 unicorn companies (though nearly one-sixth of the world population lives in India) – the US had 98 unicorns (with 4x less people).

Government Regulation

India’s rank in the World Bank’s Ease of Doing Business Index 2017 is 130, out of 189 countries. A look into specifics paints a grim picture: India ranks 155 in the ease of starting a business, with an average of 14 procedures in Mumbai, when the average is 4.8. The US’ performance is better, with a rank of 51, and an average of 6 procedures to start a business.


Marginal corporate tax rates for India and the United States are 38.6% and 38.9%, respectively. The United States ranks third in the world for the highest marginal tax rate trailing only United Arab Emirates (55%) and Puerto Rico (39%). India ranks 12th in the world and 2nd in Asia, after the United Arab Emirates.

If you’re a startup in the United States or India and you’re looking to find a venture capitalist partner, the Tandon group is interested in helping. At the Tandon group we have over 40 years of experience investing in technology startups and growing them into multimillion-dollar enterprises. If you’d like to setup a potential investment meeting, reach out to us on our website. We look forward to being your partner for the road ahead.

Sources: NASSCOM, IMF, Preqin, Tax Foundation, VCVA, ACA

adminneComparison: US Vs. Indian Startup Ecosystem