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Start-ups move to Tier II & Tier III cities

An interesting article in the Mint today - Start-ups start heading for small towns - talks about an emerging and unchronicled subtheme of new businesses being incubated by the dozens in India: start-ups moving to smaller Indian cities.

Start-ups are flocking to the smaller cities for the lower employee attrition they promise and the lower costs, not just of hiring and staffing but also of rent, utilities and transport.

Industry insiders estimate that close to 1,000 start-ups were launched in all of India in 2006, of which roughly a tenth raised venture funding.

Residential & commercial real estate prices in Bangalore are high enough to act as a deterrent to startup founders & employees; and don’t even mention traffic!

This entry was posted on Friday, March 30th, 2007 at 11:31 am and is filed under entrepreneurs, real-estate. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.

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    2 Responses to “Start-ups move to Tier II & Tier III cities”

    1. HBS Says:
      March 30th, 2007 at 1:10 pm

      Startups in Tier II/III cities? Not in Maharashtra! In my home town of Jalgaon, electricity is available for only 16 hours a day. And those 8 hours power cut are during the day time :-) All startups that do not require electricity are welcome to Jalgaon.

    2. Kaushik Says:
      March 30th, 2007 at 1:26 pm

      HBS: Bangalore is having its share of power cuts (2-4 hours at least per day), so Jalgaon may not be all that bad. Perhaps the money you save on rent here could be used to buy fuel & generator :-)