Vijay Shekhar Sharma is the founder and CEO of One97 which he incorporated in 2000 and is one of the fastest growing mobile internet company in India providing mobile content, advertising and commerce services to millions of mobile consumers. Vijay has also been an investor in early stage mobile internet startups through his $100M One97’s mobility fund which he founded in 2010 in association with private equity investor SAIF Partners. Chhotu.in, Mobiswipe, Zepo, etc are the few companies who have raised funds from One97 Mobility Fund. One97 has also incubated Paytm, which offers a simple, fast and enjoyable experience for online recharges and payments. Iamwire caught up with Vijay to know his experience and future of this industry.
What kind of products are opportunity? Is it the soft content (Ringtone, Videos, music) or the Physical good (Retail)?
Entertainment remains the first product that the consumers buys, Ringtones, Video, etc are high on consumption for bringing customers satisfaction. So, personalisation also remains to be the part of entertainment story. These things are precisely in the country and in the telecom operators ecosystem, where telecom operators were charging prepaid wallet or postpaid billing, to provide premium offer or services. I think entertainment was something where telecom operators relied on versus now where smartphones have started taking care of features, that you need in your device so unlike in a telecom environment where you have hosted in the voice sms platforms, right now one can build into device where much better user experience, can be given. Devices now allow us to to launch whether distant goods or real goods, both kinds of opportunities come here. Today, consumers are comfortable buying, using phones and now they are buying mobile content and physical goods as well.
What are the challenges or the roadblocks in the mobile commerce market in India? Govt, policies, etc.
Problem of logistics, shipment and payment. Though, government has less intervention in logistics, but definitely have a big role to play in payment. For mobile payment services the regulations are restrictive in nature versus how they should be. We quote example of Mpesa in the world, but it can’t happen here in India i.e. by definition Mpesa is not allowed as a regulatory in India. There is merit in what RBI says, i believe RBI can be more aggressive when it comes to plans and payment methods, commerce platform that are mobile driven. So the OTP environment which is on internet where third secure pages are driven versus what is on smartphone. You cannot do net-banking on a smartphone, as the browser is not that much capable or the devices were not made capable to handle on these browsers. So payment wise government can play and mend to make sure mobile ready and for net-banking which is very popular online as a payment method. It is not a popular payment method when it comes to mobile driven payments. I can’t go deeper but would say that overall things are positive but a lot more can be done. Payment remains a big restrictions that is why the commerce players are trying to drive and device payments.
What are the key services that One97 provides?
In 2000, our services were sms based and in 2005 we introduced voice based services. Both these services required us to hold consistent platform inside eco environment and use it as a payment method. 2010 onwards mobile internet took pace, we started giving consumers services directly through ourselves using bank based credit systems. We have focus on where the consumer is and building our technology so that the consumer can get our products in the most creative way. Today we have large number of orders and consumers are coming on internet and smartphones based products.
Looking at web as a space, would you be coming up with a product like payment gateway or something?
Intention is not about web as a differentiator, intention is about where the consumer is, we know there is a sizeable number of users on internet so we do offer our products on internet already. We believe that mobile internet will take course so we have primary focus on mobile internet, when we look at internet. We believe in ecosystem build up, Payment gateway is a critical component, that is why we launched the Paytm payment platform which is solving payment puzzle, still we believe that consumer must have great experience.
Now vendors and companies have understood that consumer’s interest should be safeguarded. How do you think the payment industry will revolutionize on mobile or on web, in coming time. And What features will companies come up to cope up with the competition?
Payment company extends the scope for creation of shopping mall. So don’t only take a payment platform from me but also a shopping platform. I believe this is the forward integration to the consumer side and extension of what they offer to the merchant. But the truth is the problem of payment of consumers and not about merchant’s payment. So one has to be lot more committed towards how consumers are feeling comfortable and how companies need to be more sustainable and far more trustworthy. But, I don’t see anything happening on that. So companies will launch a lot more consumer facing initiatives where the consumers will feel far more comfortable and in a trusting environment versus today.
You guys came up with One97 mobility fund, a 100 million dollar fund, how is it shaping up? What are your plans?
We believe this is a ecosystem of mobile internet, it means there are many components that have to built up. As a company we cannot build every component due to restricted times and resources, so we decided to invest in the early stage incredible companies that are building up something in the ecosystem. It can be someone who could be building a payment or consumer, company leveraging and working in that ecosystem we support and invest in those system.
Are there any startups in 2013, which One97 mobility fund will be investing in?
Yes, and right now two are in progress.
Is there a possibility that you will be investing in technology startups other than this?
We are not a fund, who has mandate and is trying to invest for commercial interest, our mandate is to grow the ecosystem, or grow the company. We are company driven corporate fund, we are not a venture fund. We are niche because we focus in the Business we do, our segment is B2B, it will remain mobile internet. It will not grow into great products like energy, desktop internet driven or something else. As a we are completely proud of that focus.
What are the mobile marketing trends? How is it shaping up and how big can it become?
Mobile marketing is consumed primarily by mobile developers and mobile players who are themselves in the mobile play right now, so more or less it is not yet a large market as mobile players, operators, device makers, content providers, app downloaders or game developer, these are the primary consumers of the mobile marketing today. True mobile marketing will happen when we have sectors such as FMCG, automobile, come on the mobile as the play for them. But, i don’t see this happening in a year or two. I believe mobile marketing to get mature in next 18-24 months where large amount of demand will continue to supply to the needs of mobile ecosystem players and then innovations like non- mobile ecosystem player will get better and grow better. In a 5 year horizon, many brands will come. But for next two years revenues will be driven by the people who are in the mobile ecosystem.
You as an entrepreneur has taken a long journey, from making One97 where it was and is now. So what are the key takeaways for an entrepreneur or a startup for raising funds, managing funds?
In India it takes 5 years for somebody to become sustainable, sizeable, unless you are addressing market globally. So if you are addressing Indian market 5 years may be enough or lengthy time, but it is small as far as Indian business market is concerned. You have to play it with an assumption that 5 year onward you will be sizeable and growing and till 5 years you might do discovery of your business plan investment and team building and so on. Case of change, or startup sustainability can be arrived in 3-5 years, not much earlier its a lot patience game.
Secondly, it is important to find how market is shaping up and how one continues to grow in regards to market relevancy. For example, 5 years back we know voice based services are critical today we know that mobile internet services will work out critical. So 5 years back success was defined as how many large users are dialing into our server, today it is defined by how large number of users are visiting our mobile internet page or app. This is where the niche small or specific differentiated product do not get hometerm value. You will have to find extensions of your business going forward after 3-5 years because by that time landscape would have changed but the company that you are building will require time for sizing up.
Thirdly, cashflow management is far more issue in India then internationally it is. Because internationally you can raise many more kind of investment, various kind of equity or debt but its not same in India. Here as entrepreneur you have to be far more skilled than at the other parts of the world. In India no one cuts out $10,000 cheque just because you are doing good, it’s negotiable, in Silicon valley lot more can be done.
A lot of startups and entrepreneurs says they are opening company to get acquired. Is getting acquired should be the aim or sustainable business should be the aim?
It’s purely a personal call, somebody may build it for flip and may get successful. I won’t say build it for a flip. If you have a capability why not try it. It is far riskier but it can be done. However, it doesn’t happen in India, so you have to make enough of road play or you have to be physically there. Most of the companies are acquired in the early days before the products are mature, these are the companies which are acquired for talent along with team or the intellectual property of selling products. So if you believe you are building something great and have a great team, you should not believe you will be acquired early because Indian market doesn’t work that way. If you want to do it, India is not the geography rather you must be doing it in San Francisco, New York, Berlin or somewhere else.
You are a speaker at Global Internet Mobile Communication(GIMC) 2013. Indian entrepreneurs don’t know what globally is going on, so any thoughts on this?
People at a talk do say mobile first or mobile primary but i don’t see many Indian companies take up to that. So this one is far different approach that has been shaping today. I can be sure about it since large companies whom i have conversation with, i don’t see a kind of focus. GIMC is standing for that, global mobile internet is more primary than rest. Its a global trend and everyone knows it but at execution it doesn’t seem like that.
Event like GIMC that are global in nature presents a lot of opportunity to everyone and economy. Should these kind of events be promoted more in India?
GIMC is great platform. India is a prime market as far as mobile internet is concerned and we are very sure that desktop internet is not worth, when you want to grow at the pace at which mobile internet is, so GMIC or equivalent events are must and definitely India is a opportunistic market to explore.
What are the future plans of One97, any new products or services that you will be coming up?
Mobile ecosystem needs building blocks and we still remain the building block, so expect more in payment, advertising, digital goods, areas in which we deal.
How One97 is doing. Can you throw some numbers?
We have 530 mn active users every month which is bigger than any other service and there are 1.5 billion transactions on our platform every day and this number is bigger than any platform in the country.Category Mobile Startups