Serving the aam admi is key to funding your start up
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In today’s Internet age, Indian start ups are focussing largely on the needs of aam admi. Be it affordable food to budget hotel rooms and the availability of day-to-day products at affordable rates, start ups have brought about a drastic change in the middle-class lifestyle. Seeing this trend, even venture capital investors have tweaked their funding strategies.Take for instance Orios Venture Partners, which is planning to invest in companies that cater to this vast demographic.
Besides these factors, the growth of the startups will also be driven by 200-300 million people who will be ready to shop online in next 2-3 years due to easy access to smartphone and reasonable data charges.
"It's not just about the 70-80 million of the Indian population that are currently online. It's about the 200-300 million strong middle-class population that will be (online) in two-three years and will need a slew of products built for them," Rehan Yar Khan, general partner at Orios Venture, told The Economic Times.
Indian venture capital firms are getting inspired by Chinese and the US startups that cater to the mass market. Startups such as OYO Rooms and Zo Rooms offer budget hotel stays beginning at less than Rs 1,000 a night, and food-tech venture Yumist offers meals at less than Rs 100.
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"Entrepreneurs have begun to understand the Indian online audience, and if you want to build a large company, you have to offer a product that caters to every single consumer segment," Tarun Davda, director at Matrix Partners, told the financial daily.
Orios has backed food-tech venture Yumist, which began operations in October, and online accommodation marketplace Zo Rooms that launched this year. In June, Matrix Partners led a $6-million series-A round of funding in affordable hotel chain Treebo that started operationing in March.
While such business models are still evolving, investors nonetheless want to pick stakes early to avail benefits of lower valuations, as well as to be among the first to back potential winners in various categories.
(Image: India Times)
Also Read: Top 10 cities to launch your start ups
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