SaaS could be India's next big story to the world

Recent rapid changes in the business environments have resulted in greater complexity. In such a scenario, effective and constructive interactions between individuals and groups have been identified as key factors towards an organisation’s growth. Companies, whether small or big, have taken the plunge and gone digital. Companies have been launching digital transformation initiatives, new workplace access models or enhancing consumer experience etc.

Remote working, digital economy, automation and supply chain enhancements have made accelerated spends in technology a reality and these trends are here to stay for the next decade. In coming years, technology enabled businesses and companies will drive larger value creation for all stakeholders. Beyond new application areas and emerging technologies like Cloud, Data and Analytics, Artificial Intelligence, Machine Learning, Quantum Computing and Industry 4.0 are rapidly expanding the horizon of opportunity. While India has emerged as a global leader in outsourced IT services and the industry is poised to grow to $350 billion in the next five years, the opportunity arising from many of the areas mentioned will be much larger and can easily be a $1 trillion market opportunity for Indian companies in the next decade.

The Global SaaS market is about $150 billion and growing at a CAGR of 23% and according to Nasscom, India’s market share in this is now only at high single digits. The Indian market for SaaS products is also growing rapidly and will grow 6 times by 2025 to touch $ 30 billion. With the strong growth opportunities in India many resourceful entrepreneurs are demonstrating that they can build a business with Indian customers and then start addressing global markets. With a strong momentum demonstrated, Indian SaaS companies are expected to garner a market share of 19% by 2025.

There is rapid growth of 70% + in Indian SaaS, it is possible with the government that has played a key role in nurturing and building a strong startup ecosystem. The median revenues of global SaaS companies have doubled in the last five years, but their valuations have gone up 5X in the same period. The market for technology products is strong for the foreseeable future and hence the opportunity for Indian SaaS companies is immense.

Finally, with the support of the strong ecosystem which is already in place the number of unicorns in India can easily grow 10X from the current levels in the next five years.