Companies & Sectors
Start-up Deadpool: Government says it's only a lean phase
Despite reports claiming that a Start-up Deadpool is an Indian reality, with as many as 800 new tech ventures closing shop or on death row in the past 3-4 years, the government contends it is only a lean phase and far from a bust.
 
"I don't see any bust or any such thing. Start-ups are in various fields, like healthcare, etc. Maybe the dotcom phase is not doing well right now. There is no bust, only a lean phase," Department of Industrial Policy and Promotion Joint Secretary Shailendra Singh told IANS.
 
Data analytics firm Tracxn Technologies had recently compiled a list of close to 800 technology start-ups founded post-2011 that have failed or are shutting operations.
 
The list is similar to the one created by a website called F**ked Company after the internet bust of the early 2000s. The site itself was a take-off on a magazine called Fast Company and compiled a list of dotcom failures that came to be known as the Dotcom Deadpool.
 
On the Tracxn list -- what could be called a Start-up Deadpool -- for example, is online grocery store PepperTap, with $51.2-million funding, which has confirmed it is shutting down core operations, while start-ups like BeStylish, a fashion accessory online store, with $10 million funding, is already down and out.
 
"To make any detailed statement on the reasons for failure of these start-ups, we need to study the report. We will be talking to Tracxn this month to find out about the basis of the report, the reasons for failure, and analyse," Singh said.
 
Talking about the likely reason for the failure of these start-ups, he said it could be their inability to scale up during a global slowdown.
 
"All start-ups need to be scaled up. In the global slowdown -- seeing the grim market situation -- the scaling up is not possible. But it is not a cause of worry as these are cyclical changes. But it (failure of 800 start-ups) is only a small story," he said.
 
Tracxn, the Bengaluru-based firm, also says that the failure to scale up is one of the likely reasons for the shutdowns, as in the case of e-commerce and food technology start-ups that face a surge in digital marketing expenses due to increased competition.
 
"But they (the start-ups) failed to scale up due to standardisation or funding issues. Bigger players like Flipkart, PayTM, Snapdeal offer a better variety and price due to their scales and the amount of funding," a Tracxn spokesperson told IANS.
 
"Replicating the foreign model without indigenisation, focusing on customer acquisition without becoming self-sustainable and 'me-too' syndrome of copying a popular format has led to many failures of startups," says Amit Jindal, Partner, Felix Advisory.
 
"The Start-up Deadpool though is a reality but not a cause of worry," added Nikhil Donde, Managing Director of consultancy firm Protiviti India.
 
"Experiementation and innovativeness are the keys to success for any start-up. The start-ups which failed (did so) either due to lack of funding, faulty business model or were mistimed against the market demand," Donde told IANS.
 
On being asked if funding could be one of the reasons of failure, Industry Ministry's Singh said, "No, funding is not an issue. Funds are constantly coming in through angel funding and venture funding. Government is also making available about Rs 2,500 crore funds every year for start-ups. In fact, it will be difficult for start-ups to absorb all the funds."
 
According to research firm Preqin, $8.9 billion investments in 2015 were made in India via venture funds. But so far in 2016, only $3.2 billion has been invested in start-ups by venture capitalists.
 
"The funding surely saw a slight slowdown. For instance, in the first half of 2015 $2.9 billion was invested, while in first half of 2016 only $2.1 billion was invested. But the overall funding scene is not as grave. The early-stage activity has notably increased with many more micro funds and angels stepping up," Tracxn co-founder Neha Singh told IANS.
 
Overall, it looks healthy for the eco-system because more number of companies are getting launching capital, but with more later-stage investors being cautious, it is forcing companies to rethink about getting their economics right early on in a more sustainable manner, she said.
 
Confident that the Indian start-ups story is still intact, Singh said: "We are regularly interacting with start-ups. There is a big boost to start-ups. We have to provide the right ecosystem for the start-ups, a common platform and hand-holding."
 
The silver lining for the failed start-up teams is that corporates are looking at hiring of experienced entrepreneurial teams.
 
"Most founders of deadpooled companies have people with strong hands-on experience in knowing what works and doesn't in a practice area or market. Failure is no longer a taboo, and the entrepreneurial mindset is highly valued among investors and corporates," Tracxn said.
 
Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.

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Western Indian coastline is tsunami prone: Scientist
City planners need to incorporate the potential of the western Indian coastline as a tsunami-prone area, when they plan urban habitats in the region, an expert has said.
 
Speaking to IANS, outgoing Director of the National Institute of Oceanography S.W.A. Naqvi also said that tsunamis were not new to the western Indian coastline, the latest being in 1945, which hit the coast of Gujarat and whose effects were felt in Mumbai as well as Goa.
 
"I think we need to be careful, that if this is a tsunami-prone area and we have a very recent evidence that it happened around 70 years ago, planners must take that into account," Naqvi said.
 
The tsunami phenomenon is normally associated with the country's eastern coastline and the extreme southern reaches of Kerala.
 
Naqvi, however, said that two major tsunamis were recorded along he western coast as well. While one such wave measuring as high as 10 metres rocked the Gujarat coast in November 1945, the other such tsunami was recorded around five centuries ago, even affecting a Portuguese fleet, sailing near the coastline.
 
"I think it also happened in 1520s, shortly after the Portuguese came here. Their fleet was also affected," he said. 
 
The tsunamis, he said, occur due to seismic activity in the Makran region off Gujarat, which is a boundary between two plates and is tectonically active area.
 
"There was a major earthquake of 8.1 Richter scale (in 1945). That tsunami hit Mumbai and our feeling is it may have come to Goa too," he said. 
 
The third and possibly one of the earliest recorded tsunamis, Naqvi said, could have occurred 3,500 years ago at Dholavira, once a port and the biggest Harappan site in India.
 
"At Dholavira 5,000 years back, they had a fair idea that this was a tsunami prone area, but because economically it was a very strategic area, they built the city and port. But they also built an 18-metre (thick) wall to protect them from the tsunami," Naqvi said. The port town flourished for around 1,500 years before a tsunami destroyed it, the scientist said.
 
"Our hypothesis is that it was built as a protective measure against marine disasters, tsunamis and storm surges because it was a major port at that time," he added.
 
Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.

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IISc Bangalore remains India's top university, global ranking drops
Even as the Institute of Science (IISc), Bangalore remains the country's top university, its global ranking has dropped two notches to 152 in the latest QS World University Rankings 2016-17 released on Tuesday.
 
Founded in 1909 as a result of the joint efforts of Jamsetji Nusserwanji Tata, the Government of India and the Maharaja of Mysore, IISc's global ranking last year was 147 -- also just within the top 150 universities in then world.
 
All the other Indian universities that make the cut within the top 400 on the list are the coveted Indian Institutes of Technology (IITs) -- Delhi (185), Bombay (219), Madras (249), Kanpur (302), Kharagpur (313) and Roorkee (399).
 
"This year's rankings imply that levels of investment are determining who progresses and who regresses," said Ben Sowter, head of research at QS.
 
"Institutions in countries that provide high levels of targeted funding, whether from endowments or from the public purse, are rising. On the other hand, some Western European nations making or proposing cuts to public research spending are losing ground to their US and Asian counterparts." 
 
The global rankings are:
 
- 01: Massachusetts Institute of Technology
 
- 02: Stanford University
 
- 03: Harvard University
 
- 04: University of Cambridge
 
- 05: California Institute of Technology
 
- 06: University of Oxford
 
- 07: University College of London
 
- 08: ETH Zurich (Swiss Federal Institute of Technology)
 
- 09: Imperial College, London
 
- 10: University of Chicago.
 
Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.
  

 

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