The Start-Up Bubble in India

A few months ago, as walked into my CMO’s cabin to say a final goodbye, he said, “Mere liye koi investor dhoodh. Mein bhi apna kuch shuru karoon.” (In English that would be, “Find an investor for me, then I can start out on my own.”) While it was said in light vein, I sensed a hint of truth in it. In a job where I was meeting fintech entrepreneurs day in and day out, asking for funding, marketing aid, tech aid, I couldn’t help but wonder how I would do, if I set out on my own. I guess I wasn’t alone, my superboss was having the same thoughts.

And while fintech is all abuzz in Indian entrepreneurial and investor circles, I have a dystopian view of it. And if you were in my place, you would probably too. As a part of my job, I sometimes met entrepreneurs who had no idea about the business they were getting into. Their basic questions about industry regulations and customer acquisition strategy were sometimes startling, even to someone like me who was completely new to financial products. But as I hoped to make things work, I decided that I must suspend all disbelief and judgment, help out whoever I can and partner with the most promising start-ups.

My enthusiasm soon disappeared. The promising ones were greedy and almost never met their target numbers even if they were paid the price they demanded. The ones that were funded, had huge egos, which is all right I guess, but the toughest to work with were ex-Silicon Valley folks with illustrious backgrounds and lots of money and grey hair. They wanted to speak to no one but the big boss for every little thing. And even if you tried to placate them, they were seldom happy unless given exactly what they demanded. Surprisingly, they never kept their end of the deal. We were always the problem and not fixing ourselves fast enough.

At the end of the month, when I made a slide or two showcasing the number of start-ups I partnered with, it looked like a great deal of work. Even though the numbers never justified the spends, my boss would come away from the review with a pat on the back. How he did it, I still don’t know.

Does India want to buy financial products online and in large numbers? As of now, maybe not. Will the distributor get disintermediated? In a few years, maybe. Can a model like Alipay work in India? We’ll see a few Indian companies try it out soon enough. And how do tech businesses market themselves? Google, Facebook, LinkedIn and Twitter ads? That’s probably not it. If it were, you’d just need lots of money and a smart media buyer to run a successful tech business.

But hey, don’t let my views dampen your mood. India’s start-up bubble isn’t going to burst anytime soon. The solution had glycerin in it.