Sramana Mitra: The other trend that is equally interesting are companies that are being built in India facing the Indian market. The FinTech sector is a really interesting sector. The health tech sector is really interesting. The EdTech is really interesting. They are crowded, but that is bound to happen in a booming market. With time, it will become clear which ones make it.
Of course, there is a unicorn mania going on. There is a lot of excessive funding. I don’t believe that just the ones that are going to get the maximum amount of funding are going to be the ones that are going to win those spaces. They have an advantage which is a capital advantage. They also have a disadvantage of not having the discipline in how to manage cash. We’ll see how all that plays out. Right now, there’s a correction going on. The bottom line is, there is movement.
Janam Mehta: A few of the sectors that you touched upon are quite unique to India. EdTech is unique to India. I’m sure you are aware that there is a high focus in Indian culture on educating children. There is a propensity to pay and experiment.
Sramana Mitra: The infrastructure for customer acquisition is coming together.
Janam Mehta: Of course. This is possible because of the internet-enabled smartphone penetration. We’re looking at 650 million smartphones and 450 million internet-enabled smartphones. That’s about half of the population. I can’t go into the nuances of how many people are looking outside of YouTube and WhatsApp.
The funnel gets thinner. People are experimenting. If not today, then tomorrow or day after they’re going to get comfortable with their smartphones and how to use the internet. That is a huge opportunity which is why you’re seeing so many EdTech companies raising such large rounds. I was speaking to an EdTech founder. He was so bullish that we just scratched the surface.
Sramana Mitra: When I started working on the Indian startup ecosystem in 2005, I remember I wrote an article in Forbes talking about celebrating the Indian entrepreneurs and not the Bollywood stars.
Janam Mehta: You were ahead of your time.
Sramana Mitra: You had to start somewhere.
Janam Mehta: In India, we have a trend of making biopics of sports people who have been successful. There’s going to be a time when we’ll be making movies about entrepreneurs. That’s going to be a significant change. A lot of talent is unlocked when taking risks is accepted.
Sramana Mitra: That has happened.
Janam Mehta: In other parts of India, I would still like to see more entrepreneurship. I would like to see young students take more risks. Allowing a platform and infrastructure for these students to come and speak to us at least gives them comfort. There are also horror stories. There’s a lot of education that needs to be done in Tier 2 and Tier 3 cities. We’re very excited about that.
Sramana Mitra: We see companies from the non-metro geographies. We have a company from Chandigarh. The education that you’re talking about, everybody needs that. First-time entrepreneurs need that education. The thing that I see constantly is that positioning is the missing expertise across the board.
People spend two to three years going after markets with a product that is not positioned properly. If you don’t have a product that is positioned properly, you will never achieve product-market fit. You will never achieve velocity. People feel comfortable taking risks when they know how to put one foot before the other.
That knowledge is vital. You may have seen we have released a bunch of courses on Udemy to get people started with the case studies. When you see people have done it before you, you get confident. I’m very bullish on the pan-India opportunity.
Janam Mehta: The smaller towns do have serious potential. In all of this, smaller towns will see significant companies coming up in the future. We are excited.