ECommerce in India

ECommerce is booming. And India is where the action is. When stories of “unicorns” (startups with a valuation of more than 1 Bn) are all around us, it helps to take stock of where the industry is at, and where it’s headed.

Here are some statistics from a recent story in the Economic Times on how far the ECommerce industry has come… (I’m skipping valuation and VC money figures, and focusing on customer stats instead)


Pregnancy, Birth & Childhood: Online baby care represents <10% of the $10 Bn market, growing at 17% a year; Currently clocks approx. 2,500 daily shipments across three major players


Education & Learning: $100 Bn market and booming; Student population rose 28% to 315 Mn in the last decade; However, lack of significant success stories in this arena


Grocery: Of the $500 Bn retail market in India, $290 Bn is grocery; Largest player – BigBasket – processes approx. 20,000 orders a day; 1 Mn people order groceries via apps every day, growing at 30% every month


Home Services: About 100 services on offer, with 20,000 daily users across the top 5 metros; $100 Mn market size, but challenging in terms of trained manpower and timely delivery


Shopping: Top players are diversified managed marketplaces mostly; Less than 2% of the $500 Bn retail market is online – plenty of room for growth; Hyper competition has resulted in heavy discounting and companies are unable to make profits currently; Top players clock >100k shipments a day to about 25k pincodes across India


Furniture & Home Decor: Offers high margins (60-70%) and not very susceptible to discounting; Market is pegged at $32 Bn and posied to grow to $70 Bn by 2020; Less than 1% is currently online; Average ticket size is Rs. 18,000; By 2018, online furniture sales is expected to reach $1 Bn


Taxi Booking: $10 Bn market size with brutal competition among two leading, disruptive players; Now expanding into courier and delivery services as well; Approx. 1 Mn users book cabs every day via apps in 100+ cities


Eating Out: Food ordering is a $15 Bn a year business, with Zomato now operational in 22 countries; Indian players service upto 10,000 orders daily via their apps with a few key players in fierce competition akin to Taxi aggregators


Travel & Entertainment: E-Ticketing is one of the most penetrated with 40% of rail tickets via IRCTC; Hotels and airline tickets are increasingly booked online; Huge opportunity to connect with wallet and other partners to add value


Assets, Properties & Cars: Tata Housing sold flats worth Rs. 50 crores online; Property is an overcrowded space, and used cars is a booming opportunity; New car sales still happen mostly through showrooms


Wallet & Bill Payment: New licences issued by RBI to 11 banks recently; Market size for mobile wallet is Rs. 350 crores, expected to grow to Rs. 1,200 crores by 2019; PayTM – the largest player – has 100 Mn users with an average wallet size of Rs. 350


Refurbished & Used Goods: Market estimated at $15 Bn; Platforms enable about 2 Mn transactions a month with an approx. GMV of $4 Bn


Social Networking & Jobs: India has the second-largest user base for almost all key social platforms; At 350 Mn internet users, India still has a long way to go for 100% penetration; Facebook has >110 Mn users in India; LinkedIn has become an alternate to job portals


Healthcare: Diagnostics alone is a $15 Bn market, and the overall healthcare opportunity is $100 Bn; Every month 20 Mn users book 20,000+ appointments via apps, but presence remains mostly limited to large cities


Insurance & Retirement Planning: Online term products cheaper by almost 35%, but only 2% of the business has gone online; PolicyBazaar sells about 40,000 policies every month


Others: Lingerie worth nearly $30 Mn is sold online; Lenskart ships >1,000 spectacles a day; The domestic gems & jewellery market is Rs. 1.2 lakh crore, while the lingerie market is approx. Rs. 4,000 crore, but less than 1% has gone online

Here are some more statistics from Mint…

Power: $68 Bn – GDP loss estimated due to electricity shortage across India

Infrastructure: $10 Bn – Traffic congestion costs per year

Healthcare: 1 doctor per 1,700 people currently

Financial Inclusion: 120 Mn households without a bank account


Startup Statistics:

  • Approx. 80-85k currently employed’ 3-4 startups born each day
  • $4.9 Bn investments made in 2015
  • 65+ M&A deals; 110+ incubators/accelerators; 290+ active angels; 155+ active VCs/PEs
  • 4,200-4,400 startups currently in India – 3rd highest after US & UK
  • $2.5-2.7 Mn is the average valuation of startups of which 13-15% are in ecommerce
  • 28 is the average age of startup founders

For some of you, these numbers may prove that the market is already saturated, while others may see an opportunity for growth. Whichever way you look at it, exciting times are afoot!

Note: Source of data – Various industry estimates as reported in Economic Times and Mint.

The New Gold Rush


The time is right, they say.
Any one and every one is launching a startup.
In fact, billion-dollar valuations are fast-becoming the norm! Just look at Flipkart and Snapdeal…


Like most of you, we too are bombarded each day by the media focused on the runaway success of startups and entrepreneurs. Any one with half a bright idea seems to want to cash-in. Feeding the frenzy is the (often mistaken) notion that if smart folks (read: VCs) are investing billions of dollars (yes, billions with a B!) in these business enterprises, they must be doing something right.

Well, yes and no.

Let’s take a look at some of the numbers, as reported in a recent article in the Economic Times…

  • Flipkart was valued at $1 Bn in Aug 2012, and is valued today at $11 Bn
  • Snapdeal was valued at $200 Mn in Jul 2011, and is valued today at $1850 Mn
  • Zomato was valued at $2.5 Mn in Jul 2010, and is valued today at $660 Mn

Do you think it is possible for any well-managed company in the ecommerce space to provide an incremental “value” of $10 Bn in just two years?! For those of us in India, that means Rs. 60,000 crores!!! In two years. And, that’s just with one “startup”. (As a reference, currently, the market cap of ACC is jut over half of that.)

Yes, many of these organizations have capable managerial teams, exemplary leadership, and the ability to scale. No doubt about that. But, it may well be a myth for us to assume that these valuations represent the true worth of their business.

Here is what we’ve understood of the Venture Capital business: When a seed fund invests in a new idea, its goal is to take it to the next round of financing (Series A), and make healthy returns on its investment. This story continues in successive rounds of financing, until the logical end is reached – Initial Public Offer (IPO), where folks like you and me literally “buy” into the dream of raking in a small share of the future profits, by buying shares in the company. That’s how the game works. Nothing wrong with that, as long you understand the mechanics.

However, things start falling apart when any one and their cousin imagines overnight success by converting an idea into a “billion dollar firm” within a year. Another fallout is that, inevitably, some businesses miss out on “investor love” and fall by the wayside, despite having a competent team and business model in place. When you think about it, how different is TaxiForSure from Ola Cabs? Or Infibeam from Flipkart? But, now that we know the dozens of zeroes added to their valuations, it’s kinda difficult to see them in the same light as their distant cousins.

Sumanth Raghavendra, Founder, Deck App Technologies sums it up well: “Valuation is ultimately a vanity metric – something startups can brag about, but it is far from a reflection of a company’s true worth.

Yes, in the short run, customers benefit by the discount mania prevalent on such services, and it is not uncommon for funded startups chasing higher levels of growth to offer their products and services below cost. That means, at a loss. But, Growth can only serve as a substitute for Revenue upto a point.

Ultimately, any organization will need to deliver exceptional value (not valuation) to its customers, to survive, sustain and succeed.

P.S. If you run a fledgling startup, or aspire to do so soon, our advice would be to reign in those zeroes and focus on getting the basics right.

Bombay to Udaipur

In April 2011, we embarked on our first “long drive” from Bombay to Goa. In May 2012, we once again attempted the same trip, this time older and wiser. Then, came some months of back trouble, which reached such a low that I did not think I would drive again. However, having made a full recovery this year, high on the agenda was a drive to Udaipur…

I was told by friends who had done it before that the Bombay to Udaipur journey is longer than Goa (approx. 800 kms each way, instead of about 650 kms), but easier to do. In any case, we decided to make the most of the road trip, and not stress about reaching Udaipur before sun down. So we planned a halt at Vadodara, both ways.

That turned out to be a good decision since Vadodara is a nice, clean city that resides roughly halfway to Udaipur. You also have the option of breaking journey at Ahmedabad, which is roughly an hour’s drive further north from Vadodara.

Here is the log from our trip… Bear in mind that, depending on your starting point, milestones may vary by 3-4 kms. Also, our goal was to enjoy the journey, not just the destination. Therefore, these logs will reflect that attitude in the stops we made.

  • Departure @ 6.10 am from Powai, Odo set to 0 kms
  • Stopped at Kamat’s @ 76kms, 7.45 am for breakfast (30 mins)
  • Other milestones: McDonald’s @ 162 kms, Hotel Tulsi @ 171 kms
  • Sugar and Spice food plaza @ 198 kms with clean loos
  • Other milestones: Sugar and Spice @ 243 kms, McDonald’s @ 262 kms
  • Stopped at Hotel Swagat for lunch @ 276 kms, 1.30 pm (45 mins)
  • Arrived at Vadodara around 3.30 pm, 410 kms
  • Started next morning at 8.15 am, towards Udaipur!
  • Breakfast stop (30 mins), 10.30 am  at the start of Ring Road (Many hotels and loos)
  • Stopped at the Vintage Car Museum (1 hour) @ 519 kms
  • Stopped at Hotel Landmark for lunch at 2pm (Bad loo) @ 175 km before Udaipur i.e. 587 kms from Mumbai
  • Multiple petrol pumps seen soon after crossing the Rajasthan border @ 648 kms
  • Reached Udaipur at 850 kms, 6 pm

On the whole, the roads were smooth and the drive was pleasurable. The journey on the way back was somewhat less eventful…

  • Departure from Udaipur at 6.20 am, Odo set to 0 kms
  • Stopped for breakfast at Hotel Aashirvad, 103 kms, 7.45 am
  • Other milestones: Hotel Ashish @ 122 kms (bigger and better), Hotel Asopalav @ 138 kms (biggest!)
  • At 10 am @ approx. 32 kms before Ahmedabad, we took a detour via Gandhinagar, to visit the Sabarmati Ashram
  • Stopped at the Ashram @ 257 kms
  • Joined the Ahmedabad expressway again @ 270 kms, at 12 pm
  • At 349 kms, 12.50 stopped at a sad food court about 15 kms from Vadodara to fill fuel and reached the city soon after
  • Departed next morning at 7.10 am, 385 kms
  • Breakfast stop (30 min) at 9.05 am at a big food court with nice loos, CCD, etc. @ 507 kms
  • Also, Sugar and Spice @ 560 kms, and a big Kamat’s @ 637 kms
  • Stopped at 12.20 pm at Hotel Ahura (45 mins) for awesome Parsi food @ 691 kms (on opp. side of the road)
  • Reached home (Powai) at 3.10 pm with 810 kms on the odo

The stretch from Udaipur to Vadodara was even better, since the detour via Gandhinagar meant that we bypass the only stretch that has two-way traffic. Driving through Gandhinagar was also an experience worth doing!

A common lament across all my road journeys remains the woefully inadequate facilities we have across the country, when it comes to washrooms and clean water.

A new phenomenon we encountered during our Ahmedabad to Udaipur to Ahmedabad stretch is spotting a number of vehicles that looked clearly ‘lived-in’, and carrying multiple passengers, but without any license plates! So watch out in case you get into an accident with one such dubious vehicle.

City of Joy

It’s been a while since I blogged. Moving to a new job has kept me busy, these past few months. It’s been a particularly demanding, challenging and exciting journey, but it hasn’t left me much time for anything else, including blogging. In August, I also moved my blogs to, and that migration took the good part of a precious weekend, but I digress. Before I joined my new employer, I took the opportunity to go on a trip to a city I’ve longed to see for more than a decade – Kolkata.

Kolkata is a city unlike any other in India, or so I’d heard until I actually saw it for myself. Now, I know it to indeed be so. I chose the last week of June – one of its hottest and most humid – not by choice, but because I was in between jobs and that was the only window I had. Yes, I’d done a fair bit of research online, and also spoken to my “bong” friends who were very generous with their long lists of things that should be ‘must-see’ on my agenda. But, I also wanted to keep it free flowing… experience Kolkata as it happens to me.

And, as it turned out, that was a wonderful idea!

I hailed a non-airconditioned yellow ambassador taxi from the airport, since that was the most classical way to traverse the city of joy. I’d chosen to stay on Sudder Street, since it was very popular with foreigners who backpacked across India, and also close to the famous Park Street. Sudder Street, and its adjoining New Market, were a full-blown sensory experience, giving me the chance to take in the sights and sounds of the city in all its glory. Most places I wanted to see were a short taxi ride away, which was convenient since it saved me a lot of time.

Over the course of the next four days, I did almost everything I wanted to do on my list – circumnavigate the famous Maidan, go to the Indian Museum, visit the Victoria Memorial monument, photograph St. Paul’s Cathedral, go up and down the legendary Park Street several times, ride the Kolkata Metro, spend some hours in the tranquil surroundings of the South Park Street Cemetery, drive over the Howrah and the Vidyasagar bridges, visit the old Howrah town, drive past Eden Gardens, experience the sprawling Science City on the outskirts, saw several street arguments, visit the glamorous and upmarket stretches of Salt Lake City, and of course use every opportunity to take in some Bengali food, including eating at Peter Cat (where my wife had enjoyed several meals as a youngster!).

In the end, the only things left unchecked on my list were a tram ride and a trip to see Mother Teresa’s home – these would have to wait until my next visit. Of course, there would be many more visits to come…

Kolkata touched me in a way that most cities haven’t, and I was glad that I was able to take this opportunity to experience it in a way that most tourists don’t. Kolkata has an uncanny ability to assimilate you into its culture. Once you’ve made it your own, so as to say, it’s almost impossible to see it like an “outsider” does. Most folks I know would have a love/hate relationship with the city – they would either think I’m nuts to think of Kolkata in these terms, or simply “get it”.

Vir Sanghvi described this sentiment beautifully when he wrote: “That’s why Calcutta is not for everyone. You want your cities clean and green; stick to Delhi. You want your cities, rich and impersonal, go to Bombay. You want them high-tech and full of draught beer, Bangalore’s your place. But if you want a city with a soul, come to Calcutta.

Bombay to Goa: Part Two

Please Note: This is an extension of my earlier post on a road trip from Bombay to Goa. Read that to get additional dope on this subject.

This April, we made a second road trip to Goa and back. This time around, however, we were far more experienced about what to expect. (For the record, the Mumbai-Pune-Kolhapur-Nipani-Ajara-Amboli-Sawantwadi-Mapusa route is still the best route to take.) I’m sharing my log file with you since many of you have written in about how helpful you found those pointers…

Bombay to Goa

We decided to get a two hour headstart by starting off from Pune early morning. So we ended up staying over in Pune one day prior to departure. In hindsight, that didn’t help much since the time on road (including breaks) from Pune to Goa also ended up taking 12 hours.

0545, 0 kms – Started from Pune (near Baner) via Katraj bypass
0625, 36 kms – Passed by McDonald’s @ Khedshivpur
0711, 80 kms – End of Khandala (Satara) ghats
0750, 96 kms – Clean loo, Petrol pump n Restaurant
0950, 208 kms – Passed by Sai Food Court
1000, 217 kms – Kini Toll Plaza
1025, 240 kms – Passed by 24-hr McD (Kolhapur) on the opp side
1123, 283 kms – Turn off NH4 towards Goa @ Hotel Kavery (very clean Indian-style loo for ladies)
1245, 325 kms – Hotel Minerva Paradise. Very clean loos + Lunch break 1 hr
1430, 362 kms – Passed by Kamat’s @ Amboli just before the ghats begin
1500, 378 kms – End of Amboli ghats

(Then we took a left for a shortcut to Mapusa, but you should avoid it as it’s an unpaved narrow that bypasses Sawantwadi; Go via Sawantwadi instead)

1545, 395 kms – Turn on to NH 17
1622, 426 kms – Turn right for Mapusa city
1645, 440 kms – Reached Hotel in Baga

Goa to Bombay

On the way back, we decided to split the journey at Kolhapur which is almost midway in terms of time taken.

0835, 0 kms reading – Started from Baga towards Mapusa, then onto NH17 for Sawantwadi
1020, 59 kms – Sawantwadi ends
1045, 72 kms – Amboli ghats begin
1140, 88 kms – Ghats end @ Kamat’s. (Loos not too functional)
1240, 120 kms – Hotel Minerva Paradise about 1 km before Ajara town
1345, 160 kms – Turn onto NH4
1430, 210 kms – Reached our Hotel in Kolhapur

Next day…

0915, 00 kms – Started from Kolhapur
1125, 137 kms – Anewadi Toll Plaza
1150, 166 kms – End of Satara (Khandala) ghats – bypassed through tunnel
1210, 187 kms – Big Kamat’s for lunch stop upto 1 pm
1325, 212 kms – New Katraj tunnel to enter Pune city
1415, 249 kms – Turn onto Pune-Mumbai Expressway
1520, 342 kms – Expressway ends @ Kharghar
1610, 371 kms – Airoli Toll Booth
1645, 382 kms – Home

Special thanks to the missus for logging in all this info on her cellphone throughout the drive. Have a safe one…