‘The City of Pearls’, also known as Hyderabad, is famous for its pearls trade, Charminar, Ramoji Film Studio and its delicious food culture. However in the economics world, it is also known for its startup ecosystem. Ranking 4th best in India and 65th best globally (source), it is the Indian city entrepreneurs are flocking to.
What makes Hyderabad so attractive to startups and entrepreneurs. In the blog, we will discuss the development of startup companies in Hyderabad and its thriving sectors.
The Growth of Hyderabad’s Startup Ecosystem
Despite the bifurcation, Hyderabad secured a total funding of $141 Billion between 2014 – 2023 (source), received from both local and foreign investors. The growing tech infrastructure has made Hyderabad the home of many tech startups. Following are a few factors contributing to the growth of Hyderabad as the hub for entrepreneurs:
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The Incubators
Incubators are a core pillar of any startup ecosystem. They play a significant role in shaping and supporting emerging startups in Hyderabad by offering co-working spaces, expert support, funding, and guidance to build their foundation, streamline their operations, and provide resources for fundraising.
A few notable incubators supporting the startup companies in Hyderabad are government-backed T-hub, We-hub for women entrepreneurs, DLabs at the ISB, and IIIT-H for deep tech startups.
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Skilled Talent Pool
No business can run successfully without skillful and knowledgeable people. Hyderabad is home to many reputed educational institutes like the IIIT-H, IIT-Hyderabad, Indian School of Business, Osmania University, National Academy of Legal Studies & Research (NALSAR), Indian Institute of Chemical Technology, Centre for Cellular and Molecular Biology, and more. These institutions create a skilled workforce to support the vision of the startups. The business startups in Hyderabad build a talented team to improvise their offerings.
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Government Support
The government plays a vital role in supporting the Hyderabad startup culture. The Telangana government has created supportive policies and backed up many initiatives to grow innovative startups in Hyderabad.
Some these policies and initiatives include the Innovation Policy, reimbursement incentives, T-Works to support prototyping for startups, Telangana State Innovation Cell (TSIC) to foster innovative thinking, Research and Innovation Circle of Hyderabad (RICH) to support research and innovation
space for science and technology startups, and Telangana Academy for Skill and Knowledge (TASK) is not-for-profit organization to upskill the youth with the diverse academic course and foster entrepreneurial mindset in the youth.
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Availability of Foreign and Local Investors
In 2024, Hyderabad’s startups secured $571 Million in funding, a 160% jump from 2023 (source). The competitive costs in Hyderabad are one of the primary attraction points as they provide better ROI to entrepreneurs and investors. Because of it, Hyderabad witnessed a surge in foreign fund influx. T-spark and T-Fund are a few government initiatives that fund startup companies in Hyderabad.
Top Sectors for Startup Companies in Hyderabad
Innovation is not a new phenomena, and we have seen a lot of it in Hyderabad in the form of innovative startups, credited due to their supportive startup ecosystem and competitive cost. Some sectors more than others have witnessed massive growth in recent years. Tech startups in Hyderabad offer unique solutions and get validated and funded by international investors.
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Healthtech
Hyderabad is known as the hub for the life science and biotech industry. Therefore, it is no surprise that it was the most dominant sector in 2024, securing $300 Million in funding. Establishing specialized economic zones, research centers, and government initiatives contributes to the growth of health-tech startup companies in Hyderabad. MapmyGenome and Docturnal are a few rising tech startups in Hyderabad’s healthcare sector.
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Fintech
Fintech is yet another thriving sector with a growing number of innovative startups in Hyderabad. The investment secured by the fintech industry
witnessed a 91% increase in 2024 by raising $105 Million. The tech-savvy workforce and the IT resources make Hyderabad the hub for tech startups. A
few notable fintech startups in Hyderabad are Zaggle, KFin Technologies, Qapita, and Payswiff.
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AgriTech
Agritech is one of the leading sectors with global startup companies in Hyderabad. In 2024, the agritech innovative startups in Hyderabad secured $32 Million in funding. The establishment of agriculture-focused research labs and initiatives has contributed significantly to the growth of agric tech startups. A few emerging food and agritech startups are Marut Drones, Cornext, and Swap.
If you are looking for a startup hub with supportive government policies, lower cost of operation, and many funding sources, Hyderabad is a place you must explore. Startup events like the Global Startup Summit by 21BY72 help you understand the startup ecosystem and connect with entrepreneurs, investors, and industry experts in Hyderabad. We are ready to conduct season 4 of our Global Startup Summit with attendees from across the globe. Early birds get some massive offers; book your seats now!
Conclusion
Whether you are an entrepreneur or investor looking for a thriving startup ecosystem, Hyderabad should be on your list! The Hyderabad startup ecosystem provides support through policies & incubators, funding, and a skilled workforce from credible education institutes to help the startups thrive. The government policies and the competitive prices make it easier for startup companies in Hyderabad to get higher ROI! Tech startups in the healthcare, finance, and agriculture sectors witnessed massive growth and an influx of funds in recent years.
FAQs
1. Is Hyderabad good for startups?
Recently, Hyderabad has become a lucrative spot for startups. It is the life science and biotech industry hub because of the research centers and the
supportive government policies. Furthermore, incubators like the T-Hub and We-Hub make learning easy for emerging startups in Hyderabad. The startup companies in Hyderabad get access to a tech-savvy and skilled workforce due to a robust education structure. Hyderabad has a growing investor network, including Hyderabad Angels and Sequoia Capital, making it easier for startups to secure funding.
2. How do you secure funding for emerging startups in Hyderabad?
Securing funding for startups in Hyderabad involves exploring multiple financing options. Entrepreneurs can seek angel investors like Hyderabad
Angels, venture capital firms such as Endiya Partners and Sequoia Capital, or participate in incubator and accelerator programs like T-Hub. Government initiatives, including Startup Telangana grants and subsidies, also provide financial support. Networking with investors, pitching at startup events, and leveraging startup-friendly bank loans help emerging startups raise the necessary capital for growth.
3. What are some challenges faced by startup companies in Hyderabad?
Despite Hyderabad’s supportive startup ecosystem, entrepreneurs face challenges securing early-stage funding, especially for non-tech startups. High
market competition in sectors like fintech and agritech makes it challenging for startups to establish themselves. Additionally, talent retention is a concern, as many skilled professionals prefer jobs in global tech companies. Regulatory hurdles and compliance issues can also slow down growth. However, startups can overcome these challenges with the right strategy and support from incubators and government policies.
4. What are the top tech startups in Hyderabad?
Hyderabad is home to several innovative tech startups across diverse industries. A few of them are as follows:
1. Darwinbox, a leading HR tech startup, provides AI-powered hiring solutions.
2. Skyroot Aerospace is a private space sector with advanced rocket technology.
3. H-Bots Robotics specializes in AI-driven robotic solutions for various industries.
4. Zaggle, a fintech startup, offers digital payment solutions.
These startups and many others contribute to the city’s reputation as a hub for emerging tech startups, attracting investors and global recognition.
