A NASSCOM study conducted last year revealed that Indian product startups were operating across 20 sectors and playing a major role in nation-building. Then in May, PM Modi’s clarion call for Atmanirbhar Bharat crystallized the idea of self-reliance, and their response was on expected lines. The nation’s entrepreneurial spirit continues to soar.
We had conducted a startup snap-survey three months back and at that time visibility – for many – beyond a few months seemed cloudy. And yet, more than 50 per cent were ready to pivot into new areas. Undeterred by the domino effect that the pandemic had on end clients, the startups demonstrated great agility and resilience to survive in the short run, serve the nation in mission-critical areas, and in turn, opened up new opportunities.
Covid-19 had violently shaken the healthcare system in April and the spectre of displacement was looming large. We had startups (many from the NASSCOM DeepTech Club as well) which rallied-around proactively to provide solutions in fighting the pandemic. And, it was an entire range that was on display – robotic applications to ensure cleanliness & safety, tech-enabled equipment for caregivers such as low-cost ventilators, analytical tools to study the strains of the virus, collaborative software for remote working teams to communicate, et al. All fronts were covered and the most remarkable thing was that these competencies were practically built overnight.
New Habit Formation
We may never get back to the old ways of doing things. Commerce, education, healthcare delivery, and the future work environment are some prominent areas where we are already witnessing new habit formation. The change will be disconcerting for some time but very soon it will ease out and open up many business opportunities that never existed earlier. As they say, in challenges, also lie opportunities. This is our Aha moment in a contact-less economy to go 10X in digital adoption – both B2C & B2B – and avoid in-person interactions to the extent possible, maximize customer experience, and much more
As an example, fintech startups while offering a range of applications have enabled Kirana stores to streamline their operations and supply chains and helped them stay afloat. A new approach to buying has evolved and it’s a major step-up in the direction of self-reliance for millions of Indians. Inasmuch, collaborative software, including AI-chat bots (capable of interacting in vernacular languages as well) for customer service et al, has been the silver lining.
Going back to our healthcare sector example, right now we need to do a massive rethink on resource utilization – human & assets. For instance, telemedicine has rendered optimum usage of doctors’ time; contactless body-scanners have ensured safety from a health standpoint; similarly, remote monitoring, virtual consulting platforms kept up the continuity and there has been increased traction in the last few months in these areas. A new path to healthcare services delivery is being paved and the existing fold of over 1,000 healthtech startups will only add great value many times over.
With blended learning likely to be the new norm, it’s anybody’s guess how much this market will expand in the next 10 years. 37 per cent of the Indian population is within the age group 5 – 24 and that market is open to edtech companies. The New Education Policy is forward-looking and emphasizes learning through practical applications and this will be an opportunity that startups can solve for. Accessibility and affordability will have borne in mind as in many parts of the country network speed is still a challenge. The solutions should work in offline mode too.
The need for cost-optimization cuts across and digital adoption is a major step in reducing costs and also in making the customer experience better and enabling employees to serve them better. Given the stressed economic condition, heavy CapEx investments may not be on the cards for many organizations in the next 12 – 18 months. While this is a challenge, it doesn’t have to be that way. The Indian SaaS market is about $3.5 billion and is growing at a 30 per cent CAGR. With 6 SaaS Unicorns and more than 150 companies having Annual Recurring Revenue (ARR) of more than $1 million, there’s tremendous opportunity to drive digital in corporate India, particularly in the SME segment. BFSI has been one of the fastest adopters of SaaS and that’s a highly regulated sector so clearly, other verticals can follow suit.
The time is ripe to push hard the software products agenda. To this end, the government unveiled the National Policy for Software Products last year. Currently, at around $9 billion (FY 20), the sector has been growing at 9.6 per cent and now with an added push towards digitalization, there’s sure to be strong growth particularly in diverse areas spanning CRM, data, analytics and AI, human capital management, collaborative platforms, just as some examples. Given the change in the business model in all these areas, a subscription-based approach will be preferred. It’s a great opportunity for product managers to make a big difference to the landscape and play that vital link between what the market requires and what can be delivered. We don’t have the leeway to miss out due to inadequate product-market fit. We have the opportunity now to Make In India but Make For The World at scale and impact.
In its economic relief package, the government has earmarked Rs 3 lakh crore as collateral-free loans for MSMEs. This is a positive move and it should be a boost to easing working capital challenges faced by tech startups. There have been other measures too, including, reduction of TDS & TCS by 25 per cent and that refunds will be issued immediately. Also, government departments will pay the receivables within 45 days. For a long time, we have been highlighting the need for governments to procure from startups and it was most encouraging to see the announcement that in government procurement up to Rs 200 core, there’ll be no global tendering. This should make ample room for startup participation, which is much-needed.
These are tough times and the idea of collaboration will be tested to the hilt. This crisis, so far, was not allowed to go waste. New innovations, approaches, business models, and tech products came up almost overnight which is tremendously inspiring. The resilience and agility demonstrated by our startups should do all Indians proud. India’s moment is now. We were number one in the world in GDP and one of the leaders in innovation a thousand years back; the time has come to start to reclaim that leadership position in the global order.
Atul Batra is the Chair, NASSCOM Product Council and CTO, Manthan. Views expressed are the author’s own.