As 2016 is approaching, it’s time to look at all the action that happened in the Indian startup ecosystem. We flashbacked through 2015 to understand how the Indian startup ecosystem panned out over the past one year and showcase the key developments – the hits & misses, the highs & lows and pivots.
Pivots are not new. Flipkart started as a book retailer and then pivoted to ecommerce. Snapdeal started out as a deals platform, and then similarly joined the ecommerce bandwagon. Similar behaviour was exhibited by mKhoj, now InMobi. Another well known brand, Myntra, was earlier an online store for personalised apparel and accessories. It pivoted in 2010 to sell fashion brands, and the rest is history.
For some, pivot is perceived as a weapon to hide brand failure, for some to start afresh in a new way, for some to simply shed some load. Whatever may be the reason, pivots are never an easy process. Directions are changed, models are morphed, and most of the time, it is accompanied by layoffs. All these are done in the hope that the new model will prove more sustainable than the last one.
Venture capital firms and investors believe that instead of following the same model and waiting for demand to meet company’s vision, it is better to reform and cater to the present needs and monetise out of it. However painful, pivots have become an integral part of the startup ecosystem. After all it’s better to change and evolve than be stagnant and become irrelevant in today’s fast paced business environments.
As Arnold Bennett rightly states,
Any change, even a change for the better, is always accompanied by drawbacks and discomforts.
Let us look at some such startups who have pivoted this year hoping to sustain in 2016. Will they or won’t they, is a story for the next year!
Founded In: April 2014
Founders: Nikunj Jain, Abhishek Gupta.
Funding: Seed funding of $600,000 from Matrix Partners.
Reason To Pivot: Frankly.me was started as a video micro-blogging celebrity Q&A platform, and later it pivoted to a more horizontal video social network. It is now focusing entirely on campus ambassador program and a new viral video format that allows people to create video memes. Thus, it laid off close to 30 employees – about 40% of its team last month, firing employees from non-technical profiles – primarily celebrity managers, business development execs and offline marketing and activation team.
Founded In: 2008
Founders: Chetan Kulkarni, Gaurav Chindlur and Vikram Nayak,
Funding: Total funding amount of $27 Mn from Ascent Capital, Intel Capital, Nokia Growth Partners, Inventus Capital Partners and Ojas Venture Partners
Reason To Pivot: Vizury, started as a digital CRM company and later pivoted to adopt a data-based marketing model. Earlier this year,the company announced Vizury Engage, a data and marketing Platform and targeted collective efforts towards Engage to realise its vision of becoming the world’s first Performance Marketing Hub. Consequently some aspects of its retargeting business had to be transitioned, and so it laid off about 50 employees across three cities in India.
Founded In: 2011
Founders: Sahil Baghla, Ayush Varshney
Funding: $270K from LetsVenture and Times Internet and $200K in an angel round of funding led by Rudy Gopalakrishnan of Fidelity and ah! Ventures.
Reason To Pivot: Bluegape which started as a Delhi-based fan merchandise & customisation platform company was shut down due to the copyright issues. Bluegape was earning INR 1 Cr monthly at the time of shutdown. Within few weeks of putting full stop to its ecommerce operations, Bluegape was relaunched as a content publishing platform. Bluegape later launched a platform where anyone can make collaborative listicles with visuals, and people can add to the lists, they are visioned to convert world’s knowledge in the form of lists of visuals. And these lists can further be embedded on other sites. Now, the company has launched a new app and rebranded itself to Murmur, as part of its mobile-first approach.
Founded In: 2012
Founders: Chirag Shah and Deven Dharamdasani
Reason To Pivot: Seventynine started out as a mobile ad network company. It later spun off the product into an in-app video ad platform. Seventynine’s product Appjacket is positioning itself as an independent technology platform for ad serving and mediation on a licensing based model. Seventynine’s technology allows app developers to create custom ad spots at App Start, App Exit or at Native in-app locations. With Seventynine, owner SVG Media is now targeting large App publishers who maintain their own sales teams, and are looking to enhance their inventory offerings.
Founded In: 2011
Founders: Ankur Singla, Vishal Pal Chaudhary, Vishrut Chalsani
Funding: Earlier this year, Sequoia Capital invested $16 Mn in Series B round. It had previously raised $5 Mn in Series A round and was incubated by Morpheus Accelerator.
Reason To Pivot: Helpchat was previously known as Akosha that started as an online complaints redressal forum. In July, the company pivoted to a personal chat assistant platform, Helpchat, that helps users ask for any service over chat. Later in October, the company fired 100 employees, which contributed as over 70% of contracted employees and consultants in brand management, who work from home on monthly-payment basis.
The company’s founder clarified that the company tried to scale its call center and quality team who were employed for a different business model. However, only a few could qualify to fit in the new business model. However, looking at different side of the coin, a few employees stated that the main reason of firing was shortage of funds in the company. We still wait to see what result does this pivot bring to company.
Founded In: 2011
Founders: Vikram Chopra, Mehul Agrawal and Vaibhav Aggarwal
Funding: Backed by Swedish investment giant AB Kinnevik and Berlin-based Rocket Internet AG,
Reason To Pivot: FabFurnish.com started its operation as an online shopping destination for furniture and home ware with a diverse range of products, ideas to grace home and unmatched customer service. It has now redone its business model by evolving itself into a content-driven platform for discovery and sale of curated home products. It will now offer design inspirations for greater customer engagement through its new segment called FabFurnish.com. The pivot comes as it aims at positioning itself as an end-to-end home and interiors solution provider.
For this, FabFurnish has beefed-up its content, design, marketing and technology teams to engage with users through feature stories, curated brand shops and designer shops. It has also roped in category influencers and fostered collaborations with top interior designers through referral programmes, content partnerships and product listings. The company has also roped in interior designer, Aprajita Suri Davar and senior creative director Tanuj Ahuja.
Founded In: 2012
Founders: Advitiya Sharma, Rahul Yadav, Abhishek Anand, Sanat Ghosh, Neeraj Bhunwa, Abhimanyu Dhamija and 6 others
Funding: Till date, the three-year old startup has raised $145 Mn from investors such as Falcon Edge, DST Global, Qualcomm, Helion and Nexus Venture Partners and is valued at around $347 Mn. In the last round, it raised $90 Mn from SoftBank Group.
Reason To Pivot: Started as a real estate portal, Housing.com is now restructuring and shifting its focus on its home-buying and selling segment. Towards this, it laid off 200 employees in November. This layoff is also meant to drive further efficiencies across the company. With this development, the company is now reorganising its teams to execute this new strategy. CEO, Jason Kothari had stated that Housing will now be laser focused on solving the pain points in home buying and selling.
This is part of our special series, In Focus: 2015 In Review, wherein, we look back, contemplate, analyse, predict and come up with our series of year-end stories that would perfectly sum up the past year and offer near-perfect predictions for the next year. Stay tuned for more.