Beyond the unicorn: why India needs a real innovation index

As entrepreneurial energy plays an ever-larger role in India’s success story, we present a package of weekly opinion articles by members of TiE, a global organization for startups and entrepreneurs. From the rural reach of India’s startup revolution and the easing of capital and compliance challenges to the role of angel investors, how startups and micro, small, and medium enterprises must grow together and how best to track innovation, TiE authors cover a wide spectrum of relevant issues.

In May 2026, Skyroot Aerospace became India’s first spacetech unicorn. Two months later, it did something that mattered far more. On 18 July, its Vikram-1 rocket reached orbit from Sriharikota, making India the third country in the world, after the United States and China, with a private company able to launch to orbit. The unicorn tag was a headline. The orbital capability was the achievement. India has spent a decade celebrating the first kind of milestone and undercounting the second.

The unicorn has become the country’s default measure of entrepreneurial success, and it fails on the most important dimensions. The count cannot even be agreed upon. A wealth advisory firm’s private-company list puts India at 61 unicorns. Another benchmark’s cumulative tally reaches 131. Even a precise figure would only measure an investor mark-up from a single funding round rather than the jobs, exports, patents, or capabilities a company creates. An innovator is more than just its valuation.

A nation aiming to be a developed economy by 2047 must not anchor innovation by a number that could reset with the next round.

A more comprehensive measure of innovation

India already measures entrepreneurship, but it builds only half the ledger. Through the Department for Promotion of Industry and Internal Trade, it ranks 34 states and Union territories on how well they support startups, most recently in the fifth edition of the States’ Startup Ranking released in January. Through DBT Bharat, the Cabinet Secretariat runs a live national dashboard that shows how welfare payments reach citizens. NITI Aayog separately publishes an India Innovation Index that scores states on their innovation environment. The country measures the enablers and the welfare plumbing with real rigour. What has been achieved over the last decade is monumental.

What it does not measure, however, is the activity at the centre of the innovation story. There is no national record of what the country’s 240,000 recognised startups actually produce, and no public account of whether the historic pool of innovation capital the government has committed ever reaches them.

The instinct to publish is sound. The picture is simply incomplete. Completing it needs two new measures that, taken together, form a complete ledger of Indian innovation.

Scoring innovation and inclusive growth

India should invite every DPIIT-recognised startup to opt in, report its core metrics, and be ranked on the two things that compound into national capability – innovation and inclusive economic growth.

The innovation account is concrete: patents and intellectual property filed, deep technology deployed in the field, robot-hours run on customer floors, and direct contribution to national priorities such as the energy transition, the diffusion of AI skills, and content built in regional languages. The inclusive growth account is just as measurable: jobs created — now close to 2.4 million across the recognised base — exports earned, women employed across the more than 100,000 startups that already have at least one woman director, and reach beyond the large cities into the 669 districts the recognised base now touches.

None of this requires new plumbing. The Startup India portal, the DPIIT recognition portal, and the BHASKAR registry already hold the rails. The ranking method is proven in the States’ Startup Ranking, which has itself begun to weight measurable outcomes. Even the vocabulary exists. As the first Indian venture firm to sign the United Nations-supported Principles for Responsible Investment, 3one4 Capital has worked with a global standard that scores capital by its contribution to society, and the Global Impact Investing Network’s IRIS+ catalogue already codifies such metrics against the Sustainable Development Goals. India would localize a proven approach rather than invent one.

An index is also different from an award. The National Startup Awards recognise a handful of winners once a year through a jury. An index is continuous, open to all, and ranked on outcomes that founders can improve quarter after quarter.

The proof that the valuation lens misfires is already in plain sight. Skyroot’s orbital capability is one example. Kuku, a company in the 3one4 Capital portfolio, is another. Kuku now draws roughly 17 hours of viewing per user each month, ranking among the applications on which Indians spend the most time, ahead of Prime Video, X, and ZEE5, and competing directly with global technology giants for national attention, according to BofA Global Research using Sensor Tower data. That an Indian regional-language platform commands attention at that scale is a national achievement. A scorecard worth keeping would elevate it well above any valuation headline.

Scoring the state’s delivery

The same discipline must fall on the government, because a policy announcement is not an outcome until the money moves. Under this administration, India has assembled the largest pool of long-term innovation capital in its history, approaching ₹5 trillion (about $53 billion) across the ₹1 trillion Research, Development and Innovation Scheme, the National Technology Missions, and the two phases of the Semicon India programme, the second of which was cleared at ₹1.275 trillion in July 2026 on top of the first phase’s ₹76,000 crore. These commitments are genuinely historic.

Their transmission is not yet matching the ambition. The RDI Scheme had ₹20,000 crore allocated for the current financial year, yet only two fund managers (both government agencies) were operational by early 2026. Capital that has been announced but not disbursed changes nothing on a founder’s bank statement or a laboratory’s order book.

India has already solved the harder version of this problem once. DBT Bharat shows, in public and close to real time, that welfare money reaches its intended recipient. The country should run the equivalent for innovation. A National Transmission Index would report, every month and scheme by scheme, disbursement against allocation and outcomes against target, including the procurement orders the state itself has placed with young companies.

A working model exists abroad, and India can surpass it. Since 1982, the United States has run the Small Business Innovation Research programme, which publishes its award data every year and celebrates the young firms that scaled on its support. Its alumni include Qualcomm and Moderna. India’s grant commitments already match that programme in scale, so a National Transmission Index could quickly become amongst the largest and most credible public measure anywhere of how state support for innovation actually reaches the economy.

The two indices close a loop, and procurement is the keystone

Measured on their own, these are two useful dashboards. Linked, they become a self-reinforcing system. The Transmission Index records what the state delivers, including what it buys. The state as first customer turns a highly ranked startup’s proven capability into revenue, the anchor-customer model already demonstrated in space, where the ₹26,968 crore Space-Based Surveillance Phase 3 programme placed 31 of its 52 satellites with Indian private firms and startups. Those orders generate jobs, intellectual property, and exports, which lift the company up the Innovation Index, which then signals where grants and procurement should flow next, which the Transmission Index records in turn. Each measure sharpens the other.

Procurement is the keystone of the closed loop. Grants can launch a company, but only durable demand can scale one, and the most dependable early demand available to Indian deep technology is the Indian state itself. Simple procurement preferences on the Government e-Marketplace for indigenous innovation that meets global quality benchmarks would convert measured capability into order books, and Viksit Bharat’s technology base into revenue. Measure what founders build, measure what the government delivers, then buy first from those who build at home. That is the National Innovation Index, and it forms the closed loop that a valuation scoreboard can never become.

What a nation measures is what it values. India can keep applauding a number that vanishes in the next down-round, or it can start measuring the jobs, patents, exports, inclusion, and hard capabilities that form the closed loop to accelerate it towards a $10 trillion economy.

Skyroot reached orbit with indigenous innovation and ambition, and the unicorn valuation it earned two months earlier had little to do with that achievement. The unicorn tag measured a moment. The closed loop will build a nation.

Pranav Pai is a TiE charter member.

This is the third part in the series. Next week: Venk Krishnan on a unified compliance stack for startups.

Read the previous part: Unlocking India’s next wave of startup investment