Indian Start-ups Won’t Stop Targeting U.S. Market: Simplilearn CEO Krishna Kumar

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The U S is still stuck in a fiscal deadlock and no one is sure how it will end. However, President Obama and House Republicans are in talks, an initial step that may prepare the path to end the standoff. Meanwhile, we bring you the last interaction of the Quick Chat series that featured the views and insights of entrepreneurs and start-up specialists. Today’s chat is with Krishna Kumar, the founder and CEO of Simplilearn, an Indian start-up gone global.

Here is one start-up that started as a blog, teaching people online for free. But in about 4 years, Bangalore-headquartered Simplilearn has become one of the biggest global players, offering 80-plus online certification courses across 11 categories and training 4,000 young professionals a month. The company was set up by former Infosys techie and serial entrepreneur Krishna Kumar (he had earlier co-founded Tech Unified, which was acquired by a public listed company) back in 2009 and within 1 year, it was earning $100,000 a month. Simplilearn has also raised $10 million in a recent Series B funding from Helion Venture Partners and existing investor Kalaari Capital (former IndoUS Venture Partners).

The US operations of this start-up happen to be huge – around 70% of its revenues come from the United States, with 15% from India and the remaining from Europe and Australia. So how does Kumar view the ongoing US shutdown from the perspective of an Indian start-up?

There’s no immediate threat, he feels, but it will definitely affect the business in case there is a spending cut on training. But the shutdown also proves that policy paralysis can happen anywhere in the world and there is a chance now that the home turf would get more VC traction if the impasse continues. Here are the excerpts from our chat.

How will this current shutdown affect Indian start-ups?
Currently, the situation seems temporary and for this reason, we have not seen any impact. However, if the situation escalates and the shutdown is prolonged, we will definitely see effects. Once a negative sentiment settles in, there can be massive consequences.

Will it hit your specific niche?
We are an individual re-skilling business that provides certification training courses to professionals. Because it’s a consumer product focused on training, the shutdown has the potential to affect us if the country reduces its spending on training.

Will this have a long-term impact on seed-stage or early-stage funding?
In my opinion, I can’t relate the shutdown to funding. Funding is a long-drawn process. Generally, cross-border funding takes places at the early stage of funding, not during the seed stage. So if there is any impact, it will be in the early stages.

What about VC sentiment? Does the current situation mean investors will turn to emerging markets again?
Yes, I think this is possible. The shutdown is a true testament to the fact that policy paralysis not only happens in India, but in the US as well. The longer it goes on, the greater the chance of VCs looking to India and other emerging markets.

Do you think Indian start-ups would now think twice before entering the US market?
When you have a start-up, you do everything you can to survive. Frankly, as long as there are buyers in the US, start-ups will continue to focus their efforts on the US. Moreover, I think such factors impact larger organisations much more, rather than start-ups. In my opinion, private companies (start-ups) will not feel the heat as much.
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