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Ratan Tata and the Indian Startup Ecosystem

ET Cases, 20 Pages
AUTHOR(S) : Vandana Jayakumar and Dr. Nagendra V. Chowdary

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Ratan Tata and the Indian Startup Ecosystem


“I am absolutely thrilled to be the part of the start-up ecosystem.”1

- Ratan Tata, Chairman Emeritus, Tata Sons

“Yours is an ecommerce startup too, so why don’t you ask him?” said Nidhi Agarwal’s (Nidhi) father to her in February 2015. Nidhi, Founder of the online clothing startup Kaaryah, was looking for an investor to fund her startup when her father suggested that she should approach Ratan Tata (Tata). Nidhi’s father had read in the newspaper that Tata had provided financial backing to an e-commerce startup. Nidhi wrote to Tata and within months, Tata was one of the investors in her startup.

Tata was on a startup-funding spree since 2014, having invested in more than 20 companies – mostly e-commerce startups. Amidst the booming Indian startup activity and an enabling ecosystem, while several other Indian business icons showed interest in Indian startups, Tata stood out for trying to support Indian startups in an individual capacity.

How will these investments from Tata affect the Indian startup ecosystem? While entrepreneurs who were able to get funding from Tata were quite upbeat about associating with him, it was debatable if his association would be a blessing or a burden for the startups. Moreover, will Tata end up being only a celebrity investor for the investee companies?

Indian Startups and the Startup Ecosystem

During the last decade, India witnessed an exponential increase in entrepreneurial activity to become the world’s fastest growing startup ecosystem.2 While Just Dial (Search Engine Company started in 1996), Bharat Matrimony (a Matrimonial website started in 1997) and MakeMyTrip (an online travel company started in 2000) were some of the early startup successes, Flipkart (e-commerce megastore started in 2007), InMobi (a mobile ads company stared in 2007) and Quikr (an online classifieds advertising company started in 2008) were representatives of successful startups started about 10 years ago..............


Exhibit I: Main Business Segments of Startups in India

Exhibit II: Periodic Table of the Indian Startup Ecosystem (2014–2015)

Exhibit III: Hurdles Faced by the Startups and their Expectations

Exhibit IV: Startup India, End up Abroad!

Exhibit V: Criteria for Startups to get Government Incentives under Startup India Action Plan

Exhibit VI: Highlights of Incentives for Startups in Union Budget 2016

Exhibit VII: Initiatives of Select State Governments to Encourage Entrepreneurship

Exhibit VIII: Top Angel Investors in 2015

Exhibit IX: Snapshots of Investment for H12016

Exhibit X: Ratan Tata’s investments in Various Indian Startups (2014 onwards)

Exhibit XI: Mentoring Relationships

Exhibit XII: Statements From Heads Of Startups and Others

1 Priyanka Pani, “Thrilled to be part of start-up ecosystem: Tata”,, January 6th 2016 (accessed date: March 12th 2016)
2 “NASSCOM Startup Ecosystem Report 2015: India the Next Tech Hotbed”,, October 14th 2015 (accessed date: March 12th 2016)

Teaching Note Preview

Ratan Tata and the Indian Startup Ecosystem



This case study helps understand the booming Indian startup ecosystem and factors that have enabled India to become a startup nation. With around 4,200 startups in India as of 2015, the Indian startup ecosystem has been showing tremendous growth, becoming the world’s fastest growing startup ecosystem. What has led to the emergence of the Indian startup ecosystem? How significant has been the role of technology in boosting the entrepreneurial scene in India? In the backdrop of the booming startup activity, the case study highlights the significant role of Ratan Tata – one of India’s most iconic business leaders – in supporting the Indian startups. What has motivated Ratan Tata to invest in Indian startups? Having invested in nearly 20 startups since 2014, Ratan Tata is not just advising and mentoring the startups but he has also lent his name. However, will the startups be able to carry Ratan Tata’s legacy forward or will he end up being a celebrity investor for startups?

Prerequisite Conceptual Understanding/Before the Classroom Discussion

  • • “Startup India – Momentous Rise of the Indian Start-up Ecosystem”, NASSCOM, 2015 – To get a glimpse of the Indian startup ecosystem


Case Positioning and Setting

This case study can be used in Management Program in Entrepreneurship to understand the role of an enabling ecosystem and an investor-mentor

Suggested Reading for the Faculty

  • • Jeanne C. Meister and Karie Willyerd, “Mentoring Millennials”, Harvard Business Review, May 2010 – To understand the nuances of mentoring for millennial employees/startup founders


Assignment Questions

  • I. Identify and analyze the factors that have cumulatively led to the emergence of a favorable startup ecosystem in India. Discuss the challenges faced by the startups in India and to what extent were the challenges addressed by initiatives of the central and state governments.
  • II. Analyze Ratan Tata’s contribution in supporting Indian startups in individual capacity and in playing the role of a mentor.


Preamble to the Case Analysis

The discussion in this case study mainly tries to understand the Indian startup ecosystem and the factors that have led to the emergence of the same. Having understood the Indian startup ecosystem, the case study then focuses on significant role that Ratan Tata has played in supporting the Indian startup ecosystem by investing in some of the select Indian startups and also mentoring the startup founders/owners. It helps debate on the impact of Ratan Tata’s investments on all the stakeholders – Ratan Tata himself, the Indian startup ecosystem, the investee companies, the investment community and potential entrepreneurs. The main discussion points have been captured in Exhibit (TN)-I...............

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The case study highlights the main elements of the Indian startup ecosystem – the fastest growing and the third largest startup ecosystem globally. While on the one hand, it analyzes the factors that led to the emergence of the Indian startup ecosystem, it lists the challenges involved in starting-up in India, on the other. In the backdrop of the booming entrepreneurial activity in India, the case study focuses on the role of Ratan Tata – who invested in more than 20 startups since 2014 – as an investor-mentor. Ratan Tata’s investments stand out prominently as he has invested in individual capacity in an attempt to help bring out a change in India. However, will the startups that he has invested in be able to carry forward his legacy or will he just end up being a celebrity investor for the investee companies?

Pedagogical Objectives

  • To understand India’s emerging and engulfing startup ecosystem in the light of Government of India’s, several State Governments’, many other public initiatives (especially from trade bodies like NASSCOM, Indian Angel Network, etc.) and quite a few personal initiatives from several Indian corporate czars (like Ratan Tata, Nandan Nilekani, Mohandas Pai, etc.)
  • To analyze the role of Ratan Tata in widening the horizons of India’s startup ecosystem in general and the investee companies in particular and debate on how Ratan Tata’s investments in Indian startups have deepened Indian startups’ financial reach
  • To discuss and debate on the pros and cons of having Ratan Tata as an investor at the fledgling stage of an Indian startup

Case Positioning and Setting

This case study can be used in Management Program in Entrepreneurship to understand the role of an enabling ecosystem and an investor-mentor

This Case Pack Includes:
- Abstract
- Case Study
- Teaching Note (**ONLY for Academicians)
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