From patents to progress: India’s DeepTech startup boom

Deep tech is all about bringing together state-of-the-art research with ground-breaking engineering. Integrating various modern technologies, including AI, ML, nanotechnologies, quantum computing, and more, enables organisations to tackle complex problems, spark innovation, and create practical solutions. 

These advancements, in turn, shape an intelligent and sustainable future. In today’s article, we will dive deep into the current DeepTech scenario in India and analyse the potential of DeepTech startups. 

Also read: How is generative AI affecting the financial industry? 

Understanding the DeepTech industry in India

As cutting-edge technology becomes more widely accessible and practical, Indian B2B SaaS companies are rising in popularity internationally. India’s IT sector has been a driving force in the country’s rise to financial power, with a projected CAGR of 11–14% over the coming five years, increasing the sector’s worth to USD 350 billion by 2026. 

The emergence of deep tech has recently experienced a rise in India, thanks to the country’s strong emphasis on innovation and its expanding startup environment. Deep technology is cutting-edge innovation with the ability to open up established markets and drastically transform existing ones.

Despite this, a NASSCOM survey found that 80% of top SaaS company heads are worried that India’s enterprise SaaS companies won’t be able to keep up with the demand for their cutting-edge cloud computing, artificial intelligence (AI), and machine learning (ML) services. 

However, out of 200+ top organisations, 25% were innovative and DeepTech-oriented, with a combined total of more than 1,400 patents filed in the last five years, compared to 574 in the previous ten years.

The report found that AI and ML are the most used DeepTech, accounting for 54% of use cases, next to big data or descriptive analytics at 39%, and smart automation at 7%.

Also read: How is India making waves in the lithium-ion battery industry? 

Why does India need to see growth in DeepTech?

• Driving force behind innovation

Businesses may benefit from the latest technology, like the IoT, AI, and ML. Integrating such technologies into their operations, sectors including medical care, production, and finance aim to fulfil customers’ constantly changing needs with advanced goods and services. 

Simply put, deep tech enables Indian organisations to do more than follow global trends; it propels them to the forefront of innovation.

• Boost international market share

Indian companies may gain a competitive edge on a global scale by adopting deep tech. Indian businesses can now compete on an equal footing with their global counterparts because of the adoption of cutting-edge technologies such as blockchain, the IoT, and quantum computing. 

In addition, Indian professionals may enhance their skills and knowledge of these technologies, which allows them to participate in global initiatives and partnerships. This boosts India’s image in the tech business worldwide.

• Improving decision-making

Businesses in India may use deep tech’s superior analytical capabilities, made possible by technologies like AI and ML, to make better decisions. This is accomplished by handling and analysing massive amounts of data in real-time that help companies make informed decisions. 

In addition to improving operational efficiencies generally, this allows companies to react quickly to shifting customer tastes and market trends.

• Gain an edge over the competition

Artificial intelligence and machine learning allow companies to automate routine activities, streamline processes, and reduce operational expenses. This way, businesses can focus on the core areas for long-term growth, such as R&D or improving customer experiences. 

This allows companies to remain competitive without going bankrupt while still providing customers with first-rate goods and services.

Market today: DeepTech-oriented B2B SaaS companies in India

India has been on the road to becoming a nation with a digital infrastructure for the past decade and a half. Also, since embracing technology, Indian businesses, investors, and businessmen have enjoyed remarkable development.

In the last 30 years, India has become a leading provider of software services worldwide. In the case of deep tech B2B SaaS companies, in particular, the investor community becomes an essential gear in the wheel of development. 

Additionally, the rapid advancement of this capability will require regulatory and policy backing from the government. There have been positive developments, such as the NIDHI Prayas scheme and the proposed National Deep Tech Startup Policy. 

These will make it possible for investors to see deep tech organisations as promising investment opportunities by offering incentives like tax advantages and opportunities for collaboration. 

However, there is still a need to encourage innovation and adoption in domains such as data regulation, intellectual property protection, and procurement regulations.

Also read: The startup saga: Tracing the growth of India’s entrepreneurial landscape 

The potential of DeepTech startups in India

India is quickly becoming a major centre for technical developments, thanks to the rise of deep tech. Startup India, Niti Aayog, and the Atal Innovation Mission are among the government programmes that are supporting startups and incubators to cultivate ideas in deep technology.

In 2022, almost 12% of India’s total IT startups were DeepTech companies. Specifically, the market has seen a 44% CAGR in the last decade and will have raised $4.2 billion by 2022. 

India’s economic growth and its solution to significant economic and social challenges caused by its massive population of 1.4 billion people are now dependent on the broad adoption of DeepTech.

Massive industry-led deep tech mentorship programmes are being developed by mega-institutions such as NASSCOM. For Indian DeepTech to thrive and last, venture capitalists must back companies that are heavy on research and development. The Indian deep tech industry is booming, which is great news for businesses, investors, and new ventures.

Top B2B startups in India using DeepTech

Below are the companies leveraging DeepTech in India with market capitalisation and net profit as of March 7, 2024.

Conclusion

Innovative deep tech capabilities can help Indian organisations achieve a competitive edge and secure a superior position as they strive to compete with global SaaS giants and increase their market share. 

If India wants to create a B2B SaaS destination that is competitive on a global scale, the country must prioritise the technological advancements that come with DeepTech.