Before every trip there is a feeling 'have I forgotten to pack something?' The list of things to be carried on a trip is long – a travel pillow, headphones, eye mask, pen knife. And, then these things get lost in the big black hole of the back pack. What if you could have a separate pocket for all travel needs in your hoodie? This is the idea behind the new line of functional wear launched by online campus merchandise brand CampusSutra.
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This will be a huge industry in five years and will add 300 million new customers, say Vishal Krishna and K Chandra MohanThere have been several payment, money transfer and wallet solutions that have been cropping up over the last six months. Snapdeal along with Freecharge has launched a wallet service. Novopay, funded by Vinod Khosla, launched its wallet service recently. Private banks such as HDFC and ICICI have launched their own wallet services. What is interesting is that Flipkart has stayed away from this business, instead, it has chosen the advertising business to bring in additional revenues. Why does finance make sense to technology companies like Snapdeal and PayTM? It's because the government has granted permissions to these companies to apply for payment bank licences. PayTM was one of the first companies to apply and get a license. But the licences are just one part of the game. Today 160 million smart phones have been sold in India and the number is expected to hit 600 million by 2018. The bet is on the new customers that will be added on the payments bank platform. Acquiring these new customers will increase the valuation of each of these businesses 50 fold. The financial payments industry is expected to hit $1 trillion by 2020. So the money raised for payments banks will be far higher than the money spent on etailing. Today, these six odd technology companies that are vying for payment banks licences are focused on a market that is not more than 40-million-strong. Their wallet businesses, where phone bills and cable bills can be paid, along with their etail platforms are suffering from low margins. They are burning money and customer acquisition cost is high and the margins are less than one per cent per transaction. This will take these businesses more than a decade to break even and meanwhile they will have to survive on the money raised. But being a bank could increase their transaction customer base to a population the size of the USA, which is 300 million, in less than 18 months. The payment banks will be a combination of the best of banking services (where there will be high margins) along with etailing services. Finally there could be a business model that could take these companies to profitability. Today none of them have sketched out a market strategy for being payment banks. They have to get people to download their apps on smartphones. They need to work on local language technologies and sync in even text message based money transfers. They also have to tie up with local folk, certified to collect money, to on board people. A payment bank carries money on the app and it becomes a deposit account. People can remit upto Rs 1 lakh in to this smart phone based app. The companies can issue debit and credit cards. They can also pay interest on deposits. What they cannot do is to disburse loans. The government expects at least 150 millions new accounts to be opened on these platforms. These six startups together have raised $1 billion just to build wallet solutions. Experts that Businessworld spoke to say there will be an additional $1 billion raised to make payments banks work. The answer, to the question about technology being disruptive to add new customers on to the mobile, in smaller towns, will be found when smart phones truly replace the business correspondents that banks deployed to win new account holders in rural towns. Perhaps cash will be burnt here by these tech companies. This will also answer a teething question; what is the real size of smart phone transactions in India. Perhaps funds have to commission a study based on the hypothesis that payment banks transactions could be their answer to big valuations.
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Happay takes a bet on 50 million SMBs who are struggling to streamline their expense management, writes Vishal Krishna Tracking expenses in an organisation is very difficult. Even today an employee has to submit bills. Many of these bills cannot be verified and there are also many cash payments that companies cannot keep track of. Today a business worth Rs 100 crore, spends at least Rs 5 crore on admin related expenses and some of these expenses cannot be tracked. There are no payment solutions integrated into the systems of companies. There is an ERP system to place orders. But payments cannot be paid because there are many layers of approval needed. To disrupt this archaic system, Happay, a startup from Bangalore, as created an expense management app that enables departments of various organisations to manage all their vendors and expenses. All small businesses order online but they pay only through cash on delivery. The problem is that the owner would have told his cashier that all payments can be made only after his approval. The business delivering the product has to run around 10 odd times to get the money. Similarly employees too have run to their office accounts to get their expenses disbursed. Offices spend a considerable time in checking their expenses. This conundrum is being solved by this 2 year old startup. Anshul Rai and Varun Rathi, batchmates of IIT-Kharagpur in 2010, founded the company with a business to consumer (B2C) model where people could transfer money to anyone from their app. However since this market was not scalable and did not add any value. They decided to pivot the model and focus on payment solutions for SMEs. “While we were building the consumer business, a couple of SMBs approached us to create a payment solution for them. This was how the idea was born,” says Anshul, the CEO of the company. Their business is funded by Prime Venture Partners, who have put in $500,000 to make the business scale up. Today India has over 600,000 FMCG distributors, 50 million small enterprises and 500,000 corporate entities that work with small businesses. There are payments systems needed to make the system robust and transparent. There are over 40 million organised workers in India and 150 million semi-organised workers. The payments industry is worth more than $1 trillion and is waiting for technology to pay a major role in its disruption. Happay is not the first solution for the business to business industry. But it is the first one to think through from an Indian context. It is only a matter of time before PayPal, Square, Amazon and Dwolla figure it out for the Indian context. Happay has a wonderful model of issuing corporate cards to all its employees and the card is managed by the accounts team of the organisation. Happay gives them real time dashboards of expenses made by employees during a sales meeting in another city. These cards are issued by a bank which has partnered with Visa. The co-branded cards, of Ratnakar Bank and Visa, which Happay issues, once with the organisation, will be loaded with money and given to the employees for their expenses. Say for example a management executive on a sales visit will stay at a 3-star hotel and pay for food there. The average daily bill can be Rs 8,000 and this can be tracked by the Happay App. The corporate credit card is just one line of business. The also help automate expense management and are also getting in to vendor payments on the manufacturing side where their systems pull money from the bank account of the entity to pay the vendor. Typically their technology will be the bridge between the manufacturer, the vendor and the bank.
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GenNext Innovation Hub, an accelerator programme by Reliance Industries (RIL) and Microsoft Ventures on Friday (11 September) began its second ‘Fall 2015’ batch by announcing the names of ten startups.
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In first two days of the rally, the company has got more than 1,600 registrations on their job portal.
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A search for a plumber on Just Dial gives an exhaustive list of more than 10-pages of contact details for plumbers. For a task as mundane as finding the right handymen, the hundreds of ‘unfamiliar’ choices seems to be a promethean task.
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The Right to Education (RTE) Act may have been passed but more than 95 per cent schools are still not compliant with the infrastructure standard prescribed in the RTE Act, says a 2012 civil society survey.
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India is evolving and so are the ambitions of Indians. It has become a start-up hotspot and has attracted investors from across the world. Despite the open and free culture in start-up offices work can get competitive and demanding from employees. To stay ahead from competition some organizations tend to have long and stressful working hours, and at times employees tend to take the stress back home. Add to that the Indian scenario where family is a big part of life, not spending enough time with them adds to the strain that employees feel. Family members start to feel excluded and the friction at home has a tendency to increase.Employees with young kids at home start feeling the guilt leading to lack of focus and concentration at work. The support of family gives significant leverage in terms of reducing work tensions and can make all the difference. Companies have starting involving families in functions and other occasions to make them feel more involved in their organizations. Initiatives that engage with family members of the employees can go a long way in keeping the work force happy and satisfied.Involvement and satisfaction of family members plays an important role in retention of talent. Some initiatives that companies can take to build a relationship with family members are:Thank you letters while hiring - Small gestures like sending welcome letters to the employee's family makes them feel like a part of the extended family of the organization. Small tokens like flowers and cakes to their home address helps the family feel more connected to the company.Celebrating work anniversaries - Celebrating every employee's work anniversary by inviting the spouse & kids or parents and bringing them to office where they meet up with MD and the team members help the members of the family more connected to the job that their spouse does. Small office tours and special dinners makes the employees and the family feel special and warm towards the organization. Gifting small personalized items to the kids will delight the kids and everyone else as well. Employee events that involves families- Involve family members in certain events that are held at work. Having a special bring your family to work day or inclusion in celebrations like annual days go a long way with families. Participation in organizing the event and spending some time with the employees to ensure its success helps families feel like a part of the company. Such gestures initiate trust and respect amongst the family and its employees.Family involvement is extremely important in the professional success of an employee. Small initiatives can help reduce family stress due to work and make family members feel attached to the organization. Understanding of the work and the environment that the spouse works in helps kins feel comfortable and relaxed. Regards and respect for companies is higher by families if they feel like a part of the organization. This interaction also helps in building credibility for the organization by the family and the employees.The author, Pradeep Malhotra, is VP & Managing Director of Blue Jeans India
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