Around 175,000 DPIIT-recognised ventures. More than 121 unicorns. An expected funding of $14-15 Bn by the end of 2025. That’s the world’s third-largest startup economy at a glance.

While Bengaluru, Hyderabad, Mumbai and Delhi NCR have so maintained a lead in the numbers, a revolution has brewed up in some smaller cities, reshaping India’s entrepreneurial landscape and challenging the traditional startup hubs.

Tamil Nadu is at the forefront in this league, with Chennai ranking 19th among the top 40 startup destinations in Asia. Known for its strong roots in industries like manufacturing, textiles and automotive, Tamil Nadu has, in fact, doubled down on entrepreneurship and inclusive growth.

The number of DPIIT-registered startups in the state has jumped from just over 2,000 in late 2021 to more than 12,000. And, this growth has percolated to Tier II cities and smaller regions of the state as well.

To support the growing ecosystem, the government has laid out the Startup and Innovation Policy 2023, with the vision of positioning Tamil Nadu in the global top 20 startup destinations by 2032.

While a strong education system, industry connections, inclusive support programmes and a growing network of incubators have helped build momentum in the sector, regional innovation hubs, support from the Tamil diaspora and a Dravidian approach to development rooted in inclusivity are shaping a distinct model for growth.

Inc42 spoke with StartupTN mission director and CEO, Thiru Sivarajah Ramanathan to take a closer look at the hectic parleys at play in the state’s homegrown startup economy.

In an exclusive interaction, the first-generation entrepreneur from Madurai explains how the founder-first initiatives of the Dravidian model have influenced the startup policy.

Edited excerpts from the conversation to track what’s really happening on the ground…

Inc42: The Startup and Innovation Policy 2023 sets an ambitious vision for Tamil Nadu to become one of the top 20 global startup destinations by 2032. How do you plan to achieve this goal?

Sivarajah Ramanathan: The policy envisions achieving its targets through a multi-pronged approach. With 30% of the top institutions in the NIRF Rankings located in Tamil Nadu, the state is leveraging this strength to build a large and affordable pool of intellectual talent. At the same time, it is working to instill trust and confidence among founders, ensuring they no longer feel the need to migrate to Bengaluru or Hyderabad in search of stronger support systems.

The state has seen a sharp rise in the number of startups since 2021, which has brought it on par with states like Maharashtra, Karnataka and Gujarat. This growth is supported by more than 40 initiatives, including funding schemes, mentoring, incubation and market access programmes.

TANSEED, for instance, provides grants of INR 15 Lakh to women-led, climate focused, rural startups, while general startups get Rs 10 Lakh. TANFUND connects startups to a network of over 200 venture capitalist (VC) firms,........

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