Trends that will disrupt the investor ecosystem in 2022 and how startups can take advantage of this opportunity
The past two years have been a watershed moment for industries at all levels as they have driven organizations to build resilience and re-equip for the post-pandemic world. For the global startup ecosystem, this “great reset” meant keeping up with rapidly changing technology trends to stay relevant to their consumers and investors.
India, like the rest of the world, witnessed an acceleration of digital transformation across multiple borders during this phase. Technological adaptation has spread to Tier 2-3 cities and beyond in India.
As reported by TRAI, India’s overall internet penetration reached 834 million, or 62%, as of June 30, 2021, with rural subscribers growing faster year-on-year compared to their urban counterparts.
This is well complemented by the growing number of smartphone users in the country which is expected to reach 844 million by the end of 2021. The consolidated impact of these dramatic changes forms some key trends that will shape 2022 for the investor ecosystem.
Turn passion into profit
A fascinating phenomenon is unwittingly brewing: entrepreneurs turning their passion into profits. Today, India boasts of a vibrant creator landscape, with around 100 million creators spread across different categories, languages, and regions. Beyond big-budget celebrities, micro-influencers and regional creators are deeply shaping India’s digital culture.
The creators of Tier 2 and 3 cities add diversity to the content, especially in the regional vernacular which resonates well with their respective fanbases.
Beyond the obvious content categories that appeal to mass audiences such as food or travel, regional content creators are now exploring their niche in various familiar and local themes.
As we move forward in an increasingly connected world, digital platforms are paving the way for the passion economy to strengthen its hold in India. Accompanied by the ease of digital payments, these platforms have opened doors for content creators to monetize their passions.
With these developments, the market conditions are ripe for platforms like Patreon and Substack to tap into India’s opportunity for creators to earn direct revenue from their followers.
Right now, creators are overly dependent on brands to monetize their fan base. In the long term, this model may not be viable, especially for mid to lower tier creators looking to diversify their revenue streams.
Building in India for the world
Over the past few years, India has become the most sought-after destination for global organizations looking to grow and build a sustainable business. This is possible due to the plethora of opportunities that the Indian landscape has to offer.
The opportunity of India’s booming domestic market, its pool of highly skilled and top-notch talent and a progressively open regulatory environment are what the country has to offer global businesses. Various global behemoths including Uber and Twitter have established their global development centers in India which are driving innovations for the world.
Unique market conditions provide an excellent learning opportunity for global companies, which in turn use those learnings to build for emerging economies.
From mere back-end hubs, India’s business landscape enables these global companies to focus on high-value activities such as intellectual property (IP) creation and skill-building around emerging technologies by leveraging product thinking to drive innovation in global markets.
India has seen a strong revival of in-house global centers and development centers of various global organizations such as Intel, Adobe and others have demonstrated that cutting-edge products for global markets can be developed from here .
The convergence of digital capabilities, thanks to the pandemic, the availability of talent, business cases and customers are all factors that are helping to cement India’s position as a powerhouse of global innovation.
Unleash business value
The integration of the dominant tools that influence SaaS is poised to make businesses and day-to-day activities faster, more productive, and certainly more affordable.
The Indian startup ecosystem has become the third largest organization in the world after the United States and China. Recent developments in China, including restrictions on new-era companies, have increased the attention of venture capital funds in India.
Indian companies are increasingly becoming good target customers for companies looking to unlock enterprise value. This is happening due to a shift in mindset from “cutting costs by building it in-house” to “seeking growth by buying best-in-class products”. This allows businesses to compete with the best in the world without losing the time advantage.
Indian companies are also increasingly willing to invest in tools that allow employees to increase productivity and collaboration. This is increasingly important in a world where remote working and hybrid working are the new normal.
The changing face of social and community platforms
The face of social media is slowly changing as people move beyond sharing moments as a method of interaction to become a community-centric mode of sharing. In recent times, interest-based platforms have seen an increase in user base and engagement as users find a sense of belonging.
Globally, platforms like Discord and Roblox have seen phenomenal growth thanks to a growing community of gamers. Likewise, platforms like Strava have grown thanks to a strong fitness community.
Many such examples can be found in various other areas of interest such as music, storytelling, design, learning and more. India has an average age of 29, making it one of the youngest populations in the world and the most lucrative market where community platforms are poised to grow.
With the advent of new social platforms and the rise of digital cohorts, the space will become more community specific as new age entrepreneurs focus on promoting community platforms in 2022 and beyond. This will allow them to focus their efforts on a small number of critical audience groups, making it easier for them to focus on quality over quantity.
To note: This is an opinion piece by Viral Jani, EVP & Country Head, India, Times Bridge. The story originally appeared in YourStory.