Cyberspace: India’s next frontier

Following a digital boom, India’s cyber security sector is seeing an exponential growth. As with many other digital sectors, start-ups are driving this trend.

The rapid digitalisation in India in the wake of Covid-19 has bolstered several sectors. From e-commerce and digital finance to online education & SaaS (Software as a Service). In fact, the Indian online education market is forecast to be worth S$ 8.6 Billion by 2026. While a new collaborative report by NASSCOM in partnership with SaaSBOOMi states that India’s SaaS revenue has reached $3.5 billion as of March, 2020, growing at 30 per cent CAGR, with 75 per cent of it coming from global sales.

Telemedicine/ healthTech as a sector in India too have seen a huge amount of growth. Research suggests that by 2022, the healthcare market might have a worth of $ 370 billion, promising yields up to 35-40 per cent, according to several investors. As per Traxcn data, , India’s investments in health tech amounted to a striking $ 571 million in 2018.

Start-ups spear ending growth

With this digital boom, it’s little surprise then that India’s cyber security sector too is seeing an exponential growth. As with many other digital sectors, start-ups here too are driving this trend. According to Data Security Council of India’s (DSCI) latest report titled Indian Cybersecurity Product Landscape 2.0—An Emerging Next-gen Cybersecurity Product Hub the number of Indian cybersecurity product start-ups in 2020 has grown to over 225 from over 175 in 2018, while revenue has doubled to over $1 billion in 2020 from $475 million in 2018.

The cyber security product industry generated a revenue of approx. USD 1016 mn in the year 2020 and grew with a CAGR of ~39 per cent from 2016-2020. The DSCI study shows that 84 per cent of the products offered by the start-ups are software-based and 78 per cent are offered with subscription-based licensing model to make adoption easier, especially on Indian companies. With more companies switching to cloud, 78 per cent of the products have been designed for cloud while 63 per cent use artificial intelligence (AI) or one of its branches for better results. Around 61 per cent of the start-ups are pure-play cyber security product companies, while 28 per cent offer a mix of products and services. The rest of the 11 per cent offer other technology products too.

The research also shows that 77 per cent of the founders of these start-ups had over 10 years of industry experience, while 64 per cent of them were from cybersecurity and 29 per cent from IT background.

Expanding internationally

According to the report 24 per cent of the cybersecurity start-ups have expanded globally in the last two years and established presence in countries such as the US, Australia, Singapore and Netherlands.

“The growth in scale, sophistication, complexity, and types of attack vectors has shifted the spotlight onto business resiliency and is further pushing the demand for next-gen cybersecurity products. India is becoming a trusted and natural partner of choice for providing next-gen cybersecurity products globally,” points out Rama Vedashree, CEO, DSCI.

The future looks byte

With increasing support from the Indian government, cyber security start-ups are poised for faster growth and scaling up. The support from the government is being lent through facilitating incubation and acceleration programs such as MeitY establishing a National CoE in partnership with DSCI, and initiatives such as Cyber Security Grand challenge that promotes innovation and creation of new start-ups and products for complex use cases. NASSCOM and DSCI are also enabling the stakeholder ecosystem to promote the twin engines of cybersecurity growth, products and services. With this sort of continued growth and expansion, India seems to be getting ready to position itself as the global hub for cyber security.