India’s startup ecosystem has expanded rapidly over the last decade. From small towns to global tech hubs, startups are emerging from every corner of the country. But what makes some states stand out as innovation leaders?
In this blog, we explore the top 10 states and top 10 startups contributing to India’s startup success, the sectors dominating in each, and key startups redefining industry standards.
Whether you’re a budding entrepreneur or an investor tracking trends, understanding where and why innovation thrives is key.
Why State-Level Innovation Matters
Startups don’t grow in isolation. The state they’re born in often determines how well they scale thanks to differences in infrastructure, policy support, investor networks, and access to talent. Some states like Karnataka and Maharashtra are already global tech magnets, while others like Tamil Nadu and Telangana are quickly becoming powerhouses.
Top 10 States Powering the Indian Startup Scene (2025)
| Rank | State | Dominant Sectors | Key Cities & Hubs | Avg. Funding Range | Infrastructure Strength |
|---|---|---|---|---|---|
| 1 | Karnataka | SaaS, Fintech, AI | Bengaluru, Hubballi | $2M–$10M | Strong tech infra, Tier-1 IT workforce |
| 2 | Maharashtra | Finance, Edtech, Healthtech | Mumbai, Pune, Nagpur | $1.5M–$8M | Financial capital, startup accelerators |
| 3 | Tamil Nadu | Manufacturing tech, SaaS, CleanTech | Chennai, Coimbatore | $1M–$6M | Industrial clusters, 5G infra pilot cities |
| 4 | Telangana | Healthtech, SaaS, AI | Hyderabad, Warangal | $1.5M–$9M | T-Hub, Data Centers, National Innovation policies |
| 5 | Delhi NCR | Ecommerce, Logistics, B2B SaaS | Delhi, Noida, Gurugram | $2M–$12M | High digital adoption, rapid policy implementation |
| 6 | Gujarat | Renewable Energy, AgriTech | Ahmedabad, Gandhinagar | $500K–$4M | GIFT City, solar tech corridors |
| 7 | Kerala | Edtech, Tourism tech | Kochi, Trivandrum | $300K–$2M | KSUM, Startup Village in Kochi |
| 8 | Rajasthan | Agro-based tech, CleanTech | Jaipur, Udaipur | $200K–$1.5M | Rural innovation centres, solar energy integration |
| 9 | Punjab | AgriTech, Food Processing | Chandigarh, Ludhiana | $250K–$2M | Agro supply chains, robust logistics support |
| 10 | West Bengal | Logistics, Retail tech | Kolkata, Siliguri | $300K–$1.2M | Eastern freight corridor, policy grants |
1. Maharashtra
Recognized startups: 3,661 in 2023 Entrepreneur
Fund of Funds allocation: ₹4,241.20 crore; utilized ¥1,450.58 crore Press Information Bureau
SISFS (Seed Fund) approvals: ₹2.20 crore (2021) → ₹39.20 crore (2023) Press Information Bureau
Mission: Scale fintech, enterprise SaaS, deep tech; leverage Auric industrial expansion with ₹3,000 crore startup funding pool The Times of India
Peak funding inflow: Estimated early‑late‐stage mix; in H1 2025 Maharashtra-based startups raised ~₹ or $1.5B+ Press Information BureauPublicMitraBangalore Mirror
2. Karnataka
Recognized startups: 2,847 in 2023 Press Information Bureau
Fund of Funds: ₹1,719.75 crore; ~₹754.15 crore utilized Press Information Bureau
Seed Fund allocations: ₹4.07 crore (2021) → ₹28.27 crore (2023) Press Information Bureau
Mission: Lead India’s quantum and AI economy, build developer-ready SaaS, biotech deep‑tech startups via Quantum Action Plan aiming at $20B ecosystem by 2030 The Economic Times
Funding boom: Bengaluru topped India’s H1 2025 funding with $2.54B across ~40% share nationally Bangalore MirrorPublicMitra
3. Delhi NCR
Recognized startups: 2,552 in 2023 Press Information Bureau
Fund of Funds: ₹252.94 crore; utilized ~₹539.31 crore (note utilization can exceed allocation via leveraged rounds) Press Information Bureau
Seed Fund: ₹2.24 crore (2021) → ₹14.55 crore (2023) Press Information Bureau
Mission: Accelerate fintech, edtech, healthtech solutions tied to government/regulatory domains, drawing on policy proximity Fortune IndiaNovark Services
Funding share: Delhi startups raised ~25% of total H1 2025 flows, roughly $1.5B–$2B PublicMitraBangalore Mirror
4. Uttar Pradesh
Recognized startups: 1,566 in 2023 Press Information Bureau
Seed Fund: ₹2.005 crore (2021) → ₹10.71 crore (2023) Press Information Bureau
Fund of Funds: ₹30.00 crore allocated; ~₹15.90 crore utilized Press Information Bureau
Mission: Build agritech, EV manufacturing, defense corridor clusters across Noida, Lucknow, Kanpur etc. Investor-friendly policies and infrastructure corridors with ₹40 lakh crore overall investment pipeline The Times of IndiaReddit
5. Tamil Nadu
Recognized startups: 1,004 in 2023 Press Information Bureau
Fund of Funds: ₹450 crore; ~₹279.05 crore utilized Press Information Bureau
Seed Fund: ₹3.025 (2021) → ₹14.52 crore (2023) Press Information Bureau
Mission: Deep‑tech R&D, automotive technology, healthcare innovations leveraging IIT Madras Research Park and incubation setups Press Information BureauWikipedia
6. Gujarat
Recognized startups: 985 in 2023 Press Information Bureau
Fund of Funds: ₹100 crore allocated; ~₹51.75 crore utilized Press Information Bureau
Seed Fund: ₹1.20 (2021) → ₹16.77 crore (2023) Press Information Bureau
Mission: Build industrial SaaS, renewable energy, exports; IT/ITeS policy aims for ₹25,000 crore exports and 1 lakh jobs by 2027 Wikipedia
7. Kerala
Recognized startups: 849 in 2023 Press Information Bureau
Fund of Funds: Not listed in top allocations (~₹10.87 crore utilized in AIF funding) Press Information Bureau
Seed Fund: ₹0.60 to ₹3.47 crore (2021 to 2023) Press Information Bureau
Mission: Focus on robotics, life‑sciences, hardware and social tech innovation via Kerala Startup Mission support Press Information Bureauscribd.com
8. West Bengal
Recognized startups: 573 in 2023 Press Information Bureau
Fund of Funds: ₹48.75 crore utilized (allocation smaller) Press Information Bureau
Seed Fund: ₹0.565 to ₹1.75 crore (2021 to 2023) Press Information Bureau
Mission: Grow creative tech, fintech, edtech via Bengal Silicon Valley Tech Hub; multi‑acre tech campus with ₹1 trillion investment aim WikipediaWikipedia
9. Andhra Pradesh
Recognized startups: ~323 in 2023 Press Information Bureau
Seed Fund: ₹0 to ₹3.80 crore (2023) Press Information Bureau
Mission: Develop Fintech Valley Vizag, Medtech Zone in Visakhapatnam, enhance mobile banking solutions, build export‑friendly FinTech infrastructure WikipediaWikipedia
Spotlight: Why Telangana Is One of India’s Startup Stars
Telangana, especially Hyderabad, has emerged as one of India’s most dynamic startup states. Its flagship incubator, T-Hub, supports early-stage startups across SaaS, AI, and healthcare technology. Backed by pro-startup government policies, the state has also introduced innovation-focused incentives, including grants and co-working spaces across Tier-2 cities like Warangal and Karimnagar.
The combination of low operational costs, 24/7 power supply, and Tier-1 city infrastructure has helped Telangana attract both domestic and international VC interest.
📊 Overall Insights
- Maharashtra leads in state seed fund approvals and fund flows under the government-connected AIF programs. Karnataka and Delhi also show hefty utilization from fund-of-funds schemes Press Information Bureau+1Press Information Bureau+1.
- Bengaluru and Delhi NCR account for over half of India’s total startup capital in H1 2025 combined, with Bengaluru alone pulling in ~40 percent Entrepreneur+3PublicMitra+3Bangalore Mirror+3.
- Fintech, e-commerce, enterprise tech, and transportation/logistics startups are among the top funded sectors nationally, while states emphasize niches: Karnataka in quantum and SaaS, Telangana in biotech and AI, Uttar Pradesh in agritech and EVs, Gujarat in clean manufacturing, and Kerala in robotics and life sciences
FAQs About India’s Startup States
Q1: Which state has the most number of funded startups?
Karnataka leads in startup funding, with Bengaluru alone receiving more than $10 billion in VC investments in the past five years.
Q2: Why are Tier-2 cities gaining popularity for startups?
Lower cost of operations, expanding infrastructure, and local government incentives are making Tier-2 cities more attractive for early-stage companies.
Q3: Which niche is expected to grow most in 2025?
AI-based SaaS platforms, healthtech, and clean energy solutions are expected to see the highest startup growth across Indian states.
India’s startup ecosystem is growing stronger with each state bringing unique value, from tech innovation to manufacturing excellence. Whether you’re tracking the next unicorn or seeking inspiration, these top 10 states show where India’s entrepreneurial future is headed. For more insights on regional innovation, follow us at BestStartup.in.
