‘Let’s not build copycats’: MeitY Startup Hub CEO on driving India’s startup innovation

On the sidelines of the Global Startup Summit in Coimbatore, Paneerselvam Madanagopal, Chief Executive of MeitY Startup Hub, spoke exclusively to The Federal about India’s journey from building a wide startup ecosystem to fostering deep, product-driven companies. Stressing the importance of solving real Indian problems, he emphasised that the future of the ecosystem lies in innovation, not imitation.

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India has over 1.25 lakh registered startups, but we're not really sure of the survival rate beyond Series A. What is MeitY Startup Hub doing to move founders from incubation to scale, not just to registration numbers?

So, if you look at the numbers, the ecosystem has almost grown to about 1.85 lakh startups today. Definitely, a significant number of them will face challenges, but we are at a healthy rate of almost 15–20% of startups reaching the Series A level, which, by global standards, is a very good benchmark.

Having said that, we have built a wide network in the country with almost 200,000 startups. It is now time to build depth—fundamentally strong companies that are product-driven and have strategic national importance. These are the focus areas of the MeitY Startup Hub, as we look at how to drive depth and build fundamentally strong companies.

We are providing three key things that are very important for startups: mentoring support, market access, and, last but not least, money to grow—helping them shift orbits from one level to the next.

You work with incubators, industry, and state governments. What’s the biggest friction you see in converting intent into execution across this multi-stakeholder network?

Well, there is no friction, but there is definitely a lot of opportunity for collaboration. Everybody has their own priorities and set of programs that they are focusing on, which leads to a lot of duplication of efforts and spending. If we can coordinate a little more and collaborate better, we can avoid these redundancies.

Especially in the startup space, this will help startups if we implement a single-window system. If they don’t have to run from one department to another for multiple types of support, routing everything through a single window could be a great opportunity for them.

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Much of India’s innovation narrative is still urban. How is MeitY enabling Tier-2 and Tier-3 founders — beyond hackathons — to access real capital, mentorship, and markets?

At MeitY Startup Hub, we have now launched a program called Genesis. In fact, in the pavilion, you would have seen what we call the Genesis Entrepreneur in Residence Program. We are showcasing about 12 of them from across the country.

Genesis is a program that focuses exclusively on tier-two and tier-three cities. We have identified 65 locations and 65 incubators across the country and are working with them in three areas.

The first is to provide mentorship support. The second is to facilitate pilot-to-POC programs and pilot purchase orders—essentially a market access program. The last, the funding in the form of matching investments, is almost up to one crore, especially for deep-tech startups.

Honestly, there is no dearth of support systems. What is important is that the quality of the startups improves—the quality of the problem they are solving, the technology they are using, and their approach to solutions. If a startup is going to be a “me-too” player, that is not ideal. Similarly, if it is just a platform or service provider, that is not an exciting space for MeitY Startup Hub.

India wants to be a global startup hub—something the prime minister talks about quite often. You also saw Chief Minister MK Stalin mention in his address here in Coimbatore that Tamil Nadu has set a target for 2035 to become a global startup hub. So, let’s be realistic—where do you really see the momentum happening? Will it be in AI, deep tech, semiconductors, or quantum computing?

So, if I were to share, we have definitely come a long way, and a significant amount of headway has been made in the startup ecosystem. Looking at the technologies we mentioned—be it quantum or AI—some of these have been under research in Western countries for over a decade. We are now seeing a surge. We definitely have a catching-up role to play.

The next 3 to 5 years will be crucial, as the efforts being put in now start to yield outcomes. These technologies take time to mature and require substantial research and development funding, so it’s not going to be easy.

That said, we are moving in the right direction and making the right investments. State governments, such as Tamil Nadu, have created fantastic startup ecosystems, while the Union government is contributing through strategic, large national-level projects. Together, I believe this will create a very different and vibrant startup ecosystem in the 3 to 5-year horizon.

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India’s R&D spend is less than 1%. While the country excels in frugal innovation, building path-breaking innovations needs substantial investment—something India currently lacks. Could this be a roadblock for Indian startups, especially when competing with countries like the US and China, where R&D spending is far higher?

If you look at the Indian tech startup ecosystem, we have built width; now it is time to build depth. Depth requires focused efforts and deep pockets.

The first phase of the ecosystem, over the last 9–10 years, was about creating awareness and confidence. Just look at the crowd here today—if even 5% become entrepreneurs, that’s significant. The goal was to cultivate an entrepreneurial mindset and a critical base.

Now, the focus is on building fundamentally strong companies. That’s why projects like R&D funds, A&RF, and other research-focused startup funds are being developed. While India doesn’t yet have the same level of long-term investment as the West, our founders are delivering strong value for the capital available.

Return on investment is crucial; risk capital in India is relatively limited compared to global ecosystems. That is what we are actively working to change.

Is this why many Indian startups end up reverse-engineering Silicon Valley models, rather than building truly homegrown innovations?

Yes, rather than calling it reverse engineering, I would be more stringent and say—let’s not build copycats. The truth is, India still has millions of problems to solve, and we have a billion minds to solve them. The focus should be on addressing real Indian problems.

While we can learn from what has worked in the West, India has its own unique challenges. Solving these will truly drive the Indian startup ecosystem forward.

(The writer is in Coimbatore at the invitation of the organisers.)