A host of tech firms are starting to emerge from the shadows
Start-ups seem to be finally coming
of age with booming e-retail companies and software solution providers
who analyse business needs of large global corporations. However, when
compared to Silicon Valley, the Indian start-up industry is hampered by
lack of technology infrastructure, access to quality mentors and good
talent, industry watchers say.
With the likes of
Flipkart and Snapdeal raising billions of dollars in capital, and the
buzz about e-commerce and what it can do to India’s retail economy, a
whole host of technology companies are starting to emerge from the
shadows. Case in point: Brain4ce Education Solutions, which offers tech
courses online under the name of Edureka, has grown its revenues by a
whopping 2,768 per cent in the last three years.
Yahoo’s
acquisition of Bangalore-based Bookpad for $15 million is another
example. Bookpad converts Microsoft Office or PDF documents for use on a
web browser. This came on the heels of Facebook acquiring Little Eye
Labs for a similar amount.
Zomato, the online food
review portal, raised ₹370 crore in fresh funding earlier this month,
raising its value to ₹4,000 crore. Lack of good public transportation in
the country has given birth to start-ups like Ola, TaxiForSure and
others, raising millions in funding.
Industry watchers believe these developments have put Indian entrepreneurs on the global map.
“If
you look at these deals, it is an affirmation that Indian companies are
starting to make a mark,” said Rajat Tandon, Senior Director, Nasscom
10K start-ups initiative.
Industry body Nasscom has
also done its bit to help start-ups. In April, as a part of its InnoTrek
initiative, Nasscom took around two dozen start-ups to Silicon Valley
and showcased their wares to tech giants like Yahoo. Similarly, iSPIRT
and Microsoft Ventures have helped Bookpad with their business
accelerator programmes.
Global ventures
In the
last couple of years, India has seen 4,000 start-ups, 400 venture
capitalists and 150 start-up incubators. “The next set of big companies
have the potential to come up from any part of India. That is a
heartening sign,” says Sharad Sharma, co-founder and a member of iSPIRT.
Entrepreneurs
themselves are a confident lot. Deepinder Goyal, founder of Zomato,
believes the company’s success in India can be taken to other emerging
markets like Latin America, which is not something a lot of tech
companies have done in the past. “Building a company that can be
synonymous with India and which achieves scale is what drives me,” he
says. Goyal is up against Silicon Valley companies like Yelp and
Facebook, all of whom compete for advertising eyeballs.
There are other start-ups like Zoho which want to take on the likes of Salesforce.com in the enterprises software segment.
“Our
logic is simple: there are millions of small businesses and they can’t
use software that costs millions of dollars. With our cloud computing
platform, we can do that at much less cost and more effectively,” says
Sridhar Vembu, CEO and founder of Zoho.
Different shades
There
is also a trend of different kinds of start-ups emerging from different
regions. Rajesh Sawhney, the founder of GSF, a company that invested in
Little Eye Labs, says the NCR region has e-commerce start-ups, Mumbai
has start-ups focused on media and financial technology-related products
and Bengaluru start-ups focused on technology.
For
example, Mumbai has seen the emergence of Powai Lake Ventures, which is
close to the IIT Mumbai campus. One of the ventures that was founded
here is Housing.com, a map-based real estate and property search portal.
TinyOwl, a location-based food ordering app, also from here, is
aspiring to go global from the financial capital of India.
Similarly,
Bengaluru and Gurgaon have buildings that are designated for start-ups.
This kind of infrastructure provides them with space that helps them to
bounce ideas off their peers, and other amenities.
E-healthcare
start-ups are also starting to see traction. Shashank ND, co founder of
Practo Technologies, says healthcare will see convergence of
information systems, picture archiving and communications systems
(PACS), electronic medical/health records (EMR/EHR) and point of care
systems to generate clinical data, including images.
Not all hunky dory
Despite
the growth and the interest in Indian start-ups, there are a lot of
basic problems that need to be addressed. From collaboration between
industry and academia to technology infrastructure and ease of setting
up business (or winding them down) there are areas of concern, industry
watchers say. Most Indian companies have lacked meaningful exits, says
Sharma. The number of exits in software products start-ups in the
country is 1.1 times the amount of investments, while Israel’s ratio
stands at seven times, according to a Signal Hill-iSpirt study.
"While
customers would benefit as they no longer have to figure out how to
return a package and which carrier to choose, sellers too will benefit
from a better customer experience and do not have to worry about
arranging returns," Deshpande said. Eventually, the company wants to
make Easy Ship at par with its global marketplace model 'Fulfilment by
Amazon' by eventually offering return services all over the country
across product categories.