The Indian software companies targeted at the US and European regions as these were primary markets for their business but the new age start-ups have found a large market in India itself and even smaller markets overseas
The retail consumer-focused online start-up companies from India are now expanding overseas and getting into markets where similar opportunities exist. The online companies from healthcare, financial services and education sectors after establishing their presence in India are now expanding into Southeast Asia, West Asia and in a certain cases even Latin America.
BankBazaar.com, an online financial marketplace in India — with Amazon as one of its key investors — has forayed into Singapore and has plans to later move into Malaysia, the Philippines and the UAE. Similar is the case of Practo, an online healthcare platform, which has got into markets like Singapore, Malaysia, Indonesia and the Philippines. It also recently expanded its reach to Brazil.
Adhil Shetty, co-founder and CEO, BankBazaar.com, said, “We have built a platform which has proven itself and is capable of extending globally where similar opportunities are present. Today opportunities exist for made in India products abroad,” he remarked. According to BankBazaar.com, it gets over five million visitors in a month and has product portfolio from over 50 financial institutions.
Shashank ND, founder and CEO, Practo, said, “We believe that Practo is building something innovative and it will be proven if it is able to scale beyond a single country. The countries we are going into have also characteristics similar to India and potential returns will come in the next five years.”
The expansion plans of these start-ups are very unlike the Indian software services companies in their early days. The Indian software companies targeted at the US and European regions as these were primary markets for their business but these new age start-ups have found large market in India itself and even smaller markets overseas.
Restaurant search and food delivery start-up Zomato has also expanded very rapidly overseas especially in developed economies but had to later scale down its operations.
Terming this as a good sign, Harish HV, Partner – India Leadership team, Grant Thornton India, said, “Generally they start in India. Once the model is successful they look at comparable markets where similar services could be offered, typically in regions such as Southeast Asia and Africa.”
Practo saw a 10-fold increase in revenue for FY15 to touch R29.73 crore while the losses rose by 30% to Rs 12.85 crore. In case of Zomato, the revenue rose by 91.2% to Rs 184.97 crore for FY16 while loss before tax was Rs 492.27 crore.
India today is considered as the third largest start-up hub with presence of more than 4,200 such entities in the country, a growth of 40% by the end of 2015, according to IT industry trade body Nasscom. This has also been equally supported by the funding which has come into this segment which stood at $4.9 billion in 2015 as compared to a cumulative investment of $3.2 billion over the 2010-14 period.
UpGrad, an online higher education platform founded in March 2015 which provides programmes for working professionals, is also looking to get into overseas. Mayank Kumar, co-founder and MD, said, “We are looking at how to take our platform and content to the global market. We are looking at markets like West Asia and Southeast Asia given their proximity and English speaking environment.”
As many of these companies have got less than a decade’s experience, there is also the question of whether these forays are coming too early. “If they don’t go there, somebody else will do it. If they go after a few years the opportunity may not be there,” Harish said.