India’s transformation into a global start-up superpower may come from the country’s heartland rather than its traditional metro hubs. According to a new report released by TiE Bangalore at the 10th edition of the Matrix Global Summit, more than 50 percent of Indian start-ups are expected to emerge from Tier-2 and Tier-3 cities by the year 2035. This promising shift, the report says, will be driven by geographically focused regional development funds aimed at backing start-ups in these smaller cities. It marks a pivotal move towards inclusive innovation, where the next wave of entrepreneurial energy is expected to originate from beyond the big metros.

Blueprint for a Start-up Nation

The TiE report outlines a comprehensive long-term strategy to turn India into an innovation-led start-up economy. The blueprint calls for a shift from isolated efforts to a well-integrated ecosystem built on systemic capacity development. It emphasises that India is well-positioned to become the destination of choice for global entrepreneurs and enterprises looking to create solutions tailored for emerging markets. At the same time, India could serve as a launchpad for innovations aimed at developed economies.

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Deep Tech and the Rise of Patient Capital

Among the key proposals is the creation of mechanisms to support deep tech ventures—start-ups that typically face longer development cycles and higher capital demands. The report advocates for the facilitation of “patient capital,” connecting these ventures with investors who understand the unique nature of deep technology. By fostering specialised investor expertise in evaluating and nurturing deep tech, India can build a robust support system that nurtures innovation from ideation to scale.

A Vision for Inclusive & Transformative Growth

“This is our opportunity to architect an ecosystem that is inclusive by design and transformative by intent,” said Madan Padaki, president of TiE Bangalore and trustee of TiE Global. “We must build an India where every individual, regardless of background or geography, has the tools to build, scale, and lead.” According to the report, India’s start-up ecosystem is expected to generate 50 million direct and indirect jobs by 2035. This would represent a major leap from the current contribution of 4–5 percent to the national GDP to an ambitious 15 percent.The employment gains would include 10 million jobs in start-up-related services, with another 5 million individuals expected to transition from traditional employment to entrepreneurship, aided by comprehensive support programs.

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Call for Unified Startup Policy Framework

Despite the growth, the report highlights that the existing policy landscape remains highly fragmented. Central government policies often clash with state-level regulations, resulting in friction that hampers scale and cross-border operations for start-ups. To address this, the report proposes the establishment of a National Startup Policy Coordination Council. This body would bring together representatives from central ministries, state governments, and ecosystem players to create a harmonised national framework. The idea is to ensure consistency across jurisdictions while allowing for state-specific customisations that leverage local strengths.