KPMG International surveyed CEOs between the period Jul’20-Aug’20 to understand how their strategic thinking evolved during the pandemic-stricken months. ~90% of the global leaders surveyed claimed that the pandemic accelerated the pace of digital transformation by months and even years, and that in order to stay ahead of the curve, they needed to prioritize investments in new technologies that fast-enable cutting-edge solutions.
While, 2020 set us up for rapid digital transformation, the ‘new normal’ has now made a permanent place for itself among us in form of virtual reality, touchless experiences and an always-ON omnipresence. This changing consumer behavior is providing the tailwinds for the Indian startup ecosystem as well, through an accelerated adoption of deep tech solutions.
For the uninitiated, deep tech is a transformational blend of new and emerging disruptive technologies such as Artificial Intelligence (AI), Machine Learning (ML), Natural Language Processing, Robotic Process Automation (RPA), Blockchain, AR/VR, Internet of Things, Big Data and 3D printing. According to a recent NASSCOM report, 19 per cent of all Indian start-ups, i.e. 2100+ startups, are leveraging deep tech to build complex and innovative products / solutions across industries. The value proposition offered by such startups is poised to disrupt a number of traditional industries such financial services, healthcare, education, manufacturing and agriculture. Many of them are focused on enhancing lives of the Indian consumer through innovations such as personalized & improved diagnostics / medical treatments, augmented reality classrooms, wealth management across all strata of Indian investors, helping SMBs deliver enhanced customer experience etc. These startups are also targeted on specialized B2B use cases across e-commerce, enterprise tech, fintech, healthtech, edtech, HRTech and agritech, with AI, IoT and Big Data as their top choice among deep tech.
In its annual report on Indian technology start-up ecosystem, NASSCOM has reported an increased investor commitment in deep tech startups, with 14% of total investments in 2020 going into such startups out of which 87% of all investments were in AI/ML. This, in turn, has fueled a positive cyclical impact on the startup ecosystem through access to global knowledge, an expanding talent base, and an increase in customer adoption.
|Sector||Illustrative Use Cases for Deep Tech|
|Fintech||Chatbots/Bot Advisors, Credit Scoring, Portfolio Management, Fraud Analytics etc.|
|Healthtech||Online Consultation, Clinical Data Analytics, Medical Image Processing for diagnosis, Surgical Robots, Fitness/Health Tracker Apps/Device, Personalized Cancer Treatment, Remote Health Monitoring, Hospital Inventory Management etc.|
|Retail||Customer Segmentation, Market-basket Analytics etc.|
|Agritech||Weather Tracking & Forecasting, Automated Irrigation for water usage optimization, Monitoring soil & crops etc.|
|Industrial & Manufacturing||Asset Tracking/Monitoring, Predictive Maintenance, Process Optimization etc.|
|Real Estate||Smart Devices for home, Smart Waste/Water Management, Efficient Sensor Enabled Energy Management, Predictive Traffic Flow etc.|
Strong policies and national initiatives such as Atmanirbhar Bharat, Return-to-India and Make-in-India are also helping enrich and expand the Indian startup ecosystem, with unprecedented growth rates among deep tech startups. UPI, AI enabled eGovernance (in many states), and other upcoming digital investments by the Indian Government such as its own official digital currency, are getting us closer to an inflection point post which the social applications of deep tech in India will surpass the enterprise use of such technologies.
The future of deep tech, hence, looks extremely bright. As the continual growth of the Indian start-up ecosystem is fueled by the ongoing era of constantly emerging new technologies, organisations and the government (state and central) would need to reevaluate their roadmaps for adopting deep tech. The horizon is fertile with technologies such as 5G, understandable AI, Quantum Computing, Cloud-native technologies, Cybersecurity mesh, Customer Data Platforms etc., that can enable the booming and resilient Indian startup ecosystem to become global leaders in the deep tech space.
The author is KG Purushothaman, Partner and Telecom Sector Leader, KPMG in India