As we bid farewell to 2023, a year marked by dynamic evolution and unparalleled resilience in the startup ecosystem, we stand on the precipice of 2024, filled with renewed hope and determination. This year’s journey, woven with the threads of recovery, resilience, and digitization, not only tested our mettle but also showcased India’s collective capacity to adapt and thrive. 

2023 was a testament to the strength and versatility of the internet economy. From the remarkable growth of startups – expanding from 10,000 in 2018 to an astounding 90,000 in 2023 – to the pioneering strides in digital adoption across sectors, each step echoed our central themes. But what were the catalysts driving this exponential growth? Was it the innovative spirit, the governmental support, or the ever-evolving consumer demands? 

Despite starting on a challenging note with the ‘funding winter,’ the sector showcased its resilience. This phase, though marked by reduced investment flow, became a crucible for innovation and strategic pivoting. How startups reimagined their strategies during this period is a story of grit and adaptability. 

Amid these challenges, a notable 17% of investors, as surveyed by Redseer, projected a confident outlook for the post-August period. This optimism wasn’t misplaced, as evidenced by the significant bounce-back in Ecommerce Consumer Confidence post the October festival season, soaring to a remarkable 127 out of 200 on the Redseer Index. This revival is more than a statistic; it’s a narrative of consumer trust and market resilience. 2023 also heralded a new era of digital transformation. The year was also defined by the influential Tier 2+ consumer demographic. Their preferences steered the growth of the domestic Short Form Video ecosystem and compelled the BFSI sector to innovate, simplifying KYC processes to be more inclusive. 

As 2024 beckons with optimism, let us all bear in mind the wise words of Abraham Lincoln “The best way to predict the future is to create it”. It is in the spirit of embracing possibilities for growth that this very last newsletter of the year captures major developments across diverse sectors of the Internet economy. 


While 2023 presented challenges for the online e-commerce sector, This year marked a pivotal point for Digital Native Brands (DNBs), which have increasingly solidified their position in the e-commerce landscape, accounting for over 40% of total online sales. These brands have notably disrupted various sectors, comprising 28% of leading innovators in Electronics & Appliances, a remarkable 52% in Fashion and Home, and 48% in Grocery and Personal Care. This surge of DNBs has catalyzed a significant shift among traditional brands, which possess a distinct legacy but are now feeling the urgency to adapt to the digital era. In an intriguing turn of events, many of these legacy brands are either introducing their own digital products or acquiring digital-first brands, thereby striving to balance the scales in an increasingly digital-driven market.  

By 2026, it’s projected that online retail will grow threefold compared to the overall retail market, with online sales expected to constitute 25% of all major non-food and grocery category sales. 

Here are some of the key highlights from the sector in 2023:  


Abroad Education is seeing a greater degree of resurgence in India with ~2 Mn students projected to opt for overseas education by 2027. In 2022 alone, ~900,000 students looked to pursue higher education overseas owing to increased awareness about the global academic landscape. Geographically, North America, particularly the United States was seen to retain its status as a steadfast hub while Australia and New Zealand (ANZ) emerged as dynamic regions. Redseer’s research identifies STEM degrees as an emerging demand cohort with their market share set to expand to 61% by 2027 although postgraduate degrees will continue to assert their dominance as a demand driver. As Tier-2 students join the bandwagon of aspirants, opportunities abound for edtech providers to support them with the appropriate support for financing and documentation through their application journey. The emergence of players with financing-first and full-stack models is proof of this potential.  

Here are some of the key highlights from the sector in 2023: 


India’s relatively nascent Rehab Tech and Transitional Care spaces bear much promise for innovators. The physical rehabilitation market alone is set to grow at a CAGR of 15.5% to reach $ 35 bn by FY2028 with potential for greater uptake in geriatric care and assisted living settings. Breaking down the awareness and availability barriers would prove to be key for positive outcomes for both tech-led players and patients at large. Transitional care facilities play a critical role in educating caregivers about health conditions, ensuring the availability of implements to aid the recovery journey, prevent the spread of infections and most importantly, focus on patient recovery post-surgery and other medical procedures. The availability of well-integrated services in Rehab tech and Transitional Care can fill critical gaps in the healthcare ecosystem and break down the awareness barriers that prevent those in need from accessing quality care.  

Here are some of the key highlights from the sector in 2023: 

Food, Grocery & Quick Commerce  

Quick commerce sector experienced a banner year, highlighting the rising trend in technology-driven food delivery and eGrocery services, especially in the wake of the pandemic. This shift underscores the significant growth potential in the Food & Grocery industry. Currently, there’s an emerging market opportunity estimated at around $10 billion in managed cafeterias and hyperlocal food delivery services, particularly within educational institutions and commercial real estate areas. 

In the fiscal year 2023, eGrocery achieved its highest growth rate since its inception in 2019, recording a 64% increase. This surge was largely propelled by the pandemic, which accelerated the adoption of online grocery services. A notable development in this sector is the evolving preferences between consumers in Tier-1 and Tier-2 cities. This divergence necessitates that players in the market enhance their product offerings to appeal to a broader range of potential users. As the industry evolves, a keen focus on the consumption habits of Tier 2+ audiences will be crucial for companies aiming to achieve sustained growth in various market segments. 

Here are some of the key highlights from the sector in 2023: 


India is home to the largest 2 wheeler market in the world with as many as 375-400 mn plying on roads. The B2B sector including last-mile delivery services and food aggregators are significant participants in the uptake of EV 2 wheelers. The low cost of ownership coupled with faster delivery are two strong factors enabling this uptake, and it would appear that there is potential to increase its adoption among the general public. Focusing on the 4As of Adaptability, Awareness, Availability, and Affordability, strengthening the safety provisions of EVs and bringing in conducive policymaking can bring about the 80% electrification of sales by 2030. There is also immense potential to strengthen the domestic EV manufacturing ecosystem and boost localization while securing the overall supply chain.  

Here are some of the key highlights from the sector in 2023: 

Media & Entertainment 

The Media & Entertainment sector witnessed multiple key trends emerging over the course of the year with diverse demographics embracing OTT Audio, Video, Gaming and Music streaming facilities. Furthermore, the use of AI/ML solutions to streamline the influencer economy is expected to increase discoverability and usher in more transparency in terms of pricing and payouts across influencer categories. The emergence of a strong homegrown Short Form Video ecosystem and the popularity of regional language content on Audio platforms cemented the influence of the Tier-2+ consumer and indicated the participation of demographics in the 30+ age group in the new age digital media revolution. As India’s cohort of mature Internet users is set to outpace that of the USA’s by 2030, nurturing a diverse Bharat audience and customizing content solutions to the requirements of these demographics will pave the way forward for the sector.  

Here are some of the key highlights from the sector in 2023:


The Fintech sector has witnessed remarkable growth alongside the expansion of the nation’s Digital Public Infrastructure. The widespread utilization of UPI has seen a significant onboarding of MSMEs and retail merchants onto the system. On embracing online sales channels, 96% of the MSMEs surveyed by Redseer reported a total net profit increase with 55% of them seeing profits rise by over 15%. As of October 2023, digital transactions across the nation have surpassed INR 3.2K Lakh Cr and the next wave of UPI growth is expected to arise from outside the top 40 cities in India. Retail QR codes are seen to have played a critical role in boosting digital payments in the retail space, and provisions such as BBPS, and BNPL, e-Rupi and Wearable Devices have helped increase the uptake of digital payments in Indian households. The widespread adoption of eKYC has helped simplify onboarding procedures for banking and wealth management beyond Tier-2+ geographies. As the expansion of India’s Digital Public Infrastructure continues to take shape and positively impact multiple sectors of the economy, Redseer Research estimates that digital transactions in India will touch 4K Lakh Cr by FY26.  

Here are some of the key highlights from the sector in 2023: 


Between CY18 and CY22, the number of registered startups has grown significantly from 10,000 to over 90,000, catalysed by the digital wave. Contrary to expectations, 2023 started off with a funding winter prompted by macroeconomic factors. Investors maintained optimism for the post-August period, anticipating a resurgence in funding unaffected by short-term economic speed bumps. Proceeding into 2024, investors surveyed by Redseer expect the sector to embrace its growth potential of $15-20 bn, and are optimistic that it will maintain its resilience in the long term.  

Here are some of the key highlights from the sector in 2023: 


  • Abhijit has provided advice to customers at Redseer Strategy Consultants in the Indian markets for food Tech, cutting-edge hotels, logistics, ed-tech, and renowned VCs and PEs.