India's startup ecosystem enters defining phase, focus shifts to IP-led outcomes: Accel partner Prashanth Prakash

New Delhi, Jan 16 (PTI) India's startup ecosystem has entered its most defining phase, shifting from scale to substance with a focus on building globally credible, IP-led companies, Prashanth Prakash, partner at venture capital firm Accel India, said on Friday.

"The current phase and the most consequential one is where founders are building global quality products and technologies from India, extending beyond software into sectors such as electric mobility, aerospace, defence, advanced manufacturing, and deep technology," Prakash told PTI as the country marked 10 years of `Startup India', the Centre's flagship programme that stoked national entrepreneurial ambitions.

India’s startup journey should be viewed not through headline counts of companies or capital deployed, but as a multi-decade process of capability building with each generation of startups addressing a different national constraint, the entrepreneur and philanthropist added.

According to Prakash, the first wave of Indian startups in the late 2000s and early 2010s focused on solving large, India-specific problems in areas such as commerce, logistics, payments, and consumer discovery. Companies such as Flipkart and Zomato demonstrated that Indian founders could operate at population scale while managing operational complexity across a fragmented market.

He said this generation laid the foundation in the form of digital infrastructure, execution capability, and venture confidence, on which subsequent waves of entrepreneurship were built.

"The second wave marked a clear shift in ambition, with Indian founders building software products for global customers and competing on product quality and engineering depth rather than cost advantage alone. Companies such as Freshworks and BrowserStack showed that world-class SaaS businesses could be built from India and sold globally, helping reposition the country as a serious global product engineering hub," Prakash said.

He identified three emerging archetypes in the current phase.

The first is translational innovation, where Indian engineering and applied R&D are converted into real-world products, as seen in companies such as Ather Energy and Agnikul Aerospace.

The second is domain-immersed entrepreneurship, where founders build from deep, lived experience within a problem space, resulting in long development cycles and difficult-to-replicate intellectual property, as seen in startups such as Unmanned and Rekise Marine.

The third archetype is emerging at the intersection of global intellectual property and Indian manufacturing rigour, Prakash noted.

According to him, in areas such as aerospace, defence, and precision engineering, founders are combining engineering depth, process excellence and startup execution speed to meet global standards.

"What actually distinguishes the current phase is the maturity of the surrounding ecosystem," Prakash said, adding that India now has over two lakh DPIIT-recognised startups, a deeper capital stack across stages, and more than USD 115 billion invested over the past decade.

Increasingly, capital is being directed towards long-horizon, IP-led outcomes rather than rapid scale alone.

Prakash also pointed to a shift in government participation, with policy moving from intent to execution through R&D, support, procurement pathways, and early-stage risk absorption in strategically important sectors.

The celebration of Startup Day reflects how India has moved from building platforms to software for the world, and now to creating globally respected products and technologies, he said.

The next decade, Prakash asserted, will be defined less by the number of startups created and more by the number of enduring, globally credible, IP-driven companies to emerge from the ecosystem, adding that the transition is already underway. PTI MBI MIN MIN