New SaaS firms pitch India base

The rise in digitization and hybrid work models has bolstered growth in the SaaS ecosystem

- Priyamvada C. and Ranjani Raghavan

Greater access to domestic capital and rising ease of doing business are prompting many new software-as-a-service (SaaS) startups to house their operations in India, investors and industry experts said, reversing the previous years’ trend of incorporating abroad.

The rise in digitization and hybrid work models have bolstered growth in the SaaS ecosystem in India and globally. More than 200 SaaS startups were founded in India in the last three years and they collectively received an equity funding of $373 million, according to Tracxn data.

"We've seen an uptick of new SaaS startups being incorporated in India...founders need to think of exit strategies when they make their decision of where to incorporate," said Pranay Desai, managing director of Matrix Partners India. The rise in SaaS startups in the country can be attributed to two reasons - access to capital and an Indian initial public offering (IPO) that is an "interesting" exit option, he said.