Unicorns from the Unseen: How Small Cities Are Building Big Dreams

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India's startup map is being redrawn in July 2025, and it is not the metros leading the charge. Tier2 cities like Indore, Jaipur, Coimbatore, and Kochi are turning into hot startup hubs, based on affordability, talent, and hyperlocal innovation.

Why Founders Are Migrating to Smaller Cities

Operating expenses are 40–60% less than Tier1 cities, and thus earlystage scaling becomes feasible
The universities in the region produce qualified graduates who would rather remain in the region, creating a "brain retention" impact
Government programs like Startup India, Atal Innovation Mission, and incubators owned by the government offer funding, mentoring, and infrastructure

Startup Success Stories from the Heartland

Jaipur origin DealShare and Razorpay began from Tier2 settings before scaling up nationally
Indore's Smart Seed Incubation Centre is empowering SaaS and agritech startups with student startups being aided by IIM Indore
Coimbatore's industrial history is propelling EV, logistics, and green energy startups
Kochi Kerala Startup Mission has given rise to marine technology and India's first underwater drone startup

What's Changing the Game

Remote and blended strategies allow business people to develop global products in home locations
Social media and online presence enable startups to be noticed without metrobased PR
Angel syndicates and local investors are increasingly investing in local founders

Prognosis:

With 49% of Indian startups emerging from Tier2 and Tier3 cities, the next unicorn does not have to be from a glass tower—but from a tworoom office in Surat or Bhubaneswar. The stealth revolution has already started.

Sources: Startup Wired, Best Startup India, Trade Brains, The Hindu, Anil S Mehta Blog