Stars aligned, watch out for some more unicorns in the making, says Ajay Ramasubramaniam, Director – India, Zone Startups
The run-up to January 2016 was quite dramatic, with several start-ups of the likes of Ola and PayTM gaining Unicorn status, in a frenetic 18-month period, during which there was “gold rush” for consumer-internet startups. The funding rounds started creating unrealistic expectations of consumer internet companies’ prospects, and over the next 18-months, the seemingly bottomless investor well seemed to have dried up.
After a relatively quiet 2017 for Indian start-ups, from a funding standpoint; I am quite bullish on their prospects for 2018. There have been signs of renewed investor appetite for startups over the past six months or so, with some exciting growth stories, funding stories and startups acquiring the coveted unicorn status.
If things continue the way they are, over the next few months or so, we could see a few more start-ups joining the flight of unicorns this year.
FinTech has been a flavor of the season for the better part of last three years. Several emerging FinTechs have raised a few rounds of funding, and the ecosystem is still growing. Recently, a few of the “older” Fintechs i.e, Policy Bazaar, BillDesk and Pine Labs have acquired unicorn status. They are of a different vintage, and I expect that more FinTechs will achieve the same status sooner rather than later. Policy Bazaar has had a great run, building unicorn value in about a decade, but, BillDesk and Pine Labs have taken close to two decades to get there. There are many more startups of that vintage that are around, and we should see a few of them getting to unicorn status. Here is a classic case of building value over offerings, rather than successive rounds of funding.
One also needs to pay attention to the different trajectories en route to the unicorn status. There are start-ups, which have reached unicorn status not through the VC funding route but through building robust businesses that have been profitable, over a few years, there have been massive pivots enroute, IPO’s etc.
InfiBeam which made it to the Unicorns’s list in 2017 is an example. Talking of IPO’s, the successful SME listing of E2E Networks, is a great example that we can see many other B2B startups following. These start-ups could lead to a different wave of unicorns coming through, those that have built value over a period of time.
In terms of what Bharat presents as an opportunity, I sense a massive potential in education, healthcare, logistics start-ups.
We have already seen Byju’s, Practo and LogiNext doing well in the aforesaid segments. The booming growth of some of the aforementioned start-ups has led to a surge in number of startups addressing problem statements in these areas. In case of logistics sector, the implementation of GST and the new logistics index should definitely make this space more interesting to watch, as more and more players are enabling technology to improve the logistics experience in the country. Healthcare is another exciting space, as start-ups cash in on the Indian middle class’ demand for instant, accessible services on their mobile phones. Players such as Practo and LiveHealth, and also some newer players should be experiencing investor interest.
Healthcare start-ups have moved on from the basics of medicine delivery and diagnostic services to addressing more topical issues like genetic disorders such as breast cancer, diabetes as well as lifestyle, and mental health.
Overall, the investor sentiments seem to be on the upswing for Indian startups, and we are seeing a renewed funding appetite. This coupled with the good growth stories that the startup ecosystem has been witnessing, should bring about a rise in the volume of funding and number of deals in the third and fourth quarters of this financial year.
Ajay Ramasubramaniam is Director – India, Zone Startups. He oversees the flagship accelerator operations as well as leads the new initiatives, including corporate innovation programs and thematic accelerators under the Zone Startups brand, in India.
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
 "Ajay Ramasubramaniam")
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
)
){kind=small}
){kind=small}
)
)
)
)
)
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}