The world is changing very fast. Big will not beat small anymore.

It will be the fast beating the slow.

Rupert Murdoch

Vol. III, No. 39, 9 October 2015

E-commerce, Start ups and B-Schools

After While reading an illustrative write up in The Economic Times (dated 08.10.2015) entitled FROM CRADLE TO GRAVE I were
thinking that how all industrial classification of business has coalesced into one term, i.e., Ecommerce. Every single business
newspaper and magazine is banging about start-ups, venture capital, e-commerce, an executive resigning from top position and
joining a start-up, how Big Business houses are buying start-ups and paying very hefty and retaining the owner as executive in
business, young entrepreneurs and so on.
The charisma of e-commerce based start-ups is creating more robust and astonishing sentiments in the Indian Business eco-system
than the movement of SENSEX. Think of any dormant business idea which seems like a dream to you but when you will explore it
you will find it has taken the shape of an e-commerce business. Many wonderful business ideas have been conceptualized in ecommerce. Everyone is familiar with big giants of ecommerce industry like Flipkart, Amazon India, Jabong, Rediff Shopping, Yepme,
Snapdeal, ebay, HomeShope 18, Naptol, Infibeam, Pepperfry, Fabfurnish, Ezoneonline, Koovs, First Cry, FashionandYou, Shoppersstop,
Biba, Basicslife and many more. Many of these e-commerce companies are running into loses but these are just sanguine and
continuing to increase investment in their business. Many of the successful start ups are even not more than of five years old.
ShopClues founded by Sanjay Sethi, Radhika Ghai Aggarwal and Sandeep Aggarwal and started in January 2011, MySmartPrice
founded by Sitakanta Ray and Sulakshan Kumar in July 2011,Edureka founded by
Lovleen Bhatia and Kapil Tyagi in May 2011,JunoTele Solutions founded by Sekhar
Rao with Krishna Tammireddy and Jana Balasubramaniam (co-founders), Linkstreet
Learning by Arun Muthukumar and Vikram Ramakrishnan in March 2011, LimeRoad
founded by Suchi Mukherjee, Ankush Mehra and Prashant Malik and started in
December 2012, Framebench Technologies founded by Rohit Agarwal and Vineet
Markan in 2012, Haygot Education Pvt Ltd founded by Zishaan Hayath (CEO),
Hemanth Goteti (CTO) in April 2013 Culture Machine Media founded by Sameer
Pitalwalla and Venkat Prasad in July 2013and HackerEarth founded by Sachin Gupta
and Vivek Prakash and started in 2012. The ET Startup Awards has added more
glamour to this industry and the start ups is vying for such awards are quite unique
in their services.
No doubt that there are many failure stories too. But investors like Nikesh Arora;
President of Soft Bank is one of the most aggressive investor in Indian ecommerce
start ups. The banks, the RBI and Government of India all are working on providing a compatible business environment to these start
ups. After looking at the importance on the venture capital, government is also planning to craft a Venture Capital Industry that will
help fund social sector initiatives of sustainable development and job creation. The Reserve Bank of India has also licensed new
institutions and full-fledged and specialized banks for meeting the financing needs of new ventures. The minister of states for
Finance, Mr Jayant Sinha said that ministry would soon announce a domestic venture capital where funds would be available for
Impact investment which refers to investments made by organizations with the objectives to generate a reckonable, beneficial social
or environmental aspect in a profitable manner. He also pointed out that India is facing many challenges and job creation, climate
change and lack of scalability & innovation are among these major challenges. By developing sound venture capital industry India can
beat these challenges in a better way. Harvard Business School, Stanford Business School and MIT are contributing exceptional
stories in the history of start ups. But India has a different scenario. Every B-School does not have a legacy of excellence in
entrepreneurship development with innovation. The IIT Mumbai & Delhi ,T-TBI Kerala and IIM-A &B are among having top start up
incubator centers in India. In most of the B-School, the MBA grads are trained to manage the business and not to generate the
business. The IITians in India are more in number than IIM grads entering into a new some innovative start up. The number of
IITprenuers is around four times the number of entrepreneurs from IIMs. Unfortunately, in the process of bringing new technology
and innovation for societal use, the IITians have learned that how to take risk but MBA grads just understand the calculation of risk
and then taking only calculated risk. Hence B-Schools must set a platform where engineers and B-School grads can work together so
that these engineers can share their innovation and provide a stage for fledging for young entrepreneurs in B-Schools. According to
one research, the experienced grads in B-Schools are less risk takers so if a B-School has more number of MBA grads without
experience then probability of finding new entrepreneurs is definitely more.

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Written by: - Dr. Kiran Mehta

Faculty of Finance, Chitkara Business School

www.chitkara.edu.in

Disclaimer: This Newsletter is prepared to enhance awareness and for information only. The
information is taken from sources believed to be reliable but is not guaranteed by Chitkara
Business School as to its accuracy. Chitkara Business School will not be responsible for any
interpretations, opinions generated or decisions taken by readers.