Several start-ups are tapping into the lucrative sports sector in India
IT’S NOT too often that one gets to meet a vegetable-seller who also happens to be an Asian Games gold medalist. But Bengaluru-based Protik Roychowdhury met one during a vacation in Jharkhand in 2011. “I was studying at IIT-Kharagpur when I met this woman, Lina Kumari, a kabaddi player, selling vegetables at a market in Sonari, Jamshedpur, Jharkhand. She had apparently sold her medals to make ends meet. This should never have happened,” says Roychowdhury.
“The problem is that the media is very selective in reporting and a lot of stories go unnoticed,” the 26-year-old says, adding, “It was then that I decided to give Indian athletes a platform through which they could voice their opinions and, going forward, own the commercial rights to their stories.”
Thus was born the concept of Athlete Diaries, a sports start-up that provides sportspersons a platform from which they can directly connect with their fans. “The great thing about sports is that it produces gripping human stories of determination, perseverance and success, things that resonate with the general populace. These neglected heroes of Indian sports can be the role models of our future generations,” says Roychowdhury, who, in 2012, co-founded Croak.It!—a voice-based social media start-up based in Singapore, which was acquired by cloud telephony firm Exotel in 2015—before starting Athlete Diaries in partnership with IIT-Kharagpur batchmates Babita Pegu and Pankaj Urmaliya in November last year.
Currently, Athlete Diaries has four revenue streams, which include royalties from re-publication of content (which it shares with the athletes), native ads, media partnerships, and corporate tournaments and events. “Although Athlete Diaries is an online new media platform, the idea is to create an environment that encourages sports and sporting achievements,” Roychowdhury explains.
Similarly, KOOH Sports, which organises in-school and professional sports training programmes, was started by BPO provider Intelenet’s founders Susir Kumar and Prabhu Srinivasan in 2010. “With the fast-paced life everyone is leading today, there is hardly any time for parents to play with their children. Children are also hooked on to their laptops, mobiles and TV screens, living a sedentary lifestyle, with hardly any interest in outdoor activities. The aim of starting this venture was to revive the culture of outdoor activities at a grassroots level and simultaneously create a healthy lifestyle among children,” explains Chirag Patel, CEO of the sports education, training and technology company.
Since its inception, KOOH, which stands for ‘Kids Out Of Home’, has reached out to over two lakh children across the country and plans to reach over five lakh children in the next three years.
Talking about the business model, Patel says the company’s delivery model includes service offerings that include 14 sports. “We have designed products that fit various requirements of schools and communities, and we have invested in a technical team that continuously monitors the quality of the delivery and programmes,” he says. KOOH currently stands at R14-15 crore topline and aims to become a R20-crore topline profitable company in the next one-two years, Patel adds.
Ventures like Athlete Diaries and KOOH Sports are tapping into a sector that has been growing steadily in the past few years. As per the 2015 India Sports Sponsorship Report by investment firm GroupM and sports business media company SportzPower, the sports sector in India grew by 10% in 2014 to Rs 4,806.9 crore. “The sector has seen the formation of newer leagues and successful franchises. From a single-sport country to a multi-sport one, India is witnessing a boom that will benefit the sports business ecosystem,” the report noted.
“The sports industry is seeing a lot of interest—partly due to the (sports) leagues and partly due to the health and fitness concerns of a growing population that has limited access to public play spaces. And, therefore, I think there will be more investments in this space going ahead,” says Saumil Majmudar, co-founder and CEO of EduSports, a Bengaluru-based sports education company.
Started in 2009, EduSports is the brainchild of Majmudar, Parminder Gill, Meer Waqiruddin Khaleeq and Jyoti Majmudar. The co-founders are people with 16-18 years of experience across sales, marketing, new business development, product management, supply chain and operations across India, the US and Europe.
EduSports operates in over 80 cities in India and is currently live in over 320 leading schools. Its programmes currently cover over two lakh children, 5,000 teachers and 80,000 parents. “When we started, we did not have any of the tools (curriculum, assessment, monitoring, etc). We only had the desire to get children to play. Some of the early schools trusted our sincerity and decided to give us a chance, but also asked us how we would actually execute the programme throughout the year,” says Majumdar, an IIT-Mumbai and IIM-Bengaluru alumnus, adding, “In partnership with schools and with a sharp focus on ensuring that the on-ground programme is world-class, we kept iterating and fine-tuning the various tools used to deliver the programme with accountability and transparency.”
What’s helping these start-ups is that many angel investors and high net-worth individuals are investing in sports—many for their passion and others for the access and visibility that a sports business brings. “The sports industry worldwide has been seen as a lifestyle business (of the rich and famous, as well as of the not-so-rich). Given the recent trend of urban play spaces disappearing, increasing sedentary lifestyles and concern over health and fitness, this sector is starting to attract risk capital from individuals and some institutions,” says Majumdar.
Initially bootstrapped, EduSports got a fund infusion worth Rs 7.5 crore from Mumbai-based early-stage venture capital fund Seedfund in January 2010. More recently, Gaja Capital Partners, a private equity and investment advisory firm, has invested $10 million in Sportz Village (the parent company of EduSports).
In December last year, KOOH Sports, too, raised a fresh round of funding worth $2 million from existing investors—private equity fund Faering Capital, Tata Consultancy Services and HDFC. The round also saw participation from Mumbai-based sports promotion service Elevate Sports, which will now have a 5% stake in the company.
As long as the market is big enough and there is potential for investors to get a good return, investment is never a problem, says Roychowdhury of Athlete Diaries. “Overall, it’s good for the whole start-up scene. As recently as 2012, the market was very conservative. However, investors have now become bullish and maybe the mindset is changing. It makes it easier for entrepreneurs to actually go out and change the world,” he says.
As per Roychowdhury, the one thing that will give a boost to the sector is the emergence of a unicorn. “We need a Flipkart, a Zomato or a Grofers for investors to sit up and say that this is where I want to be. I don’t think that day is far and, till then, we will just go about doing our job of getting fans closer to athletes and the games they love,” he adds.