If you aspire to create a billion-dollar business in India, one of the IITs is your best bet. Sage, a UK-based accounting and payroll company, stated this in a research released on Friday.
In a study that lists universities that have produced the most unicorn founders, the Indian Institutes of Technology (IITs) bagged the fourth spot. US-based Stanford University claimed the top rank with 51 unicorn founders, followed by Harvard University with 37. The University of California came third with 18 unicorn founders and IIT followed with 12 founders.
Unicorns are startups with more than a billion-dollar valuation+ . India is home to 10 unicorn companies , making them the poster boys of the country’s startup ecosystem. From e-commerce giants Flipkart, Snapdeal and ShopClues to cab aggregator Ola, restaurant aggregator Zomato, classified ads platform Quickr, digital payments company Paytm, mobile adtech player InMobi, messaging app Hike and analytics company Mu Sigma, these startups have grabbed spots in the elite club and almost all the founders have had stints at one of the IITs.
Within the various IITs, it is Delhi that produced the maximum unicorn founders. Sachin and Binny Bansal of Flipkart, Sanjay Sethi of ShopClues, Zomato founders Deepinder Goyal and Pankaj Chaddah, Snapdeal’s Rohit Bansal and Quikr’s Pranay Chulet and Jiby Thomas (now founder of Webbutterjam Digital) are all products of IIT Delhi. Ola’s founders Bhavish Aggarwal and Ankit Bhati went to IIT Bombay. Inmobi’s founders Naveen Tiwari, Abhay Singhal and Amit Gupta studied at IIT Kanpur while their co-founder Mohit Saxena went to IIT Roorkee.
“Good students and faculty is a given with IITs. What is probably the differentiator with IIT Delhi is the culture of the institute which has been cultivated over several decades. They are more connected to the society and have a deep awareness of the problems that exist. Hence, they are able to look for solutions and become entrepreneurs,” said IIT Delhi director V Ramgopal Rao, who is an alumnus of IIT Bombay.
Industry experts say that while earlier it was the rigour of the entrance exams and the competitive culture within the IITs that led to the creation of such companies, over the last 5-7 years, there has been a structured effort to foster unicorns.
“Over last 5-7 years, each of the IITs have made significant strides in creating the right ambience to promote entrepreneurs. From bringing in seasoned alumni to assist startups to encouraging students and alumni to take the entrepreneurial plunge, setting up mentoring clinics and offering assistance of professors, a disciplined effort has been made to create the right structures to foster startups and their founders,” said Suresh Kalpathi of Kalpathi Investments, an alumnus of IIT Madras who is involved with PanIIT Alumni Association, a volunteer-driven organisation that brings together IIT alumni on a single platform.
According to the study, for over 60% of the founders, the current unicorn was the only company they had ever built. However, indicating that experience pays, the research said those who founded more than one company have, on average, a 34.5% higher valuation than those who founded just one company ($4.29bn vs $5.88bn).
In terms of countries that are home to the most number of unicorns, US tops the list with 144 unicorns, followed by China with 47. India grabs the third spot with 10+ . The study also found 2007 to be the bumper founding year, with 29 companies joining the club, including Flipkart, while 2015 was identified as the year of the unicorn with 86 companies achieving the unicorn status. In contrast, 2016 came out poorly, with only 41 companies.