The Indian market has been flushed with investments in recent times. This is great news for entrepreneurs or aspiring entrepreneurs from various sectors, as this seems to be just the beginning of what lies ahead.
With innovative ideas ruling the new-age businesses, investors across the globe are confident of what the Indian market has to offer and continue to lookout for the next big disruptive idea that has the potential to change the market and be a game changer.
The first level of disruption has already taken place and created a stir in the market. Whether you talk about eCommerce ventures such as Flipkart and Snapdeal, Taxi aggregators like Ola Cabs and Uber, Healthcare disruptors like Practo or Online Restaurant guides like Zomato, each of them has proved to be a huge disruptor in the sector that they operate and left a lasting impact – an impact that has changed the market forever and lead to an evolution of that sector.
However, it is the next level of disruption that now has the investors keeping a keen eye on the Indian market, regardless of the sector. For instance, with mCommerce, an extension of eCommerce, is gaining in terms of popularity. The market will see yet another shift and give a big boost to the mobile apps market.
Then there’s the Internet of Things (IoT). The market is primarily driven by hi-tech gadget lovers across the world. The domain includes breakthrough technologies like Google Glass as well as others that allow your door to unlock using facial recognition or your AC temperature to adjust automatically to your comfort level once you enter your room. These technologies are here to stay because of their growing demand among the discerning customers, who want nothing but the best for themselves, and are sure to be a favourite with investors in the coming years.
As for 2015, going by the recent trends, frugal innovation seems to be yet another favourite buzzword for investors. Be it smartphones, cars or household items like detergents and soaps etc., market leaders as well as startups are slowly realising the importance of frugal innovation and adopting it as an important part of their strategy to get ahead of competitors in the market.
It is the key to building sustainability for a product, service or brand. Frugal innovation means not just doing more with less, but rather, much better with fewer resources. It is all about integrating affordability, quality, simplicity as well as sustainability. Companies are increasingly working on how to improve their effectiveness and get better results with fewer resources and offer better value to their customers.
For example: In 2010, under the aegis of Paul Polman, CEO, Unilever, the company undertook the huge challenge of doubling the company’s revenues to 80 billion euros, while simultaneously halving its environmental impact by the year 2020. Ever since, it has built in sustainability and social inclusion into the core of its operations. The efforts have helped Unilever in building up and strengthening the frugal innovation engine that can help profitably serve 4 billion customers across the globe by 2020 in a socially and environmentally responsible way.
What investors primarily look for when they identify such disrupting business ideas is their long term sustainability and scalability. A high growth potential within a definite time frame is yet another prerequisite for attracting investors. Ideally these business should be growing or have the potential to grow faster than its competitors in the market and follow a steep, hockey stick growth curve.
In addition to the above, I believe that a business that clears the unique evaluation criteria of T.E.S.T. and POC (T.E.S.T. refers to Team, Execution capabilities, Scalability in the business model and Technology, while POC refers to Proof of Concept) stands a greater chance of receiving Stage A funding, which can be crucial for the future of the business.
To elaborate on the T.E.S.T. criteria, no business can succeed in the marketplace unless there is a great team in place, with right skills, capabilities and experience to lead others. An ideal team is also in a better position to execute and implement the business plan and give shape to the business. A great team needs to be backed with a great business model and technology that makes the business sustainable and scalable.
Similarly, POC or Proof of Concept refers to a test that proves that the hypothesis about the business concept has been proven. It could be a hypothesis around a technology innovation, service, value proposition, price-point, business model or anything that needs to be proven or demonstrated.
Most businesses that have a successful product or service believe that they have a successful POC. But POC ought to go beyond that and should include testing all aspects of a business that are vital for its success.
For instance, are you able to produce the product or deliver the service at a cost that is financially viable? Do your prospective customers see the value of the product or service, and are they willing to pay the price that you expect them to pay? In short, POC is about validating the commercial viability of the business. That is because planning different aspects of a business is as important as the actual innovation, product or service itself.
Any business that successfully meets the aforesaid parameters is sure to grab investors’ interest and there’s no stopping them thereafter.
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Source : EntrepreneurIndia.
