India continues to be a favored destination to start your business. The new year brings new hopes for startups that want to leave a mark, with their innovative new products/business models. As per industry statistics, startups in India received a funding of $ US 12 billion last year. With the government easing its rules for doing business combined with its Startup India Initiative, it is going to be another aspiring year for budding new businesses in India.
The Indian financial markets are currently best poised with their strong standing to attract foreign startup investors. India is ranked third in the world startup economy and with approximately 11000 new startups to flourish in 2020, there is no stopping India from becoming the largest and the most promising startup market in the world.
Here is a list of key startups that we think may hold the potential to become unicorns, and boost the economy. These may grow on to transform sectors and offer more employment opportunities.
Industry: Online grocery delivery platform, e-commerce
Grofers is a Gurgram-based online grocery delivery e-commerce platform founded in 2013 offerings its customers the facility of delivering products like vegetables, groceries and daily need items.
The unicorn processes over 25,000 orders a day across 13+ cities in the country. To date, Grofers has received funding of US $ 644 million from key investors like Soft Bank, Tiger Global Management and Sequoia Capital. The CEOs attribute the success of the company to understanding consumer behavior and investing in a supply chain with no middlemen thereby offering more discounts on the products. With the online grocery market industry increasing to INR 6500 crore, Grofers is confident to get it right with its continued focus on building value for middle-class consumers.
Industry: FinTech, NBFC, B2B lending platform
LendingKart is an NBFC that offers working capital for SMEs that either does not have access to credit or are currently capital deficient. The unicorn aims to disburse loans within 72 hours with minimal paperwork. The company uses technology and analytical tools to access the creditworthiness of small businesses. It does not focus on the vendor’s past financial statements and IT returns to evaluate their credit risk profile, unlike other banks and NBFCs. LendingKart has disbursed more than 76000 loans to SMEs so far since its inception in 2014. With more than US$200 million raised from investors like Fullerton Financial Holdings, India Quotient, and likes, it is an NBFC with the largest geographical coverage in India. The company has received numerous awards for innovation and ICRA and CRISIL have upgraded its long-term rating from BBB- to BBB+.
Industry: Healthcare, Fitness and Wellness, Online platform
Practo is a Bangalore-based health care startup that helps patients (or their families) with finding the right healthcare providers/doctors, booking diagnostic tests, obtaining medicines and storing health records. The site has enrolled over 1 lakh doctors listed from 310 cities and towns and comprehensive coverage in prominent Indian cities and about 15 countries. Practo claims that it manages 50 million patients annually. The company’s current valuation is slated at the US $600-800 million with total funding of US$ 25 million from key investors (like Tencent Holdings, Sequoia Capital India, ru-Net, RSI Fund, Thrive Capital). The key to Practo’s success is its 24 x 7 online appointment booking (with reliable and accurate information about doctor’s consultation fees and clinic’s location) with no booking costs, regular updates and ease of rescheduling/canceling appointments.
Industry: Financial services, Online stockbroking firm
Zerodha is a Bangalore-based fin-tech startup that gives brokerage free, equity investments, retail and institutional broking, currencies and commodities trading and mutual funds services. The unicorn is well known for its innovative technology and discount pricing. Founded in 2010 by much younger Nikhil and Nithin, Zerodha is the largest stock broking company today with more than 1.5 million registered users that contribute about 15% of retail trading volumes daily. Zerodha was started without any VC or PE investment and completely funded by Nikhil himself (bootstrap funding). The co-founders claim that they have a pre-tax profit of Rs 350 crores this year. The discount broker is different from other brokers as it does not offer research services or buy or sell recommendations to its clients. The cost saved by not having a research team is passed on to the clients via a low brokerage.
Industry: Social media
ShareChat is a Bangalore-based social media content platform that was started in 2015 by 3 IIT alumni. The company offers content sharing only in Indian vernacular languages to cater to 1.17 million wireless network users of India. ShareChat’s valuation stands at US$ 460 million as of Sept 2018, a 7-times jump from its valuation in Jan 2018. Twitter has invested heavily in ShareChat to help it grow and to help Twitter to expand its market share in India. A November 2018 Business World report states that vernacular user base in India may reach 540 million by 2021. The firm removed the English language and focussed on Indian regional languages and as a result, the average time spent on the app by the users rose by 22 minutes per day.
Industry: Rental car platform
Zoomcar is a Bangalore-based car rental service platform that offers cars on subscription-based rentals of daily, weekly and monthly basis. The company was started by two foreigners in 2011 who identified the business potential of car renting service in India. Currently, ZoomCar has a 75% market share in the rental car segment. With more than 10,000 cars, the company operates across 45 cities for 20 million-plus registered users in India. Sequoia Capital, among other investors, has heavily invested in ZoomCar eyeing the growth potential of the rental car market in India. The company’s revenues have increased by 67% from 2018 to 2019. Zoomcar has been listed among the Top 10 Innovation Companies in India.
Industry: Online movie ticketing platform, Consumer Services
BookMyShow started in 1999 in Mumbai as a platform for booking movie tickets and currently offers bookings for events, movies, sports, and plays. From Rs 25000 as its seed capital in 1999 to Rs 391 crores revenues in 2018, the company has managed to sail through the tough times and has emerged as a winner. Today, BookMyShow holds a 78% market share in the online ticketing platform. It is present in 650 cities and covers 4500 screens. It has expanded its operations internationally to Dubai, Singapore, Sri Lanka, and Indonesia. The company wants to focus on its mobile segment and also on its merchandising segment where customers can buy tees, hoodies and other apparel.
Industry: Ecommerce, Online furniture
UrbanLadder is a Bangalore-based leading online furniture company that started in 2013 to simplify furniture shopping. With $77 million funding in 2015, it heavily invested in technology and design which is believed to be the key driver in the company’s success. In 2017, the company announced its shift from online retail to a furniture brand which the company claims have increased its average sales by 24%. The company is planning to aggressively increase its retail stores’ presence by opening multiple outlets across 10 major cities in India.
Industry: Online education, edu-tech startup
Unacademy is an eLearning platform that started in 2015. Recently, the company raised US$50 million as its Series D funding thus inching its way to become the next edu-unicorn after Byju’s. Currently, Unacademy has 3million+ subscribers and 250million+ views on its YouTube channel. The company has been successful since it offers parallel education in remote towns making the concept of learning in the comfort of your home at lesser fees an attractive proposal. Unacademy has strong investors like Blume Ventures, Stanford Angels India, Rajiv Bansal among others who realized the market potential of Virtual learning and teaching segment in India.
Industry: E-commerce, logistics
XpressBees is an e-commerce logistics company offering services like last-mile delivery, real-time tracking, and multiple payments and processing options. The company progressed from 50,000 shipments a day when it started in 2015 to 6 lakhs shipments daily through its 100 hubs and 2000 offices. The company recently raised $10million from its existing investor Alibaba. The company’s financial statements ending 2019 state a 99% jump in revenues last year. The company services e-commerce giants like Snapdeal, Paytm and Flipkart.