The number of Indian cybersecurity product startups in 2020 has grown to over 225 from over 175 in 2018, while revenue has doubled to over $1 billion in 2020 from $475 million in 2018, according to Data Security Council of India’s latest report.
India is emerging as a cybersecurity hub catering to both Indian and global companies amid the growing wave of cyberattacks. The number of Indian cybersecurity product startups in 2020 has grown to over 225 from over 175 in 2018, while revenue has doubled to over $1 billion in 2020 from $475 million in 2018, according to Data Security Council of India’s (DSCI) latest report titled Indian Cybersecurity Product Landscape 2.0—An Emerging Next-gen Cybersecurity Product Hub.
India accounted for 63% of the revenue for these startups followed by North America (16%). Banking, financial services and insurance (BFSI), and IT were the key contributors to their revenue, while growth in healthcare, e-commerce and manufacturing has been robust too.
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Though based in India, the startups are aware of the growth potential in global markets and the higher spending capacity of global companies. According to the report, 24% of the cybersecurity startups have expanded globally in the last two years and established presence in countries such as the US, Australia, Singapore and Netherlands.
“The growth in scale, sophistication, complexity, and types of attack vectors has shifted the spotlight onto business resiliency and is further pushing the demand for next-gen cybersecurity products. India is becoming a trusted and natural partner of choice for providing next-gen cybersecurity products globally," points out Rama Vedashree, CEO, DSCI.
In terms of funding and development, DSCI found that 78% of funding for these startups were generated domestically, while 22% received funding from US investors. Venture capitalists (VCs) are the main source of funding, accounting for 75% of all funds.
Further, the study shows that 84% of the products offered by the startups are software-based and 78% are offered with subscription-based licensing model to make adoption easier, especially on Indian companies. With more companies switching to cloud, 78% of the products have been designed for cloud while 63% use artificial intelligence (AI) or one of its branches for better results.
Around 61% of the startups are pure-play cybersecurity product companies, while 28% offer a mix of products and services. The rest of the 11% offer other technology products too. Majority of the founders have robust experience, especially in IT and/or cybersecurity. For instance, 77% of them had over 10 years of industry experience, while 64% of them were from cybersecurity and 29% from IT background.
In terms of size and location, 83% of these startups have 100 or lesser employees. Bengaluru, Mumbai, Pune, Delhi-NCR, Hyderabad and Chennai are largest hubs for cybersecurity product startups in India, with 25% of new offices located in Maharashtra, followed by 19% in Karnataka.
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