Building for India — a billion opportunities
What does it mean to build for India?
One often hears that Indian entrepreneurs need to focus on the needs of Indians instead of just following the west and their business models. Last year the founder of Helpchat(now Tapzo!) commented on why Indian entrepreneurs were unable to build for India. Haresh Chawla, partner at True North has an interesting take. I’ve stayed in 5/6 metros in India, all cities expect Chennai. I grew up in the hustle bustle of Bombay, studied in Goa and now live in Pune. So i thought i’ll take a dab at how one can build for India. Also Happy Independence day!
According to Haresh — “There are two Indias- the top 10% that can afford your clones from the west and the remaining 90% that can’t or simply won’t. The Indian consumer is value-driven, not convenience-driven.
However I think there are more like 3-4 Indias
— people who will pay for convenience(top 10% — grofers)
— people who will pay for utility(bookmyshow, redBus)
— people who can pay indirectly only (via ad consumption— vast range of medium — low wage workers who install apps) &
— people who can’t pay.
Let’s examine how some of the Chinese players have solved for segment 3 — people who can pay via ads only.
The top 3 Chinese apps on the app store are
1. SHAREit
2. UC browser
3. MX player
All three have very successful monetization models. SHAREit is a geniunly ingenious use of mobile technology, a bit like Truecaller. Innovation at its best. Piracy is the rule in India. People view videos/movies shared using SHAREit during train journeys and bus rides. Making their lives a little less mundane.
UC browser however is a case of hacking the playstore. The product is installed onto apps via interstitial popups to unaware users threatening malware if you don’t download the software.
Since privacy is the rule, users need an app to view those videos. And MXplayer an app that enables this wins by been the best among available options.
Tools and Utilities are two categories that offer a lot of opportunities to the Indian developer. It’s a sweet spot of segments 2 and 3 — users who might pay and users who pay via ads.
Not just apps — a whole range of invoicing, retail software will still be built in this space.
Let’s look at a few categories and examine opportunities in each space.
The Vernacular opportunity
the top 10% — convenience users consume content and use english as a primary medium. Beyond that usage is fragmented —spread between hindi, marathi, telugu, kannada, tamil and other languages in India. The newer users will use your app in different languages.
While google translate it a good start to translate to the local language, one needs better services to convert to a local language — and there’s your opportunity. A cursory look at hindi news websites gives you glossy ads, un-even fonts and an inferior experience. The new rise of local news app — UC news, NewsPoint from Times Group points to growth in this space.
UC news has expanded to 50m by pandering to the masses and dumbing down content. Bollywood, <actress> hot pics, you won’t believe what happened with this snake, X rated content — it’s all used for growth. It’s Buzzfeed localized :)
Access to credit
Crosstalk fellows mention this and it’s got a lot of attention and VC funding recently.
There are 2 aspects to this problem.
1. Lending to individuals and
2. Lending to businesses
Currently access to credit for individuals is limited as banks have tough limits based on salaried/non-salaried, employer, salary amount etc for issuing credit cards. Also a lot of the population is new to credit — so existing models of CIBIL score need to adapt to take this into consideration. A startup whose model holds the test of time would win this space.
Lending to small and medium businesses is a new beast altogether.
Personal finance — a problem I’m currently focused on. As incomes increase and consumption increases, a lot of us would need services and products to help us manage money, save money and invest money better than existing ones. Our relationships with our banks aren’t that deep anymore. When was the last time you visited a bank or received a cheque?
UPI and payments tech — I guess you’ve experienced the smoothness of using UPI to pay another person. Paytm has brought an alternative method of payment to so many merchants.
Currently card acceptance is low because the merchant has to pay MDR. You walk up to an kirana shop and he’ll tell you it’s 2% extra to pay by card. Better systems can mean lower transaction charges and more online txns.
Services enabling and leveraging UPI can go a long way.
A very good point Dalan makes in CrossTalk part 2.
“Paying for software is alien to people”
- a essential difference of the Indian market. This is similar to my point that users of seg 3 are most comfortable by paying for ads or indirectly.
We’re a country of middle men. Middle men for booking a train ticket. Middle men for finding a house on rent. We’re ok giving you a cut for enabling something. And that’s why regular mutual funds are better than direct!
Enabling/Removing middleman — I’m not covering this here since it’s a big post in itself.
Agriculture tech
our agricultural yields are still low. Having stayed in cities my understanding of agriculture and it’s tech is low. I guess it’s a familiar challenge for the rest of us.
Location
I became aware of how big a problem location is in India when we built the #AtmwithCash feature at Walnut.
There are two problems with location — accuracy and proximity. So for a taxi app like uber a coarse location can mean a big detour — which side of the intersection is the passenger? Do I come to the back side of the house or the front side?
The other issue is accuracy — for an app like nearbuy — an incorrect address means the user goes to the wrong place for his spa appointment. So instead of a Lajpat Nagar -1, he can easily end up in Lajpat Nagar 2.
Innovative solutions to these problems can help businesses create a lot of value. Example — for the current bus booking apps — the app lets you book and that’s about it. You have to worry about finding the exact location of the stand/status of the bus.
NexusVenture partners recently invested in Hypertrack — though I’m not exactly sure what kind of applications they provide.
Transport
Transport infrastructure in most of India sucks. Poorly designed roads & buildings, traffic congestion, lack of efficient public transport. Uber and Ola have solved this problem to a certain extent. However for a large section of the society there is still no cost effectient way to commute to work, go out for movies.
In Pune, I feel this problem everyday. A ‘tuktuk’ — a 6 seater autorickshaw that makes as many stops as required — frequently carries close to 12 people — 4 on each side, one of the window, one floating in space and two beside the driver’s seat. Buses on certain routes have an interval of 30 mins and full to the brim. A journey that should have taken 20 mins takes more than an hr.
As Haresh mentions Shuttl is one company in this space and if they can execute — optimize for routes/customers they’re good.
Communities
Once the first 2 layers of Maslow’s hierarchy of needs are met the population pays attention to the third layer — relationships and friends.
As a lot of indians migrate to cities and are away from their families, they need mechanisms to build new relationships and friends. Also as people spend more time online, there’s a loss of a sense of community and belonging. This has led to depression and over work.
Apps that would redefine communities in the offline & online world would have a big impact in my opinion. How do we connect with people? Based on our interests? Based on our location? A lot of interesting products can still be built in this space.
Right now Twitter is the only useful network that I use that helps me connect with newer people and ideas.
Rise of the Titans
With the rise of Google, Facebook, Jio — the app store has been dominated by products by the big firms. Cash from an existing well functioning business allows them to take losses on the internet business for a long time. Jio decided that they wanted an app for every possible use case out there — so now they have 15 apps — from JioNet to JioHeatlhclub with one mega app that bundles the rest of them.
The playstore needs to do more to help new products get exposure and users.
Building Global Products
Finally — while it’s great to build for India only — building global products and technology should be our holy grail. AI and machine learning are expanding rapidly. We can contribute to its growth and build applications that use AI.
An example of a truly global product built by my seniors at BITS is Postman. Useful for API developers all around the world.
As Masa San has recently said, India is a land of golden opportunity. Will you be there to grab it?
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