Over the past decade, Bengaluru has evolved from the IT capital of the country to the startup hub of India. In 2022, the city topped the startup funding charts with $10.8 billion raised by firms in the city, the second city that came close was Mumbai at $3.9 billion.
The sector, which is creating tons of jobs and attracting talent from across the country, is looking to the next government to address some of its most pressing issues – infrastructure and transportation.
Startups find that their productivity has been hampered by terrible road infrastructure and the lack of a reliable public transport system. “There is not much of a startup ecosystem in the other end of the city. It is only here (HSR Layout-Koramangala-Bannerghatta Road). I spend two hours traveling one way on the road. It really puts a lot of stress on me. The commute time has to be reduced,” says Aishwarya, a startup employee who travels from north Bengaluru to her office at Bannerghatta Road in south Bengaluru every day.
Most of the employees and founders complain that it takes 1.5 hours to cover a distance of just 11-12 km.
Need for regulation of house rent
Most of the workforce in the startup world is from outside Bengaluru and largely outside Karnataka as well. But housing in Bangalore is expensive. Landlords take anywhere between 6-12 months rent as security deposit apart from paying exorbitant rents.
“I am from Chhattisgarh, I have come here to work for a startup company. Rent is a big issue. There are 2-3 BHK houses for Rs 60,000-70,000 per month. Arbitrary rent is increased during contract renewal. The bail amount sometimes goes up to Rs 3 lakh. I think the government should do something about it,” said Kamya, a startup employee in the city.
Karnataka is yet to adopt the Model Tenancy Act. If adopted, landlords can collect only two months’ advance rent as security deposit. The act was passed by the central government in June 2021 and states were asked to adopt it, but a progressive state like Karnataka is yet to do so.
Collaborate, Create a Mini-Bengaluru
Even as there is a competition among several states to emerge as the first state to hit the landmark of one trillion economy, startup founders feel that if more cooperation between the state government and the startup ecosystem was ensured If it is, Karnataka can achieve it.
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“In terms of policy, there is a lot the government can do beyond the IT sector, IT is the favorite right now. But there is a lot more, for example, we work in the education sector, collaborating with the government on a large scale. That would be great,” said Ashwin, founder of Flurn.
Many founders argue that the startup ecosystem has to be built in Tier II cities, especially as many of these cities have great educational institutions providing raw talent.
“If Karnataka has to become a trillion-dollar economy, startups being only in Bengaluru will not help. We need to see how to create a complete ecosystem and job opportunities outside. There are great universities in Mysore, Mangalore and Dharwad. But as founders, it never crossed our mind that we should start somewhere other than Bengaluru. Actually people come here from other cities. The government should see what can be done holistically. We need many mini-Bangalores across Karnataka,” said Lohit, co-founder of Flurn Startup.
In a recent action plan, the state government revealed that it wants to increase the number of startups based out of Bengaluru from 2,955 to 10,000 by 2032.
Will the Bengaluru-Mysore Highway change things?
Mysore has been projected as an alternative to Bengaluru when it comes to IT and startup companies, reducing the travel time between the two cities to 90 minutes.
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Many believe this will help drive some startup investment into the cultural capital.
“The Startup India program of the central government has given a huge boost to this sector. Also, the newly inaugurated Bengaluru-Mysore highway will create new opportunities in Mysore,” said Tejaswi Surya, Bengaluru South MP.
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