While Indian startups have had a ball last year attracting billion of dollars, 2016 appears to have brought a reality check for startups addicted to raising capital on the pretext of vanity metrics and growth at any cost. For some, this reality check is a blessing in disguise. “Indian startups were running on steroids (there was no funding crunch) last year. However, the hangover of these steroids has gone, and as a result, better investment opportunities are surfacing for investors,” says Miten Sampat.
Miten is a Vice President, Corporate Development at Times Internet Limited (TIL). He oversees investment, strategies and mergers and acquisitions for TIL. According to Miten, sanity across investment patterns is creating a conducive ecosystem for genuine startups. He adds,
Entrepreneurs and a decent team with genuinely good ideas, going after mass pain-points won’t struggle much to raise capital in the current scenario. Strong companies get stronger in the current cycle.
Now that the euphoria has subsided, one of the largest Internet groups in the country sees sweet opportunity for investment and acquihiring. “As a group, we strive to present better products around information. The recent acquisition of Viral Shots and restaurant management company inResto signifies our appetite for information-centric products,” adds Miten. The group also invested in transport/commute alternative startup Shuttl. He adds,
Our Investment in Shuttl was driven by our interest in the commute space. In addition to capital, we also bring reach to portfolio companies. I believe we can bring immense value to companies like Shuttl with the reach we’ve built over decades.
Collectively, users spend close to 13 billion minutes on a monthly basis across various platforms owned by TIL.
The trend of acquihiring gathered momentum last year and experts opine that it will continue this year. Miten says,
The lack of funding is forcing many startups to explore acquihiring as an option and we’re opportunistic about it. Currently, we’re in talks with a couple of startups for acquihiring.
When asked about what verticals are on TIL’s radar for investment and M&A, Miten adds, “Broadly, we have significant lust for apps, fintech, and the offline to online (O2O) sector. Apps meant for daily and weekly use make sense for us. Such apps are a strategic fit given our reach and bandwidth of bringing capital to them.
On the O2O front, the group has bet on several startups including DineOut and Get Me A Shop. O2O is an e-commerce model that combines offline business opportunities with the Internet. O2O commerce essentially attracts customers online, but the real consumption happens offline.
There seems to have been a lot of noise around fintech over the past one year.Currently, there are close to 800 companies in this space in India. Of these, 174 were launched in 2015 alone, according to Traxcn, a data analytics company. Times Group is bullish on the fintech sector and is exploring startups to invest in. “Currently, over 120 million people are accessing the Internet via the mobile and this growing base could be easily tapped for distributing financial products and services. Startups with massive use cases across payments, lending (both business and consumer) and personal finance are slated to swing in terms of scale and size,” points out Miten. He personally believes that 2016 will see interesting disruption in the fintech space.
Strategic partnerships have always been a key focus area for TIL and, in the recent past, the company partnered with global companies including Uber and Coursera. The alliance with Uber is somewhat similar to Uber’s deal with Baidu in China. “We will continue to make strategic investments/partnerships with global companies, which see India among the top five markets,” says Miten. The company is willing to work with global tech-oriented products for which Indian consumers have a strong affinity.
Some strategic investments by TIL in the past (particularlyFab) had also gone south. “Look, not all investments will work and we also have our own shares of success and failures,” says Miten. TIL also invested in ZopNow, one of the early evangelisers of the on-demand grocery business; however, unlike competitors (Grofers, Peppertap, Bigbasket) the Bengaluru-based company failed to raise big rounds.
Running an on-demand grocery platform amidst cut-throat competition requires deep pockets. But Miten is confident about the future of ZopNow. “We will have some interesting updates coming from ZopNow very soon,” he concludes.