Fewer IIT, IIM graduates launch startups this year

Entrepreneurial activity in the country has seen asharp decline this year, especially among recent graduates from the Indian Institutes of Technology (IITs) and Indian Institutes of Management (IIMs), a slowdown that experts attribute to investors turning more cautious amid heightened macroeconomic and geopolitical uncertainties.

According to data collated for ET by Tracxn, a market intelligence platform, only 36 startups have been founded by graduates of these premium institutions in 2025 to date, compared to 236 in 2024 and 383 in 2023.

However, the numbers need to be interpreted carefully, experts said. “A temporary dip in entrepreneurial activity among graduates from premier institutions such as the IIMs and IITs should not be misinterpreted as a waning of aspiration in Indian youth,” Himanshu Rai, director, IIM Indore told ET.


According to him, the decline is symptomatic of broader macroeconomic headwinds.

Softer job market
The headwinds include global uncertainties, a more cautious funding environment, inflationary pressures and elevated interest rates, says Rai.

Neha Singh, chairperson and managing director at Tracxn, attributed the slowdown in startup activity to a tightening funding environment.

“This is due to the global economic uncertainty and rising interest rates have led investors to adopt a more cautious approach,” she said.

Startups founded by women graduates from IIMs and IITs have seen a drastic decline to three since the beginning of this year from 34 and 61 in 2024 and 2023, respectively, according to Tracxn data.

This is in line with the overall fall in the number of startups founded by women in the country to 26 so far in 2025 from 328 in 2024 and 582 in 2023.

“This phase should be viewed as a market correction rather than a decline in entrepreneurial spirit,” said Singh.