While India is poised to become the global software-as-a-service (SaaS) capital over the next few years, 50 per cent of the technology providers said driving higher awareness for SaaS products continues to be a prerequisite for customer acquisition, a report said on Thursday.
Over 80 per cent of the SaaS promoters feel there is the need to build a robust talent pool, according to the EY-CII study.
While the landscape is mainly driven by small and medium businesses with a focus on large enterprises, SaaS companies in the SMB market are structured very differently from those catering to the enterprise market.
“Macro-economic environment notwithstanding, the funding activity in the first two quarters of this year surpassed the funding activity in 2021 – which was a breakout year with over $4.3 bn in funding for SaaS start-ups,” said Nitin Bhatt, Technology Sector Leader, EY India.
According to other reports, the Indian SaaS market is expected to grow multi-fold by 2025, accounting for almost seven to ten per cent of the global SaaS market, from 2-4 per cent at present.
Led by Freshdesk and Zoho Corporation, India now has 18 SaaS unicorns as compared to one in 2018, with India being the third largest SaaS ecosystem globally, after the US and China.
The number of SAAS companies in the country have more than doubled in 2021 as compared to 2019 and the funding too increased from $2.6 billion in 2019 to $6 billion in 2021.
According to the EY-CII report, SaaS providers are also doubling down on their customer acquisition, retention, and success strategies by upselling and cross selling to existing customers.
The study also pointed towards the need for skill development in areas like product management and design to cater to the growing talent demand in the SaaS industry.