India has emerged as a new innovation ‘empire’ of choice by global corporates. Bengaluru – the information technology and start-up hub – has surpassed many global cities as a preferred destination for innovation centres, according to Capgemini’s study on ‘Innovation Empire’.Bengaluru that has emerged as the fifth most preferred location for housing innovation centres, overtook Tokyo, Shanghai, Berlin, Tel Aviv, Munich and Chicago, said the report titled ‘Digital Dynasties: The Rise of Innovation Empires Worldwide’. In the previous report that captured data until July 2015, Bengaluru did not figure in the list of top 10 cities.
The report said Silicon Valley was no longer the hub for corporate innovation, as global enterprises were seeking talent pools beyond established hubs.
Between July 2015 and February 2016, four global enterprises set up their innovation centres in Bengaluru, the highest in Asia. During the same period, the number of innovation centres set up in Silicon Valley and London were five and four, respectively, the report added.
Among the companies to set up their innovation centres in Bengaluru are Airbus’ BizLab and Visa, whose new technology centre aims to house 1,000 developers, accelerating development of next-generation payment solutions.
Other than global corporates opening up more innovation hubs in Bengaluru, the city also hosts several billion-dollar Indian start-ups like Flipkart, InMobi and Mu Sigma, and attracts world-class technology, talent and investments.
Global companies are showing interest in other Indian cities as well. TriMas Corporation, a diversified manufacturer of engineered and applied products, opened an innovation centre in Delhi, while Puratos, a food ingredient company, launched an innovation centre in Mumbai.
“Digital has accelerated the pace and potency of innovation. No period in history has seen so many industries reinvented in such a short timeframe. The list of disruptors is long: Uber in transport, Airbnb in travel, Tesla in autos, Amazon and Alibaba in retail, Netflix in entertainment. The list of victims is even longer. 52 per cent of the companies on the Fortune 500 list in 2000 have since been bankrupted; bought or closed,” said the report.
Silicon Valley still dominates, but as innovation continues to spread globally, a number of new pockets have emerged. Between July 2015 and February 2016, 56 innovation centres opened in 20 countries and 11 more are planned to open soon.
“Over the last year, we witnessed the rapid rise of Asia as a destination for innovation centres. Compared to our previous research, Asia has seen a 29 per cent rise in the number of innovation centres being launched,” Capgemini said.
The report also said that last year’s report found manufacturing companies being more aggressive in opening up innovation centres, but that mantle has been taken over by financial services companies.
“Our latest research shows that 42 per cent of leading financial services organisations now have innovation centres, compared to 28 per cent in the first half of 2015. Between July 2015 and February 2016, financial services experienced the greatest growth in innovation centres (48 per cent), overtaking manufacturing (which grew by seven per cent) and consumer products (grew by 20 per cent),” the report added.
India seems to be again a favoured destination for financial services firm. For instance, UK-banking giant Barclays will operationalise its fintech innovation hub ‘Rise’ in India. This will be the bank’s fifth centre across the globe to tap into the fintech start-up ecosystem.
According to a report by Nasscom, there are nearly 400 companies in India focused on financial services technology. This attracted $450 million investment in financial services technology start-ups in 2015.
First appeared at Business Standard