Unless you were living in a cave, you should be aware of the state of affairs with Indian unicorns like Flipkart and Ola.
They are in a bit of shit and are now asking for govt protection against capital dumping by foreign competitors (Amazon and Uber respectively).
Mahesh Murthy has written a candid piece which is a pretty good roundup of the situation right now. While I agree with Mahesh (esp on take by Kalaari and Matrix – which is purely misguided), I think he is totally discounting the efforts Flipkart and Ola have put in creating the ecosystem.
Comparing just the numbers do not really help. Context matters.
“Flipkart took 9 years and US$3.5 billion to grow to where it is. It asked for a price of $15 billion to be acquired. Amazon did something smarter. It simply took less than $2 billion (about 1/10th of what was demanded) and built a larger and better-loved business in India than Flipkart that too in 1/3rd the time.
Ola went the same path. It raised $1.3 billion and spent a lot of that to build a business that it asked for $5 billion to sell. Uber didn’t take the bait, and like Amazon, just spent 1/10th that amount – i.e. around $500 million to build a larger and more loved business in India than Ola, once again, in 1/3rd of the time. Perhaps there’s a formula here.” [Mahesh]
Mahesh argument is quite flawed and misses out on the market creation part played by these two companies (i.e. Flipkart and Ola).
Flipkart, to its credit played a huge role in creating the ecommerce space in the country. If you are used to CoD – be thankful to Flipkart for executing CoD at scale.
Great customer service?
Not a thing for most Indian companies till Flipkart came in and focused red-eyed on building a great customer service brand. It was the biggest USP of the company for a very long time.
Tech brands from the country?
Well, it’s easy (and cool) to diss off every single accomplishment by Indian startups and call them copy/paste, but really difficult to respect them for what they have been through.
How many tech brands existed before Flipkart ? Surely if you consider Rediff as one.
Trusting online companies?
Rediff / Indiaplaza/ Indiatimes – they were all full of shit when it comes to ecommerce. Flipkart, to its full credit helped create that trust with easy returns policy, spend massively on TV ads et al.
Recommended Read : Evolution of Indian ecommerce through TV commercials.
Where do you get product managers / online marketers / growth hackers / data scientists in the country? For a country where there was no product culture (do we have one now?), most of these startups have actually helped created that tech culture. Of course, Amazon and Uber who don’t need these operating roles in the country and when they do – they just poach. They don’t have the patience and the mandate to create and train such talent.
Pushing the envelope?
Be it Flipkart’s first big billion days or Ola’s city launches – these companies have paid the price for pushing the envelope. They did disrupt the existing food chain and that hasn’t gone well with folks (remember how offline retailers campaigned against Flipkart?), including government.
In a country full of chalta hai / ho jaayega / kal karenge attitude, these companies have tried (and still trying) to setup new standards for other startups to follow and you can’t take it away from them.
Right from hiring to creating and retaining talent, these startups have done a great job. Of course, that needs a huge investment unlike their foreign counterparts who have a playbook.
Hunter Vs Farmer
History has never been kind to farmers. Hunters take away everything – fame, revenue and the glory.
Flipkart and Ola were the farmers who proved to be extremely inefficient hunters and I can certainly hope that things change.
We can be original. We can innovate. But Mahesh – let’s also respect the innovation and originality these companies have shown* because if you don’t do that, you won’t see more originals coming from the country.
And just to share, Mahesh’s investment redBus DID NOT create any money for its employees (founders and investors made all the money). Flipkart has created an opportunity for a whole lot of employees (am not so sure about other unicorns).
Taking cue from the noted urban motorist and noted wildlife conservationist Salman Khan, here is what I expect from Flipkart and Olas of the world.
* : Couple of things.
1. I have no respect for the way Flipkart and Ola have spent on PR/marketing and lost track of the product (and consumer). I have been the most vocal on this.
2. I have no personal agenda/interest in these companies. FYI : I haven’t spoken to any of these founders in the last 2 years. They are well protected by their PR folks and I hardly give a shit to all this. Having said that, I do respect companies and founders for all they create.