<img class="gwt-Image" src="/photo/42259515.cms" /> After making a personal investment in popular e-tailer Snapdeal.com, <keyword id="6360722" type="PERSON" weightage="80" keywordseo="ratan-tata">Ratan Tata</keyword>, former chairman of <keyword id="2512315" type="UNKNOWN" weightage="60" keywordseo="salt-to-steel-Tata-conglomerate">salt-to-steel Tata conglomerate</keyword>, has reportedly invested in an e-jewellery company known as Bluestone. 
 
According to a Times of India report, Tata has subscribed to fresh shares of the three-year-old e-commerce player; the value of the investment is not known yet. 
 Bluestone was founded by Gaurav Singh Kushwaha, an <keyword id="2512314" type="UNKNOWN" weightage="80" keywordseo="IIT-Delhi-graduate">IIT Delhi graduate</keyword> and seed-funded Meena Ganesh, the former CEO of Tesco's operations in India. The jewellery e-tailer has a beautiful collection of about 2,000 designs of pendants, rings, bangles, earrings, etc. Notably, the website even runs a gold deposit scheme through which buyers can pay monthly instalments. 
 
By investing in this e-jewellery company, Ratan Tata has proved his keen interest in exploring the e-commerce market. Last month, he had said, “e-retailing today is one of the hottest forms of marketing and has a good potential in the country as 500 to 600 million people of the country are the consuming public. You can just walk away with what you want. This adds new dimension in a huge market.” 
(Image: indiatimes)

​Ratan Tata Bets Big On India’s e-commerce Sector, Invests In Bluestone

<div class="KonaFilter image-container display-table float_right"><div><div class="image on-image"><img src="https://static-ssl.businessinsider.com/image/5464b2b7eab8eab142ea5478-800-600/deena varshavskaya-1.jpg" alt="Deena Varshavskaya Wanelo" data-mce-source="Wanelo" />WaneloDeena Varshavskaya, the founder and CEO of digital mall Wanelo</div></div></div>Female founders are overshadowing their male peers, according to a <a href="http://10years.firstround.com/#method">report on Wednesday by First Round Capital</a>, a venture capital firm that provides seed funding to startups.The firm has invested in notable startups like Wanelo, Square, Warby Parker, Refinery29 and most famously, Uber, but counted the ride-hailing service as an outlier in its analysis. After examing a decade's worth of data from 300 portfolio companies, First Round Capital learned that startup teams with at least one female founder performed 63 percent better than all male teams. The data also showed that women are present in the top ranks of their ten most valuable companies. "We're thrilled to see [the data]," partner Josh Kopelman <a href="http://www.forbes.com/sites/alexkonrad/2015/07/29/first-round-female-founders-outperform-the-men/">told Forbes</a>. "It could be that women are a net positive on a founding team from a diversity of thought and experience perspective - and the market doesn't recognize that yet." Kopelman also said that this may be due in part to a higher expectation of female-founded teams to rally for funding in the first place.Either way, it's good news for the tech community. According to a <a href="http://money.cnn.com/2015/03/24/investing/female-ceo-pipeline-leadership/">CNNMoney analysis</a>, only 24 women reside as CEOs in the top 500 companies. While First Round acknowledged that their report is a "small subset" of the larger economy, it hopes to provide some insights of what successful seed-funding looks like. "Fortune favors the young," the data also revealed of the startup ecosystem. The average entrepreneur who receives funding from First Round is 34.5 years old, but those under 25 performed 30 percent above the norm. Those who attended an Ivy-branded school also tended to do a whopping 220 percent better than average - and alums of top-notch tech companies like Google and Amazon tended to secure pre-money valuations that were twice as large as those of their peers. <div class="margin-top"> <h3>NOW WATCH: <a href="http://www.businessinsider.com/misconceptions-reputation-career-women-finance-sallie-krawcheck-2015-2">People were shocked to see what this female executive was really like</a></h3> <div> <div> <script src="http://player.ooyala.com/v3/6e12e8b3387a44daacfb73afba25a76e"></script> <div class="ooyala-video-player" data-video-autoplay="false" data-video-id="ExNXMxczoXY_4apUlcj592xf6kcRzPKk" data-player-variable="ooyalapopvideo" id="ooyalaplayer_popvideo" style="width:1280px;height:720px"></div> <script> if (typeof RunFunctions === 'undefined') { var RunFunctions = []; } RunFunctions.push(function() { var ooyalapopvideo = OO.Player.create('ooyalaplayer_popvideo', 'ExNXMxczoXY_4apUlcj592xf6kcRzPKk',{ autoplay: 'false' }); }); </script> <noscript><div>Please enable Javascript to watch this video</div></noscript></div> </div> <script>(function() { function createPlayer() { OO.ready(function() { RunFunctions.forEach(function(ooyalaFunction) { ooyalaFunction(); }); RunFunctions = [];}); } createPlayer(); }()); </script> </div>

Startups founded by women are doing way better than ones founded by men, says top firm First Round Capital

<img class="gwt-Image" src="/photo/56198907.cms" />For startups to grow they must garner funds from investors; and to gather funds, startups need to have a robust product-market fit along with a promising team and a solid business plan with the potential to scale. Then comes the role of angel investors and <keyword id="6357097" type="COMPANY" weightage="100" keywordseo="venture-capital">Venture Capital</keyword> (VC) <keyword id="6357455" type="EVENT" weightage="100" keywordseo="Funding">funding</keyword> that usually surfaces when larger amounts are required to grow a business. 
 Lately, major <keyword id="982553" type="UNKNOWN" weightage="100" keywordseo="Indian-startups">Indian startups</keyword> have seen a tremendous boost from venture capitalists. To start with, we saw how Tiger Global Management, Softbank Corp., Morgan Stanley, Sequoia Capital, Accel Partners, IDG Ventures India and SAIF Partners managed to support promising Indian startups like that of Flipkart, Snapdeal, Ola, Zomato, ShopClues, Urban Ladder and many others. Moreover, it is not only the bigger firms who are eyeing VC funds, relatively younger and smaller firms like OYO Rooms, Swiggy and Grofers have also joined the race. 
 Apart from ruling the e-commerce and fashion industry, <keyword id="153868" type="UNKNOWN" weightage="100" keywordseo="VC-funding">VC funding</keyword> is now gradually moving into other sectors too, such as agriculture, healthcare and education. As per the data from the upcoming Wharton India Economic Forum (WIEF), which is all set to launch the Wharton India Startup Competition (WISC) with over 500 entries, though majority of applicants (around 25%) belong to the e-commerce industry, the healthcare segment is not far away with around 22% applicants. Moreover, most of the participating startups already have pre-seeded and seeded funding arrangements and around 31% of them have listed themselves as social enterprises. 
 
The ecosystem for VC funding for Indian startups would be discussed at length at the Wharton India Economic Forum (WIEF). WIEF is a two-day event starting from January 6, 2017, which will bring together the best entrepreneurs, investors, distinguished Wharton faculty, students and inspirational speakers. Attendees will not only have numerous opportunities for interaction and networking across the board but will also witness in-depth discussions in terms of understanding the evolving business landscape in India and the need for business model innovation from the government, various industry leaders, and distinguished Wharton faculty. 
 
The relevance of this summit doesn’t end there. It is also known for hosting the Wharton India Startup Competition (WISC) which is giving Indian startups the opportunity to present themselves in front of an esteemed panel of judges and also win cash prizes of over $25,000 and unparalleled mentorship of up to 4 months from some of the most renowned names in the industry on strategy and funding. The jury for WISC comprises top-notch personalities with the likes of Bharati Jacob (Co-founder of Seedfund), Nipun Mehra (Investor at Sequoia Capital India), Rehan Yar Khan (Managing Partner of Orios Venture Partners), Tarun Davda (Managing Director of Matrix Partners), Aditya Nair (Investor at Nyca Partners), Ajay Hattangdi (CEO India &amp; Group COO of InnoVen Capital Group), Ankit Shah (Vice President at Unilazer Ventures), Sameer Verma (Director &amp; Junior Partner of Nexus Venture Partners), Saurabh Joshi (Strategy Manager at PayPal) and Shantanu Gangal (Head – Analytics at Fundbox). Also, past finalists of this prestigious event includes names such as Ketto, Haptik, Zoomcar, Zostel, Targeting Mantra, Qlicket, Samaan and Ambitioni. 
 
Needless to say, such competitions and summits go a long way in not only promoting upcoming startups but also in educating the audience and the participants regarding the funding scenario. Not many seem to be aware about the types and rounds of funding, the know-how of VC funding and even the right way to go about securing such funds, hence this is surely going to be one the most-sought after events at the start of the next year. 
 
(Image Credits: Thinkstock) 
 
(About the Author: This article has been authored by Aman Jain, Chairperson WIEF 2017)

How VC Funding Fuels the Indian Startup Ecosystem

<div class="KonaFilter image-container display-table float_right"><div><div class="image on-image"><img src="https://static-ssl.businessinsider.com/image/580679078d83b439008b52f1-2400/rtsj3xn.jpg" alt="Mark Zuckerberg" data-mce-source="Stephen Lam/Reuters" />Stephen Lam/Reuters</div></div></div>On Tuesday, <a href="https://code.facebook.com/posts/1802489260027439">Facebook made an announcement</a> that should set Cisco's teeth on edge. Its second-generation computer network switch, called the Wedge 100, is now available for purchase though Chinese contract manufacturer Edgecore (owned by Accton Technology).That's the same company that manufacturers the Facebook-designed switch for Facebook's own internal use. This is a super-fast 100G switch and could be something that many other big companies (and certainly other internet companies) will want to buy.While Facebook isn't a direct competitor to Cisco (it's giving away the switch design for free, not making money on it), it is doing something perhaps even more astounding: it has created an entire ecosystem of companies that are, collectively, taking on Cisco, which <a href="http://www.idc.com/getdoc.jsp?containerId=prUS41338316">owns 59% of the market, according to IDC.</a>This is all part of Facebook's <a href="http://www.opencompute.org/">Open Compute Project (OCP)</a>, arguably one of Facebook's <a href="http://www.businessinsider.com/facebook-open-compute-project-history-2015-6">most important technology projects.</a><div class="KonaFilter image-container display-table"><div><div class="image on-image"><img src="https://static-ssl.businessinsider.com/image/58067dde8d83b49f228b5026-842/facebook wedge 100.png" alt="Facebook Wedge 100 switch" data-mce-source="Facebook" data-link="https://code.facebook.com/posts/1802489260027439" /><a href="https://code.facebook.com/posts/1802489260027439">Facebook</a>The new Facebook 100 network switch.</div></div></div><h2>Joining the 'cult'</h2>"OCP has a cult-like following," one person with knowledge of the situation told Business Insider. "The whole industry, internet companies, vendors and enterprises, are monitoring OCP."OCP aims to do for computer hardware what the Linux operating system did for software: make it "open source" so anyone can take the designs for free, modify them with contract manufacturers standing by to build them. OCP allows the world's best hardware engineers to collaborate and work openly together "without fear of transferring" their company's secrets, this person explained.In its six years, OCP has grown into a global entity, with board members from Facebook, Goldman Sachs, Intel, and Microsoft. Famed network engineer Andy Bechtolsheim is also on the board. (Bechtolsheim is a co-founder of Cisco's arch enemy, Arista Networks. He famously seed-funded Google with Arista's other co-founder, David Cheriton). OCP conferences draw in tens of thousands of people. In fact, there's a famous story among OCP insiders that demonstrates this cult-like phenom. It involves Apple's networking team.<div class="KonaFilter image-container display-table float_right"><div><div class="image on-image"><img src="https://static-ssl.businessinsider.com/image/58067c1a8d83b437008b52dc-801/jason forrester snaproute.jpg" alt="Jason Forrester SnapRoute" data-mce-source="SnapRoute" data-mce-caption="Jason Forrester, founder CEO SnapRoute" />SnapRouteJason Forrester, founder CEO SnapRoute</div></div></div>This team was responsible for building a network at Apple that was so reliable, it never goes down. Not rarely. Never.Think about it. When was the last time iTunes or Siri or Apple Maps were offline?Building a 100% reliable network to meet Apple's exacting standards was no easy task.So, instead of going it alone under Apple's secrecy, the Apple networking team wanted to participate in the revolution, contributing and receiving help. But when the Apple team asked to join OCP, Apple said "no.""The whole team quit the same week," this person told us.Shortly afterward, Apple <a href="http://www.businessinsider.com/apple-joins-open-compute-project-2015-3">did publicly join OCP</a>. But that was too late for the engineers that quit. Instead, they founded a startup called SnapRoute led by former team leader, Jason Forrester. While Forrester declined to comment to us for this story, he did publicly hint about the story <a href="http://www.snaproute.com/our-story/">on his startup's website,</a> explaining:"Slowly, our desire to share our ideas with the world began to overshadow the thrill and pride of working for Apple. My team and I left in 2015," he wrote."Truth be told, I spent days crying on the couch. My mood only improved when we began to test our ideas with potential customers," he wrote. While Facebook also gives away the software it designed to run its new switch as an open-source project, a whole list of startups and a few established players are standing by to sell commercial software that works with and improves upon the Facebook switch. That's the whole point of doing this as an open source project.For the Wedge 100, the list includes Big Switch Networks, Linux maker Ubuntu, and Apstra, the new startup from billionaire Stanford professor David Cheriton. (Cheriton left Arista in 2014 <a href="http://www.businessinsider.com/controversy-surrounds-arista-ipo-2014-6">and sued it over some disputed technology</a>, though he is still a major shareholder.) And the list includes that tiny startup, SnapRoute.Word is that SnapRoute already has impressive roster of customers although it's not alone in attacking this SDN market. HPE and Arista, both OCP members, have partnered on it. And Microsoft, an OCP board member, is working on something called <a href="http://www.zdnet.com/article/microsoft-to-release-azure-stack-as-an-appliance-in-mid-2017/">Azure Stack.</a> Meanwhile, Facebook will soon be upping its assault on Cisco by releasing an even faster piece of optical networking equipment currently in development, Facebook vice president of infrastructure foundation Jason Taylor <a href="http://www.businessinsider.com/facebook-open-compute-project-history-2015-6">told Business Insider last year.</a>Who knows what kinds of startups - or rebellions - that piece of equipment will inspire?Apple could not be reached for comment. <div class="margin-top"> <h3>NOW WATCH: <a href="http://www.businessinsider.com/lisa-brennan-jobs-steve-jobs-daughter-2016-10">The story of Lisa Brennan-Jobs, the daughter Steve Jobs claimed wasn't his</a></h3> <div> <div> <script src="http://player.ooyala.com/v3/6e12e8b3387a44daacfb73afba25a76e"></script> <div class="ooyala-video-player" data-video-autoplay="false" data-video-id="RiZXk1eDosEkg3ZHQRbxeoPFcLvmNNoy" data-player-variable="ooyalapopvideo" id="ooyalaplayer_popvideo" style="width:1280px;height:720px"></div> <script> if (typeof RunFunctions === 'undefined') { var RunFunctions = []; } RunFunctions.push(function() { var ooyalapopvideo = OO.Player.create('ooyalaplayer_popvideo', 'RiZXk1eDosEkg3ZHQRbxeoPFcLvmNNoy',{ autoplay: 'false' }); }); </script> <noscript><div>Please enable Javascript to watch this video</div></noscript></div> </div> <script>(function() { function createPlayer() { OO.ready(function() { RunFunctions.forEach(function(ooyalaFunction) { ooyalaFunction(); }); RunFunctions = [];}); } createPlayer(); }()); </script> </div>

Facebook's project to take on Cisco inspires such 'cult-like' devotion, it once caused a whole team to quit Apple

<img class="gwt-Image" src="/photo/51794933.cms" />Bubble or no bubble, every <a href="http://www.businessinsider.in/searchresult.cms?query=startup&amp;sortorder=effectivedate">startup</a> founder will agree <keyword id="6359051" type="COMPANY" weightage="80" keywordseo="investors">investors</keyword> are harder to come by these days. 
 
Some say it points to slack investor interest, others say investors should be judicious about their moolah anyway. 
 Anyway what matters is to get the damn money to fund your startup idea. Few people manage it, and they did. I mean <keyword id="847170" type="PERSON" weightage="60" keywordseo="Chumbak">Chumbak</keyword>, a <a href="http://www.businessinsider.in/searchresult.cms?query=retail+brand&amp;sortorder=effectivedate">retail brand</a> known for selling quirky stuff. Back in 2012, Chumbak raised some $2 million in <keyword id="6357455" type="EVENT" weightage="60" keywordseo="Funding">funding</keyword> from early stage investor Seedfund. 
 
Chumbak co-founder Shubhra Chadda offers you solid advice to go about your funding spree, and explains what’s worked for them. 
 
What has been the investor sentiment towards you? 
Ours is very much a proven model. We finished several successful rounds of funding. 
 
It’s not a scary proposition for investors anymore. 
 
Do you suggest unconventional startups go for funding a bit late? 
There is no right answer to that. 
 
Given what the investor sentiments are like now, it definitely helps if you can demonstrate that it works, and has been well accepted. 
 
We were in existence for over 2 years as a brand before we thought of funding. We were already profitable, and the brand was known. 
 
All those things did help in giving confidence to investors. I’ll be lying if I said it doesn’t matter. 
 
Does the data or the design help while pitching to investors? 
You have to have the data on your fingertips. It’s your best friend. 
 
Some, not all <a href="http://www.businessinsider.in/searchresult.cms?query=investors&amp;sortorder=effectivedate">investors</a> understand the importance of design. Data helps explain what’s different about you, and why anybody would come to you. 
 
It’s also important to find the right <a href="http://www.businessinsider.in/searchresult.cms?query=investors&amp;sortorder=effectivedate">investors</a>. We were very lucky to find people who understood the DNA of Chumbak, and helped it evolve as a stronger brand. 
 
Most e-commerce players shy away from the <keyword id="6354851" type="ORGANIZATION" weightage="80" keywordseo="Retail">retail</keyword> store model. How has that experience panned out for you? 
The model has never mattered much. We were selling from other <a href="http://www.businessinsider.in/searchresult.cms?query=offline+stores&amp;sortorder=effectivedate">offline stores</a> from day one. 
 
The question isn’t offline and online. We’ll offer the Chumbak customer the best experience wherever they’re shopping. 
 
Today, offline and online constitute 70% and 30% respectively of your sales. Why do you think offline works better for you? 
What better way to tell your story for a single brand like us than through an offline store? 
 
It’s where people experience Chumbak in all its glory. It alleviates the brand, and is a great marketing engine as well. 
 
How did you expand to Japan? 
That was three years back. We tied up with a chain of stores. They approached us saying they’d love to have Chumbak. Japan is a design-conscious nation, and it was extremely flattering for us. 
 
After 6 years, the strategy has really changed. We want to be very careful before we step foot on a new market. ​We have not quite categorized our India business yet, while we are doing great in terms of expansion, there is still a huge opportunity to be tapped before us. 
 
Why expand to the US? 
The US is an evolved market with one of the biggest Indian diaspora. 
 
You’d want to be where your potential customers are. For us, it’s definitely the US. 
 
How do you ensure offline stores don’t hamper your growth opportunities? 
The idea that the channel affects margins is wrong. 
 
We do an ROI analysis, calculating cost-to-revenue ratios, and so on. There are costs on both fronts. For offline there’s rentals and electricity. For online there’s marketing and logistics. You need to be focused on being at the best location. 
 
We’ve refrained from growing too fast. It’s important to get it done carefully and sensibly, not just for the sake of it. 
 
Small brands complain they don’t get enough visibility. How do you ensure visibility as a brand? 
We depend on wonderful media channels like yours *laughs*. 
 
From very early on, the brand has resonated very well just by word of mouth. That in itself is a wonderful channel from a marketing perspective. We do most of our marketing online. 
 
We’re extremely active on social media. There’s <a href="http://www.businessinsider.in/searchresult.cms?query=Facebook&amp;sortorder=effectivedate">Facebook</a>, <a href="http://www.businessinsider.in/searchresult.cms?query=Instagram&amp;sortorder=effectivedate">Instagram</a> and also our blogs. We’re constantly communicating with our audience, and that helps.

Chumbak co-founder Shubhra Chadda tells you how to go about
funding your no-so-conventional startup

<div class="KonaFilter image-container display-table float_right"><div><div class="image on-image"><img src="https://static-ssl.businessinsider.com/image/54e4e5efeab8ea366a11959b-1200-924/ethan-bloch-ceo-digit.jpg" border="0" alt="Ethan Bloch CEO Digit">DigitDigit CEO Ethan Bloch</img></div></div></div>If you find it painful saving money, you're not alone: a <a href="http://money.cnn.com/2015/02/04/pf/money-stress/index.html?sr=fb020515moneystress930aStoryPhoto">recent survey</a> says 72% of Americans were stressed about money last month.In fact, <a href="http://www.federalreserve.gov/econresdata/2013-report-economic-well-being-us-households-supplemental-appendix-201407.pdf">according to the Federal Reserve</a>, 60% of Americans between the age of 18 to 40 saved absolutely nothing in 2013. Last year, adults under the age of 35 had a savings rate of negative 2%.So, why is this happening? Is it that hard to go to a bank and open an automatic savings or a CD account?"I think the bank experience has too much friction and inertia that people are just not saving," Ethan Bloch, founder of the personal finance app Digit, tells Business Insider.So Bloch created <a href="https://digit.co/">Digit</a>, an app that automatically saves money from your checking account without having you even think about it. It's been in pilot testing for the last seven months, and opens to the public today.The way it works is pretty simple. Once you connect your checking account to Digit, it will automatically transfer a small portion of your money that it knows you won't be needing immediately to a separate Digit savings account. These are FDIC-insured, custodial accounts held by Digit at two of its partner banks, Wells Fargo and BofI Federal Bank, meaning even if Digit or both those banks go bankrupt, you will be insured up to $250,000.The secret sauce is in Digit's algorithm, which monitors your income and spending patterns and calculates the exact amount of money you won't be missing.It mainly looks at four things: the current level of money in your checking account; upcoming salary; upcoming bills; and how you've been spending lately (with some banks, Digit can pull three years of transaction data). So if you get fired one day, and your paycheck stops, Digit will see that and readjust the transfer amount. Users can always manually set their savings amount, and if needed, withdraw their savings anytime they want, too.But there's a catch: Users do not earn any interest on their savings.<div class="KonaFilter image-container display-table"><div><div class="image on-image"><img src="https://static-ssl.businessinsider.com/image/54e4e61fecad04f7043d7691-1000-750/digit-screenshot.jpg" border="0" alt="Digit screenshot">Digit</img></div></div></div>Digit doesn't charge users for its service, so all the transfer and operating costs are covered by the interest Digit earns by saving those users' money at its partner banks. Eventually, it hopes to share some of that interest back with its users once it builds enough of a financial base. "Our goal is to share some of the interest with our customers as we grow our deposits, as long as we know we can cover our costs," Bloch tells us.That sharing may happen sooner than later, as the company is growing pretty well. During its five-month pilot period that ended in December, Digit saved a total of $600,000 for its members, and now it's saving members $1 million per month. And it hasn't even launched to the public until today.If anyone can make this happen, Bloch seems to be the right guy. He was an accountant and a finance researcher before selling his own startup to DemandForce, a software company that was acquired by Intuit for over $400 million in 2012. It's part of the reason why VCs like Google Ventures and Baseline Ventures have seed-funded $2.5 million in Digit late last year. <div class="margin-top"> <h3>NOW WATCH: <a href="http://www.businessinsider.com/iphone-headphones-tricks-2015-2">14 things you didn't know your iPhone headphones could do</a></h3> <div> <div> <script src="http://player.ooyala.com/v3/6e12e8b3387a44daacfb73afba25a76e"></script> <div class="ooyala-video-player" data-video-autoplay="false" data-video-id="o2OGM3czpWcydnvhjbkDBd6feXPuExiD" data-player-variable="ooyalapopvideo" id="ooyalaplayer_popvideo" style="width:1280px;height:720px"></div> <script> if (typeof RunFunctions === 'undefined') { var RunFunctions = []; } RunFunctions.push(function() { var ooyalapopvideo = OO.Player.create('ooyalaplayer_popvideo', 'o2OGM3czpWcydnvhjbkDBd6feXPuExiD',{ autoplay: 'false' }); }); </script> <noscript><div>Please enable Javascript to watch this video</div></noscript></div> </div> <script>(function() { function createPlayer() { OO.ready(function() { RunFunctions.forEach(function(ooyalaFunction) { ooyalaFunction(); }); RunFunctions = [];}); } createPlayer(); }()); </script> </div>

This 29-year-old invented a painless way to save money, and Google's buying into it

<div class="KonaFilter image-container display-table float_right"><div><div class="image"><img src="https://static-ssl.businessinsider.com/image/5385ed786bb3f7f14d13aa72-1066-800/lucas-duplan-3.jpg" border="0" alt="lucas duplan" />Clinkle</div></div></div>How much do startup founders pay themselves? And how much should they pay themselves if they raise money from investors?
Career research company <a href="http://80000hours.org/blog/341-how-much-do-y-combinator-founders-earn#fn:5">80,000 Hours estimates that founders going through the Y Combinator </a>accelerator program pay themselves about $50,000. If they go on to raise more money, that salary can double. If the startup flops, $50,000 could be the highest salary a founder makes.
"During the Y Combinator program, they use only a one-off seed investment from Y Combinator of US$120,000 to pay living and business expenses," 8,000 Hours' Ryan Carey writes. The investment is expected to cover everything, including a small salary for the founder. "If they go on to receive angel investment [they] can pay themselves about $50,000 per year. With venture capital funding, this tends to increase to about US$100,000 per year."
The most successful Y Combinator founders can make much, much more. Carey estimates that the founding teams of Dropbox and Airbnb are worth $6 billion combined, for example.
Carey's salary estimates for early-stage startups up with a Quora post on a similar topic. A founder who raised $500,000 used the Q&amp;A site to ask, <a href="http://www.quora.com/Is-a-100k-salary-too-much-for-an-angel-VC-backed-startup-co-founder">"Is a $100K salary too much for an angel/VC-backed startup co-founder?"</a>
Foundry Group's Brad Feld thought a six-figure salary was too high for an early entrepreneur. Another person agreed, stating that while $100,000 is below what an engineer should make, it's "certainly above market for a seed-funded startup." 
"Salary should be sufficient to not create hardship - no sense in losing productivity because you can barely eat," this person concluded.
The general consensus seemed to be that a $50-$75,000 salary was reasonable. "$50K/year is plenty. Some families live on that," says VC Sean Owen.
David Rose agrees. "In my experience, that fact pattern (a pair of founders, $500K seed round) would typically see them each taking $50-$75K, at least until they either start generating revenue, or raise a larger round."
When you're profitable, you can start paying yourself a more impressive salary.
"An adviser once told me to keep the total annual figure (including taxes) under $100k per year until you're profitable, and VCs have seemed to accept this," another says. Here's the most voted up response by Michael Wolfe, a four-time entrepreneur:
Read <a href="http://www.quora.com/Is-a-100k-salary-too-much-for-an-angel-VC-backed-startup-co-founder/answer/Michael-Wolfe/quote/4261" class="quora-content-link" data-width="575" data-height="1017" data-embed="GSAJQBS" data-type="quote" data-id="4261" data-key="5ae2ad4ff7d0b93370659848539cd049">Quote of Michael Wolfe's answer to Is a $100k salary too much for an angel/VC-backed startup co-founder?</a> on <a href="http://www.quora.com">Quora</a>.
<script type="text/javascript" src="http://www.quora.com/widgets/content"></script>

Most Startup Founders Pay Themselves This Totally Reasonable Salary

<img class="gwt-Image" src="/photo/57287418.cms" /> 
 <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. 
 
<img class="gwt-Image" src="/photo/57287426.cms" /> 
 
 
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. 
 
 
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​ <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.” 
 
<img class="gwt-Image" src="/photo/57287472.cms" /> 
 
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. 
 
​<img class="gwt-Image" src="/photo/57287468.cms" /> 
 
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

<div class="KonaFilter image-container float_right"><div class="image on-image"><img src="http://static3.businessinsider.com/image/52c43112eab8eab23f7479ab-889-667/american-airlines-thumb-2.jpg?maxX=480" border="0" alt="american airlines thumb" width="480" />Getty Images/Scott Olson</div></div>American startup entrepreneurs have got it incredibly good, says London-based entrepreneur Liad Shabado.
Shabado says he learned this back in the Spring of 2012, when, in just one week in California he was able to raise seed-funding for his startup, called <a href="http://shoply.com/">Shoply.</a>
Shoply helps small businesses and brands sell their goods online. Shabado says it's like Etsy, but for more than just handmade goods.
Back in 2012, Shabado posted about an earlier version of Shoply on a Website called AngelList. AngelList is a site where entrepreneurs meet startup investors.
One of the investors on the site, early Groupon employee Shawn Bercuson, messaged Shabado to say Shoply looked interesting. So Shabado booked a ticket to meet with the Bercuson in Northern California.
When they met, the Bercuson told Shabado that Shoply still looked good to him, and that Shabado should meet all of his friends.
So Shabado spent the week shuttling back and forth from San Francisco to the Valley, meeting with that Becuson's friends. Every night, Shabado would come back to his hotel room to get online and manage his business from 3,000 miles away. He'd also tweak his pitch deck based on what he heard that day.
Eventually Shabado met with a former Facebook executive named Chamath Palihapitiya. Palihapitiya invited Shabado over to his house for dinner with him and his wife. At the table, Palihapitiya decided he liked Shabado and that he wanted to invest in a small seed round.
It was a pretty wild week.
Looking back on it two years later, Shabado says American entrepreneurs don't understand how good they've got it - especially compared to entrepreneurs based in places like London. 
He gave three reasons why it's so good in America:
<ul>
<li>
There's a boat load of angel investors in Northern California who will decide very quickly if they want to invest in you and will open their networks to you if they see value in you.
</li>
<li>
There is a collegiate atmosphere in the American startup industry that is missing in London. The collegiate atmosphere out there for entrepreneurs, even if they aren't successful yet. In Silicon Valley, people who have seen the model work before are willing to invest in young people they trust, even if they don't have a long track record and their business ideas aren't fully formed yet. In London, people are less willing to take on young, seed entrepreneurs because they are much more into business models, cash flow, and financial forecasts. Shabado thinks its particularly silly for an early stage investor to expect a startup to have a realistic financial forecast.
</li>
<li>
In the US, failure is viewed asa step on the path of success. In the US, people who start companies that fail are celebrated for actually having the balls to try. In the US, people use their past failures as badge of honor. In the UK, such entrepreneurs are seen as tainted.
</li>
</ul>

American Startup Entrepreneurs Have It Incredibly Good In 2014, Says This Londoner

<img class="gwt-Image" src="/photo/48440028.cms" style="width: 800px; height: 600px;" /> 
When 43-year-old Indian origin <a href="http://www.businessinsider.in/Everything-you-need-to-know-about-Googles-new-CEO-Sundar-Pichai/articleshow/48430267.cms">Sundar Pichai</a> was named <keyword id="2996011" type="UNKNOWN" weightage="80" keywordseo="Chief-Executive-Officer-of-internet-giant">Chief Executive Officer of internet giant</keyword> <keyword id="6355629" type="CITY" weightage="80" keywordseo="Google">Google</keyword> by co-founders <keyword id="100155" type="PERSON" weightage="80" keywordseo="Larry-Page">Larry Page</keyword> and <keyword id="360878" type="PERSON" weightage="80" keywordseo="Sergei-Brin">Sergei Brin</keyword> today, Indians across the world commemorated the occasion as if each one of them had a personal stake in the development. 
 
Though, to be fair they did have reason to rejoice. With Pichai’s elevation from Senior Vice President of Chrome, Android and Apps to CEO, he joins the growing club of corporations run by Indian-born business leaders and the elite club of Indians heading a technology giant, right in the footsteps of Microsoft CEO Satya Nadella. 
 
His promotion as CEO came after Google’s Larry Page announced<a href="http://www.businessinsider.in/Heres-what-analysts-are-saying-about-Googles-huge-re-organization-announcement/articleshow/48435862.cms"> changes to the company’s executive structure</a> in a bid to present a ‘slimmed down Google,’ which will be included under a new parent company, Alphabet. <a href="http://www.businessinsider.in/In-choosing-Alphabet-Inc-Google-joins-a-branded-crowd/articleshow/48437236.cms">Alphabet</a>, headed by Larry Page is essentially a collection of companies, the largest of which will inevitably be Google. 
 
Joining Google as a ‘low-key manager’ in 2004, Pichai quickly worked his way up the ladder and became part of the team that successfully launched Chrome browser in 2008. Then in 2012, he undertook the responsibility of heading Apps after the former head departed. And, finally in 2013, he was put in charge of Android. 
 
Pichai’s advancement as Product Chief in 2014 quite literally sealed the deal as he became second-in-command to none other than Page. In a press release announcing Pichai’s new post, Page mentions how Pichai ‘stepped up since October last year, when he took on product and engineering responsibility for our Internet businesses.’ 
 
However, the responsibility of heading the $66 billion-revenue, $16-billion profit, company didn’t come easy to Pichai. He undoubtedly worked for it. Really hard. 
 
Responding to a recent Quora thread which questioned Pichai’s surprising promotion to the highest ranks, Chris Beckmann, former Product Manager at Google was all praise for Pichai, crediting him for recruiting, mentoring and retaining the best team of product managers who helped him spearhead ‘successful efforts for difficult projects that were core to <a href="http://www.businessinsider.in/Heres-an-interesting-theory-making-the-rounds-about-Googles-big-shakeup/articleshow/48430574.cms">Google’s</a> continued financial success, namely Toolbar and Chrome.’ He also added that Pichai ‘avoided making enemies’ and instead navigated office politics to build a team that’s talented and one that delivers. 
 
In comparison, it took <a href="http://www.businessinsider.in/Microsofts-Windows-10-to-change-the-tech-world-says-Nadella/articleshow/48070350.cms">Satya Nadella</a> 20 years to rise up to the coveted rank of CEO of technology giant Microsoft. However, that is where the differences between the two Indian-origin CEOs end. 
 
Both Nadella and Pichai now command an influential position in the US tech world and they’re not alone. The list also includes Shantanu Narayen, President and CEO of Adobe, Vinod Khosla, co-founder of Sun Microsystems, Amit Singhal, Senior Vice President at Google, Rajeev Suri, CEO of Nokia and Rashmi Sinha, co-founder of SlideShare. 
 Moreover, according to a 2014 report by Dr Vishwas Wadhwa, the founders of 15% of the startups in the <keyword id="6357722" type="COMPANY" weightage="80" keywordseo="silicon-valley">Silicon Valley</keyword> are Indians. 
 
So, what is it exactly that’s making Indians stand tall in the Silicon Valley? 
 
It’s certainly a stark contrast from the scenario in 1992, when Indians in the Silicon Valley were deemed incapable of becoming managers- leave aside CEOs, despite being excellent engineers. 
 
The metamorphosis from 1992 to today can be largely attributed to banishing negative stereotypes that limited the entry of Indians to enviable positions. 
 
To attain this, the first generation of Indian-Americans who successfully started shattering the glass-ceiling acted as mentors for the future generations, providing them seed-funding, sharing their experiences and opening quite a few doors. 
 
This also unraveled in the management culture wherein it was noticed by a 2004 research from St. Gallen University in Switzerland that Indian executives prioritised participative administration and building meaningful relationships with subordinates which fostered an emotional bond. 
 
As Indra Nooyi, the CEO of Pepisco, once famously divulged, there's no executives in the ‘Indian club’ who possess a dictatorial style of management. “They value their employees as a person.” 
 
Additionally, they are also known to be future-oriented, patient, humble and persistent- traits which are sacrosanct for any leader. 
 
Thus, it comes as no surprise that the unique process of mentoring and uplifting within the community, immense hard work and dedication by Indian-Americans themselves, have worked out in a way which promptly put the Indian club of executives onto the global platform. 
 
Image credit: Indiatimes

I'm CEO: Indian-born business leaders are the future of Silicon Valley

<img class="gwt-Image" src="/photo/46715785.cms" /> A recent study found that only less than 3% of comments on venture capital blogs focusing on US financial and startup space are by women. While it is commonly understood that the proportion of women in the tech sector is low, this study showed that the engagement of women with the VC industry is even lower. Another recent study found that only about 15% of US companies receiving venture-capital investment included at least one woman in the executive team. If this is the case in a mature startup ecosystem like the US, one can imagine how inadequate the representation of women in a nascent startup ecosystem like the one in India, which is slowly catching up with the emerged markets in terms of cash flow to <keyword id="2783479" type="UNKNOWN" weightage="20" keywordseo="VC-funded-enterprises">VC-funded enterprises</keyword>. 
 
Of the top VC firms operating in India, Accel Partners India, Bessemer Venture Partner, Blume Ventures, Helion venture Partners, IDG VC India, Inventus Capital, Nexus Venture Partners, Matrix Partners India, SAIF Partners and Sequoia Capital India have no women partners or managing directors while Kalaari Capital and Seedfund have just one each. 
 
Among reasons for the limited representation of women at the top strata of VC firms—and thus the nature of decisions that are made or not made in the country’s startup ecosystem, which will lead to wealth creation and drive growth in the long run—is the fact that the ‘men club’ that leads most VC firms tends to opt for people like them when it comes to recruiting talent. 
 
Secondly, since VC industry in India is at a nascent stage and is not well understood, women perceive VC jobs as something that belong to the area of hardcore finance and number crunching rather than a business model evaluation, and hence tend to stay away from it. 
 
Another reason is the lack of awareness at business school level, which results in very few women taking up internships at VC firms that will help them mould their career in the VC space at an early stage. 
 
Since Indian startup ecosystem is still at its cradle, even those women who would want to take up a corporate career have not got enough opportunity to see how investments in startups would turn around in the long run. Or how innovative ideas can give birth to multi-billion dollar companies in the future, unlike in mature markets like the US where there are ample examples of startups, which were bit players at certain point in time, emerging as corporate behemoths valued at billions of dollars. Mobile-app-based radio taxi aggregator Uber, which raised a recent funding round at a staggering valuation of $40 billion within five years of being launched, is just one example of startups turning billion dollar opportunities for VC firms. 
 
More cash flow to startups owned by women entrepreneurs will happen only when a larger percentage of decision makers at VC firms become women who would want to nurture fellow women as future corporate leaders. 
 
Another drag is lack of concentrated efforts from the government to nurture VC investments and support the startup ecosystem. Despite the ‘Make in India’ campaign, the recent Budget presented a miserly picture when it came to allocation to nurture startups. 
 
However, the silver lining is the new law announced by market regulator SEBI, mandating at least one woman on the board of publicly-listed companies though it exempted SMEs having equity share capital of up to Rs 10 crore and net worth not exceeding Rs 25 crore. 
 
Also, corporate India seems to be slowly awakening to the need for more women in the ranks of the top honchos. The Indian unit of telecom firm Vodafone recently said it increased the percentage of women employees in its workforce to 20 per cent currently from 14 per cent two years ago and will hire even more women across levels and functions. Group Executive Council of the Tata Group too is said to be planning to double the count of women to over 300,000 from 115,000 currently in its 540,000-strong workforce. 
 
One hopes VC players in the country, too, take a cue from the SEBI directive and what larger industry peers like Vodafone and Tata Group are trying to do bring about a change when it comes to ensuring women representation in the country’s investment space. 
Image: thinkstock

Venture capital and gender gap: Where is India headed?

<img class="gwt-Image" src="/photo/46835516.cms" /> Long before Prime Minister <keyword id="6354477" type="PERSON" weightage="20" keywordseo="Narendra-Modi">Narendra Modi</keyword> had visualized a digital India, the country was already witnessing a trend on the digital front, which was enabling education, retail and eatery reach out to people faster and cheaper. The sudden upsurge in eCommerce did not come in as a surprise given the technology driven time where mobile phones with Internet have become a lifeline for Indian consumers. 
 
A large number of Indian audiences are hooked to their smartphone screens looking for the next big sale. Now this brings a huge opportunity for the eCommerce firms and as well as the advertising world. 
 
GroupM, the world's largest advertising media investment company, in their report titled "This Year Next Year', <a href="http://www.adageindia.in/homepage/interesting-times-ahead-for-the-indian-advertising-industry/articleshow/46131426.cms" rel="nofollow" target="_blank">says</a>, "eCommerce is expected to lead the charge in 2015 in terms of ad spend growth although from a relatively smaller base than more established categories." 
 
No wonder eCommerce firms are going to every extent to capitalize on the mindsets of the people. Time and money both are in favour of eCommerce. But does that mean the brands are lagging behind somewhere while eCommerce makes it a win-win situation? Not really! The digital platform is there for every brand and many of them are using the digital and social media to the core. 
 
But what makes eCommerce firms do aggressive advertising is that they bring brands under one umbrella, are easy to access and are available for a much cheaper price - exactly the things Indians urge for. When we spoke to Flipkart about their advertising funda, this is what their spokesperson shared. 
 
"In the recent years, the advertising landscape in India has undergone a lot of changes. It has transformed into a more engaging and communicative medium. Changing consumer mindset has pushed every brand to experiment with innovative OOH, digital and social campaigns." 
 
She further added, "The need and target audience of every campaign determines the use of different mediums. TV and print have been extensively used for most of our campaigns. Additionally, we have observed that change in the media consumption pattern of Indians has made social and digital advertising crucial for the success of a campaign. With rapid growth in the number of Indians accessing internet and the rise in mobile browsing─ mobile and online advertising have seen a rapid growth/adoption by brands too." 
 
Overall, the Indian advertising industry is growing and brimming with new-age mediums of communicating with the customers. Depending on the nature of the campaign and target consumers, the advertising spends are distributed between traditional and <keyword id="184415" type="ORGANIZATION" weightage="20" keywordseo="new-media">new media</keyword>. Like with most brands, spends on new media has been increasing over the last few years. 
 
Favourable Forecasts 
 
Given the analysis, is it possible that a nascent sector like eCommerce can really topple the big spending behemoths like <keyword id="34523" type="CITY" weightage="20" keywordseo="fmcg">FMCG</keyword>, Auto and BFSI? 
 
Anil S Nair, CEO &amp; Managing Partner, Law &amp; Kenneth Saatchi &amp; Saatchi, believes that there is nothing new to this analysis. "eCommerce and new tech-enabled businesses have been dominating the ad spends for two quarters now. I don't see a change for sometime till the funding dries up or investors run out of patience. It will drive ad rates up and make the traditional brands panic a bit. And we will get stupid briefs like "I want you to do a Flipkart on this." 
 
Kartik Iyer, CEO, Happy Creative Services, also feels that the analysis by GroupM is obvious, "It is quite a possibility and they should know best as they would be aware of the kind of inventories that have been bought for the IPL. Besides the evident need to gain maximum mind share and the aggression to grow the category, it doesn't have any unique impact on the messaging. A brand still needs to say what it needs to, no matter what it spends on visibility. But for sure the pressure on ROI will be definitely felt from the marketing departments." 
 
K Vaitheeswaran, eCommerce pioneer and Founder of Indiaplaza, India's first eCommerce website, opines, "The forecast is not surprising. Selected Indian eCommerce companies are flush with funds. Their only goal currently is to increase top line and acquire customers, whatever the cost to enable the next round of funding. Hence these companies, and of course, <keyword id="18635" type="CITY" weightage="20" keywordseo="Amazon">Amazon</keyword> who is also competing hard to build scale in India, will spend massive amounts on mass media this year. I expect this to continue for the next two years at least. I also expect mobile only eCommerce firms like PayTM to also spend lot more." 
 
Vice Versa? 
 
Strangely, traditionally large offline ad spenders like FMCG, Telecom, BFSI companies are allocating higher amounts from their ad budgets to online, while pure play online companies like eCommerce firms are spending more offline. 
 
Mahesh Murthy, Founder, Pinstorm &amp; Managing Partner, Seedfund, believes that this is a temporary blip, which is happening because eCommerce firms have been funded in silly ways to burn each other - and not to do good business. 
 
"Within 12 - 18 months, sanity and depleting bank balances will prevail, and this spend will shrink to a fraction of its current levels. This is just a temporary bonanza for TV channels and news papers who get big ad revenues; and for consumers - who can buy products below cost. But it won't last long," states Murthy. 
 
Now given the platform being huge and too many players trying to make it big, marketing strategies have to absolutely nail it. Murthy says, "In terms of strategy, more firms and their backers will realize that undifferentiated offerings do not work online. Creativity in terms of graphics and text won't make a difference. And undifferentiated firms will die, after burning through their cash." 
 
Truly differentiated offerings, that can capture healthy consumer word-of-mouth, are the ones who will survive. This means fewer people who are trying to copy Amazon or some Chinese company and more people building businesses to uniquely answer India's needs. 
 
However, Vaitheeswaran believes that he does not expect any change in approach or strategy. "It will be more of the same - deals, discounts, offers, specials, and savings in some random order. With so much of spends, there is a perfect opportunity for an eCommerce company to create a memorable campaign but no one so far has attempted to do it." 
 
Differentiate or Die? 
 
Much has been written about positioning of eCommerce firms since the concept was first introduced to the world of marketing. With thousands of eCommerce sites offering very similar product lines and looking almost identical, it is either that these sites ignore this very simple marketing concept or that differentiating themselves is much more challenging online. 
 
Iyer believes, "I don't think I can agree that most eCommerce platforms lack differentiation. Each one scores differently on trust, quality of delivery and service. This is the primary area that consumers build relationships with eCommerce brands. Do we see similar car ads? They all have four wheels and fight with the same specs in each category. So it's unfair to assume that the creative ideas will be the same. Well, I sure do hope they won't." 
 
Whereas Nair expresses, "It's a case of Quantity vs. Quality, though some of them have realized that behaving like footpath vendors outside the railway station no matter how loud you can scream will not make a sustainable brand. So as we have seen in some cases, few emotive stories will emerge and hopefully differentiate." 
 
This year, Indian TV has seen big events like ICC World Cup and IPL tournament and in this race for numbers, top line is all that matters. And very rightly, it is also predicted that during IPL, eCommerce brands will dominate ad spends on broadcast platform. 
 
For eCommerce to advertise a lot during the tournament and also to be the lead sector spending on ads throughout the year, experts believe, will add on to their traffic, sales and losses too. 
 
Image: thinkstock

eCommerce Ad Spends In India: A Fight Between Quality And Quantity?

<div class="KonaFilter image-container display-table float_right"><div><div class="image on-image"><img src="https://static-ssl.businessinsider.com/image/55d33631dd08951d418b4638-2456-1842/damian_kimmelman.jpg" alt="DueDil CEO Damian Kimmelman." data-mce-source="DueDil" data-mce-caption="DueDil CEO Damian Kimmelman." />DueDilDueDil CEO Damian Kimmelman.</div></div></div>Business information company DueDil started life because of a "chip on my shoulder," according to co-founder and CEO Damian Kimmelman.A bad experience on a past company left the American expat feeling burned and wishing he'd known more about what he was getting into before it all got started."In the end I didn't get ripped off, but I could have," he says. "I was very, very lucky to get out of that cleanly."DueDil - short for due diligence - started out as a way to stop people falling into the trap Kimmelman had. With just a few clicks on the startup's website, you can easily see the health and wealth of who you're dealing with.The startup's platform pulls together data from thousands of sources including company websites, financial filings, news reports, registry data, trademarks, and country court judgments. Then it crunches through all this and presents it in an easy to understand way, letting you see information on companies and their directors. Customers of the 4-year-old business include Royal Mail, Dell, Stripe, Unicef, and private equity houses like HG Capital and Providence Equity. As well as due diligence, companies use it for research and lead generation.<a href="http://www.ft.com/cms/s/0/cd830afa-8364-11e3-86c9-00144feab7de.html#axzz3hAuwUakn">The Financial Times dubbed DueDil the "Bloomberg of private companies"</a> and Lex Fenwick, the former CEO of both Bloomberg and Dow Jones, <a href="http://uk.businessinsider.com/lex-fenwick-joins-duedil-board-2015-7">also sits on the company's board</a>. All customers pay a subscription fee of £100 ($156) a month "per seat" - the same model as Bloomberg (although <a href="http://qz.com/84961/this-is-how-much-a-bloomberg-terminal-costs/">below its $24,000 annual charge</a>).I sat down with Kimmelman, the company's co-founder and CEO, for an hour recently to get the inside story on the company that some think could become a tech success story for London.<h3>'Most VCs at the time thought what we were doing was illegal'</h3>32-year-old Kimmelman enjoys the Bloomberg comparison but is keen to point out a big difference."Where Bloomberg focuses on the 1% of businesses, we focus on the other 99%," he says. "Increasingly, businesses are staying private. 99.8% of businesses are private and they make up 50% plus of GDP across any developed economy."<div class="KonaFilter image-container display-table"><div><div class="image on-image"><img src="https://static-ssl.businessinsider.com/image/55b76198dd0895b94a8b45dd-1859-925/screenshot 2015-07-28 10.46.32.png" alt="An example of how DueDil presents company information, in this case on Harrods." data-mce-source="DueDil" data-mce-caption="An example of how DueDil presents company information, in this case on Harrods." data-link="https://www.duedil.com/" /><a href="https://www.duedil.com/">DueDil</a>An example of how DueDil presents company information, in this case on Harrods.</div></div></div>DueDil's pitch is that it can supercharge business between private companies in the same way Bloomberg accelerated activity in public markets. It claims its platform can make doing business faster and safer by making information clearer and more accessible.Investors were initially skeptical. Kimmelman says: "There was this common misconception that the 'private' in private companies referred to privacy, when in fact it really referred to privately held or limited liability."Most VCs at the time thought what we were doing was illegal. They thought you had to pay for that [the information] and you couldn't expose it - we'd be shut down immediately."One early investor was <a href="http://uk.businessinsider.com/jonty-hurwitz-amazing-nano-sculpture-art-2015-3">Jonty Hurwitz</a>, the former CTO of short-term online loans company Wonga. "It was actually Damian's personality that drew me," says Hurwitz. "You see good ideas everyday as an investor. It was Damian's creativity combined with his single-mindedness that drew me to him."The company proved VCs wrong and stayed in business, proving its worth in 2011, the same year it launched. Charity <a href="http://www.actionaid.org.uk/blog/campaigns/2011/10/12/how-we-got-the-data-with-a-little-help-from-duedil">Action Aid approached it to help with an expose of FTSE 100 companies with subsidiaries based in tax havens</a> and the resulting data <a href="http://www.theguardian.com/news/datablog/2011/oct/11/ftse100-subsidiaries-tax-data">generated headlines.</a> Kimmelman says: "We tried to keep out of it because those were going to be our customers."<h3 class="p1">Bantr Ltd.</h3>As DueDil began to pick up customers, raising money became easier. To date, the company has raised $22 million (£14 million), most recently raising $17 million (£10.8 million) last March.London seed-fund Passion Capital is an investor and, like Hurwitz, Passion partner Eileen Burbidge credits Kimmelman for spurring the investment."When we originally invested in DueDil, we were drawn by the ambition and vision of Damian," says Eileen Burbidge over email.She adds: "The company's value and impact potential is difficult to quantify - because if delivered, it brings unprecedented transparency to private company information which unlocks value in sales opportunities, commercial development, lead generation, partnerships and other corporate transactions."<div class="KonaFilter image-container display-table float_left"><div><div class="image on-image"><img src="https://static-ssl.businessinsider.com/image/55d33631dd08951d418b4639-3264-2448/img_2595.jpg" alt="DueDil logo" data-mce-source="Oscar Williams-Grut/Business Insider" data-mce-caption="DueDil's logo at its London offices." />Oscar Williams-Grut/Business InsiderDueDil's logo at its London offices.</div></div></div>DueDil recently took on debt and isn't looking at another equity raise any time soon. Kimmelman says: "We're doing really well. We've well-exceeded targets every month for the last 7 months."If you do a DueDil on DueDil its latest accounts for 2014 show turnover up 416% to £805,896 ($1.2 million), but mounting losses of £3.5 million ($5.5 million).It's not clear how much the recent debt round was given that the accounts only go up to December 31, 2014. At that time, DueDil had £940,363 of debts due within a year.(The company's page also reveals, amusingly, that DueDil started life in 2009 as Bantr Ltd.)Investors seem happy with performance. Burbidge says Passion are pleased with "everything [Kimmelman]'s been able to achieve to date, as well as the promise of what's still to come."Hurwitz says: "I'm finding the evolution of the company super exciting. One of the things that DueDil do, as an investor, on a level I haven't seen in any other investment of mine, is the reports. The reporting is exquisite."Every month we get these beautiful reports telling us exactly what's going on. Damian and Justin [Fitzpatrick, DueDil's co-founder, CFO &amp; COO] are fantastic at investor relations. They do it like none other."<h3>'One of our competitors used to say data is the new oil - it's not at all'</h3>Detractors speculated that Companies House, the <keyword id="6354868" type="COUNTRY" weightage="60" keywordseo="UK">UK</keyword>'s central store for financial filings, <a href="https://www.gov.uk/government/news/free-companies-house-data-to-boost-uk-economy">opening up its records for free this year will kill the business</a>, but Kimmelman says this is far from the case."We were predicated [on the belief] that this would happen. Take the Bloomberg example - a lot of the data that Bloomberg is built on is free or completely commoditised. One of our competitors used to say data is the new oil - it's not at all. It's the worse analogy you could find. The value in data is context - it's information, it's insight."The more information is free, the lower DueDil's costs. Still, is it really sustainable to charge £100 a month for free information?Kimmelman is keen to show it is, saying: "I really want to prove to customers over the next year their return on investment. We're doing that already, but we want to do that across all our customers."Hurwitz, who was responsible for building Wonga's data-driven lending engine, says: "In the world we live in now, the gathering of extensive data sets is where all the value will lie. I think there's enormous value in the collation and curation of data."<h3 class="p1">Flipping properties, hedge funds, and Mahjong</h3><div class="KonaFilter image-container display-table float_left float_right"><div><div class="image on-image"><img src="https://static-ssl.businessinsider.com/image/55d33631dd08951d418b463a-3264-2448/img_2597.jpg" alt="DueDil offices" data-mce-source="Oscar Williams-Grut/Business Insider" data-mce-caption="Part of DueDil's London offices" />Oscar Williams-Grut/Business InsiderPart of DueDil's London offices</div></div></div>DueDil's offices occupy two floors of an old block in East London, with around 70 staff there.The building is near an outpost of a heavyweight in the financial information field: Thomson Reuters.The proximity is just a coincidence, Kimmelman says - they got the space from an architecture firm who were downsizing (the firms models are still on the walls) and it was a good deal.While DueDil is Kimmelman's best-known venture, it's hardly his first. The New Yorker has a tinkering, entrepreneurial nature that has seen him dabble in a number of fields.After attending boarding schools across the US, he came to Scotland in 2001 to study International Relations at St Andrews University, a course he says he found undemanding."I had a lot of time at University so I bought and sold properties, I flipped a lot of student properties," he recalls. "I built an online gambling engine for Chinese Mahjong with a friend. I worked for hedge funds doing risk assessment on credit default swaps. I tried to get involved in as many things as possible."His eclectic CV is reflected in his personality. Hurwitz says: "He's quite brilliant in a very strange and eccentric way. There's everybody else on one stream, then on another stream, that's slightly periphery, is Damian. He just sees the world differently to everyone else."Kimmelman speaks in an unhurried, methodical manner at a volume just low enough to merit comment. He often pauses mid-sentence to gather his thoughts.<h3 class="p1">'It's all about the opportunity'</h3>As well as the UK Ireland, DueDil now carries company information for 18 other European countries and is planning expansion."I can't go into that much detail, but it's pretty obvious that the biggest markets present the biggest opportunities. There's Germany and there's France and what have you."Kimmelman is more wary about expansion into his home market: "The US is like doing 50 countries. Europe is one of the most exciting opportunities and it's often the one that's overlooked."Kimmelman is also hugely confident of his company's potential. When I ask if he thinks the business can fulfill its promise as "Britain's Bloomberg" and one day reach a valuation of $1 billion (£640 million), a much-vaunted level for tech companies he replies: "I'd like to be a lot bigger than that.""I think that what we're trying to solve is much bigger than that. If you were to say what the size of the mobile music market is in the early 2000s you'd say maybe $200-300 million - you've got the Walkman, the Discman. But out comes the iPod. It's all about the opportunity, not the size of the market as it currently stands." <div class="margin-top"> <h3>NOW WATCH: <a href="http://www.businessinsider.com/how-to-roll-shirtsleeves-2015-7">You've been rolling your shirtsleeves wrong your entire life</a></h3> <div> <div> <script src="http://player.ooyala.com/v3/6e12e8b3387a44daacfb73afba25a76e"></script> <div class="ooyala-video-player" data-video-autoplay="false" data-video-id="00aWJtbTpGLZzI--HC1ROjDOsVJUGKFP" data-player-variable="ooyalapopvideo" id="ooyalaplayer_popvideo" style="width:1280px;height:720px"></div> <script> if (typeof RunFunctions === 'undefined') { var RunFunctions = []; } RunFunctions.push(function() { var ooyalapopvideo = OO.Player.create('ooyalaplayer_popvideo', '00aWJtbTpGLZzI--HC1ROjDOsVJUGKFP',{ autoplay: 'false' }); }); </script> <noscript><div>Please enable Javascript to watch this video</div></noscript></div> </div> <script>(function() { function createPlayer() { OO.ready(function() { RunFunctions.forEach(function(ooyalaFunction) { ooyalaFunction(); }); RunFunctions = [];}); } createPlayer(); }()); </script> </div>

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