As a follow up to my previous crystal ball gazing into the realm of investing trends for early stage angels, I’d like to share some more thoughts amongst the noise of valuation markdowns, ecommerce players taking potshots at each other and social media babas’ revealing some hard truths in the maligned Indian startup ecosystem.
There are a few spaces which might have potential for more players to exist or even newer ones to enter and make a mark. Here are 3 of them which I am looking out for (+ 1 bonus moonshot) –
- Single vertical fully integrated omni-channel commerce – Warby Parker, Bonobos, Greats are all prime examples of how great customer experiences can be built by cutting out the middle men and celebrity endorsements to give affordable bridge to luxury products at competitive price points. Controlling manufacturing, design, offline touch points in forms of ‘experience zones’ have given these names the advantage of being in control of brand experience and drive heavy repeat purchases.
- Skill based legalized betting – Ever since supreme court has ruled in favour of game of Rummy being a considered as a game of skill and hence forth made betting legal in it, online players have rushed to capture strong niches for e.g. Adda52 (Online Poker & Rummy), Dream11 (ePrediction sports betting). These are very huge markets and only bound to grow as more and as a cherry on the top – customer lifetime value here can be anything from zero to millions.
- B2B fulfillment – All startups thus far have worried about fulfilling needs of the consumer. There are businesses with much bigger fulfillment worries ranging from restaurants (fruits & vegetables etc.), daily supplies & stationary, office equipment and other procurement requirements. This can be a long term relationship play and the churn is definitely going to be lower than any of the consumer discounting and cashback plays.
- AI as a Service (AIaaS) – I am of the opinion that AI and other intelligence based algorithms (not core to one’s particular startup / venture) can be used to monetize their intelligence capabilities and spare service capacity much like how AWS uses their infrastructure elastically. Opening up APIs to let other startups use your intelligence from time to time can also serve as a feed to make your engine smarter. This can open up the possibilities to a whole new bunch of startups coming up in a much faster and ‘layered’ ways.
Hope this serves as a note for opening up of the playbook. You can reach me on Twitter to take discussions forward.
