India HR Tech Market Map 2019
India HR Tech Market Map 2019
We looked at 180+ HR Tech companies which are either HQ in India or have originated from India. This data gave us some interesting stories. Some of these stories are shared here. Hope you like them. If you need the complete list of 180+ HR Tech companies in India, please write to us.
The 180 Strong Community
The Indian HR Tech community is now a thriving ecosystem of 180+ companies of different life stages. It consists of companies from the startup phase to mature global businesses. This diversity lends itself beautifully for massive growth potential.
Indian HR Tech space has companies like Ramco, MyAdrenalin, Neeyamo, Zoho, and Freshworks. These companies have proved it’s possible to build globally competitive products from India. A recent example of global growth, Knolskape, once again proved to Indian HR Tech entrepreneurs that it is possible to blend product and service to scale globally.
The 180+ companies are roughly divided into 19 different categories. There are no universal definitions of these categories within the HR Tech space. Hence we have used our experience and judgment to determine the best-suited category for each company.
50% of these companies are concentrated in the top 4 categories namely – Sourcing, HRMS, Learning, and Wellness. This indicates that most Indian HR tech buyers are looking to reach larger talent pools while the 2nd highest area of focus in HR digitization appears to be simple HR automation and digitization. Wellness emerged as a surprise in the top 3. This could be because of increased interest in the healthcare sector and looking to solve its problems by using technology.
11 of the 19 categories have less than 10 companies. Compared to global data in similar categories there appears sufficient headroom for new and innovative solutions creators here. Few categories like employee development, People Analytics, and organizational network analysis are not present or sufficiently represented in the Indian HR tech market. We believe the Indian HR tech community has an opportunity to create solutions to compete with OrgMapper, Visier, Fuel50, and Talentguard.
80% of the HR tech companies are in the West and South and the rest 20% are in the NCR region. The eastern region is almost non-existent in this community right now.
When you look at the variation within cities you find Bangalore leading the pack on ATS, Sourcing and wellness applications. This could be linked to the Indian Silicon Valley’s focus on sourcing and hiring. It is safe to assume the local HR Tech entrepreneurs are helping the industry solve these challenges. It is no surprise we have global successes emerging from here like Hackerearth and Hackerrank.
The financial capital, Mumbai leads the HR tech categories of wellness, HRMS and Learning solutions. This frankly surprised us as we expected to see some interesting and innovative approaches to Payroll and integration of Fintech with financial wellness to emerge from here.
NCR leads in sourcing with the highest number of HR tech companies solving this problem located here. The second highest category seen in this region is recognition and HRMS.
Pune was a surprise to emerge as the fourth largest concentration of HR tech companies in the country. We frankly expected Hyderabad or Chennai to occupy this spot. These locations have 50% less number of HR Tech companies than Pune. Pune leads in HRMS, Learning and Talent Assessment solution categories. Pune’s dominance in Learning can be linked to its reputation of being the Oxford of the east.
Looking at these regional variations in the solution sets and assuming that these regional variations occur due to regional buyer behaviors, we get an interesting view of the Indian HR Tech buyer.
We understand that these are simplistic generalizations but do offer us a lens to look at buyer persona based on geographical location. It appears that HRMS is seen as a basic form of automation and most Indian HR tech buyers are still in phase 1 of their HR digital evolution.
We compared this data with a database of 700+ global HR tech companies. It appears Indian HR tech companies are consistent with the global trends as far as top 3 categories are concerned. Indian HR tech entrepreneurs are simply following the global trends and creating solutions around Sourcing, HRMS and Learning. This appears to be a safe bet in terms of getting investors and customers in India and beyond.
Consistent with the global trend, we see wellness as a fast emerging category in the Indian market. We believe these solutions are gaining momentum as they can easily ride on existing health care benefits that most organizations and government programs offer to employees.
Indian HR tech companies differ from their global counterparts, by not using pulse surveys, chatbots, and analytics as frequently. While some HR tech companies in the country offer these solutions we still don’t see these becoming the default. The Indian buyer seems to be operating with caution on these technologies. This seems consistent with the earlier observation of most Indian HR tech buyers being in Phase 1 of their digitization efforts. It appears the technology exists with solution provider readiness to deploy but the buyer community is struggling to make the business case.
The Big Opportunities
We see great opportunities for Indian HR tech companies to take a clue from their Fintech counterparts like Paytm. Indian HR tech companies have an opportunity to create unique solutions deeply rooted in the Indian way. Some opportunities that we see are mentioned here.
We expect the ubiquitous financial accounting software Tally to march into HRTech via direct entry or partnerships to enable intelligent HR functionalities of basic HR tasks to its 1.5 million plus customers. It has a great network of 26,000 partners, 1800+ certified partners and 60+ distributors that can be leveraged for HR tech solutions too. This existing ecosystem lends itself for immense value creation.
The other sleeping giant in the Indian HR tech space is Naukri. It’s one of the oldest and biggest sourcing platforms which practically reaches all nooks and corners of the country. With an estimated 51 million registered job seekers and 65,000 corporate customers, it is in a unique position to create innovative HR tech solutions. It has sadly disappointed so far with its product launches and its lack of focus on UI/UX and building intelligence in the solution. We hope that changes soon.
We see great opportunity for India based HR Tech startups to create and lead categories globally. Knolskape and xoxoday have shown the path in recent past and we believe players like Tydy, Payreview, Qilo, Belong, Synergita and a few others can lead this global charge. We need the matured HR Tech companies and buyers in the market to support these innovative category leaders emerging from India.
Indian HR tech ecosystem is one of the most matured and diverse in the world. We need to start leveraging the community while creating cross-referencing opportunities, especially from MarTech and FinTech. HR tech entrepreneurs in the country are a motivated lot and most young HR tech entrepreneurs I meet are aiming for a global reach. They are focused on building world-class products. Currently, we just have 1 India HR Tech focused fund in the HR Fund. We need more and we need them soon. We want established companies to come forward with a focused fund. We hope some of these expectations are fulfilled in 2019.Download the PDF infographic of India HR Tech Map, 2019 (142 downloads)
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