Three Indian startups turned unicorns just this week and the year has seen 32 of them already, but we are just scratching the surface of the real potentials of the country's internet economy, Mayank Kumar, co-founder and MD at edtech unicorn upGrad said at the 19th edition of the India Today Conclave on Saturday.
"It's not the year of unicorns, but a decade of unicorns from India. The 30-35 unicorns that have been formed this year; we are just scratching the surface. When we look at those businesses, these are real business, they are actually disrupting existing offline ecosystem with an online ecosystem, these are tech-enabled, they come with a very different margin profile, they are businesses that have the potentials to reach scale, which in physical formats are difficult," he said.
Kumar said investors are bullish on the Indian market because there is an opportunity to build a large scale business in the country. "I do believe that with the quality of founders, the capital coming in, the market opening up, digital infrastructure getting ready, it's not just a year, but a decade of long long growth for us. If you provide value, there is margin to be made," he added.
Indian startups are closing the gap with their Chinese counterparts in valuation and growth though the latter enjoyed 25 years of protectionism, Sandeep Aggarwal, founder and CEO of online automobile marketplace Droom said.
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Talking at the panel titled 'Unicorn Diaries: How to make a billion' Aggarwal said Chinese companies have created high value relatively easily and quickly due to the protection they enjoyed in the home market.
"In the late 90s, China had three e-commerce companies, all in the same size; one was owned by eBay, one by Amazon, and the other one a local company named Alibaba. In 3-5 years, there was only one company, Alibaba. After the US, there are only two countries that can offer a billion Internet population - India and China. The only difference between these two is that China had 25 years of protectionism for internet companies, that is not the case in India. But we are catching up without it," he said.
Abhiraj Singh Bhal, the co-founder of Urban Company, said valuations are ahead of where the companies are today, but these investments are bets made on India's growth potentials for the next 10 years.
"The hope is that India will become at least a $5-7 trillion economy. That means you are creating a $2-3 trillion new economy and that is a re-balancing of a lot of sectors. Tech companies need to do the heavy lifting," he said.
Valuation will follow when the focus is on creating a high-quality company that creates value for customers and for suppliers, he added.
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