TCS CEO bullish on Indian startup ecosystem, shares strategic approach to acquisitions

K Krithivasan, Chief Executive Officer (CEO), Tata Consultancy Services (TCS), remains bullish on the Indian startup ecosystem, highlighting the potential and creativity prevalent within the sector.

"The number of all these billion-dollar valuation unicorns that you see in India is increasing, so that definitely is an important hope. The kind of creativity people come in with, I'm completely bullish on the Indian startup scenario," he told CNBC-TV18 at the Nasscom Technology & Leadership Forum.

Krithivasan also addressed TCS's approach towards mergers and acquisitions (M&A), outlining the company's discerning criteria. He noted that while TCS actively explores M&A opportunities, its standards remain high, focusing on achieving a multiplier effect through synergies with existing talent rather than simply bolstering revenue. This selective strategy has resulted in a smaller number of M&As for TCS, but those undertaken have been notably successful.

On potential M&A ventures within the startup ecosystem, Krithivasan struck a cautious tone. While acknowledging TCS's interest in acquiring complementary capabilities, he talked about the importance of preserving the innovative spirit of startups.

"We have a unit called Co-Innovation Network that constantly looks at startups not only in India but across the world. We help them scale by introducing them to our customers. We show them the problems that are solvable. So, that's our approach. I think that you can work together very well with them than just acquiring them," he added.

Reflecting on TCS's operational approach, Krithivasan described it as resembling a "big, small company," with an emphasis on agility and autonomy within individual client units. He underscored the company's commitment to maintaining a startup mindset, even within a large organisation, by encouraging small units to operate independently while leveraging TCS's scale and resources.