India could be on the cusp of unlocking a $1 trillion opportunity for Software-as-a-Service (SaaS) companies, creating nearly half a million new jobs by 2030, according to a report titled ‘Shaping India’s SaaS Landscape’ by SaaSBOOMi, Asia’s largest community of SaaS founders and product builders, in association with McKinsey.
In a conversation with YourStory Founder and CEO Shradha Sharma, Manav Garg, Founder of Eka Software and Together Fund, and Noshir Kaka, Senior Partner at McKinsey, deep-dive into how Indian SaaS providers can scale to their full potential and win 4-6 percent of the global SaaS market.
To be clear, software accounts for 20 percent of the total enterprise spending on technology but has a value creation of nearly 50 percent. The SaaS industry, which is $2.6 billion in size and employs about 40,000 people, is expected to record a 20X revenue jump by 2030. The narrative goes beyond this mammoth opportunity.
This ‘20X jump’, which will generate $50 to $70 billion in revenue, is merely 6 percent of the global SaaS market —reflecting the untapped size of the pie and the huge window of opportunity that lies ahead for the SaaS industry.
A trillion-dollar SaaS opportunity: What is India’s right to win?
“Indian SaaS ecosystem can be worth a trillion dollars by 2030, which will be one of the biggest value creation opportunities that we are going to see in the decade ahead of us. It is touted to grow at a CAGR of 18 percent,” Noshir says.
This is coupled with the multiplier effect that will give rise to half a million jobs in India, boost forex reserves, economic activity, and so on. Having said that, what is India’s right to win over the Valley and upcoming markets like Estonia and Vietnam?
Exuding confidence, Manav lays out strengths that will play in India’s favor in tapping this trillion-dollar opportunity.
First is the shift to digital go-to-market (GTM), which the founder terms as the “Ramban” provided to the industry by the pandemic.