Startup bug bites fewer IIT, IIM alumni

New Delhi: Fewer graduates from Indian Institutes of Technology (IITs) and Indian Institutes of Management (IIMs) are taking the entrepreneurial path in 2026 compared to last year, although India's appetite for startups remains strong.Only 79 IIT alumni and 20 IIM alumni launched new tech startups between January and August this year, compared to 307 IIT graduates and 71 IIM graduates who founded startups in the entire 2025, according to Tracxn data collated for ET. The platform tracks only the year of incorporation for tech startups, so it does not have comparable January-August 2025 data.Also Read: Not Just AI - How soft skills are becoming key to getting hiredFurther, according to Tracxn data, 6,353 tech startups were founded until August this year, compared with 3,969 in the whole of 2025."The increase in the number of startups being founded is a positive sign, but the real question is who is making that transition. The fact that we are not seeing a meaningful increase in founders from the IITs and IIMs suggests there is still a large, untapped pool of talent," said Vikram Gupta, founder and managing partner, IvyCap Ventures.Also Read: Centre to tap IITs, NITs for nuclear tech courses to power India's 100 GW dream135376542AI & Layoffs as Decisive Factors"If India wants to build the next generation of enduring companies, entrepreneurship must become a more viable career choice for a much wider talent pool," Gupta said.According to Saakshi Gera, managing director at Kedaara Capital, startups are increasing largely because artificial intelligence (AI) and no-code tools have dramatically reduced the cost of launching a venture, while layoffs have made entrepreneurship a more viable fallback option."But volume isn't quality. Investors continue to prioritise sustainable unit economics, and India's most credentialed talent is increasingly choosing safer, AI-adjacent jobs instead," Gera said.More IIT graduates take the entrepreneurial route than IIM alumni. India had 196,704 tech startups as of August 2026, according to Tracxn. Of these, 6,147 had at least one IIT founder, while 2,102 had at least one IIM founder."IIT alumni continue to account for a substantially larger share of startup founders than IIM alumni, which is consistent with the larger IIT alumni base and the strong engineering and deep-tech orientation of many technology startups," said Neha Singh, cofounder of Tracxn. "The technical founders have the tendency to initiate ventures early, often complemented by business expertise from IIM graduates or other professionals as companies scale."For the study, the market intelligence platform considered alumni from IITs including Bombay, Delhi, Kharagpur, Kanpur, Madras, Roorkee, Jodhpur, Hyderabad, Guwahati, BHU (Varanasi), Mandi, Bhubaneswar and ISM Dhanbad, as well as IIMs at Ahmedabad, Bangalore, Calcutta, Indore, Lucknow, Udaipur, Nagpur, Kashipur, Sirmaur and Sambalpur. According to Tracxn, it takes time to fully incorporate a company formally. "The full incorporation figures as well as the final share for startups founded in 2026 will only be known later. This may rise to some extent," said Singh.