1. How India's startup story changed in 2016

    How India's startup story changed in 2016

    CHENNAI: Resilience. Survival. Strategy. Profitability. The startup vocabulary of 2016 has been markedly different from the glory years of 2014 and 2015 when unicorns were born every other week, and sky-high valuations meant scale and size won over strategy and solid business models.

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  1. Categories

    1. Markets:

      Bollywood, Gaming, Maps/Local, Mobile, Outsourcing, Social Networking, Telecom, Travel, Video
    2. Financing:

      Acquisition, Funding
    3. Other:

      Jobs, Reports

    1. People got lured into thinking that they could build companies and ramp up quickly like China. One can't keep discounting and spending on customer acquisition. Valuation mark downs are a reflection of this and it is a hard lesson.
    2. Equity is more expensive than paying interest and we were getting debt at an attractive rate. We did not want to dilute equity in a tough market and wanted to have sufficient cash in case the situation got worse. Now we have cash for three years.
    3. Debt fund keeps you from diluting too fast too soon. For us, debt is the main route to fund assets. The day we become profitable, we won't need equity funding at all. More equity with the founders means more leverage as well.
    4. B2B enterprise startups have been around for at least five years. Since sectors like consumer internet, which were heavily funded earlier, saw a smaller cash funnel, B2B companies got interest.
  3. Topics Mentioned