The very dynamic, 16 startup founders to watch out for in 2016.
Here is a list of 16 founders ET believes the startup world must watch out for in 2016. The group is eclectic, and building businesses which are special in one way or another. Some are operating in market segments which are growing rapidly and others are building technology which could transform entire industries in addition to their own fortunes.
This list, put together by our team of startup reporters and editors, is by no means a comprehensive collection, but it is indicative of the sectors which are likely to see the most action this year:
AMIT JAIN, Cardekho
Amit Jain, according to his fellow entrepreneurs, is one of the rare startup founders who comfortably straddles technology and finance. Indeed, Jain, along with his brother Anurag, is in the process of building one of the country’s biggest consumer internet businesses-auto portal CarDekho.com.
“Amit is one of the most energetic internet entrepreneurs in India, with a keen understanding of both technology and business, which is a rare combination indeed,” said Ashish Kashyap, founder and chief executive of Ibibo Group.
Ibibo Group sold its auto portal – Gaadi.com – to CarDekho in 2014, making the transaction one of the first in the highly-fragmented Indian online auto classifieds space.
And Jain hasn’t stopped there. Recognising that the country’s online auto market was ripe for consolidation, and flush with capital from hedge funds Hillhouse Capital and Tybourne Capital, the company has gone on a buying spree over the course of the last 18 months. CarDekho counts Ratan Tata as one of its investors.
From buying Gaadi last year, to snapping up Delhi-based cross-product price comparison portal BuyingIQ.com and Times Internet-owned Zigwheels this year, the seven year-old company, which was valued at about $300 million (Rs 1993 crore) after its last funding round, is in no hurry to slow down.
HITENDRA CHATURVEDI, Greendust
Like a lot of typical startup stories, this one too starts with a business plan sketched out on a paper napkin. Back in India due to a parent’s illness, Hitendra Chaturvedi, then business unit head for Microsoft’s OEM business in India, sketched out his plan for a potential business to a friend, only for her to turn around and tell him that if he (Chaturvedi) didn’t follow up on it, she would.
Thus was born GreenDust.
Chaturvedi’s company – Reverse Logistics, which owns and operates GreenDust.com – India’s largest refurbished goods retailer, has practically created the market in India, an achievement few can boast of.
And unlike most of the country’s startup icons, Chaturvedi was a late entrant to the country’s startup ecosystem, having started at 38, but taking a mere seven years to build a company that is valued at around $250 million (Rs 1660 crore).
Success breeds copycats, and GreenDust is no exception. Startups looking to capture a slice of the hitherto untapped $12 billion refurbished goods market in the country, have come up over the last two years, albeit with a few tweaks.
But Chaturvedi’s ambition doesn’t stop at the country’s borders. GreenDust has begun to tap opportunities in the Middle East, Latin America, Africa and in the US, where the refurbished goods market is estimated to be about $350 billion and growing.
The ambitions are being fuelled by Chaturvedi’s investors, a list that includes, Vertex Ventures, the venture capital arm of Singapore government-owned private investment company Temasek, and Lightbox Ventures.
Separately, Taiwanese contract manufacturer Foxconn Technology Group is believed to be in the final stages of investing about Rs 460 crore in the company.
NALIN GUPTA, Auro Robotics
For the past three months Y Combinator-backed Auro Robotics has been operating autonomous golf carts that shuttle students across Santa Clara University in California. While Uber and Google are slugging it out for dominance in the driverless car category, this seven-month-old firm from India has emerged as an unlikely contender in the race.
By operating shuttles within large private properties, Auro has sidestepped the many restrictions that the large companies are grappling with. “I read books by Isaac Asimov when I was young, and I’ve wanted to do this all my life,” said CEO Nalin Gupta, 26. His company does not make or sell cars. It retrofits its solution into cars and sells it as a subscription. But in future it wants to design a custom vehicle by striking partnerships with auto-makers.
“Our DNA is autonomous driving software,” said Gupta, for whom the software was the result of four years of research at IIT Kharagpur along with cofounders Jit Ray Chowdhury and Srinivas Reddy.
In 2016, Auro plans to make a few prototypes of the shuttle, and pilot them on private campuses including colleges, retirement homes and resorts. “Initially we wanted to licence our software to automakers, but they were moving very slowly, so we decided to start up,” said Gupta, Auro has an unlikely set of backers: Y Combinator’s partner Trevor Blackwell; a resort owner in Mexico, and a former Tesla executive. The names of the latter, Gupta does not want to disclose, just yet.
MN SRINIVASU, Billdesk
Billdesk’s website almost looks like the company did not survive the dotcom era. The registration year for IndiaIdeas.com Ltd, which owns Billdesk, dates back to 2001 and last media article on the company’s website dates back to 2002.
But this company raised Rs 620 crore in funding from some of the world’s largest investors, private equity firm General Atlantic and Singapore’s sovereign wealth Temasek, last month. This deal gave Billdesk a valuation of around $700 million (Rs 4,650 crore), but sources said that company will raise more capital as a part of this round which could peg it around $1 billion. And then Billdesk also acquired and invested a total of Rs 345 crore in Loylty Rewardz, a customer-loyalty program management company. Both were sizable deals which would have given Billdesk lots of headlines, but neither of them were announced.
That’s because MN Srinivasu, director of BillDesk who cofounded the company in 2000 with Ajay Kaushal and Karthik Ganapathy, colleagues at the erstwhile Arthur Andersen, likes to keep a low profile. And Billdesk is a thriving business, with total revenue of Rs 370 crore in FY15, with a profit after tax of Rs 69 crore. And with ecommerce and online bill payments about to take off further, a lot of the growth for Billdesk still lies ahead.
This is the first time Billdesk has raised capital in 10 years, and industry trackers say more acquisitions could be on the cards. Also, government is centralising utility payments under Bharat Bill Payment System. In 2013, RBI had estimated that around 3,080 crore bills per annum were generated amounting to Rs 6.2 lakh crore in the top 20 cities of the country. This is expected to rise to Rs 9.3 lakh crore by 2019.
“They (Billdesk) have almost captured 85% of the market for utility bill payments,” said Amrish Rau, MD at rival Citrus. “With government pushing for automation of utility bill payments, it puts them in a really good position.” Rau said that while Citrus has focused on consumer-related payment services like ecommerce and wallets, Billdesk has kept its attention on the bank-related utility payment market.
“For players like us, more the number of payment methods (banks, payment banks, wallets etc.) greater is the opportunity to aggregate and higher is the potential for a larger range of electronic payments to flow through”, said Srinivasu.
ABHISHEK GOYAL, Tracxn
As the funding climate becomes tough for startups, the network early backers will become increasingly important. That’s where the network of Tracxn, a startup analytics company, will come in handy in 2016.
Founded in 2013 by former Accel Partners associate Abhishek Goyal and SequoiaCapital associate Neha Singh, Tracxn combines big data aggregation with custom curation to create market intelligence of startup ecosystems, mainly in India, the US and China. The company raised $3.5 million (Rs 23.2 crore) in Series A funding from SAIF Partners to expand this business globally.
Besides its data business, it’s the seed investment platform Tracxn Syndicate which is likely to influence the Indian startup ecosystem. This syndicate plans to have as many as 20,000 angel investors in 2016, where they co-invest along with its $10 million seed stage fund Tracxn Labs.
While Tracxn Labs counts Flipkart’s Sachin Bansal and Binny Bansal as investors, the syndicate includes founders like Snapdeal’s Kunal Bahl, Delhivery’s Sahil Barua and Zomato’s Deepinder Goyal. This network is making them investors of choice for early-stage startups. “They are entrenched in the space, and Abhishek has a good view on the startup ecosystem in India. His minds works almost like an excel sheet,” said Arihant Jain, cofounder of Joe Hukum, a personalisable chatbased order-taking app which got funding from Tracxn Syndicate. “Tracxn Labs brings the connections with venture capitalists and the clout.”
RAJESH YABAJI, Blackbuck
As online retailing grows at a rapid pace, startups in the logistics space will play a key role. That’s where BlackBuck, an online freightbooking service whose founders include former executives of tobacco major ITC, come in.
BlackBuck was founded by IIT Kharagpur graduates Rajesh Yabaji and Chanakya Hridaya, along with logicstics industry veteran Ramasubramaniam B in late 2014.
Yabaji was a category development manager at ITC before which he worked for four years in managing the supply chain for tobacco leaves.
What makes the startup–which is said to have caught Flipkart cofounder Binny Bansal’s eye first–stand apart is the list of investors backing it. BlackBuck has raised $30 million (Rs 199 crore) from Russian billionaire Yuri Milner, New York-based investment firm Tiger Global Management and Silicon Valley venture capital firm Accel, besides Flipkart.
But before getting any e-tailing clients on board, Blackbuck’s has got fast moving consumer goods players like Unilever, Britannia, Godrej, Marico and Jyothy Laboratories and others like Asian Paints and EID Parry on board. While Yabaji says that BlackBuck doesn’t plan to ride the ecommerce wave, those tracking the space it is a matter of time before the startup gets them as clients.
“The biggest question with trucking is how quickly you get the trucking community to adapt to technology and smartphones. Companies will have to invest in training to maintain service levels,” said Tanwar of KPMG.
ABHINAV SHASHANK, Innovaccer
Abhinav Shashank has established four offices across the world, is taking on Palantir Technologies on its home ground, and is worried that he’s ageing too fast. He is 28. This sense of urgency is responsible for catapulting Innovaccer from being just another data analytics firm to the one that is sought after by financial and medical institutions in United States.
The three-year-old company started off in pursuit of helping researchers crunch their work time. Now, the 500 Startups-backed firm works with hedge funds and insurance organisations in the United States to streamline multiple data sources and address questions such as correlations of a bank’s delinquency rate with the status of a country’s economy, and more.
As the implementation of Obamacare gains speed, hospitals across Texas and Iowa are tapping into its Datashop platform to integrate electronic health and medical records, creating a consolidated database for all patient needs. It has 27 enterprises as customers and plans to clock Rs 53 crore in revenue in 2017.
“Their key differentiators are the ability to display meaningful data in well-structured dashboards, and a team of very bright engineers and data scientists,” said Ellen Salisbury, managing director of Start Smart Labs, which is a strategic investor in the company.
MOHIT KUMAR, Roadrunnr
Mohit Kumar founded hyperlocal logistics company Roadrunnr in February 2015. In a span of nine months, the company has expanded to intracity, intercity and hyperlocal deliveries, but instead of a central warehouse model like traditional businesses, it is focussing on building smaller storage areas called dark stores dotted across cities. The company is doing close to 40,000 orders every day including food and ecommerce deliveries.
Roadrunnr has raised $11 million (Rs 73 crore) from Nexus Venture Partners, Sequoia Capital and Flipkart’s Ankit Nagori. Its competitors include Opinio, which recently raised $7 million led by Sands Capital and Accel, and Shadowfax, which mopped up $10 million from Eight Road Ventures.
Experts say 2016 will be a make or break year for hyperlocal commerce companies. “In the case of Roadrunnr, the biggest challenge is scalability and profitability. They have built a critical mass and volumes, now they have to prove cost structures can come down significantly,” said Manish Saigal, a specialist in transport and logistics who is managing director of professional services firm Alvarez & Marsal.
SAHIL BARUA, Delhivery
Sahil Barua is the CEO of five-yearold logistics startup Delhivery which started as a pure-play warehousing and delivery company. In the last one year Barua has turned his attention to expanding the company’s portfolio.
Tiger Global-backed Delhivery will offer cloud solutions for its sellers, assist merchants to list online and provide point of sale technology as it looks to create a dependable flow of income without being affected by price wars. Gurgaon-based Delhivery has raised over $126 million (Rs 837 crore) so far and aggressively bought stakes in tech-focussed logistics players including Parcelled and Opinio.
Delhivery’s customers include Flipkart, Shopclues, Voonik and Paytm. The company delivers some 204,000 shipments daily, servicing more than 4,000 pin codes.
“Delhivery needs to quickly build capabilities in ancillary areas and offer value add services to its customers in order to create a hook since the business of logistics itself is very transactional,” said Prahlad Tanwar, director for transport and logistics at KPMG.
SUNIL COUSHIK, Prijector
Most entrepreneurs pin their chances of success on venture capital funding. Sunil Coushik could not even entertain such a thought. He was building a hardware device for the world from Bengaluru.
“We ran our business with the money from pre-orders,” said the 37-year-old, who has sold over 7,000 devices to employees of San Francisco police, Facebook, Stanford University and General Electric, among others, all through word of mouth.
The device, a Swissarmy knife equivalent for all conferencing needs, clocks in a few hundred thousand dollars in sales every month. Coushik plans to increase that four-fold next year.
“Hardware is hard. We focused our first two years in nailing the product, support, manufacturing and business model. With all of these highly optimised we are on a strong footing to grow the business 5 to 10 times in 2016 with our sales partners,” said Coushik.
Prijector is a plug-and play device that can kickstart conferences and without trailing wires around the room.
Once connected, the device allows users to share presentations from either their laptop, desktop, or mobile phone wirelessly. It also morphs into a wireless hotspot for internet access. It distinguishes from others like Microsoft Lync, Skype, Cisco telepresence and other solutions by being compatible with all devices, apps, and operating systems.
“They can tie in any device and operating system that you can think of. That’s why they are heavily accepted in environments like classrooms,” said Guhesh Ramanathan, cofounder of startup incubator Excubator.
VIRENDRA GUPTA, Dailyhunt
This year is expected to be a significant one for digital media as more users in smaller towns across India acquire smartphones. This is the opportunity, which news and ebooks mobile application Dailyhunt, founded by Virendra Gupta in 2007, hopes to benefit from.
Owned by Ver Se Innovation, which initially started out as a mobile classifieds company, Dailyhunt is focused on the vernacular market, which is estimated to be growing by 56%, while English websites are expanding at 11%.
Dailyhunt expanded to ebooks in 2013 and since then the platform has seen more than 28 million books downloaded. It plans to aggressively expand its library from around 100,000 primarily vernacular language books now to 500,000 by March 2016.
Dailyhunt has 100 million downloads and 25 million monthly active users who read 3 billion pages on the platform. Gupta, who did his engineering from Jodhpur and MBA from IIT Bombay’s Shailesh J Mehta School of Management, knows the pulse of his users. Dailyhunt acquired recommendation platform called BuyT in July 2015 to allow Dailyhunt users to make ecommerce transctions.
Gupta told ET in October that he expects to drive 5-6% of the overall online retailing transaction volume in next 12 months. That will be something to watch out for.
BYJU RAVEENDRAN, Byju’s
If 2015 was about completing a transition to a smartphone-based education company, 2016 promises to be much more for Think & Learn. And underlining this change, the company is now known as Byju’s- The Learning App instead of Byju’s Classes.
Byju’s provides coaching for students across subjects from Class VI onwards to test preparation for exams like CAT and GRE. After the launch of the app in August, which got 2.3 million downloads in three months, over 90% of the business and the volume comes through this channel. While one-third of the business was offline in FY15, by FY17 the company expects close to zero contribution from offline classes which are primarily sessions where students’ doubts about what they have learnt can be cleared. Experts believe that there will space for both. “Both offline and online model will stay in India,” said Nitish Aggarwal, cofounder of Alphaneo Private Equity who has worked on test preparation deals like Resonance and IMS Learning.
But growth seems to be much faster online. From adding 35,000 annual subscribers in entire FY15, Byju’s is now adding close to 15,000 annual subscribers every month. Revenues are expected to increase from Rs 48 crore in FY15 to Rs 125 crore in FY16. “We are not only an education technology company, but also a media company. We employ over 100 people each across the three teams – content, media and technology – so lessons look like movies,” said Byju Raveendran, a CAT topper and National Mathematics Olympiad winner, who started the company in 2008. Raveendran, an engineer by qualification, decided to startup after topping CAT exam two times in 2003 and 2005.
Thirty five years old now, he still takes time out to make new video lectures.
Byju’s has already become the most funded education tech company, having raised Rs 225 crore from Sequoia Capital and Aarin Capital. And on the cards in 2016 is international expansion, to be financed by much bigger rounds of funding.
NITHIN KAMATH, Zerodha
The son of a public sector bank official and an engineer by training, Nithin Kamath, 36, was like any other engineering graduate in Bengaluru drawn by default to tech services job. But his true obsession was the stock markets, so much so that he would attend his call centre job at night, and stay awake for a few hours the next day to trade in stocks.
But when he finally decided in 2010 to strike out on his own and launch a broking business with a flat broking fee–a new concept in India— venture funds turned the other way. Not wanting to retreat, Kamath went ahead, roping in a partner. His company, Zerodha, was bootstrapped from day one. Kamath today runs his young company from a swanky office in Bengaluru’s JP Nagar, aided by a team of about 250 employees. His firm claims a daily turnover of $2 billion.
If anyone talks just stocks with Kamath, he will clarify trading is just one aspect of his venture. The larger goal of his company is to strengthen and expand the technology products of Zerodha. “They (Zerodha) have pioneered and popularised the concept of flat rate brokerage on transactions, and leveraged technology to deliver good trading services,” Shriram Subramanian, founder of corporate advisory InGovern Research Services.
ABHINAV ASTHANA, Postman
“We like picking people with eclectic reading taste,” says CEO Abhinav Asthana of Postman, a maker of tools that help make a developer’s life easy. The 15-member team at Postman sits at the focal point of all software development today: its tools help in creating, collaborating and managing APIs, or application program interfaces.
APIs are powerful pieces of code that allows applications to talk with one another. Be it a mobile app, a software within an enterprise, or a website, APIs are a crucial building block of all software development today. Used by over two million developers across the world, the company’s tool is deeply enmeshed in the technology world today.
“We get a lot of love from developers, and that love transcends into partnerships with large enterprises,” said Asthana, 28.
Now, several top Silicon Valley firms, old and new, vouch for Postman’s tools. Box.com, Microsoft, Cisco, Verizon, 23andme, Freshdesk are among the many firms that have enlisted them as partners for API creation and management. Scott Hanselman, the principal program manager at Microsoft’s developer division, has called the suite a “TiVo for your Web Service” while Pamela Fox, who designs the programming curriculum at Khan Academy said the tool made her life “a billion times easier.”
Cofounded by Asthana, Abhijit Kane and Ankit Sobti, Postman became cash-flow positive even before it was formally registered last year. In 2016, the company plans to take its new product to over 10,000 enterprises across the world.
JAYDEEP BARMAN, Faasos
Faasos Food Services, that owns online restaurant Faasos, has established a foothold in the food-tech sector when most players were forced to shut or scale down operations. Founded by INSEAD and McKinsey alum Jaydeep Barman and Kallol Banerjee, also from INSEAD and then Bosch, the company raised two rounds of funding in 2015, setting the tone for itself as a player that has bucked market and investor sentiments around models with high cash burn and perceived operational deficiencies.
Faasos, now with 160 delivery centres across 15 cities (including in tier 2 towns), has retained its core proposition, a platform for quick and affordable food delivery, with 350,000 deliveries per month. From a pure quick-service restaurant brand in 2010, the company has evolved to a marketplace for food. With food from both its own kitchens and third-party food vendors, Faasos sells 200 items on its menu at any given time, offering consumers the option to order through the day.
“Food tech has seen a quick evolution this year. Faasos has been fastest in pivoting its model from just pick and deliver to integrating it with its own kitchens and establishing a hub and spoke model,” said Arvind Singhal, chairman of Technopak Advisors.
The company raised $30 million (Rs 200 crore) in December led by Russian internet-focused investment firm ru-Net with participation from existing investors including Sequoia Capital and Lightbox Ventures, taking the valuation of the company to about Rs 1,000 crore.
ABHIRAJ BHAL, Urbanclap
Twenty-nine-year-old Abhiraj Bhal is the CEO of India’s fastest-growing services marketplace UrbanClap. In less than a year, Bhal has raised more than $45 million (`299 crore) in venture funding from marquee investors and funds including Accel Partners, SAIF Partners, Bessemer Ventures, Ratan Tata and Snapdeal’s cofounder Kunal Bahl.
Gurgaon based UrbanClap is a marketplace to hire verified professionals for more than 80 local services from plumbers and beauticians to yoga trainers and wedding photographers. It competes with a dozen others including Amazon-backed HouseJoy and Tiger Global-funded LocalOye.
Bhal however sees this highly fragmented market opportunity, which is pegged at close to $100 billion, as a winner-take-all space. UrbanClap, which has scaled to six cities in India and built a network of 30,000 service professionals, expects its technology and execution to be the differentiator. In 2016, the company plans to extend its offering to 25 cities and 100 categories.
Vikram Bhalla, senior partner at Boston Consulting Group, said that the real challenge for services marketplaces is going to be execution and assuring quality of services.
“I believe Abhiraj and his team’s obsession over customer experience and service quality is what will differentiate them from the other players in the market.”