India’s got the next big thing in tech, and it could be worth $1 trillion

• The most well-known SaaS businesses in the world include Zoom (ZM), SAP Concur etc.
• India’s SAAS sector may generate $1 trillion in value by 2030 and create 500,000 jobs.
• There are close to a thousand such businesses in India, 10 of which are start-ups worth $1 billion.

India started its metamorphosis into a major player in the global IT industry more than 20 years ago, ushering in a period of unprecedented prosperity and job growth in the nation.

The third-largest economy in Asia is now prepared for the newest technological frontier: creating the next wave of software firms like Zoom or Slack.

The Covid-19 pandemic has compelled businesses all over the world to invest heavily in digital infrastructure, enhancing the power of organisations that offer software as a service, or SaaS.

According to a KPMG poll, businesses increased their weekly IT spending by $15 billion last year as they rushed to establish secure remote working environments.

SaaS businesses offer web-based programmes that look after everything from the software’s performance to its security.

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The most well-known SaaS businesses in the world include Zoom (ZM), SAP Concur, and Salesforce (CRM), the American juggernaut that owns the Slack for work chat tool.

According to a recent analysis created by consulting firm McKinsey & Co. and SaaSBoomi, a community of industry experts, India’s software-as-a-service sector may generate $1 trillion in value by 2030 and roughly 500,000 new jobs.

According to the survey, there are close to a thousand such businesses in India, 10 of which are unicorn firms, or start-ups worth at least $1 billion.

According to Girish Mathrubootham, CEO of Freshworks, the most well-known SaaS business in India, “this potentially be as huge an opportunity as the IT services market was in the 1990s.” It submitted an IPO application last month, joining a long list of other significant Indian software unicorns that are floated this year.

More than ten years ago, in the city of Chennai in southern India, Freshworks was established. It offers software to assist businesses manage relationships with their clients, much like Salesforce does. It has more than 50,000 clients and is the industry’s oldest unicorn in India. It has raised money from investors including Tiger Global and Accel. According to data provider Tracxn, the company’s most recent valuation was $3.5 billion in a 2019 investment round.

Other Indian SaaS companies have achieved success by concentrating on specialised industries. For instance, the unicorn Zenoti creates software for the spa and beauty salon sector.

Six of India’s 10 SaaS unicorns attained that milestone in 2020, attracting the interest of investors worldwide. According to the SaaSBoomi study, investors invested $1.5 billion in Indian SaaS startups last year, four times more than in 2018 or 2019.

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