India creates 11 unicorns in 2020 - the year of WuhanCoronaVirus

India has seen a record number of startups becoming unicorns in the year 2020. 

The year that began with shock of lockdowns 

The year which began with the fear of Wuhan Corona Virus spread all across the world saw the longest lockdowns ever.  This had a major impact on the economy - especially of India - as it imposed one of the strictest lockdowns. 
However release of liquidity (money) by Central Banks of various countries ensured that easy money was available to businesses. 
And many businesses, the ones sensing higher business due to lockdown, quickly went into expansion mode.

Indian Startups weather the storm

Some Indian startups managed to weather the storm, post impressive revenue figures and raise funding to gain a valuation of more than $1 Bn and enter the unicorn club.

In all, 11 Indian startups —  

1. Unacademy, 
2. Pine Labs, 
3. FirstCry, 
4. Zenoti, 
5. Nykaa, 
6. Postman, 
7. Zerodha, 
8. Razorpay, 
9. Cars24, 
10. Dailyhunt and 
11. Glance — 

became unicorns this year. As experts have pointed out, the core propositions of these startups were ones that actually solved challenges for individuals and businesses during the lockdown for a large portion of the year. 

3rd largest number of unicorns

India is home to 32 Unicorns, making it the 3rd largest country with most Unicorns. Delhi NCR, the city with most Unicorn activity, alone has 14 unicorns.

On an average it took 5.5 years for Unicorn companies in India to achieve the status of a "Unicorn"

Aileen Lee first wrote about Unicorns

According to Investopedia - A unicorn is a term used in the venture capital industry to describe a privately held startup company with a value of over $1 billion. The term was first popularized by venture capitalist Aileen Lee, founder of CowboyVC, a seed stage venture capital fund based in Palo Alto, California.

Aileen Lee first wrote about unicorns in the venture capital world in her article, "Welcome to the Unicorn Club: Learning from Billion-Dollar Startups." Here, she looked at software startups founded in the 2000s and estimated that only 0.07% of them ever reach $1 billion valuation. Startups that managed to reach the $1 billion mark, she noted, are so rare that finding one is as difficult as finding a mythical unicorn.

(Disclaimer : This blog is for information purposes only)

India - Stack, A set of APIs (Application Programming Interface) One of the best of what India has created.

 WHAT IS INDIA STACK

IndiaStack is a set of APIs (Application Programming Interfaces) that allows governments, businesses, startups and developers to utilise an unique digital Infrastructure to solve India’s hard problems towards presence-less, paperless, and cashless service delivery. 

Its founded on core principles that services can be 

1. Presenceless = capable of being authenticated from anywhere
2. Paperless = reliant on digital records
3. Cashless = truly universalising the access and usage of digital payments 
4. Consent based = allowing secure movement of data authenticated by its owners.

THE EVOLUTION OF INDIA STACK 

1. 2009 - UIDAI was created with objective to issue Unique Identification Numbers named as "Aadhaar"
2. 2010 UIDAI launched Aadhar Authentication API before the first Aadhaar was issued 
3. 2011 NPCI launched Aadhar Payments Bridge and Aadhaar Enabled Payments System which uses Aadhar Number as a central key for electronically channelizing the Government Benefits and subsidies 
4. 2012 UIDAI launched eKYC which allows business to perform Know Your Customer verification process digitally using Biometric or Mobile OTP
5. 2015 CCA launches eSign as an open API to facilitate an Aadhar holder to digitally sign a document and MeitY launches Digital Locker, a platform for issuance and verification of documents and certificates in a digital way, thus eliminating the use of physical documents 
6. 2016 NPCI launches Unified Payments Interface, the most advanced payments system in the world to revolutionise digital payments in India 
7. 2016 NeGD launches Digital Locker a platform for issuance and verification of documents and certificates in a digital way. 

(Source : The India Fintech Report 2020)

The Very Different Approach 

India has chosen to have a very different approach to open banking. Unlike many other geographies where instant payment initiatives are running parallel to open data initiatives, India flipped the equation by implicitly launching open banking payments first on what is now widely considered the best real-time payment network in the world. 

Based on the success of IndiaStack, over 20 countries have shown interest in studying and implementing a digital identity system inspired by Aadhar and the software stack built around it. 

In 2018 Singapore and India had signed a high level agreement to internationalise the IndiaStack which resulted in creation of a joint working group on Fintech to develop API based platforms in ASEAN region. 

A number of countries and international agencies such as the World Bank and Gates Foundation  have also approached India with help to build digital identity. 

 Visit the website of IndiaStack here

(Disclaimer : This blog is for educational purposes only. Please read further disclaimers at the bottom of this webpage)

Amid pandemic, while most Indian startups are struggling for funds, four have become unicorns

Unicorns in Corona Crisis 

The virus outbreak and the nationwide lockdown that ensued have thrown up funding and business continuity challenges for many in the Indian startup ecosystem. More than half of Indian startups are struggling to raise fresh funds

Four Indian tech startups became unicorns, or private companies valued at over $1 billion, in the middle of the pandemic.

These are – 

1. online beauty products retailer Nykaa, 
2. tech firm Postman, 
3. education startupUnacademy and 
4. fintech firm Razorpay 

India’s total unicorn count is now  33.

Challenges faced by Indian Startups During Corona Lockdown 

The virus outbreak and the nationwide lockdown that ensued have thrown up funding and business continuity challenges for many in the Indian startup ecosystem. More than half of Indian startups are struggling to raise fresh funds.

Consider startups in the hospitality sector. Since the possibility of travel and tourism has been next to nil over the past six months, and with revival of the sector expected to take anywhere six to 12 months from now due to the apprehensions of the public regarding infection and safety, enterprises in the hospitality sector have been struggling just to stay afloat.

If startups in the hospitality industry are faring badly, social sector enterprises are in a worse state.  The pandemic has increased the risks for staff to work on the field. Anyone with Covid-19 symptoms have had to go into quarantine, which affected the ongoing projects.

New investors are risk averse. CSR funds are also not available since all private companies are practicing conservative spending for the rest of the financial year to prepare for the full economic impact of the pandemic in 2021.

Not all are suffering 

Not all startups are suffering though. Those in e-learning (think Byju’s and other online learning apps), e-commerce (Grofers and Big Basket) and health spaces are flourishing. 

(Disclaimer : This blog is for information purposes only.)

Tesla Market Cap Crosses USD 500 billion - what's unique about the company

Tesla Market Cap Crosses USD 500 billion 

Tesla Inc crossed $500 billion in market value on Tuesday as investors lapped up its shares in the run-up to its addition to the S&P 500 index, extending a meteoric rally that has seen the stock gain more than six times this year.

Shares of the electric-car maker have risen nearly 28% since the S&P Dow Jones Indices decided to add the company to the benchmark index from Dec. 21.

Its shares rose as much as 3.9% to a record high of $542.35 in early trading, valuing the company briefly at $514 billion.

Tesla to become part of S&P 500

·       S&P Dow Jones Indices recently announced  that Tesla will join the S&P 500 effective prior to trading on Monday, Dec. 21.

·       Upon entry, Tesla is already one of the S&P 500's 10 most valuable companies based on Monday's closing prices.

History 

Tesla - an American electric vehicle and clean energy company - started business in the year 2003 in Palo Alto, California. 

The company's name is a tribute to inventor and electrical engineer Nikola Tesla. Eon Musk who is the current CEO of the company was the fourth employee of the company. 

Tesla has been pushing the envelope on battery usage since its inception. The 2008 Tesla Roadster was the first highway-legal production car to employ lithium ion batteries. It was also the first to manage a range of over 200 miles. 

Sales 

Tesla's global vehicle sales increased by 50% in 2019 - over 2018. 

In 2020 its sales have already crossed a million mark. They are already 3 times that in 2019. Its Model 3 has already sold more than 500,000 cars making it the best selling electric car in the world.

No wonder then its shares have skyrocketed.

Aspirational 

The market for fully electric vehicles is growing.

Some reasons behind the growth include 

• new regulations on safety
• vehicle emissions
• technological advances, and 
• shifting customer needs and expectations.

Tesla has been able to catch the attention of people seeking to buy electric cars and has also become an aspirational product. 

The Beginning Approach 

Tesla took a unique approach to getting its first vehicle in the market. 

It did not try to build a relatively affordable car that it could mass produce and market. Instead it took the opposite approach, focusing on creating a compelling car.

It was costly to build an electric car in the "initial days". Tesla therefore took the approach of making an "electric sports car".  An electric sports car could match upto price of other gasoline based sports cars and yet be aspirational.

The Next Stage 

Once Tesla established its brand it went in for growth. Tesla's current business model is based on

1. Direct Sales Tesla has created an international network of company-owned showrooms and galleries. They are located mostly in prominent urban centers around the world.  Tesla believes this helps it in the speed of its product development.
2. Supercharger Network Tesla has created its own network of Supercharger stations. These are places where drivers can fully charge their Tesla vehicles in about 30 minutes for free. This is to speed up the rate of adoption for electric cars.

Doing things differently 

According to Harvard Business Review Tesla does four things which sets itself apart 

1.  It develops cars as if it is a software product.
2.  It simplifies buying process putting the consumer in control. 
3.  It leverages its technological prowess in battery technology to minimise the total cost of ownership over the vehicle's timeline. 

(Disclaimer : This blog is for information purposes only)

GIG Economy - tends in India and Govt. initiatives

What is it? 

Gig workers are independent contractors online platform workers, contract firm workers, on call workers and temporary workers.  Gig workers enter into formal agreements with on-demand companies to provide services to the company's clients.

Background

In the 2000s, the digitalisation of the economy and industry was carried out rapidly due to the development of information and communication technologies such as the Internet and the popularisation of smartphones.

As a result, on-demand platforms based on digital technology have created jobs and employment forms that are differentiated from existing offline transactions by the level of accessibility, convenience and price competitiveness.
In general, "work" is described as a full-time worker with a set working hours, including benefits.

But the definition of work began to change with changing economic conditions and continued technological advances, and the change in the economy created a new labor force characterised by independent and contractual labor, such as well.

Job Economy vs GIG Economy 

How is it different?

In a Gig Economy, employees work on a contractual basis, which exists outside its traditional employment. The jobs are flexible, on a temporary basis, and mostly creating networks digitally.

People start making a living by taking multiple job roles which are project based, and it’s definitely fun since they do what they want to and whenever they wish to. No limitations.

Some are already a part of this GIG ECONOMY like Cab drivers, delivery and some are freelancers like web designers, content writers and the other talent gigs.
Teachers, sales person, independent contractors, consultants, artists are few more examples of common gig workers.

INDIA'S GIG Economy - projections 

New Platform - by the Govt. - for GIG workers on the anvil

The draft rules of the labour code on social security unveiled on Sunday by the Centre (Govt. of India) has suggested establishing a national platform, man database and monitor progress, while states will create policies to provide social security benefits to gig and informal sector workers on a self-registration basis.

• Under the Code on Social Security (Central) Rules, 2020 all unorganised sector workers will have to update their particulars on a portal specified by the Govt
• Gig firms will be required to make an annual contribution by June 30 of every year for the social security of gig and platform workers
• The rules have been framed for the implementation of the provisions of the Code on Social Security, 2020, which was passed by Parliament in September

(Disclaimer : This blog is for information purposes only)

New type of batteries are coming - better and faster than Lithium Ion ones.

History 

It was not until the early 1970s that the first non-rechargeable lithium batteries became commercially available. Attempts to develop rechargeable lithium batteries followed in the 1980s but the endeavor failed because of instabilities in the metallic lithium used as anode material.

Advantage - Lithium Ion or Li-on Batteries 

Lithium is the lightest of all metals, has the greatest electrochemical potential and provides the largest specific energy per weight. 

Rechargeable batteries with lithium metal on the anode (negative electrodes) could provide extraordinarily high energy densities, however, cycling produced unwanted dendrites on the anode that could penetrate the separator and cause an electrical short. The cell temperature would rise quickly and approaches the melting point of lithium, causing thermal runaway, also known as “venting with flame.”

Because of the inherent instability of lithium metal, especially during charging, research shifted to a non-metallic lithium battery using lithium ions. Although slightly lower in energy density than lithium metal, lithium-ion is safe, provided certain precautions are met when charging and discharging. In 1991, the Sony Corporation commercialized the first lithium-ion battery. Other manufacturers followed suit.

Growth of Li-on Batteries 

The global lithium-ion battery market size is estimated to grow from USD 44.2 billion in 2020 to USD 94.4 billion by 2025; it is expected to grow at a CAGR of 16.4%. 

The growth of this market is likely to be driven by the excellent features of li-ion batteries, increasing adoption of consumer electronics, and growing R&D initiatives by different organizations & battery manufacturers. 

Moreover, an increase in demand for plug-in vehicles, rising need for automation and battery-operated material-handling equipment in industries, propelling demand for smart devices and other industrial goods, and high requirement of lithium-ion batteries for industrial applications are other key driving factors.

New Batteries - Organic Battery 

Researchers from York University have explored a new type of organic battery that could last much longer than a typical battery while being safer for the environment. 

The study was published Thursday in the journal Batteries & Supercaps. Organic batteries use environmentally-friendly, organic materials instead of the toxic metals that are widely used. These organic materials would be used to take on the role of the electrode. Previously, protein-based solutions were explored by researchers across the globe, but this new study highlights a carbon-based organic molecule instead.

However, the technology isn’t ready yet. There are still some issues with the researchers’ organic battery, such as the significant capacity loss at lower temperatures of around 5 degrees Celcius, or 41 degrees Fahrenheit.

New Batteries - Organic Proton Battery which charges instantly 

Waiting for a battery to charge once it’s depleted is still a big hassle for mobile-device users, especially in these days when smartphones have become a ubiquitous part of everyday life.

Researchers at Uppsala University have developed an all-organic proton battery that could solve this problem by charging in a matter of seconds.  Moreover, the battery can charge more than 500 times without any significant loss of capacity, and use a solar cell for charging rather than needing to be hooked up to a typical wired electronic charger.

The battery, made from organic materials rather than the metals that comprise lithium-ion chemistries, could provide a breakthrough in developing an environmentally friendly and sustainable source of energy for electronic devices and even potentially electric vehicles (EVs), said Christian Strietzel of Uppsala University’s Department of Materials Science and Engineering.

As innovation picks up further many alternatives to Lithium Ion are likely to emerge which will be even more environment friendly and easier to operate and manage. 

The era of fossil fuels is likely to get over sooner than expected.

(Disclaimer : This blog is for information purposes only).

The startups which can go for IPO in the next 1-3 years

These are the startups which may be considering an IPO in the next few years:

Flipkart

The Walmart-owned e-commerce firm has been eyeing a US IPO for a while now, according to reports, although it has no immediate funding shortage given its cash-rich parent and other investors.

Wuhan Coronavirus pandemic has accelerated digitisation and online buying, from which Flipkart has gained. 

Freshworks

Software provider Freshworks raised $150 million in November last year, tripling its valuation to $3.5 billion, and according to reports and sources, this was supposed to be its last private round before a US NASDAQ IPO in 2021. 

However, the COVID-19 pandemic pushed these plans. But Freshworks is still one of the few profitable unicorns and with the US being its largest market, an IPO there could do well. 

Policybazaar

Insurance aggregator Policybazaar is another startup closer to an IPO than many, given it is profitable, and still growing. Group CEO Yashish Dahiya wants to list in Mumbai next year, he told Bloomberg in June, but after the change in law, it may also go for a dual listing.  

Zomato

Food delivery firm Zomato is a surprise candidate here, given that food delivery and eating out has been one of the worst-hit sectors from the pandemic. 

Even six months on, most players in the space have seen order volumes recover to only 50-60% of pre-pandemic levels. Despite this, on the back of a fundraising spree, Zomato CEO Deepinder Goyal told employees in an email that it is planning for an IPO in the first half of 2021. 

Nykaa  

Online beauty and cosmetics retailer Nykaa has been a candidate for a domestic IPO for a few years now, given that it is profitable, and still growing. 

The COVID-19 pandemic hit Nykaa for a few months, but CEO Falguni Nayar told the Economic Times in June that it would be at 75 percent of pre-pandemic levels by July and it plans for an IPO in the next 2 years. 

Delhivery

E-commerce logistics firm Delhivery was said to be preparing for an IPO in 2018, and had started reaching out to bankers, when it ended up raising money from the SoftBank Vision Fund instead and decided to stay private longer.

 Since then it has also raised funds from Canadian pension fund CPPIB, and is valued at $1.5 billion. Delhivery is now planning for an IPO in the next 12-18 months, Chief Business Officer Sandeep Barasia told Mint on September 16. 

Others 

Other startups including Lenskart, Pepperfry, Oyo, Paytm and Mobikwik has also spoken about listing ambitions in the past. It is unclear whether their plans have changed post the pandemic, or whether it is a priority above other things.  

(Disclaimer : This blog is for information purposes only and not to solicit any business or offer any kind of advise)

Byju's - tutoring app's journey to a valuation of $10.5 billion - 12 years

Byju's 

India's most loved tutoring app is on a growth rampage and perhaps one of the rare Ed-tech product innovations that has come out of India in recent times. 

Valuation 

The Edtech startup is now valued at a valuation of USD10.5billion.  

Silver lake - an American private Equity Firm focussed on worldwide large scale investments in technology, technology-enabled and related activities - has decided to invest USD500million in Byju's at a valuation of USD10.5billion.

The Journey  

2008 - Among the few who cracked Common Admissions Test (CAT) with 100% score globally and National Math Olympiad winner, Byju Raveendran started BYJU's CAT classes for CAT training

2009 - Starts online video-based coaching for CAT 

2011 - Registers as a company called Think and Learn focusing on K-12 segment 

2012 - Awarded as fastest growing tech companies in India under Deloitte Technology Fast 50 India.

2013 - Starts raising monies from institutional investors, raises $9million from Aarin Capital Series A fund. 

2014 - Launches tablet learning program for competitive exams.

2015 - Secures $25million in Series B round led by Sequoia Capital.

2016-2020 = Raises monies from various reputed investors.  

2017 - Acquires learning guidance platform Vidyartha fro an undisclosed sum to boost its personalised learning products.  Acquires Tutorvista and Edurite from Pearsons.

2020 - Acquires Whitehat Jr. a Mumbai based coding platform. 

Current position - growing business

The restrictions imposed by the #WuhanCoronavirus pandemic with schools across India remaining shut for the past three months has further boosted growth.  

Byju's like many other players in the ed-tech space, made content on its learning app free for all students and introduced live classes on its platform. 

Since the lockdown, Byju's has seen 20 million new students start learning from its platform for free. 

As of now the app has over 64 million registered students and 4.2million annual paid subscriptions. 

(disclaimer : this blog is for educational purposes only and not to solicit any business or provide any kind of advise)

India's Soonicorns - the soon to become Unicorns!

Soonicorns are startups which are likely to become Unicorns i.e. go past USD1billion in valuation this year. 

Startup Ecosystem -2025

According to Datalab Inc42 by 2025 the number of startups in India is expected to cross 100K.  

These startups are likely to create more than 3.25million jobs in the process. 

The total funding to startups is likely to increase to over USD150 billion and with the total value creation expecting USD500 billion. 

51 Indian Startups are likely to become Unicorns in the year 2020.

1. Share-chat 
2. Urban-clap
3. Growers 
4. Rebel Foods
5. Cardekho
6. Mobikwik
7. Bookmyshow
8. Justdial
9. Mobikwik
10. Incred
11. Pinelabs
12. Navi
13. Digit
14. Lendingkart
15. Cred
16. Khatabook
17. Acko
18. Bharatpe
19. Capital Float 
20. Razor pay
21. Bankbazaar
22. Fino
23. of Business
24. Kissht
25. mSwipe
26. cureFit 
27. Pharmeasy 
28. Practo 
29. 1mg
30. Medgenome
31. Netmeds.com
32. Pepper Fry 
33. Infibeam
34. Nyakaa
35. droom
36. livespace.com
37. moglix
38. Cartrade.com
39. Blackbuck
40. Capillary 
41. Vedantu
42. XressBees
43. GreyOrange 
44. NinjaCart 
45. Unacademy
46. Mygate
47. Nazara
48. dialyhunt
49. Zoomcar 
50. NoBroker
51. Indiamart

Fintech Startups 

Fintech startups lead this race as as digital payments have achieved deep penetration in metros and in Tier 1 cities.  

The consumers who are already using digital payments interface are more likely to adopt digital services such as digital lending, online insurance and Neo-banking. 

Post Pandemic World 

In the post pandemic world, health care startups are likely to do better. 

India is likely to implement National Digital ID Health Plan - which will come up in the next few years. 

As more and more people get covered under the Digital Health ID, there spend on healthcare will provide data to entrepreneurs to innovate products and services. This will create a new wave of startups and will better the healthcare ecosystem in India. 

READ HERE THE FULL REPORT - "The state of Indian Startup Ecosystem Report 2020"

(Disclaimer : This blog is for information purposes only and not to solicit any business or provide any kind of advise.)

Reliance vs Amazon - the epic clash.

Amazon in India 

Amazon.com Inc. has begun making forays into everything from grocery delivery and insurance to drugs in India.

The U.S. giant is fanning out at a pace not seen elsewhere in the world. 

Amazon is now delivering prescription and over-the-counter medicines and herbal remedies in Bangalore. It started last month selling car and motorbike insurance -- a first for the Seattle-based online giant -- claiming to finalize policies in under two minutes without paperwork. It piloted a restaurant delivery service to Prime subscribers in parts of Bangalore last year. Amazon had also secured clearance for alcohol delivery in one Indian state, Reuters reported in June. 

As Amazon builds its business at a rapid pace in India, it's now getting competition from Reliance Jio Platforms. 

Reliance JIO Platforms 

Reliance Industries Limited owns Reliance retail which currently owns 10415 stores across 6600 cities in India. Reliance Jio currently has 380 million subscriber base in India. The company has built a connection layer first by providing affordable data (internet) to consumer and even selling phones. It incentivised consumers to go online.  

It now wants to use its retail stores as well as other offline merchants and kirana stores to sell goods to consumers. For this purpose Reliance has raised $15.2 billion in 2 months from some of the most coveted investors on the planet.

Acquisition of Netmeds 

Reliance Industries on August 18, 2020 announced the acquisition of a 60 per cent stake in online pharmacy Netmeds' parent company Vitalic Health for Rs 620 crore valuing it at Rs 1,000 crore. The acquisition gives RIL’s retail unit Reliance Retail entry into a vertical e-commerce space, in addition to its online grocery platform JioMart.

India is yet to finalize regulations for online drug sales, or e-pharmacies, but the growth of several online sellers such as Medlife, Netmeds, Temasek-backed PharmEasy and Sequoia Capital-backed 1mg has threatened traditional drug stores. Their associations are threatening protests and legal action. 

Why Future Group?

Future Retail operates some of India’s most popular retail chains and is in more than 400 cities in every state of the country through digital platforms and over 1500 stores that cover over 16 million square feet of retail space.  It has large format stores Big Bazaar its flagship chain.  It also has neighbourhood retail chains EasyDay Club and Heritage Fresh.

Future Group has enormous potential however it is now under severe financial strain. The total debt of Future Group is approx. 13000 crores and it needs 6000-8000crores to stay afloat. 

Amazon however holds a minority stake in Future Group and may make Reliance takeover of Future Retail difficult. 

The race to expand product profile as well as acquire strategically useful companies to gain a higher share of the consumers wallet has just begun in India. And it will be played between these 2 giants Amazon and Reliance Jio aggressively as they independently also take on other e-commerce players (do not forget Flipkart backed by Wallmart). Interesting times and discounts to consumers are perhaps here to stay!!

(Disclaimer : This blog is for information purposes and not to solicit any kind of business or offer any kind of advise)