Start-ups – Dutch Uncles

In the Recent Months Which Startups Are Buying Back Companies Stocks?

Anju Nambiar — Wed, 12 May 2021 03:35:05 +0000

A development which has steadily been picking up pace is that the Indian start-up ecosystem has been announcing ESOP (Employee Stock Option Plan) buybacks, one after the other. ‘The Employee Stock Ownership Plan Liquidity Offer 2021’ is highlighted now because most start-ups are facilitating such liquidity programmes to help their staff weather the second wave of the Covid-19 pandemic.

What is ESOP?

ESOP is essentially an employee benefit plan exclusively made available for key roles within an organisation. It’s a program where employees are given a share within the company. Employees associated with the company for a long time as well as decision makers are mostly a part of this programme.

Why are startups considering ESOP buyback exercise?

It’s common knowledge that the domestic economy has taken a beating and any recovery has been stamped out once again this year. Start-ups have seen fit to buyback company stocks from their employees to reward them. Employees are being granted an alternate opportunity for wealth creation. Start-ups are determined not to let their employees’ motivation dwindle due to the bleak circumstances.

Companies in the spotlight

Udaan

The first start-up in the spotlight is Udaan which is doing a buyback exercise for employee stocks worth INR 165-175 Cr. An online B2B Marketplace, Udaan is extending eligibility for the buyback to its active employees who held vested stocks as on the 31st of March 2021.

CRED

The next start-up in the spotlight is CRED which recently concluded its ESOP buyback programme. CRED did the buyback for all its employees, even those that were no longer associated with the company. CRED’s buyback happened during its Series C funding round in November of last year during which time their employee ESOP liquidation was valued at INR 9 crores. The eligibility criteria was extended to employees holding vested stocks and they were able to sell up to 50% of their vested ESOP shares.

Acko

The next start-up worth mentioning is Acko (Bengaluru-based Insurance start-up whose employees could liquidate 40-100% of their vested ESOPs. The eligibility criteria covered employees who were associated with Acko for 3 years. Acko’s ESOP buyback was valued at $2M and 40 employees benefited from the programme.

Other start-ups in the spotlight include PhonePe, PayTM, Zerodha. There’s also Browserstack, and Zetwerk (manufacturing start-up) in the long list of start-ups who’ve been buying back company stocks.

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CRED’s buyback happened during its Series C funding round in November of last year during which time their employee ESOP liquidation was valued at INR 9 crores.

What’s in it for me?

Start-ups are doing ESOP buybacks as a way to ensure that they retain their technology talents during the pandemic. Corporates are in need of skilled engineering professionals and the pandemic has created a dearth, although a lot of engineers have lost jobs. Overall, it’s a mess and start-ups want to ensure that they don’t lose valuable employees amidst the disruption caused by the pandemic.

ESOPs are a way to provide salary bonuses to employees in exchange of vested ESOP share prices. The money received through ESOP sales becomes part of the employees’ income and giving employees this additional wealth is highly essential during these uncertain times. ESOP buybacks increase the start-up valuation along with the increase in the ESOP pool valuation. Since they often occur in conjunction with an external strategic or fundraising round.

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These are the Top 5 Funding Deals Bagged by Chennai-Based Start-ups during the Lockdown

DU Desk — Mon, 03 May 2021 11:00:09 +0000

Over the last couple of years, Chennai has quickly become a hub for start-ups and small businesses, making it a very attractive option for investors in what is essentially becoming a snowball effect for growth prospects and a significant number of funding deals.

Top 5 Start-up Funding Deals Closed in Chennai during Lockdown

BankBazaar

This online financial market place, which gives customers access to customised loans and credit cards is one among many that attracted the eye of big investors. In April of 2020, BankBazaar closed a funding deal of $3.8 Million in their Series D funding round from Amazon, Sequoia Capital and Walden SKT Venture Fund. In total this start-up managed to close a funding deal of $9.78 Million during the lockdown.

WayCool

WayCool is an agritech logistical start-up that handles, processes and distributes food products like produce and dairy to clients across India. The company managed to raise a total of $5.6 Million over two rounds of funding during the lockdown. The majority of the funds came from its Series C debt financing funding deal with Induslnd Bank, which brought in a staggering $5.5 Million in June of 2020.

Specsmakers

In 2008 this optical chain start-up underwent a rebranding by its CEO Pratik Shah, from ‘Venkateshwara Opticals’ to ‘Specsmakers’, as part of an overhaul. It was then able to close a number of funding deals since then with the latest one being in June of 2020, for a little over $3 Million from Eight Roads Ventures.

Grinntech

This start-up which produces specialised lithium-ion batteries for electric vehicles (EVs) closed a funding deal of $2 Million from a group of angel investors in August of 2020. They capitalised on the rapidly growing EV space in Chennai, a smart and strategic move.

Chai Waale

Though Chennai has no shortage of tea brands, Chai Waale took the scene by storm when it managed to close a funding deal with top angel investors for a sum total of Rs.1.75 Crores in July of 2020. Some of the investors included Arun and Vishal Ostwal of the DK Group of Companies, Gunavanth Vaid of 4G Capital Ventures and even Bharat Kumar Sohanraj from Mahalaxmi Jewellers.

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Chennai’s popularity can be attributed to its growing infrastructure and relatively lower cost of operation.

What Makes Chennai an Ideal Space for funding deals?

Chennai, quite simply put, is a cheaper option when compared to other metropolitan cities like Mumbai or Delhi for businesses to set up in. This, combined with the rapidly developing infrastructure, makes for a very viable market for start-ups and investors alike.

What’s in It for Me?

As a business owner or an entrepreneur, the right location at the right time makes all the difference where starting a business is concerned. Chennai is that place, a growing hub full of potential customers and investors looking to close a funding deal with an innovative business.

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How Will the Complete Lockdown in 11 Districts of Jammu and Kashmir Affect Business?

Roopali Kotwal — Fri, 30 Apr 2021 03:35:03 +0000

Curfew, Internet Shutdown or 2G Internet Services are not new to Jammu and Kashmir (J&K). Natives in the Union Territory (UT) especially, Kashmir region have lived through this for years. But this time the lockdown imposed in the 11 districts of J&K is to contain the further spread of Covid-19 with an exemption to essential services for 84 hours which is effective from 7:00 pm on April 29, 2021 till 7:00 am on May 3, 2021. The lockdown is to break the chain of transmission and stop the intermingling of people to control the intense impact of the second wave of ‘Corona’ as people in some regions have not been following the norms strictly. Jammu and Srinagar being the Capital cities and among the busiest cities, have a frequent movement from various regions and, Srinagar is currently one of the most affected districts due to Covid.

The Lockdown in 11 districts means chaining the movement in urban cities. However, it will have its own impact on the businesses in the regions.

Let us know what are these districts and the impact in the following section:

Jammu Division – Jammu, Kathua, Reasi and Udhampur

Kashmir Division – Srinagar, Budgam, Anantnag, Baramulla, Ganderbal, Kulgam and Pulwama

Business Impact of lockdown in 11 districts

Some who may succeed in Lockdown

Under the Disaster Management Services, administration in each district issued a notification categorising the essential activities to be carried on as that shall be exempted in the lockdown. This means businesses that deal with the below listed activities shall have ‘business as usual.’

Supply of groceries (wholesalers and retailers) with specific time slot/schedule in some of the districts, fresh fruits and vegetables (mandies and retailers), domestic and commercial LPG and supply of cattle feed and fodder within specific time slots.

Loading and unloading of wheat and rice at FCI and state food depots, milk shops, dairies and related products.

Health services, medicines and other pharmaceuticals (retailers, wholesalers and manufacturing of health and medical equipment).

Telecom operators and their designated agencies, banks and ATMs, newspapers and post offices, dispensing of petrol/diesel at pumps, provision of electricity, water supply, municipal and sanitary services (including the movement of staff thereof).

Transportation of essential commodities through national and state highways (petrol, diesel, kerosene, milk, vegetables, fruits, groceries, FCI supplies etc.) but testing at borders may be required in interstate travels.

Some districts have laid down further detailed notifications including some other services as essential and permissible. For instance, e-commerce and home delivery of essential goods under the essential services shall be available in Jammu district and all industrial and scientific establishments will be permissible in Jammu and Baramulla district. Also, restaurants in hotels shall serve the in-house guests in some districts. To know more, you may go through the Covid-19 guidelines available on each of these district’s websites.

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E-commerce and home delivery of essential goods under the essential services shall be available in Jammu district.

Some may have to find ways to succeed in Lockdown

Now, what about the businesses that deal with non-essential goods, commodities and services? Businesses like restaurants and bars, shopping complexes, bazaars, beauty and wellness centres like saloons, gyms, spas and cinema halls may not be at loss in 3 days of lockdown but, in the long run they will be affected if the rise in covid-19 cases continues extending the lockdown.

The lockdown started with these 11 districts. Like other states or UTs, all districts in J&K are not in lockdown yet because these 11 sectors are the urban locations and have surging cases every day. With latest updates coming in, the curfew is being extended to the remaining nine districts of J&K for the weekend but, what about the situation after that?

What’s in it for me?

Covid 2.0 definitely carries high intensity. The lockdown will break and make some businesses again. However, the businesses dealing with non- essential goods, commodities and services must start thinking if not yet about a much required ‘pivot’ in a business for survival.

As the e-commerce sector is booming across India and it is very much a part of delivery platforms for essential services, this may help the start-ups and other businesses who can adapt as per the changing times, to ‘survive’ in the ‘Crown’ state too.

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What is a ‘Pivot’ in a Business?

Roopali Kotwal — Mon, 26 Apr 2021 11:35:04 +0000

What does Pivot mean?

Pivot means a modification in the business strategy. This shift is applied to test a new approach for the startup business model post receiving feedback. In simple words, change in the startup idea for the business to survive in the market is ‘pivot’.

Why a Startup Might Need to Pivot?

Charles Darwin’s Theory, ‘Survival of the fittest’ explains a ‘pivot’ in a business well. The primary reason for companies to ‘pivot’ is ‘survival.’ When the current products or services are not meeting the needs of the market, a change in the direction of the business to be visible in the market, improve the revenue and survive is a must. However, ‘pivot’ shall only be considered after exhausting all the possible options.

Warning Signs to Decide ‘When’ to Pivot

The immense competition, stagnant company progress or a change in the business perspective can result in a ‘pivot.’ As an entrepreneur, you must watch out for the below warning signs to decide when to ‘pivot:’

Customer is Unable to Understand the Value

If you repeatedly explain to your customers how your product is solving their issues but, they still do not understand product value on their own. It means a market for your product does not exist as of now.

Product is not Scalable

Scalability is important for business survival. Therefore, if the product is not scalable with the available finances you may or may not have, a new approach may be required.

Product is not competitive

Products or services provided by your startup are good but still not good enough to motivate a client to switch. So, it may be time to work on the competitive edge.

Only a Part of the Product is useful

If part of the product provides a solution to the client but the product as a whole does not, you shall consider a shift in the business idea.

Customer isn’t Promoting the Product

First customers’ vs Future customers’ expectations will vary. Your first customers may not think that your product really provides a solution to their problem or maybe are unaware of their problems leading to a lack of passion to promote the product. Hence, the time to make a shift.

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Charles Darwin’s Theory, ‘Survival of the fittest’ explains a ‘pivot’ in a business well. The primary reason for companies to ‘pivot’ is ‘survival.’

What’s in it for me?

Absence of agility and adaptability to the customer need will result in business failure in the long run. Start-ups will need to adjust to the fact that they must make progressive changes to improve the product. Twitter is a perfect example of a ‘pivot’. Twitter – a popular social media platform to send short instant messages and updates is a pivot from a podcasting company known as ‘Odeo’ that could not compete with Apple’s iTunes.

In today’s times, Pandemic due to the outbreak of coronavirus became the main reason for many start-ups to make a ‘pivot.’ A Bengaluru based Space Designers Startup, 10by10 builds sustainable and smart solutions for both customers and the environment. Inspired by Do It Yourself (DIY) methodology, they designed ISO.POD, an instant isolation portable room to protect people/consumers against further infection.

Many businesses and their solutions became irrelevant as the demand changed and the start-ups which saw the opportunity in the pandemic as a ‘blessing in disguise’ survived.

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Five Reasons You Should Raise Capital for Your Startup

Roopali Kotwal — Mon, 26 Apr 2021 05:35:03 +0000

An Idea is conceived but, to materialise it into a successful startup you need strong determination and most importantly enough ‘Capital’ which is a very practical aspect in any business. No doubt, it is going to be very challenging for entrepreneurs at all stages of the business cycle. However, the below stated reasons shall provide an insight to why it is important to raise the capital.

Reasons to Raise Capital

To meet the daily and long term cost

Requirement of office space, equipment, inventory and licenses along with product development are the practical aspects that will need funding.

To scale the business

Being ahead of time is always appreciated in any field. If you are the first one in the marketplace, you will be the pathbreaker. To scale up the business i.e., to increase the product visibility and to attract potential clients/consumers before your competitors in the market, would require capital. Hence, funding from venture capital will be the most relevant step.

To build credibility

A startup with a revolutionary business idea and strong business plan will attract investments from venture capitalists. The big and new investments in the potential idea shall build credibility and shall enhance the image of your start-up.

Expert advice and extended network

Scope of going faulty is less when you have experts to advise on the business strategies. And, with an extended network of experienced people, you have an option to consult them anytime along with the funding you receive. Think about this!

To identify business risks and decision making

Timely identification of business risks can save a lot of time, effort and money. Strategic and expert guidance shall help to identify the risks in the business and provide a scope to make decisions at an early stage.

When to Raise Capital?

The best time to raise capital is when you are clear in your thoughts – you know what you need to do, how much money you need to get to a milestone, what is the business plan you will follow and how the return on the investment (ROI) will be calculated.

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Being ahead of time is always appreciated in any field. If you are the first one in the marketplace, you will be the Pathbreaker.

Ways to Raise Capital

Bootstrapping, angel investments, raising funds from family and friends or traditional bank loan processes shall help to launch the business. However, for mentorship and further funding, business incubators and accelerators along with the venture capitalists play a pivotal role in the growth of the startup. One may use the crowdfunding platform to increase the visibility of the product and to attract additional investors for the next round of funding.

What’s in it for me?

Depending on the stage of your startup i.e. early/late stage, the ways of the investment may vary. But, raising capital in any scenario is a must.

As an entrepreneur, to launch a startup with, for example, a revolutionary consumer tech product and to get to a milestone, you must ask yourself – if you need funds? If yes, when, why and how to raise the capital? Simultaneously, you must think about the ways to generate the ROI. Raising capital from investment firms means lump sum payment with a comfortable repayment plan. You may not need to pay monthly instalments to pay off the investment amount received. Hence, you may use the capital for building the startup but it can turn into a huge liability in absence of clarity of thought on business plan and ROI.

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Latest Accelerator Programmes for Beauty, Health and Wellness

Roopali Kotwal — Fri, 09 Apr 2021 02:30:09 +0000

Purpose of the Accelerator programmes

Accelerators and Incubators support early age start-ups by mentorship and seed funding. There are various programmes for mentorship in partnership with start-up India and private accelerators. The Accelerator Programmes push the entrepreneurial spirit of a promising businessperson by mentorship and guidance of experienced leaders.

Latest Accelerator Programmes: Beauty, Health and Wellness

Huddle Accelerator

Huddle based in Delhi NCR has launched an exclusive ‘Acceleration A programme’ that focuses on new age home-grown consumer-focused/D2C start-ups. The programme focuses on personal care and beauty brands offering skincare, haircare and body care products, early-stage ventures offering wellness supplements for prevention, immunity and other common treatable ailments along with consumer-packaged goods etc. Early age start-ups can log in to their website to fill out the details as no entry announcement has been made yet.

Beauty Accelerate Virtual

Beauty Accelerate will host a virtual event from October 19-21, 2021 to connect Brand marketing and Research and Development Innovation. One can pre-register for the event/programme from their home page.

HealthStart Accelerator 2021

India’s first Healthcare Incubator, HealthStart is introducing a four months-long programme to promote and nurture the early-stage healthcare entrepreneurs with access to the global network. The selection process identifies 5 companies for funding and mentorship and 5 additional start-ups only for advisory services. Each selected company gets an investment of around 25 lakhs. The programme’s current delivery model is virtual and entries for 2021 have already been announced. To enroll timely for the next session, you may want to keep a close watch on the website.

Amazon’s Global Selling Propel (AGSP) Accelerator

It is a 6-week programme to identify early age high potential start-ups in the consumer space. AGSP is an initiative by Amazon India in partnership with the Indian government to support Indian brand sellers and start-ups to expand globally across North America, Europe, Japan, UAE, Singapore etc. through Amazon’s international market place. Amazon already has an accelerator programme in place and they recently announced few start-ups like Sirona and Azani Active in the Beauty, Health and Wellness sector as a part of the 2021 programme.

Pulse

India Accelerator (IA) announced Pulse cohort in December 2020 to enable entrepreneurs to nurture and grow 5-7 innovative start-ups in the health-tech space in a 16-week programme. IA aims to provide access to IA’s technological and business infrastructure, mentors, network-building opportunities that concludes into a demo day that shall be attended by corporates, Venture Capitals, Private Equity Partners and external investors.

Flipkart Leap

Flipkart launched its first-ever accelerator programme for start-ups in August 2020 to help new and upcoming start-ups to contribute to India’s growing entrepreneurial ecosystem and boost “Start-up India. Leap focuses on the five different areas that include the Design and Make in India i.e., Consumer and Technology products built for Indian consumers and digitisation of predominantly offline sectors such as Agtech, HealthTech etc. especially in the post-covid world.

The entries were announced in August 2020 to identify B2C and B2B start-ups and support them scale through an intensive 16-week virtual programme. Flipkart has already shortlisted and identified start-up for 2021. However, aspiring start-ups or small business owners can follow their website to take timely action and not to miss any further update on the Flipkart Leap programme.

Max Life Innovation Labs 2.0

Within the seven focus areas, Health and Wellness is one of the largest themes of the programme Max Life has selected the seven areas to post crowdsourcing the use cases within the organisation. Max Life has already selected 4 start-ups to mentor and fund in 2021.

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Accelerators and Incubators support early age start-ups by guidance and funding. They push the entrepreneurial spirit of a promising young aspiring entrepreneurs by mentoring and nurturing them.

What’s in it for me?

Entrepreneurship and successful start-up are more than getting funding. It is about empowering the founders by right mentorship.

India has many incubators and accelerators. As per the Indian Venture Capital Report 2021 (in partnership with Bain & Company, Inc.) report, India has around 450 incubators and accelerators. All the Accelerators and incubators are designed to support early age start-ups to scale by mentoring, funding opportunities, global and local business connections. Enrolling for an accelerator programme is purely an entrepreneur’s choice. However, if one feels the need to expand the product to the global market and require expertise and technological and resource funding, enrolling for one may be a good idea.

Keep a close watch on the scheduled date, track the website for the programme as the entries are called for, usually 6 months in advance and you must not miss out on any opportunity. If you are a Beauty, Health and Wellness start-up or planning to be a part of one, you would want to think about the incubator and accelerator programmes. The best suggestion would be to prepare and start today for any upcoming programmes.

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If You Are An E-commerce Start-Up This Is How You Can Enter New Markets

Anju Nambiar — Sat, 27 Mar 2021 10:35:05 +0000

Entering new markets in e-commerce means to get multiple revenue sources and to list your products/services on different avenues allowing you to expand across geographical regions. The number of online shoppers is multiplying rapidly and since people are physically moving less frequently, their attention is turned to the internet for all kinds of purchases.

As an e-commerce start-up, whenever you see it fit to explore new markets, the key is to take baby steps forward. It is always wise to start off small, try and test out how your products are received. Once you’ve toed the line, it may be safe to pump in more investments.

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Going beyond the local market is always daunting for an e-commerce start-up. Mainly because while the potential of taking your online store beyond your comfort zone is high, the impending risks can threaten to disrupt what you have already established.

How Indian beauty start-up ‘Purplle’ is going global:

Let’s take the example of ‘Purplle’, an Indian beauty e-commerce start-up who planned on expanding their presence online. Purplle verily understood the massive demand for beauty products online. In its latest Series D funding round, Purplle managed to raise $45 M backed by Sequoia Capital, Verlinvest, Blume, and JSW Venture. This latest funding round has taken the valuation of Purplle to a new high of $300 M.

Purplle’s business model for start-ups:

Purplle’s Customer Acquisition Cost (CAC) is relatively low which allows them more room to strategize on retaining their existing customers. Start-ups have an excellent lesson here about focusing on trust building and retention strategies.

The next aspect of Purplle’s business model for expansion is their product portfolio which is a mix of both in-house label products as well as the top brands popular with the consumers.

Minimizing risk for e-commerce start-ups in new markets:

Going beyond the local market is always daunting for an e-commerce start-up. Mainly because while the potential of taking your online store beyond your comfort zone is high, the impending risks can threaten to disrupt what you have already established.

While you may not know how to enter new markets, what you really need to know is ensuring that your entry is efficient, successful, and at low risk.

Start-ups in e-commerce need to thoroughly research the ins and outs of new markets before leaping right into them. Whether you want to expand on a global scale or venture into different categories of selling online, perform business research to predict in advance whether your e-commerce start-up can succeed in new territory.

While taking your business to another country, there are several ground rules you need to be aware of. Although the growth trajectory can be tempting for a local e-commerce start-up, careful research and analysis on the new, unfamiliar market is essential if you don’t want your existing business to run the risk of disruption.

What’s in it for me?

For Indian e-commerce start-ups trying to enter new markets, here is a set of preventative measures for you to reduce the risk.

Kick-start your market research from the perspective of whether it is financially viable for your start-up in the new setting.

You also need specific answers to several questions before venturing into a new market. Things like, identifying who your new competitors will be, whether your existing products need tweaks before getting launched in a new market, whether your pricing needs tweaking to be more appropriate for a new market, the changes required in business processes or additional duties and costs you will incur in a new market.

With all these preventative measures in place, your start-up will be able to minimize risk and successfully explore new markets in e-commerce.

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Top 5 Pricing Strategies for a Small Business

Anju Nambiar — Wed, 24 Mar 2021 09:10:04 +0000

Pricing is crucial for a small business mainly because it’s important to strike a balance between competitiveness and the value added by your product or service in the market.

Showing the lowest or even the highest price among your competitors are both equally wrong approaches while introducing your product or service for the very first time in the target market.

Top 5 pricing strategies

Choose between the lowest and highest price points in the market

Two pointers which are indisputable for small businesses is one, to never choose to offer the lowest price. You can be somewhere in between the scale for your product/service/market and even close to the highest. But the lowest offering is off-limits since it can hurt a small business’s entry into the market.

Another rule is to never establish pricing based on pricing alone. It’s important for small businesses to consider other factors while deciding price.

Determine affordability of your customers

Compare the spending habits of your potential customer base with the value you are offering. Are your potential customers willing to shell out big bucks for the value you are providing, or do they have strict spending habits? Keeping these two as deciding factors, formulate a strategy which agrees with the customer budget while being fair and profitable for what you have to offer.

Informed decision-making

Informed choices must motivate your decision making while settling on a suitable pricing model. Being informed and aware of your own challenges, the targets you need to meet and the financial commitments you need to fulfil are foundational in choosing a strategy.

Choose from existing pricing models

There are several existing pricing models to choose from which small businesses have utilised successfully in the past like Cost-plus, value-based, penetration pricing, price skimming, and competitive pricing. These are tried and tested models which your small business can choose from after deciding what’s best for your business.

Small businesses should not be desperate to gain permanent hold of the market share since this can also hurt them. Instead of engaging in a constant pricing battle for getting a firm grip on the market share, small businesses can instead focus on building brand reputation and adding value to the market through unique products/services after in-depth market research.

Perform regular in-depth market research

The last and best strategy for coming up with the perfect pricing model is to perform regular and deep market research right from the moment you sit down to set prices for your products and services.

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Formulate a pricing strategy which agrees with the customer budget while being fair and profitable for what you have to offer.

What’s in it for me?

If we have to pick the top 5 strategies for small businesses, it would be the pricing models mentioned above. However, choosing a pricing model is not as simple as picking one from a list.

It depends on various factors, the nature of your business, what competitors are doing to some extent, and most importantly on the market.

Two mistakes small businesses can make is to focus only on pricing and to aggressively battle it out with competitors for pricing. Start-ups and small businesses should instead be immersed in creating the best they have to offer while nurturing a reputable brand name and make an unshakeable place for themselves in the market.

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Jobs Are Morphing: How Start-ups Should Pace Up?

Anju Nambiar — Mon, 22 Mar 2021 12:35:04 +0000

The present time is a boiling pot for technology start-ups. Mainly because the disruption brought about by the pandemic has forced all industries to fall back on technology, whether they are ready for it, or not.

These industries need to do a rehaul of their operations, and worker skillset to improve engagement with technology. This is where job morphing will occur where the non-technical workforce is upskilled and morphed to create a technologically sound workforce.

Professional networking moved to the technology space when the pandemic commenced. While most industries and companies have easily been able to adopt technology with just a few speed bumps to report, a few are still struggling to fall in line.

The financial services sector has absorbed digital technology well and this has enabled them to easily overcome the challenges posed by the pandemic. A good example is ‘Slice’, a Bengaluru-based Fintech start-up which managed to achieve 100% growth in 2020 despite the pandemic. It recently declared an annualised gross transaction volume (GTV) of INR 1600 Cr and has also raised a capital of $33 million.

EdTech is one sector where networking mainly relies on technology and the need for lifelike interactions is strongly felt. For instance, teachers in the EdTech sector need hands-on training on advanced tools to be able to conduct lifelike classes smoothly on them.

Just like Fintech, Manufacturing has done pretty well in adapting to technology and morphing its workforce jobs with tech capabilities.

On the other hand, the healthcare sector has already failed to assign enough healthcare workers during the pandemic and this problem is continuing. Technology start-ups have already seeped in to help them counter this problem.

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Start-ups have emerged as the solution for industry sectors like financial services, healthcare, manufacturing, and EdTech to face the problems of the pandemic.

What’s in it for me?

Start-ups have emerged as the solution for industry sectors like financial services, healthcare, manufacturing, and EdTech to face the problems of the pandemic. Essentially, start-ups have two tasks to complete in order to pace up with the job morph currently ensuing. One, they have to offer technology solutions and two, they need to provide the means for upskill-ready workforces to utilise and apply these technology solutions. Start-ups have a clear avenue to fulfil the gap between the pandemic and industries.

In education, AirMeet is a prime example of a virtual events start-up which is providing a valid technology solution to the education industry and a means for the educators to upskill.

Orion Edutech, SimpliLearn, Eruditus are other examples which start-ups in EdTech can mimic to help workforce receive training and to upskill.

In Manufacturing, start-ups can get inspired by the business models of Altizon, Infinite Uptime, and Ecvinox which are offering Predictive Modelling and Automation technology solutions.

In healthcare, companies like Dozee, eKincare, and DocsApp are leading the start-up bid to resolve the industry’s covid challenges. They are offering digital healthcare platforms for online consultations, AI/ML driven predictive models that can perform complex diagnoses and technology tools which can assist healthcare workers.

In order to pace up, start-ups need to grab the opportunity to leverage technology as a solution for struggling companies since industries have no choice but to absorb them.

Start-ups should come in as a benefit. And in return, they can expect good investments from these struggling companies. It will be like a giving of technology in exchange for investments.

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Why are Fintechs growing in India?

Aakash Sharma — Sat, 13 Mar 2021 02:35:04 +0000

India’s fintech sector is one of the fastest-growing in the world. In March 2020, India and China received the highest fintech approval rating at 87% of any world’s emerging market. In contrast, the global fintech acceptance rate stood at 64%.

Government’s Role in the Fintech Sector

Despite the turmoil from COVID-19, the Indian fintech market is expected to grow at a compound annual growth rate of 22.7% between 2020 and 2025. Government regulation is essential to support a healthy financial technology system and promote balanced competition in the market.

The Government of India is working to create a cashless society through several financial institutions. In tandem with the government’s policies, technology professionals from many companies are playing a crucial role in adopting technology to improve efficiency and growth.

With the proliferation of fintech start-ups, the Indian fintech sector is attracting more and more investment. Government initiatives to promote digitisation, such as Jan Dhan Yojana, Aadhaar and Unified Payment Interface (UPI), are contributing to the development of the industry.

Fintech Market Intelligence for Growing Areas

In 2019, India’s fintech market was priced at Rs 1,920.16 crore and is expected to reach Rs 6,207.41 crore by 2025. The fintech market in India has developed due to the deployment of good internet services and robust internet infrastructure. However, consumer confidence in digital payment systems and a growing threat to cyber and data security are disrupting market progress.

What are the key Fintech Industry Divisions?

Payments, loans, insurance (insurtech), wealth management (wealthtech) and banking digitisation (banktech) are the most critical components of the fintech market. Insurtech is a unique part of the Indian fintech ecosystem, including insurance, IoT, and health data aggregators.

The payments section includes M-Wallet, PPI (Prepaid Payment Instruments), Merchant Payments, International Payments, and Cryptocurrency transactions. The lending industry is increasing using fintech in operations. It majorly consists of peer-to-peer lending, crowdfunding, online lenders, NBFCs and credit scoring platforms.

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With the proliferation of fintech start-ups, the Indian fintech sector is attracting more and more investment.

Effects of COVID-19 on the Fintech Sector

With the drastic fall in costs and revenue of the fintech industry, the overall valuation and investment in digital transactions industry also declined. This had a significant impact on the cash flow of the country’s largest companies. However, the use of digital payment methods has increased by 42% due to many businesses, especially MSMEs and SMEs, shifting quasi-online.

The trade of basic amenities and daily use items on a small scale alone is not enough to jump-start the Indian fintech ecosystem. Healthcare, bills, and food industries are becoming increasingly digitised. But the major sectors, including entertainment, fashion, travel and tourism, have been crippled, weakening the country’s trade and severely affecting India’s fintech industry. These areas need to be revived to ensure a safe track for the Indian fintech sector and widespread digitisation.

What’s in it for Upcoming Fintech Businesses?

The future of the fintech industry looks bright. The sector is growing and giving a boost to numerous start-ups in the industry. With a growing number of smartphone users, the continuous build-up of the digital infrastructure and overall cross-sector streaming of financial processes, the fintech sector is pegged to grow significantly. Incoming entrepreneurs can take advantage of this upward trend and start their journey by learning the basics of a fintech business, which are- combining finances with technology and innovating solutions for customers.

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