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A few days back, we told you how <keyword id="541988" type="COMPANY" weightage="100" keywordseo="SnapDeal">Snapdeal</keyword> has tied up with <a href="http://www.businessinsider.in/You-can-now-use-the-Snapdeal-app-to-book-tickets-and-order-food-online/articleshow/51340726.cms">Redbus, Zomato and Cleartrip</a> so that its users can book online tickets and order food using the mobile app. 
 This time, however, Snapdeal has entered into a tie-up with that the car cab-booking company <keyword id="1042120" type="PERSON" weightage="100" keywordseo="Uber">Uber</keyword>, so that its consumers can book cabs using the app. This makes it one of the most high-profile partnerships in the recent history of India's startup ecosystem. 
 
When contacted by ET, spokespersons from both <a href="http://www.businessinsider.in/Snapdeals-Rohit-Bansal-spills-beans-on-what-next-in-e-commerce-innovation/articleshow/51424704.cms">Snapdeal</a> and Uber declined to comment on the matter. 
 
In the recent past, Snapdeal has regularly updated its app, majorly its <a href="http://www.businessinsider.in/Product-selfies-IMPS-refunds-and-much-more-this-is-how-Snapdeal-is-using-technology-to-improve-user-experience/articleshow/50768069.cms">user interface and user experience</a>, because it wants to evolve from just another ecommerce company to a complete ecosystem of goods and <a href="http://www.businessinsider.in/Heres-why-Indian-e-commerce-players-are-partnering-with-on-demand-services-platforms/articleshow/51408204.cms">services</a>. 
 
Talking of Uber, this deal will give the company access to more than 25-million registered users of the ecommerce company, which can prove to be useful for its ongoing battle with rival Ola. 
 
<a href="http://www.livemint.com/rf/Image-621x414/LiveMint/Period1/2014/01/10/Photos/DSC_1935--621x414.JPG">Image source</a>

You can soon book an Uber using your Snapdeal app

In a bid to attract more and more customers, <keyword id="541988" type="COMPANY" weightage="100" keywordseo="SnapDeal">Snapdeal</keyword> has integrated with companies like <keyword id="6359128" type="COMPANY" weightage="100" keywordseo="Redbus">Redbus</keyword>, Zomato and <keyword id="132652" type="COMPANY" weightage="100" keywordseo="Cleartrip">Cleartrip</keyword> so that customers can directly use the mobile app to book bus tickets, flight tickets, hotel tickets and order food. 
 
While Cleartrip, Zomato and RedBus have got access to Snapdeal's huge user base, Snapdeal will be earning a commission for each booking for these companies made through its app. 
 
This can prove to be <a href="http://www.businessinsider.in/Snapdeal-is-now-valued-over-6-billion-Thanks-to-200-mnfunding/articleshow/50992078.cms" target="_BLANK￿￿￿￿">financially beneficial for Snapdeal</a> since booking air tickets is a large gross merchandise value (GMV) category and food ordering is category that sees high frequency. 
 
"Horizontals are looking at monetising their user base with a focus on GMV and repeat use cases. As funding environment becomes tougher, growth in these metrics will stand out," a Snapdeal investor told ET on the condition of anonymity. 
 
It was last year that Snapdeal CEO Kunal Bahl had said that <a href="http://www.businessinsider.in/Snapdeal-aims-to-overthrow-Flipkart-says-CEO-Kunal-Bahl/articleshow/48741092.cms" target="_BLANK￿￿￿￿">they would surpass archrival Flipkart</a> in terms of GMV by March 2016, declaring an open war in the <a href="http://www.businessinsider.in/Swords-are-drawn-Snapdeal-and-Flipkart-are-challenging-each-other-to-become-numero-uno/articleshow/48770391.cms" target="_BLANK￿￿￿￿">Indian e-commerce space</a>. 
 
GMV refers to the overall sales by merchants on an e-commerce platform, without factoring discounts. Out of these, the e-tailer gets 5 to 20% as margin on an average. 
 
It was only two months back that Snapdeal had tied up with <a href="http://www.businessinsider.in/Now-buyProperty-on-Sale-from-Snapdeal/articleshow/50589572.cms" target="_BLANK￿￿￿￿">real estate developers</a> to launch real estate and financial services on its website, to boost the GMVs. 
 
Talking of user experience, Snapdeal is <a href="http://www.businessinsider.in/Product-selfies-IMPS-refunds-and-much-more-this-is-how-Snapdeal-is-using-technology-to-improve-user-experience/articleshow/50768069.cms" target="_BLANK￿￿￿￿">heavily using technology</a> to improvise in that area, like having IMPS refunds and product selfies. 
 
<a href="http://s32.iamwire.com.s3.amazonaws.com/wp-content/uploads/2015/03/Snapdeal.jpg">Image source</a>

You can now use the Snapdeal app to book tickets and order food online

<keyword id="1489410" type="UNKNOWN" weightage="100" keywordseo="e-commerce-in-India">E-commerce in India</keyword> is once again grabbing the headlines and this time, for all the right reasons. Bangalore-based <keyword id="319719" type="COMPANY" weightage="100" keywordseo="Myntra">Myntra</keyword>, arguably India’s largest standalone <keyword id="1127700" type="UNKNOWN" weightage="100" keywordseo="fashion-e-tailer">fashion e-tailer</keyword>, has recently closed a <keyword id="6357455" type="EVENT" weightage="100" keywordseo="Funding">funding</keyword> round worth $50 million from an investor consortium led by <keyword id="1430452" type="ORGANIZATION" weightage="100" keywordseo="PremjiInvest">PremjiInvest</keyword>, the family office of the <keyword id="10862" type="CITY" weightage="60" keywordseo="Wipro">Wipro</keyword> chairman <keyword id="6419840" type="PERSON" weightage="80" keywordseo="Azim-Premji">Azim Premji</keyword>. Myntra is also in talks with a clutch of investors to raise an additional $40 million at a higher <keyword id="51393" type="UNKNOWN" weightage="100" keywordseo="valuation">valuation</keyword>, according to an Economic Times report. So far, the <keyword id="2049121" type="UNKNOWN" weightage="100" keywordseo="E-commerce-firm">e-commerce firm</keyword> has raised $125 million in risk capital funding. Another fashion e-tailer that is also raising <keyword id="57924" type="ENTERTAINMENT" weightage="100" keywordseo="big-money">big money</keyword> is Gurgaon-based <keyword id="6388367" type="COMPANY" weightage="100" keywordseo="Jabong">Jabong</keyword>.com, which is backed by Berlin-based <keyword id="1965711" type="COMPANY" weightage="80" keywordseo="Rocket-Internet-GmbH">Rocket Internet GmbH</keyword> – a venture arm of the Samwer brothers. The e-commerce firm is reportedly raising a fresh round of equity funding worth $100 million, of which it has already received $27.5 million from the British <keyword id="2049123" type="ORGANIZATION" weightage="100" keywordseo="Development-finance-institution">development finance institution</keyword> <keyword id="1613067" type="UNKNOWN" weightage="100" keywordseo="CDC-Group-Plc">CDC Group Plc</keyword>. 
 All this is good news for the cash-strapped Indian e-commerce segment. So we have taken a close look at the recent fundraising by the <keyword id="2049116" type="UNKNOWN" weightage="100" keywordseo="Indian-e-commerce-players">Indian e-commerce players</keyword> and identified five key trends that seem to be prevailing. Will they rule the <keyword id="2049126" type="UNKNOWN" weightage="100" keywordseo="Fundraising-scenario">fundraising scenario</keyword> and determine the parameters of growth throughout 2014? Let us have a quick look. 
 
Growing big is the key priority E-commerce start-ups in India are finally coming of age and looking beyond the quickest possible exits. When Myntra closed $50 million in funding a couple of days ago, the company was immediately approached by its bigger rival <keyword id="6354742" type="COMPANY" weightage="60" keywordseo="Flipkart">Flipkart</keyword> who had reportedly come up with an acquisition offer worth $200 million. According to a TechCrunch report, e-commerce giant <keyword id="18635" type="CITY" weightage="80" keywordseo="Amazon">Amazon</keyword> had also approached Myntra but the details of the proposed deal are not yet available. 
 Although rumours were rife that Myntra could be considering either of the deals as part of a bigger strategy, the e-tailer has decided to stay off the <keyword id="1949341" type="UNKNOWN" weightage="100" keywordseo="Exit-route">exit route</keyword>. In fact, its ongoing talks for an additional round of funding worth $40 million clearly indicate that the company has in place some well-thought-out <keyword id="414633" type="UNKNOWN" weightage="100" keywordseo="growth-plans">growth plans</keyword> and big ones at that. The only other reason for back-to-back funding is to raise the valuation but at this point, Myntra doesn’t look like it is on the block. Neither has it decided to quit in a hurry like <keyword id="6359128" type="COMPANY" weightage="100" keywordseo="Redbus">redBus</keyword>.in did last year. <keyword id="2049136" type="UNKNOWN" weightage="100" keywordseo="Indias-largest-bus-ticketing-firm">India’s largest bus ticketing firm</keyword> was acquired by the <keyword id="1643008" type="UNKNOWN" weightage="100" keywordseo="Ibibo-Group">ibibo Group</keyword> for around $125 million but the sale cut short a successful <keyword id="530125" type="UNKNOWN" weightage="100" keywordseo="entrepreneurial-journey">entrepreneurial journey</keyword> that could have become a $500 million business in terms of revenue and could have achieved a $1 billion valuation. 
 As for Jabong, the very fact that it is backed by Rocket Internet may tell the industry insiders a different story. Rocket is known in the market for its fast and furious build-and-sell business module, and the start-ups are essentially replicas of successful US businesses. But the kind of funding Jabong is raising right now shows that the company is in no hurry to down the shutters in India even though two of its four co-founders have recently left the company. Jabong started its India operations in 2012 and competes with key e-com players such as Flipkart, Myntra, <keyword id="541988" type="COMPANY" weightage="100" keywordseo="SnapDeal">Snapdeal</keyword> and <keyword id="6354743" type="COMPANY" weightage="40" keywordseo="Amazon-India">Amazon India</keyword>, among others. 
 
Only <keyword id="2049143" type="UNKNOWN" weightage="100" keywordseo="Core-expertise">core expertise</keyword> matters Internet giant <keyword id="6355629" type="CITY" weightage="80" keywordseo="Google">Google</keyword> has already given us a case in point when it sold <keyword id="487941" type="ORGANIZATION" weightage="60" keywordseo="Motorola-Mobility">Motorola Mobility</keyword> to Lenovo for $2.91 billion, less than two years after paying $12.5 billion to acquire it. The deal is not a total financial loss as Google has managed to keep patents worth billions of dollars and expects to turn Lenovo into a manufacturing unit for its <keyword id="6355645" type="COMPANY" weightage="40" keywordseo="android">Android</keyword> OS. But selling <keyword id="11148" type="CITY" weightage="40" keywordseo="Motorola">Motorola</keyword> is a sure indication that Google should have focused more on its <keyword id="1430489" type="UNKNOWN" weightage="100" keywordseo="Core-Competencies">core competencies</keyword> – search, software and selling ads – instead of developing hardware. 
 You will find a similar case here as Jabong has reportedly sold its <keyword id="2049146" type="UNKNOWN" weightage="100" keywordseo="logistics-arm">logistics arm</keyword> <keyword id="2049145" type="UNKNOWN" weightage="100" keywordseo="JaVAS">JaVAS</keyword> (Jabong Value Added Services) to Gurgaon-based QuickDel Logistics as part of its business restructuring and funding exercise. Jabong <keyword id="170488" type="POSITION" weightage="40" keywordseo="co-founder">co-founder</keyword> <keyword id="536011" type="PERSON" weightage="40" keywordseo="Praveen-Sinha">Praveen Sinha</keyword> has also confirmed to the media that JaVAS is now an independent entity. 
 However, that brings us back to the basic question. Should companies try and provide end-to-end solutions to ensure a complete customer experience or should they focus on core competencies and leave the rest to the experts in those fields? We particularly raise this question as many Indian e-commerce firms are currently focusing on <keyword id="2049154" type="UNKNOWN" weightage="100" keywordseo="Proprietary-payment-gateways">proprietary payment gateways</keyword> and customised logistics services in a bid to propel their services to the next level. However, such services can actually make you lose money unless a company is catering to a customer base as vast as <keyword id="6357395" type="CITY" weightage="40" keywordseo="eBay">eBay</keyword> or Amazon. 
 After JaVAS, the writing is definitely on the wall. The bells and whistles can always come in later, but the key focus must be core competencies. Of late, even <keyword id="6354427" type="CITY" weightage="80" keywordseo="Apple">Apple</keyword> seems to be falling in this trap – its newest hardware products have ‘n’ number of <keyword id="2049161" type="UNKNOWN" weightage="100" keywordseo="Incremental-features">incremental features</keyword> but real innovations seem to be eluding the iconic company. 
 
Investors showing better <keyword id="170907" type="UNKNOWN" weightage="100" keywordseo="risk-appetite">risk appetite</keyword> India’s e-commerce market is projected to grow sevenfold to $22 billion in the next five years, and investors, both national and global, want to have a piece of the pie. According to <keyword id="1981" type="PERSON" weightage="80" keywordseo="Rahul-Khanna">Rahul Khanna</keyword>, managing director of the <keyword id="6357097" type="COMPANY" weightage="100" keywordseo="venture-capital">venture capital</keyword> firm <keyword id="218905" type="COMPANY" weightage="80" keywordseo="Canaan-Partners">Canaan Partners</keyword> (India), e-commerce players in India (and everywhere else for that matter) require very deep pockets to scale up to the level of breaking even and hitting profitability. In this space, sales margins are typically low; volume is high, and logistics &amp; back office <keyword id="6362476" type="ORGANIZATION" weightage="100" keywordseo="investments">investments</keyword> only become viable when companies are catering to a very <keyword id="2049169" type="UNKNOWN" weightage="100" keywordseo="Large-customer-base">large customer base</keyword>. Consequently, <keyword id="2049171" type="UNKNOWN" weightage="100" keywordseo="Follow-on-rounds">follow-on rounds</keyword> are extremely crucial for sustainable growth. Now that big institutional investors like PremjiInvest and UK-based development <keyword id="25455" type="ORGANIZATION" weightage="100" keywordseo="finance">finance</keyword> institution CDC Group are entering the arena, the much-needed <keyword id="2000080" type="UNKNOWN" weightage="100" keywordseo="Cash-burning">cash burning</keyword> is sure to propel growth to the desired level. 
 “E-commerce is fast maturing in India and that’s the main reason <keyword id="363248" type="ORGANIZATION" weightage="100" keywordseo="Global-Investments">global investments</keyword> are flowing in,” says another analyst. “When big players like Amazon show interest (the e-commerce giant has reportedly approached Myntra), investors are quick to sense the tremendous <keyword id="452394" type="UNKNOWN" weightage="100" keywordseo="growth-potential">growth potential</keyword> lying here,” she adds. 
 
Forget the buzz you are creating; it’s result time now Analysts, who have followed the course of events over the past few weeks, also point out another interesting trend. Be it Myntra or Jabong or other up-and-coming e-commerce businesses, it’s their <keyword id="2049173" type="UNKNOWN" weightage="100" keywordseo="Growth-quotient">growth quotient</keyword> that has attracted <keyword id="2049174" type="UNKNOWN" weightage="100" keywordseo="Big-funding">big funding</keyword>. In other words, start-ups who are delivering in a big way will get the valuable <keyword id="2049175" type="UNKNOWN" weightage="100" keywordseo="Growth-dollars">growth dollars</keyword> as investors are now looking beyond the buzz and focusing on <keyword id="1730239" type="UNKNOWN" weightage="100" keywordseo="business-fundamentals">business fundamentals</keyword> and results. 
 Companies must have the numbers – in terms of customer base, <keyword id="169826" type="UNKNOWN" weightage="100" keywordseo="growth-figures">growth figures</keyword> and brand leadership – to justify the big money they are raising. For instance, Myntra expects to more than double its <keyword id="657194" type="UNKNOWN" weightage="100" keywordseo="gross-sales">gross sales</keyword> to over $250 million by March 2015 and the fashion e-tailer’s <keyword id="2049176" type="UNKNOWN" weightage="100" keywordseo="Monthly-gross-sales">monthly gross sales</keyword> could touch $20-25 million by April this year. Myntra is expected to end the current fiscal with more than $100 million in gross sales and it is targeting $1 billion in <keyword id="6399113" type="ORGANIZATION" weightage="100" keywordseo="GMV">GMV</keyword> by 2016-2017. Flipkart, which raised $360 million last year at a valuation of about $1.6 billion, is also projecting a GMV of $1 billion by 2015. 
 Jabong, too, has aggressive growth plans and the latest round will be used to strengthen its <keyword id="2049177" type="UNKNOWN" weightage="100" keywordseo="Supply-chain-infrastructure">supply chain infrastructure</keyword> and enhance its <keyword id="2049178" type="UNKNOWN" weightage="100" keywordseo="Technology-platform">technology platform</keyword>. According to industry sources, Jabong might have generated <keyword id="2049180" type="UNKNOWN" weightage="100" keywordseo="Gross-merchandise-sales">gross merchandise sales</keyword> of $100-150 million for the fiscal 2012-13. Other key investments in the Indian e-commerce space since 2013 included online marketplace Snapdeal raising about Rs 300 crore and baby care portal <keyword id="1615917" type="COMPANY" weightage="80" keywordseo="FirstCry">Firstcry</keyword> bagging Rs 92 crore. 
 
Inventory, <keyword id="6630005" type="UNKNOWN" weightage="100" keywordseo="private-labels">private labels</keyword> are adding value 
With the lone exception of Snapdeal that runs a 100% marketplace, most of the big e-commerce entities in India are flourishing on a hybrid model – a strategic mix of inventory, private label and marketplace. In fact, Jabong has been doing all three for some time now, although a bit discreetly, and it could be now pushing hard to extract every penny from each of these categories. 
 
Myntra, on the other hand, focuses on both inventory and private label, with the share of private labels rising rapidly. A couple of years ago, the e-tailer acquired Exclusively.in Inc., the company behind the private label brand Shersingh.com and the fashion site Exclusively.in, in a cash-cum-equity deal. Myntra is reportedly eyeing more private labels to add to its portfolio as the margins are pretty high in this segment and add substantially to the profits. 
 
Bottom line: Is it a <keyword id="2049185" type="UNKNOWN" weightage="100" keywordseo="Volatile-situation">volatile situation</keyword>? In one of her latest blogs in <keyword id="6359301" type="POSITION" weightage="100" keywordseo="Entrepreneur">Entrepreneur</keyword>.com, entrepreneur-writer Erika Trautman has nicely summed it up. “No matter how great the idea, if your start-up doesn’t create hard and fast results with analytics, targeted business solutions and mobile integration, it won’t survive in 2014. Launching a start-up can’t just be about how cool your product is. No business can subsist off just buzz and Press. This year, start-ups must focus on business fundamentals and start emphasising partnerships that generate results.” 
 
Can the Indian e-commerce players innovate, scale up and deliver (as the takeaways so amply illustrate) to justify the trust investors are now putting in them? Will there be new ventures to take up the gauntlet? Let us wait and watch. 
 
Image: Thinkstock Photos/Getty Images

Indian E-com Players
Are Raising Big Money; These 5 Takeaways Can Help You Understand What’s
Changing

<keyword id="6354742" type="COMPANY" weightage="20" keywordseo="Flipkart">Flipkart</keyword>, the poster child of the Indian startup ecosystem, was devalued for the seventh time in January 2017, by <keyword id="4205639" type="UNKNOWN" weightage="20" keywordseo="fidelity-partners">Fidelity Partners</keyword>. At a $5.56 billion valuation, Flipkart’s shares were valued at $52.13 in November 2016, down by 36.1 percent from $81.55 per share as of August 2016. The domino effect hit the cab aggregator <keyword id="6354720" type="PERSON" weightage="20" keywordseo="Ola">Ola</keyword> next with the US-based investment firm <keyword id="4205636" type="UNKNOWN" weightage="20" keywordseo="vanguard-world-fund">Vanguard World Fund</keyword> marking down Ola by over 40 percent. 
 According to their regulatory filing with the <keyword id="108474" type="ORGANIZATION" weightage="20" keywordseo="US-Securities-and-Exchange-Commission">US Securities and Exchange Commission</keyword>, the current valuation for Ola is now $3 billion, with its shares dropping from $311.27 per share in the previous quarter to $182.70 apiece. During their peak, Ola had raised $500 million at a valuation of $5 billion. 
 That’s not all. According to reports, e-commerce giant <keyword id="541988" type="COMPANY" weightage="20" keywordseo="SnapDeal">Snapdeal</keyword> is reportedly looking at raising funds at a lower valuation of $4 billion. At their last fundraising round, they raised $200 million at a valuation of $6.5 billion. 
 
Valuations are normally decided according to a company’s market share, its gross margins, and its rate of growth, among other factors, but is anyone talking about the elephant in the room? Does a number decide a company’s worth or does the mettle lie someplace else? 
 
What’s The Big Deal about Valuations? 
 
While Valuations and devaluations are part of the game, they are a mix of market environment, risk appetite, a fund manager’s biases, hot new trends, fear of missing out, the multiples comparable are commanding, and of course, expected cash flows and margins. 
In 2015, we lauded the entry of Flipkart, Ola and Snapdeal in the Unicorn club. The first quarter of 2015 saw over $1.7 billion funding in start-ups and all we hear now are downturns with reality hitting the magic creatures to the ground and forcing them to compete in a horse race for fund-raising. 
 
<a href="http://www.businessinsider.in/heres-how-uber-is-letting-you-earn-from-its-platform-uberdost/articleshow/57083396.cms">ALSO READ: Here's how Uber is letting you earn from its platform 'UberDost'</a> 
 
While there were muffled concerns of profitability and unit economics, the dynamics took a harder turn when in the middle of 2016 the world economic dynamics shifted. 
 
Suddenly, the pouring funding started slowing down, news of firing rounds, internal tiffs, and investor involvement began to cloud the startup skyline. 
 
Now the lauded valuations started to seem bloated and overhyped, and the cost-cutting started and it doesn’t seem to end. 
 
 
 
 
The secret is in the Business Model 
 <keyword id="824043" type="COMPANY" weightage="20" keywordseo="Business-Insider">Business Insider</keyword>, while digging deeper into factors ailing the startup ecosystem in India, realized that business models had to be one of the core ingredients to a startup’s success or failure. So, we got in touch with key players, notable investors and successful companies that had a say in the functions of the industry. 
 
What clearly emerged was that there were mainly three business models that most start-ups and unicorns, followed in India- 
 
1) Cut prices to gain industry share and chase profit later 
2) Set up person-to-person exchanges 
3) On-Demand Model 
 
Now we break down the models to see why Indian start-ups think they’d work and why they haven’t succeeded yet. 
 
Investors’ Point of View 
 <keyword id="262067" type="PERSON" weightage="20" keywordseo="Mahesh-Murthy">Mahesh Murthy</keyword>, Co-Partner, Seedfund, one of India’s most vocal investors told us what’s wrong with the Indian startup ecosystem,”The problem is that we are idolizing businesses that are not ‘New’. There is nothing elusive or different about the companies we look up to, they are just copycats.’’ 
 Seedfund, which is an early stage VC firm has invested in companies like Redbus.in, Chumbak, Carwale, and Voonik. “Real businesses need little or no marketing. The cost of acquiring a customer shouldn’t be higher than your investment in your product which is what is happening right now’’<keyword id="20148" type="PERSON" weightage="20" keywordseo="murthy">Murthy</keyword> comments on the viability of the business models of India’s best-known <keyword id="6362513" type="ORGANIZATION" weightage="20" keywordseo="Startups">startups</keyword>. 
 “Innovation for the sake of innovation is useless. Most consumers prefer the companies that are competitors to Flipkart, Snapdeal, and Ola and that speaks volumes. We are just looking for great service coupled with great value for money and <keyword id="18635" type="CITY" weightage="100" keywordseo="Amazon">Amazon</keyword> and Uber give us that while the other companies don’t hit the mark while getting celebrity endorsements with full-page ads.’’ 
 “Rule Number 1 of business: Never lose money. Rule Number 2: Don’t forget Rule Number 1,” said <keyword id="71133" type="PERSON" weightage="20" keywordseo="Warren-Buffet">Warren Buffet</keyword>, probably the most popular investor in the world. 
 <keyword id="542474" type="PERSON" weightage="20" keywordseo="Reid-Hoffman">Reid Hoffman</keyword> from <keyword id="28120" type="CITY" weightage="20" keywordseo="Linkedin">LinkedIn</keyword> and now a VC says that as a VC, you should be able to put your money into a startup and walk away from your investment and at the most, you are best placed to understand a sector if you have built a business in it or at the very least, worked in it. For Indian start-ups, we see the opposite happening with Flipkart who recently appointed <keyword id="6379357" type="UNKNOWN" weightage="20" keywordseo="Kalyan-Krishnamurthy">Kalyan Krishnamurthy</keyword> as CEO, who is an ex-employee at Flipkart’s key investor, Tiger Global. 
 
What is a business model? 
 
A business model explains which consumer pain a startup chooses to relieve, why your solution works better than competing ones and how big a wedge a company can drive between what customers are willing to pay and the costs. 
 
Breaking down the Business Models 
 
There are broadly the following business models at play when it comes to start-ups that hold the public eye in India: 
 
1. Cut prices to gain an industry share and chase profit later: Target a huge market and sell a product at the lowest price with fast delivery and great service. As the company grows, expand the product line, negotiate volume discounts with suppliers, invest in technology, customer response time and cut waste from the operations. Then deliver the lower costs to customers in the form of lower prices. 
 
This was Amazon’s model which is still one of the fastest growing companies in India and the world. Although it was founded back in 1994, Amazon didn’t actually make a profit until 2001. Amazon has some profitable projects, but the money made from them is typically used as investments to fund other Amazon businesses and ventures. The company invests its profits in new lines of businesses and uses them to expand. In short, Amazon seems to value growth over profits. 
 
 
 
​ <keyword id="8589" type="PERSON" weightage="20" keywordseo="padmaja">Padmaja</keyword> <keyword id="980938" type="PERSON" weightage="20" keywordseo="Ruparel">Ruparel</keyword>, President, Indian Angel Network doesn’t believe in this model simply because she thinks that Indian consumers are flighty, “There is a constant need to lure the consumer to stick with you which is tricky when you’re not the only player in the market. Your focus here is on how quickly you can grow the market and not on your business strategy.’’ Ruparel believes in investing in a much more stable business model, “We are old-fashioned for sure as our focus is on businesses building a top-line and a bottom-line. We ascertain a business by unit economics and even though the cycle might be slightly longer, B2B start-ups create a sustainable business.” 
 
“The consumer is surely attuned to buying online which was their aim, but only some players will remain in this market. Consolidation is inevitable as loss-making businesses can’t stay afloat for long, but only time will tell who will remain the top dogs here,’’says Padmaja when asked about the future for consumer-centric start-ups. 
 
India’s perspective: “E-commerce companies like Snapdeal and Flipkart are following a similar model to that of Amazon in India. The difference is that Amazon can afford to lose money in India as it is profitable in other markets. The former players are just playing in India where they’re losing money trying to compete with Amazon,” comments Mahesh Murthy. 
 
2. Set up person-to-person exchanges: A house owner in a town has a huge house that has idle rooms that aren’t occupied. The young professionals living in the city need accommodation in different towns to work flexibly but they don’t want to own a house or live in expensive hotels. It seems to be working for <keyword id="719382" type="COMPANY" weightage="20" keywordseo="Airbnb">Airbnb</keyword> which doesn’t own any inventory and millions of people have taken advantage of these services, and Airbnb now has a market value estimated at $30 billion—roughly the same size as the <keyword id="183920" type="CITY" weightage="20" keywordseo="Marriott-International">Marriott International</keyword> hotel chain. 
 
Vikram Gupta, CEO, IvyCap Ventures, “India is not a mature market where you can write off $100 million checks to companies that are spearheaded by college graduates or in some cases, dropouts. The entire ecosystem is disturbed as new companies were getting funding at overhyped valuations. The market has started to finally stabilize and we see investors going back to the revenue as a yardstick for company’s growth instead of the GMV. The businesses are coming back to realistic valuations and while they might have money left in the bank, they are looking to reduce their cash burn rate.” 
 
 
 
India’s perspective: Companies like <keyword id="2808667" type="UNKNOWN" weightage="20" keywordseo="OYO">OYO</keyword> are trying to work with small hotels and guesthouses and have even leased their own properties but the burn-rate is consistent. With simplifying its business model and focusing on one aspect; people sharing their homes with people and minimal revamping, Airbnb has revolutionized how the world sees hotel accommodation forever. 
 
3. On-Demand Model: Smartphones have driven transformational shifts in how we consume goods and services, and many consumers have become acclimated to purchasing at the press of a button. The on-demand model allows a startup to leverage new technology while utilizing existing infrastructures. Another benefit lies in the use of freelance labor with its obvious advantages in cost cutting. 
 
Uber is a great example of the sharing economy where they connect the supply to the demand of taxis without investing in their own fleet. 
 
India’s perspective: <keyword id="6362049" type="UNKNOWN" weightage="20" keywordseo="Ola-Cabs">Ola Cabs</keyword> is Uber’s biggest competitor in India and while both companies burn a lot of money trying to lure customers to get into a taxi, Uber is currently the world’s most valuable startup at $69 billion. 
 
<a href="http://www.businessinsider.in/online-cab-players-in-2016-completed-nearly-half-a-billion-rides-with-250-y-o-y-growth-in-india/articleshow/57273938.cms">ALSO READ: Online cab players in 2016 completed nearly half a billion rides with 250% y-o-y growth in India</a> 
 
Winner Speak 
 V. Krishnan, Co-founder, and Director of <keyword id="1675768" type="UNKNOWN" weightage="20" keywordseo="Justdial-Ltd">JustDial Ltd</keyword> who likes to call his company an ‘18-year old startup’ says that for a successful business you don’t need an extraordinary idea, “The problem with start-ups today is that they don’t focus on profitability. To create a profitable business, you need extraordinary execution, not an idea. Giving money to people to use your services doesn’t make sense. The Indian customers are not loyal to brands, but to offers. Our goal was to create a world-class business and a world-class company.’’ 
 
For the first ten years of JustDial’s existence, the company didn’t raise any funding. The company ran on a shoe-string budget and used its own money to survive. In 2006, when internet penetration and broadband gained traction in India, the company was ready with its fully functional website to complement its telecom services. From 2-3% internet users to now 85% internet users, the company has grown to 200 Cr web searches annually, without any cashback or incentives. The company is probably one of the rarely profitable internet companies in the country today. 
 
<a href="http://www.businessinsider.in/65-of-start-ups-feel-indian-startup-eco-system-may-be-in-a-tech-bubble-report/articleshow/57205211.cms">ALSO READ: 65% of start-ups feel Indian startup eco-system may be in a tech bubble: Report</a> 
 
“The core business of start-ups isn’t ready but there is marketing happening. India is going to be giving you a lot of opportunities. Everyone wants to create a company, raise a great valuation and sell it off to do something bigger; the attitude is wrong," he signs off. 
​ 
Business Insider got in touch with Flipkart, Ola, Snapdeal, and Uber for this story but the companies chose to not comment on the same. 
 
​ 
 
Business Insider’s Take 
 
While popular Indian start-ups struggle to survive without additional funding coming in, we see some internet companies like JustDial and BookMyShow staying afloat, without investor-intervention. 
 
When it comes to businesses and business models, investors and successful companies agree that the tried and tested works; build a business with a strong product that you can alter as technology develops. The business of losing money can only take you so far if you don’t put it to good use. 
 
There’s a difference between investment into a product and burning money, and the start-ups better realize that before they get acquired or relinquished by the players who created the game that they’re set to lose. 
 
The market is big enough for companies that create value for customers not just for start-ups that create customers; the difference is everything. 
 
(Graphics: All figures in INR crores for the financial year 2015- 2016. Source: <a href="http://www.livemint.com/Companies/vtqiTC9VgJgnUfOAH2QdiL/Flipkart-still-Indias-top-startup.html">Mint Research</a>) 
 
**For Oyo, the result is from Apr-Dec 2015. 
*BookMyShow is the only company mentioned that has profits.

BI Investigation: Business models akin to Amazon and
Uber’s aren’t working for Indian startups

International property consultant JLL India’s residential services division has joined hands with Indian e-commerce giant <keyword id="541988" type="COMPANY" weightage="100" keywordseo="SnapDeal">Snapdeal</keyword> to market residential real estate in India. With this alliance, they will offer brokerage-free buyer services in primary sales properties, as per the company’s release. 
 
<a href="http://www.businessinsider.in/Now-buyProperty-on-Sale-from-Snapdeal/articleshow/50589572.cms">People who buy properties on Snapdeal</a> will now be able to avail on-ground advisory and transaction services from JLL. JLL will also organise guided site visits, help clients negotiate with developers and assist with documentation and mortgages, while Snapdeal will provide the customers with online real estate platform to enable home searches. 
 
Off lately, Snapdeal has been making a lot of alliances to enrich its customers’ experience. It had recently partnered with <a href="http://www.businessinsider.in/You-can-now-use-the-Snapdeal-app-to-book-tickets-and-order-food-online/articleshow/51340726.cms">Zomato, RedBus and ClearTrip</a>. 
 
"Ecommerce is evolving rapidly and proving to be a major disruptor of traditional marketplaces. In November 2015, India's internet user base was around 402 million - today, it stands at just over 462 million. There is no ignoring the power of the Internet and the online marketplace, and we will leave no stone unturned to leverage this power. This partnership underscores our mission to remain future-ready and ahead of the curve," said <a href="http://www.businessinsider.in/This-real-estate-CEO-told-us-which-specific-part-of-Indias-property-market-is-going-to-take-a-beating/articleshow/50700686.cms">Anuj Puri</a>, Chairman &amp; Country Head, JLL India. 
 
Also read: <a href="http://www.businessinsider.in/You-can-soon-book-an-Uber-using-your-Snapdeal-app/articleshow/51454572.cms">You can soon book an Uber using your Snapdeal app</a> 
 
For homebuyers, this partnership will get them everything ranging from home search to purchasing the house without paying brokerage on deals in the primary sales space, i.e. on buying properties from developers. 
 
"The real estate category on Snapdeal has grown rapidly since its launch in August 2014. We have forged alliances with some of the most trusted names in the real estate industry to offer a range of housing options for our ever-expanding customer base in a hassle-free and transparent manner. Our partnership with JLL India's Residential Services agency will further enhance purchase experience for our real estate customers," said Tony Navin, Senior Vice President, Partnerships and Strategic Initiatives, Snapdeal. 
 
<a href="http://www.housingwire.com/ext/resources/images/editorial/A-New-Big-Images/houses/For-Sale/Computer-keyboard-house-for-sale-copy.jpg?1453763363">Image source</a>

Buy houses on Snapdeal without any brokerage fees

<a href="http://www.businessinsider.in/searchresult.cms?query=Snapdeal&amp;sortorder=effectivedate">Snapdeal</a> has changed its business model, yet again. This time by introducing services. It now has segments like flight and bus ticket bookings, hotel reservations and food ordering through partnerships with <a href="http://www.businessinsider.in/searchresult.cms?query=Zomato&amp;sortorder=effectivedate">Zomato</a>, <a href="http://www.businessinsider.in/searchresult.cms?query=Cleartrip&amp;sortorder=effectivedate">Cleartrip</a>, <a href="http://www.businessinsider.in/searchresult.cms?query=UrbanClap&amp;sortorder=effectivedate">UrbanClap</a> and <a href="http://www.businessinsider.in/searchresult.cms?query=RedBus&amp;sortorder=effectivedate">RedBus</a>. 
 At a time when <keyword id="35621" type="UNKNOWN" weightage="60" keywordseo="e-commerce">e-commerce</keyword> majors are struggling with fresh funding and rift with sellers, this all-in-one business model is reminiscent of China’s <a href="http://www.businessinsider.in/searchresult.cms?query=Dianping&amp;sortorder=effectivedate">Dianping</a>, an online portal that offers almost everything from shopping, online reservations, food delivery, and e-coupons, among others. 
 <keyword id="2189133" type="UNKNOWN" weightage="60" keywordseo="Dianping">Dianping</keyword> is currently one of China’s most popular restaurant-review and group-buying services. Valued at a solid $4.05 billion, this Shanghai-based startup founded in 2003 is a bit of Yelp and Groupon. Co-founder Zhang Tao launched Dianping in 2003 after he earned his M.B.A. from the University of Pennsylvania’s <keyword id="6442384" type="ORGANIZATION" weightage="60" keywordseo="Wharton-School">Wharton School</keyword>. Interestingly, <keyword id="541988" type="COMPANY" weightage="80" keywordseo="SnapDeal">Snapdeal</keyword> co-founder <a href="http://www.businessinsider.in/searchresult.cms?query=Kunal+Bahl&amp;sortorder=effectivedate">Kunal Bahl</a> is a ​Wharton alumni as well. 
 
<a href="http://www.businessinsider.in/searchresult.cms?query=Dianping&amp;sortorder=effectivedate">Dianping</a> was founded a year after Yelp, which was founded in 2004. Currently, Dianping has over 190 million monthly active users and more than 60 million reviews of restaurants and other local businesses. Its services cover over 12 million local businesses in about 2,300 cities across China. 
 
India has an untapped services industry as well. "Online services is an industry potentially worth $100 billion by 2020 and is poised to play a huge role in driving habit commerce in India. The introduction of services on <a href="http://www.businessinsider.in/searchresult.cms?query=Snapdeal&amp;sortorder=effectivedate">Snapdeal</a> is a big leap forward in catering to nearly all the consumption needs of our customers," <a href="http://www.businessinsider.in/searchresult.cms?query=Snapdeal&amp;sortorder=effectivedate">Snapdeal</a> co-founder <a href="http://www.businessinsider.in/searchresult.cms?query=Rohit+Bansal&amp;sortorder=effectivedate">Rohit Bansal</a> recently said. 
 
"We will continue to add leading service providers from other categories in our journey to offer a single point access to the widest range of services. We are confident that the introduction of services on <a href="http://www.businessinsider.in/searchresult.cms?query=Snapdeal&amp;sortorder=effectivedate">Snapdeal</a> will bring us closer to our goal of 20 million daily transacting users by 2020," Bansal added. 
 
After acquiring mobile recharge platform FreeCharge back in April 2015 for an estimated $ 500 million, <a href="http://www.businessinsider.in/searchresult.cms?query=Snapdeal&amp;sortorder=effectivedate">Snapdeal</a> launched recharges and bill payments in March this year. The company claims it has done over a million transactions in a month. 
 
In a recent study by Red Seer Consulting, <a href="http://www.businessinsider.in/searchresult.cms?query=Snapdeal&amp;sortorder=effectivedate">Snapdeal</a>’s market share fell from 21-23% in 2015. This has allowed other players to grow. While this is sure to boost the online traffic to Snapdeal’s app, it will also allow for more diverse ways of monetization including native advertising.

Snapdeal may be trying to become India’s Dianping

Google ‘top 10 Marketing Automation companies’ and the list that’ll appear will have billion dollar names like Hubspot, Salesforce and IBM. At a time when Indian <keyword id="35621" type="UNKNOWN" weightage="80" keywordseo="e-commerce">e-commerce</keyword> companies are estimated to spend as much as 70% of their revenues on marketing, an Indian e-commerce &amp; <keyword id="3395310" type="UNKNOWN" weightage="40" keywordseo="B2C-marketing">B2C marketing</keyword> software platform has earned the goodwill among several of these startups. 
 <keyword id="2998774" type="UNKNOWN" weightage="80" keywordseo="Betaout">Betaout</keyword> has an impressive array of investors on board who have invested $2 million till now. Some of the names include <a href="http://www.businessinsider.in/searchresult.cms?query=Vijay+Shekhar+Sharma&amp;sortorder=effectivedate">Vijay Shekhar Sharma</a> (founder and CEO, <a href="http://www.businessinsider.in/searchresult.cms?query=Paytm&amp;sortorder=effectivedate">Paytm</a>), Ashish Kashyap (CEO, Ibibo Group), <a href="http://www.businessinsider.in/searchresult.cms?query=Kunal+Bahl&amp;sortorder=effectivedate">Kunal Bahl</a> (CEO and co-founder, <a href="http://www.businessinsider.in/searchresult.cms?query=Snapdeal&amp;sortorder=effectivedate">Snapdeal</a>) and Phanindra Sama (co-founder, Redbus) among others. The interesting fact is most of these people were Betaout customers initially. 
 “Ours is a very niche product. The platform is built especially for e-commerce companies. Most loved our product so much they invested in the company”, <keyword id="419257" type="PERSON" weightage="60" keywordseo="Ankit-Maheshwari">Ankit Maheshwari</keyword>, co-founder of Betaout smiles. 
 
The company’s proprietary software allows e-commerce companies to build user intelligence databases and provides tools to engage with users through email, on-site engagement, mobile push, live-chat, SMS, and through other channels. It enables e-commerce companies to increase conversions and personalize user engagement using real-time user persona and intent data. 
 
Ankit claims existing marketing tools in the market used by <a href="http://www.businessinsider.in/searchresult.cms?query=e-commerce&amp;sortorder=effectivedate">e-commerce</a> companies and B2B sites are general in nature and need a high degree of customization before delivering value, and Betaout differentiates itself by offering a customized set of tools tailored to the needs of <a href="http://www.businessinsider.in/searchresult.cms?query=e-commerce&amp;sortorder=effectivedate">e-commerce</a> players.

This Indian startup turned its
customers into investors

<a href="http://www.businessinsider.in/searchresult.cms?query=FreeCharge&amp;sortorder=effectivedate">FreeCharge</a> has recently announced in a <a href="https://blog.freecharge.in/2016/05/19/now-whatsapp-money-with-freecharge/">blog post</a> that users can now use its ‘<keyword id="3293302" type="UNKNOWN" weightage="40" keywordseo="Chat-n-Pay">Chat n Pay</keyword>’ to pay using <a href="http://www.businessinsider.in/searchresult.cms?query=WhatsApp&amp;sortorder=effectivedate">WhatsApp</a>. The feature is much like Tencent’s money transfer service on WeChat. 
 Users will have to go to ‘<keyword id="6377963" type="UNKNOWN" weightage="80" keywordseo="Freecharge">Freecharge</keyword> on <a href="http://www.businessinsider.in/searchresult.cms?query=WhatsApp&amp;sortorder=effectivedate">WhatsApp</a>*’ on the Freecharge Menu of their Android phone, click ‘Enable’ to enable Freecharge in accessibility settings, open <a href="http://www.businessinsider.in/searchresult.cms?query=WhatsApp&amp;sortorder=effectivedate">WhatsApp</a>, type in the amount followed FC, for example 100F, and the transfer’s done. 
 At the launch of FreeCharge’s ‘Chat-n-Pay’ feature, <keyword id="541988" type="COMPANY" weightage="60" keywordseo="SnapDeal">Snapdeal</keyword> Chief Product Officer <a href="http://www.businessinsider.in/searchresult.cms?query=Anand+Chandrasekaran&amp;sortorder=effectivedate">Anand Chandrasekaran</a> said in an <a href="http://www.businessinsider.in/Exclusive-The-Good-Boy-of-e-Payments-Anand-Chandrasekaran-CPO-Snapdeal/articleshow/51496881.cms">exclusive Business Insider interview</a> to that ‘the intuition was that payments can be social’. Looks like they’ve done it. 
 
The ‘Chat n Pay’ feature was launched on FreeCharge in March, was built as a feature over the new chat-based communication in the latest version of the <a href="http://www.businessinsider.in/searchresult.cms?query=FreeCharge&amp;sortorder=effectivedate">FreeCharge</a> app. 
 
FreeCharge has recently joined hands with Zivame, ClearTrip, RedBus and Café Coffee Day to enable its Wallet payments in merchant outlets. The company claims customers can pay at any time in less than 10 seconds in a secure way across all RedBus platforms. 
 
FreeCharge is currently positioned against segment-leader Paytm. The portal is a key to <a href="http://www.businessinsider.in/searchresult.cms?query=Snapdeal&amp;sortorder=effectivedate">Snapdeal</a>’s businesses in building an all-inclusive online marketplace like China’s <a href="http://www.businessinsider.in/searchresult.cms?query=Alibaba&amp;sortorder=effectivedate">Alibaba</a>. 
 
Image credit: Indiatimes

You
can now send and receive money on WhatsApp using FreeCharge

​The growing proficiency of Indian technology companies in building innovative products is drawing a great deal of attention from global corporations eager to acquire fresh ideas and skilled workers. 
 
Applications that help ease online payments, offer security for data stored on multiple devices as well as those that help drive greater advertising revenue on mobile devices are some of the technologies on the shopping list of multinationals scouting for the right startup. In the next five years, experts say at least 40 technology ventures in India could be bought over by large corporations. 
 “Couple of them (startups) will be valued at over $1 billion (Rs 6,200 crore),” said Ravi Gururaj, an angel investor who heads the software product council at industry lobby <keyword id="6372077" type="CITY" weightage="60" keywordseo="Nasscom">Nasscom</keyword>. He expects about half a dozen technology ventures to be valued at around $500 million (Rs 3,100 crore) while <keyword id="818790" type="UNKNOWN" weightage="40" keywordseo="the-rest">the rest</keyword> will likely fetch a price of between $15 million (Rs 93 crore) and $50 million (Rs 311 crore). 
 A handful of such acquisitions has already set the ball rolling. Last November, Japanese engineering and electronics maker <keyword id="69870" type="CITY" weightage="40" keywordseo="Hitachi">Hitachi</keyword> acquired Prizm Payment Services, in a deal estimated at $250 million (Rs 1,547 crore). In mid 2013, South African media conglomerate Naspers bought online bus ticketing firm red-Bus for about $100 million (Rs 618 crore), giving it access to not only the large <keyword id="47445" type="UNKNOWN" weightage="40" keywordseo="Indian-market">Indian market</keyword> but disruptive technology as well. 
 “Multinational companies primarily look for talent and <keyword id="388837" type="UNKNOWN" weightage="40" keywordseo="intellectual-property">intellectual property</keyword> that can compete at global level,” said Prashant Gupta, group manager at Microsoft India (R&amp;D). “There are early signs in India that such companies are emerging that can meet these demands, especially in cloud-driven application lifecycle and big data,” he said. 
 
The global software maker runs an accelerator programme in India for technology startups that has graduated 22 ventures so far and is poised to make its first venture investment this year. 
 Interest from <keyword id="6355311" type="COUNTRY" weightage="40" keywordseo="Japan">Japan</keyword>ese corporations too is growing. Apart from the Hitachi deal, others such as NTT too have been active buyers. In 2012 Japan’s <keyword id="913532" type="ORGANIZATION" weightage="40" keywordseo="NTT-Communications">NTT Communications</keyword> bought a majority stake in technology firm <keyword id="423557" type="COMPANY" weightage="40" keywordseo="Netmagic">Netmagic</keyword> for about Rs 900 crore. “India is becoming the laboratory for products and services for the world,” said Krishnan Ganesh, <keyword id="36740" type="POSITION" weightage="40" keywordseo="founder">founder</keyword> of online tutoring company TutorVista that was bought by the UK’s <keyword id="152222" type="CITY" weightage="40" keywordseo="Pearson">Pearson</keyword> group at an enterprise value of about Rs 1,000 crore. 
 
After the acquisition, the number of students using the services of TutorVista has tripled to four million across both the local and the US market. Pearson now aims to replicate the TutorVista model in emerging markets such as Brazil, China and South Africa. 
 
In 2013, there were 100 merger and acquisition deals across the India’s information technology industry. Of this, 31 whose value was announced were worth $1,906 million (Rs 11,807 crore), according to research firm Venture Intelligence. 
 The trigger for this growing M&amp;A activity is the range of disruptive technology startups emerging out of India. Companies such as advertising network InMobi, data analytics company Mu Sigma and online retailer <keyword id="6354742" type="COMPANY" weightage="40" keywordseo="Flipkart">Flipkart</keyword> have achieved a scale where they are valued at over $1 billion. “This is driven by leading-edge globally competitive technologies,” said Naren Gupta cofounder and managing director of Nexus Venture Partners, an early investor in Netmagic and online retailer <keyword id="541988" type="COMPANY" weightage="40" keywordseo="SnapDeal">Snapdeal</keyword>. 
 For instance, Pune-based <keyword id="741520" type="COMPANY" weightage="40" keywordseo="Druva">Druva</keyword> provides data security and retrieval software to customers such as US space agency <keyword id="6360409" type="ORGANIZATION" weightage="40" keywordseo="NASA">Nasa</keyword>, drug maker <keyword id="44612" type="CITY" weightage="40" keywordseo="Pfizer">Pfizer</keyword> and fashion brand <keyword id="5940" type="PERSON" weightage="40" keywordseo="Louis-Vuitton">Louis Vuitton</keyword>. 
<div style="page-break-after: always;">
	&#xa0;</div> In Chennai, Perfint Healthcare has developed robots that treat cancer by precisely inserting a needle in the affected area to burn or freeze a patient’s tumour, leaving the good tissue alone. The founders, all former employees of <keyword id="166456" type="COMPANY" weightage="40" keywordseo="GE-Healthcare">GE Healthcare</keyword>, quit to launch the firm when they realised the demand for such a product. For global corporations acquiring such game-changing technologies can help them enter new markets and raise barriers against competition. 
 Two years ago, when global software maker <keyword id="183292" type="CITY" weightage="40" keywordseo="Red-Hat">Red Hat</keyword> bought Bangalore-based <keyword id="6373689" type="ORGANIZATION" weightage="40" keywordseo="Cloud-computing">cloud computing</keyword> startup <keyword id="724826" type="COMPANY" weightage="40" keywordseo="Gluster">Gluster</keyword> for around Rs 667 crore, it acquired a storage platform technology which it offered to its customers for the first time. The cost of technology infrastructure to set up such ventures and scale them up for acquisitions has also come down drastically. 
 “A bunch of guys can now launch an application from a garage, keep the tablet or a mobile phone as the front end and the product becomes viral in few weeks,” said Anand Babu Periasamy, cofounder of Gluster. A computer <keyword id="6369183" type="POSITION" weightage="40" keywordseo="Engineer">engineer</keyword> graduate from <keyword id="119675" type="ORGANIZATION" weightage="40" keywordseo="annamalai-university">Annamalai University</keyword>, Periasamy who now works at Red Hat is aiming to build Gluster into a billion dollar business unit. 
 
Experts hope small-size technology ventures in India will also attract the attention of larger firms. “Smaller exits are the life blood for healthy startup ecosystems like in <keyword id="6355882" type="COUNTRY" weightage="40" keywordseo="israel">Israel</keyword> and US,” said Sharad Sharma co founder of software product think-tank iSpirt. Sharma is running an active M&amp;A Connect Program at iSpirt that is curating a list of several dozen companies. 
 Some of those on the radar are retail services software maker Capillary Technologies, healthcare applications provider <keyword id="1165142" type="UNKNOWN" weightage="40" keywordseo="Practo">Practo</keyword> and security software maker <keyword id="171228" type="COMPANY" weightage="40" keywordseo="Quick-Heal">Quick Heal</keyword>. According to Sharma, many of them have shown healthy growth traction and are attractive for strategic partnerships. 
 Sharma of iSpirt is of the view that a larger proportion of bootstrapped companies is stymieing merger activity in India. “It is harder for large corporations when there is no validation from <keyword id="6357097" type="COMPANY" weightage="40" keywordseo="venture-capital">venture capital</keyword> firms,” he said. 
 The other major problem say experts is that large Indian firms such as Infosys, <keyword id="10862" type="CITY" weightage="40" keywordseo="Wipro">Wipro</keyword> and <keyword id="6357150" type="CITY" weightage="40" keywordseo="TCS">TCS</keyword> have shied away from making any such purchases, despite having huge cash reserves. Infosys has $4 billion (Rs 24,000 crore) cash reserves. 
 
“When Wipro can be in soaps and vegetable oil, why can’t they be in the Flipkarts of the world,” said Ganesh of TutorVista. “They are sitting on a huge cash reserve and not a fraction has been spent on startups. That mentality is not there.” 
 
“Over the next five years, I expect that quantity will dramatically improve and we can be optimistic about merger and acquisition activity out of India,” said Nasscom’s Gururaj.

Indian startups' global competitiveness and innovation make them acquisition targets

Do you have ‘it’ in you to take the leap of faith and become an <keyword id="6359301" type="POSITION" weightage="100" keywordseo="Entrepreneur">entrepreneur</keyword>? Of late, the <keyword id="6404679" type="UNKNOWN" weightage="100" keywordseo="start-up">start-up</keyword> mania has caught up in India and <keyword id="107737" type="ORGANIZATION" weightage="100" keywordseo="Entrepreneurship">entrepreneurship</keyword> is passionately glamorised all over the country. Home-grown role models can be found aplenty – right from <keyword id="225032" type="PERSON" weightage="60" keywordseo="Sachin-Bansal">Sachin Bansal</keyword> and <keyword id="6364080" type="PERSON" weightage="60" keywordseo="Binny-Bansal">Binny Bansal</keyword> of Flipkart fame who are taking home million-dollar paycheques to Phanindra Sama, the former redBus CEO who recently made a $100-million-plus exit from his venture. 
 But one can’t ignore the flipside either – the numerous consolidations and shutdowns that had taken place. Only 10% of the approximately 800 start-ups that enter the <keyword id="47445" type="UNKNOWN" weightage="100" keywordseo="Indian-market">Indian market</keyword> each year survive to make it to the next level, experts say. The <keyword id="6357455" type="EVENT" weightage="100" keywordseo="Funding">funding</keyword> stream has thinned as well. In a typical scenario, only about 27% start-ups in incubators make it to <keyword id="6364511" type="UNKNOWN" weightage="100" keywordseo="angel-funding">angel funding</keyword> and out of that set, only about 20% reach Series A stage, according to Alok Mittal of <keyword id="218905" type="COMPANY" weightage="80" keywordseo="Canaan-Partners">Canaan Partners</keyword>. 
 But in case you have got <keyword id="1946693" type="UNKNOWN" weightage="100" keywordseo="Business-ownership">business ownership</keyword> on the brain and would not back out at any cost, here are five crucial points to ponder. Take a look and find out if you, your idea and your business fit the bill. 
 
Have you got a ‘zero’ idea or ‘hero’ idea? Have you got hold of a concept that will take the world by storm? You might be obsessed with your ‘disruptive’ idea but can it survive some of the acid tests that the market has in store for you? That’s a difficult thing to evaluate, especially when you are passionate and firmly believe in your idea. But do it right now and better still, get an expert’s view (an industry guy or an investor could be the ideal person to approach). Don’t flinch if a rejection letter is thrown your way. Just remember you can work around the initial idea and hit the jackpot in a bit. After all, even <keyword id="6354427" type="CITY" weightage="100" keywordseo="Apple">Apple</keyword> was selling blue boxes (phone phreakers used them to make free calls) and PC kits before its revolutionary i-devices came to life. So stay focused, try hard and avoid launching copycat companies. It requires more brainstorming, more <keyword id="1946700" type="UNKNOWN" weightage="100" keywordseo="Innovative-thinking">innovative thinking</keyword> and loads of insight to establish quality entrepreneurship. 
 
Can you entice your <keyword id="6359672" type="UNKNOWN" weightage="100" keywordseo="customers">customers</keyword>? Do you have a market for your product/service and will it grow in time? An idea may sound great on paper but it must have real-life utility if you want to develop a sustainable business. In most cases, you will have to prove the potential in your idea through hard work and the investment of your own capital. So do a thorough <keyword id="878850" type="UNKNOWN" weightage="100" keywordseo="market-research">market research</keyword> with focus on <keyword id="900658" type="UNKNOWN" weightage="100" keywordseo="traction">traction</keyword> and <keyword id="1558852" type="UNKNOWN" weightage="100" keywordseo="paying-customers">paying customers</keyword> who will get your business going. The money must be there where the mouth is – so have a viable <keyword id="173266" type="ORGANIZATION" weightage="100" keywordseo="Business-Plan">business plan</keyword> in place, along with a <keyword id="584695" type="UNKNOWN" weightage="100" keywordseo="prototype">prototype</keyword> and an effective team. Otherwise, even the most wonderful ideas won’t work out. 
 
What about a great team? 
Ideas sound great when they are abstract, but it is an entrepreneur’s painful necessity to find the right kind of people who can build upon those without spending a fortune and market the same in a memorable way. This may seem deceptively simple and some first-timers actually feel that hiring is an exciting chunk of the whole deal. Unfortunately, there are too many loopholes. For one, you need some outstanding people who are experts in their own space, can think out of the box and share your long-term vision. But it requires a large amount of money to get them on board. 
 
On the other hand, industry veterans are a bit wary about joining start-ups – not just because they pay less but because they go back on promises as soon as they strike gold. “Within a few months, they become the worst sort of dictators and getting a free hand is next to impossible,” reflects a former CTO of a start-up who was compelled to return to his old job after a ‘miserable’ start-up outing. Again, mid-level managers bitterly complain about the lack of transparency and sudden pink slip spurts that keep them on their toes all the time. 
 
“The bad thing is funds are not always the issue,” says Arunav Massey, an HR executive. “Their policies are not that people-friendly and ego comes in the way. That’s why even co-founders part ways after some time,” he adds. So take note. Putting together a great team is crucial for your business. But it also matters how you build the team and how you play the game. 
 
Can you <keyword id="766636" type="UNKNOWN" weightage="100" keywordseo="Bootstrap">bootstrap</keyword>? Going by the current trend, that’s the way ahead for start-ups. On an average, start-ups in India received 52 angel and 155 Series A <keyword id="6362476" type="ORGANIZATION" weightage="100" keywordseo="investments">investments</keyword> over the past three years, according to Venture Intelligence, a research <keyword id="6359391" type="ENTERTAINMENT" weightage="100" keywordseo="SERVICE">service</keyword> focusing on <keyword id="34499" type="POSITION" weightage="60" keywordseo="private-equity">private equity</keyword> and mergers &amp; acquisitions. Let’s also get back to Mittal’s analysis, presented at the TiE India Internet Day event earlier this year. Based on an informal survey involving more than half-a-dozen stakeholders in <keyword id="1946708" type="UNKNOWN" weightage="100" keywordseo="Early-stage-funding-ecosystem">early-stage funding ecosystem</keyword>, it has been found that about 38% of the start-ups have to survive through self-funding, at least for a year. Of course, you can try out government funding, collateral-free and interest-free loans and the latest craze – crowd funding. But overall, you must be prepared to put in some seed money of your own if you want to start up in today’s volatile economy. 
 
Do you have the courage to fail? Mental toughness is the key to success in any field but here you need a double dose. Don’t worry – you have home-grown role models like <keyword id="6436290" type="COMPANY" weightage="80" keywordseo="just-dial">Just Dial</keyword> and <keyword id="541988" type="COMPANY" weightage="80" keywordseo="SnapDeal">Snapdeal</keyword> who failed and pivoted over and over before striking the pot of gold. However, the path ahead will not be easy. As for the born optimist, here is another disconcerting finding from the legendary land of start-ups – the <keyword id="6354458" type="COUNTRY" weightage="100" keywordseo="US">US</keyword>. According to a new study by the <keyword id="361096" type="ORGANIZATION" weightage="60" keywordseo="Kauffman-Foundation">Kauffman Foundation</keyword>, only 52.8% Americans are aware of <keyword id="6357934" type="PERSON" weightage="80" keywordseo="Steve-Jobs">Steve Jobs</keyword> while 96% know who <keyword id="21024" type="PERSON" weightage="60" keywordseo="Marilyn-Monroe">Marilyn Monroe</keyword> is. If that does not deter you (knowing fully well that very few of us will ever reach his height), go, take your leap of faith, backed by well-chalked-out business plans and future-proof growth strategies.

5
Points To Remember When Starting Your Own Business

<ul><li>Indian entrepreneurs have come together and formed a group called ‘Founders against COVID-19’. </li><li><keyword id="219793" type="PERSON" weightage="20" keywordseo="Kunal-Bahl">Kunal Bahl</keyword> of Snapdeal, Gaurav Munjal of Unacademy, Phanindra Sama of RedBus, Abhiraj, Varun and Raghav from Urban Company, Kunal Shah from Cred have joined over 50 startup founders and investors to form the group. </li><li>They also suggested that a government war room headed by the Chief Minister of each state should be set up. </li></ul>Indian entrepreneurs have come together and formed a group called ‘Founders against COVID-19’. Under the group, the startup founders have sent out a petition to the government of India to take even more stringent action to stop the spread of the deadly <keyword id="1754604" type="PERSON" weightage="20" keywordseo="coronavirus">coronavirus</keyword>. Kunal Bahl of Snapdeal, Gaurav Munjal of Unacademy, Phanindra Sama of RedBus, Abhiraj, Varun and Raghav from Urban Company; Kunal Shah from Cred have joined over 50 startup founders and investors to form the group. The group has suggested that the Indian government should impose Section 144 in most major cities and head for a complete lockdown in order to ensure quarantine. The founders have suggested a four step process – Section 144 to be imposed and a lockdown from March 20 to April 12; a precautionary phase of social distancing from April 13 to May 17; second lockdown from May 18 to May 31 and finally, opening up with social distancing June onwards. They have also suggested that a government war room headed by the Chief Minister of each state should be set up. As the Coronavirus pandemic spreads, the Indian government has already taken swift action and shut down malls, theatres, pubs etc in several cities. Over 20 lakh IT employees have been asked to work from home to prevent the spread of the virus. Yet, cities like Mumbai have seen little difference in peak hour traffic which shows that few are opting to stay home. But as people are fearing a complete shutdown, they are also hoarding on groceries. In such a scenario, the founders group is asking the government to ensure that there is a steady supply of essentials in the market. This also includes that the government should ensure that there is cash availability in the ATMs. “Open up to the private sector and ease out licensing for production,” was another suggestion from the group. The group has also done an analysis of the growth in Wuhan, the epicentre of the Coronavirus, to say that actual undiagnosed cases are 5-20 times of the diagnosed cases – thus urging the government to amp up the tests in the country. See Also: <a href="https://www.businessinsider.in/topic/coronavirus">coronavirus: Latest News, Articles on coronavirus | Business Insider India</a> <a href="https://www.businessinsider.in/india/news/many-uber-drivers-in-bengaluru-claim-at-least-50-drop-in-bookings-as-coronavirus-keeps-people-off-roads/articleshow/74604230.cms">Many Uber drivers in Bengaluru claim at least 50% drop in bookings as coronavirus keeps people off roads</a>

India’s top entrepreneurs form Founders against COVID-19 and ask government to head for a complete lockdown, build war rooms

<keyword id="3001203" type="UNKNOWN" weightage="60" keywordseo="PayUBiz">PayUBiz</keyword>, an Indian <a href="http://www.businessinsider.in/searchresult.cms?query=payment+gateway&amp;sortorder=effectivedate">payment gateway</a> aggregator has hit a total processed value (TPV) of half a billion dollar per month. It currently has more than 10,000 merchants from multiple industry verticals. 
 “We have been continuously expanding our industry portfolio such as <keyword id="35621" type="UNKNOWN" weightage="40" keywordseo="e-commerce">E-commerce</keyword>, Airlines, Education, Utilities, etc. which has also been fueled by our strong relationships with resellers and banks,” Rahul Kothari, Business Head at PayUBiz said. 
 
<a href="http://retail.franchiseindia.com/mediaint/images/858.jpg">Image Source</a> 
“Our ambitions go beyond this feat and intend to hit a billion dollar mark in processed value in the next one year. The growth will be organic and will also come from new lines of businesses - offline, payment products, risk solutions and global business”, Kothari added. 
 
PayU has introduced several initiatives in the payment industry including dynamic switching for routing transactions through the healthiest <a href="http://www.businessinsider.in/searchresult.cms?query=payment+gateway&amp;sortorder=effectivedate">payment gateway</a> for a high transaction success rate, CVV-less transactions, Magic retry and SurePay. 
 
PayUBiz currently caters to 90 of the top 100 ecommerce merchants. Some of itsmerchants include Snapdeal, Jabong, Ola, Bookmyshow, Goibibo, Redbus, Myntra, Foodpanda, Groupon, PepperFry etc. 
 <keyword id="1493567" type="UNKNOWN" weightage="60" keywordseo="PayU-India">PayU India</keyword> was founded in October 2011 and is based out of Gurgaon, India. 
 
<a href="http://calgaryrealestate.ca/images/2012/05/Money-by-Nick-Ares.jpg">Image Source</a>

This Gurgaon-based startup processes half a billion dollars every month

India is increasingly seeing a host of ingenious <keyword id="138263" type="UNKNOWN" weightage="100" keywordseo="startup">startup</keyword>s. While some may say the startup bubble would burst soon, as long as the money’s coming, the party’s on. 
 
Business Insider India ranks the top 10 most promising Indian <a href="http://www.businessinsider.in/searchresult.cms?query=startup">startup</a>s. 
 
P.S: Flipkart and Snapdeal are excluded from the list as they’re too big to be considered ‘<a href="http://www.businessinsider.in/searchresult.cms?query=startup">startup</a>s’ now. 
 
1. <keyword id="6362049" type="UNKNOWN" weightage="100" keywordseo="Ola-Cabs">Ola Cabs</keyword> 
Online taxi aggregator Ola is giving <a href="http://www.businessinsider.in/searchresult.cms?query=Uber">Uber</a> a hard time over who gets the biggest pie of the Indian market. This Mumbai-based startup has grown exponentially since it bought off rival <a href="http://www.businessinsider.in/searchresult.cms?query=TaxiForSure+">TaxiForSure </a>for $200 million. 
 
2. <keyword id="6357120" type="UNKNOWN" weightage="100" keywordseo="PayTM">Paytm</keyword> 
What more do you need if you have <a href="http://www.businessinsider.in/searchresult.cms?query=Alibaba">Alibaba</a> supporting you! <a href="http://www.businessinsider.in/searchresult.cms?query=Paytm">Paytm</a> has expanded from online recharge to become an online marketplace. While it’s retail business is a fraction of Amazon, Flipkart or Snapdeal, it’s undeniably the jack of all trades. 
 
3. <keyword id="1960231" type="UNKNOWN" weightage="100" keywordseo="Housing-com">Housing.com</keyword> 
Housing.com has been in recent news for all the wrong reasons. However, with an aggressive marketing campaign and ambition to tap into global real estate business, investors clearly see a lot of muscle in the company’s claims. 
 
4. <keyword id="6381424" type="COMPANY" weightage="100" keywordseo="Quikr">Quikr</keyword> 
This online classifieds website is doing pretty well. In April 2015, the company raised a whopping $150 million from Tiger Global and Steadview Capital Management among other existing investors. Valued at $1 billion, the company has also rolled out its special Quikr Cars ad campaign with Ranvir Singh. 
 
5. Mu Sigma 
This Bangalore-based analytics firm clearly breaks the list of internet-based startups. This one offers analytics to major companies across the world. 
 
6. InMobi 
This company, founded in 2008 is fighting against the likes of Google and Apple in the mobile advertising segment. The startup already has 750 million users across 160 countries. 
 
7. Zomato 
Zomato sits at top of the host of food tech startups India has seen. Its international expansion plans and venture into food ordering and transportation has ensured its leadership in the food-tech space. 
 
8. Zivame 
Zivame offered a niche choice for an already under-served segment. The unavailability of sizes, social discomfort and poor market penetration ensured Zivame.com took the market by storm. 
 
9. RedBus 
RedBus has made a mark on consumer minds, thanks to it’s targeted marketing campaigns and differentiation. Of course, it has now been sold off to the Ibibo group for a whopping $138 Million. 
 
10. ShopClues 
 
Founded in January 2011, Gurgaon-based ShopClues has big names like Tiger Global, Nexus Venture Partners and Helion Venture Partners backing them up.

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