Is Value in the Eye of the Beholder?

Is Value in the Eye of the Beholder? 

Is Value in the Eye of the Beholder?

Valuation of Startups

You regularly read in the press about mergers between startups or startup funding rounds being delayed or falling through due to disagreements/disputes over the valuation of a startup.

How do you get the valuation of a startup right? Is the valuation based on simply how much an investor is willing to pay for the shares? Is startup valuation more art than science?

Judging a startup’s growth potential, especially in the early stage, is probably more art than science. Investors look at factors like traction, the hotness of the industry, reputation of the founder and team, distribution channels and revenues to date.

Getting help from mentors or other startup founders who have been through the funding process will help. What has been your experience?

DigitalAsian

Do Investors Leave Founders with Little Skin in the Game?

Do Investors Leave Founders with Little Skin in the Game? 

Investors Leave Founders with Little Skin in the Game

How much share of their startups should founders dilute to their investors? Are founders with little skin in the game good for the startup?

Often after a number of rounds of funding, startup founders are left with single-digit percentage, or less, of their startup. Investors have taken the rest. There are some well publicised cases in the Indian startup ecosystem to see the difficulty that startups can get into when founders are left with little skin in the game.

Investors v. Founders: the eternal battle in startups. Is there a way to achieve a good balance for any particular startup?

DigitalAsian

In the Business of Everything: Digital Tech

In the Business of Everything: Digital Tech 

In the Business of Everything: Digital Tech

With the Internet of Things or Internet of Everything gaining ground, corporations like Google, Apple, Amazon and other tech giants getting into all sorts of businesses such as driverless cars, mobile payments, IoT, AI, satellites, medical devices and other more obscure ones.

These tech giants make strategic acquisitions around the world and also hire staff from other tech companies to further their research and development. Corporations like Apple, Google and Amazon are in the business of everything now as digital technology touches virtually every aspect of human life. These tech giants are in the business of human beings.

DigitalAsian

How to Choose the Best, Most Useful and Rewarding Events?

How to Choose the Best, Most Useful and Rewarding Events? 

How to Choose the Best, Most Useful and Rewarding Events?

A whole new events industry has grown up around startup founders and entrepreneurs - now mostly virtual events due to the pandemic. Networking events, pitch your idea events, meet the investors events, business groups and clubs, industry events, talks, summits and conferences for entrepreneurs, speaker events to get you motivated and inspired, celebrity events, events to boost your productivity.

There are so many events in your city that it is not possible to attend all of them. What do event organizers do to stand out? How does a startup founder decide which events to attend and which will be useful without the fear of missing out? Which events will be time well spent? Is there any method to choosing good events? Any hints or tips?

DigitalAsian

How do you get the most as an investor in the Softbank era?

How do you get the most as an investor in the Softbank era? 

How do you get the most as an investor in the Softbank era?

With Softbank's US$100 Billion Vision Fund, sovereign wealth funds and tech giants able to write huge cheques for startup investments, how do smaller investors get the most bang for their buck as a startup investor nowadays? Are these big investors raising the valuations of startups over the top? Even during the pandemic, these big investors are looking for big returns. 

Softbank may be going through a bad patch now but it still has a lot of clout in the startup ecosystem. Its investments in the sharing economy may be down now due to the pandemic but otherwise its portfolio companies are good businesses, with good business models, which attracted millions of customers.

VCs, VC funds, PE investors, Angel investors, incubators and accelerators are going to have to rethink their investment strategy in the Softbank era. 

What imapct has Softbank had on the startup ecosystem and how are startup valuations and investment strategies changing?

DigitalAsian

Growing importance of VCs in the economy

Growing importance of VCs in the economy 

Growing importance of VCs in the economy

  

Silicon Valley, Chinese VC firms and Softbank are probably the biggest players in VC currently. With disruptive ideas and technology changing the economic landscape, VCs with deep pockets will probably be dominant players in world economy. ICOs, in the short term, will probably not dislodge VCs from their pre-eminent position in the startup ecosystem.

Countries where government regulation is aligned to the tech sector will probably benefit more than others. Another path to maintain your pace of innovation is to ensure that you attract the top talent from around the world.

Increased spending on R & D will also be crucial (which means having VCs with deep pockets), especially in fields of AI, biotech, blockchain, data and cloud tech, robotics and space. VCs with deeper pockets will control more of the innovation. Creating tech hubs (read unicorn factories, predominantly in Silicon Valley and Beijing) which attract venture capital, startups and talent will be important.

Tech Giants, themselves, are now major players in investing and acquiring startups.

DigitalAsian

Going App in India: Apps and Mobile Websites

Going App in India: Apps and Mobile Websites 

Going App in India: Apps and Mobile Websites

India has now become one of the biggest app markets in the world. The onset of huge competition between telcos, reducing mobile data costs, has made India more app-friendly. Since Jio came on the scene, mobile data costs have reduced, resulting in more app downloads and more time spent on apps and smartphones.

There are a huge number of platforms available via app for users to create and share content. Some companies are producing so-called ‘lite’ apps which have reduced functionality in order to appeal to the Indian market where internet connectivity may be poor in a lot of areas.

With lot of startups going mobile first, app-first or app-only, is the desktop website slowly on the way out in India – or is there still need for it from a business perspective?

Also, is it better for business to have a mobile website or an app? Do they achieve the same things or is it beneficial to have both?

DigitalAsian

Founder's Blood, Sweat Equity and Tears in a Startup

Founder's Blood, Sweat Equity and Tears in a Startup 

Founder's Blood, Sweat Equity and Tears in a Startup

Is sweat equity a good way to help scale up your startup?

I guess finding the right person is obviously crucial. It’s important, if you are giving sweat equity, to have a written agreement in place to try avoid it all ending in tears. Even then it feels like a gamble to a founder betting on someone who joins you as a shareholder in your startup.

There are lots of people out there who put themselves forwards as mentors or having exited their own startup in the past, who say they will help you if they are given sweat equity. I suppose doing thorough due diligence on choosing the right person to join you is also important.

What are your experiences of giving sweat equity in your startup to someone?

DigitalAsian

Events and Activities Create Content

Events and Activities Create Content - DigitalAsian 

Events and Activities Create Content: Stories for Events, Groups and Brands

Make an Event of it!

When you go out with your team colleagues for a night out, you take selfies or video of yourselves which are then uploaded onto social media. Even a family get-together results in visual content which later goes online.

If you attend an event, the organisers and participants will create visual and written content around the event which is then uploaded for promotion and marketing purposes.

A lot of what we do nowadays results in content being created and uploaded. When you get-together with others, most will have smartphones with them and this device now means content going online.

Marketers can make use of this in allowing groups to create content and stories around events which help in brand marketing.

If a group goes to a restaurant/cinema/event, the restaurant, for example, can utilise the smartphone culture to allow people to create their stories around their meal at the restaurant to help the restaurant’s brand. Allowing groups to create your brand story.

Brand Marketing: Make an Event of it!

DigitalAsian

Event Horizon

Event Horizon 

Event Horizon

The way ahead for the events industry

Before the pandemic, startup and blockchain conferences were proliferating and were getting expensive to attend. Now during the pandemic, event organizers have migrated to virtual events which are also many in number. But do they add value? Startup/blockchain events had keynote speakers, pitch sessions, places to set up your stand etc. They gave you a boost for a while but did you track what you gained from attending? Now with virtual events, how do choose which ones to join?

Players, such as co-working spaces and other firms also organised events on a smaller scale to attract you to their services. Clubs and business networking groups, also many in number, now organise webinars.

The number of online events is growing but some are beginning to feel event fatigue. Is it all about sponsorship and profit for the event organizers? How do you measure what value the event has given to the attendees?

Are smaller, more specific events the answer? With more care taken on speakers and attendees where there is more scope for better and more relevant interaction between the participants?

How will the events and events industry evolve?

DigitalAsian

Digital Will Dominate the Dow

Digital will dominate the Dow - DigitalAsian

Digital Will Dominate the Dow Jones

Do the companies which comprise the Dow Jones properly represent the economy or should more Tech firms – Google, Amazon, Facebook, Nvidia, Netflix, Uber,  etc. – be in the Dow Jones?

Dow Jones slowly changes in the digital world. Digital technology companies will slowly dominate the markets because they are in the business of everything. You only need to see the acquisitions being made by Google, Apple, Amazon etc. Dow goes virtual.

Slowly the Tech Giants (FAANG stocks) and others will begin to replace older companies in the Dow Jones Industrial Average. When Apple replaced AT & T in the Dow Jones in 2015 it signaled the growing dominance of the tech companies to the economy. This change reflects the changing economy and dependence on technology. Apple is one of the most valuable companies in the world now.

DigitalAsian

Digital Risk

Digital Risk

With more of our lives going online do we need digital risk rating for online activity?

With more of our lives going online with e-commerce, fintech, social media and IoT, data created is out there for the taking due to, either, lack of understanding of the technology we use or insufficient cybersecurity in place. It is probably not possible to get 100% security online and so there is an element of risk we have to accept to any transaction/activity we do online.

It would be useful to attach a digital risk rating or quotient to activities online, e.g. banking or e-commerce transactions, so that users can judge the level of risk they are taking on. This digital risk rating is assessed it should take into account e.g. privacy, how the data generated is used, who has access to the data, how secure the activity/transaction is, procedures and technology that company has in place for cybersecurity, procedures that company has for notifying users of hacking attacks or data loss, how the company deals with user requests for data or reports of hacking, etc.

Some independent international organisation would probably have to assess the digital risk ratings. Just as credit rating has grown, digital risk rating may need to be introduced to in this digital age.

DigitalAsian

Digital Content in Regional Languages

Digital Content in Regional Languages

Digital content in Indian languages in the areas of entertainment, e-shopping and local services is growing but needs to catch-up with content in English. There is a shortage of original content in vernacular languages in India. Apart from music and films, content in India’s regional languages needs to increase in other sectors to get more people online.

An increase in digital content in India's regional languages will have definite advantages in India. Digital India programme should get ideas to improve the content in India's regional languages.

DigitalAsian

Data Assets

Data Assets

Aren’t all companies that have millions of users/customers just data companies?

When Uber started out, you could perhaps call it a ride-sharing/mobility startup. But now with millions of users worldwide, it is really a data company – the mobility aspect of their business is now just a side-show. Same goes for the FAANG companies. They have just become data acquisition platforms.

Each user gives a certain amount of their data when they use a digital platform like Uber, Facebook, Google, etc. What type of data the user gives depends on the platform. E.g. using a search engine, ecommerce, fintech/digital payment platform or social media platform, a user will give different data to each of these platforms. Each of these platforms has a wealth of data from its users. And when combined can produce a clear picture of each user.

If it scales up, every startup, in the end, becomes a data company. Its all about the data now.

DigitalAsian

CyberINsecurity

CyberINsecurity?

Cybersecurity continues to be a hot topic. With the number of hacks and data leaks every year, cybersecurity is on all our minds.

As more of our lives are going online with AI, IoT, Fintech, (Aadhaar in India) and smartphones, people want to feel secure and feel they can trust the technology – see The Technology of Trust.

Companies that hold data, don’t only need to get the latest cybersecurity technology but also need to get their staff procedures in place to ensure that things like phishing emails don’t work. It is not just about technology itself but about daily practices about how we ourselves deal with our online devices and our own data. It’s about getting the cyberbasics in place.

In the digital world we need to have not just the latest anti-virus software but a regular programme of practices and procedures to combat ever more sophisticated cyberattacks.

There probably needs to be a co-ordinated effort, globally, to deal with cybersecurity.

DigitalAsian

Creating Communities Increases Opportunity for Revenue Generation

Creating Communities Online

Creating Communities Increases Opportunity for Revenue Generation

Empowering individuals through simple use of apps to create communities online of people with similar interests by giving them access to a distribution channel of one sort or another, so that the community can then interact in the real world, is a way to survive in the startup ecosystem.

Allowing communities to use and share their knowledge and resources to bring together global communities of like-minded individuals should be the goal of B2C, consumer orientated startups as this will keep users logged on for longer.

Startups that can create communities online that then carry forward into the real world will prosper as they will have the opportunity of both online and offline channels to market to users. Creating communities through your startup increases the opportunities for revenue streams. Opportunities are then there to partner with other service providers to increase your offerings to your customers.

DigitalAsian

Cloud Control

Cloud Control

Cloud Control

Every cloud has a silver lining

Want to start a startup? Most probably you will need to think about hosting a website or an app, and data services.

That’s where the cloud providers come in. They have the scalability and reliability, whether your website has 100 users a day or 100 million users, the cloud providers can deal with this scale and provide data and other services. They also provide reliability that your website will rarely go down.

A lot of the startups are based on cloud platforms. Even IoT depends upon cloud services. Cloud providers are deeply embedded into the startup ecosystem, business environment and digital infrastructure nowadays. In India, cloud providers are marketing their services heavily, including hosting events in cities to attract customers and recruiting more customer service agents who can help clients migrate to their cloud.

DigitalAsian

Blockchain Energy

Blockchain Energy

Blockchain Energy

Using Bitcoin and other cryptocurrencies requires a lot of computing time. Each Bitcoin transaction takes up a huge amount of energy to run the servers that do the ‘mining’ that is required for the blockchain technology that underlies cryptocurrencies.

If bitcoin becomes a widely used digital currency and if blockchain is used for other purposes such as supply chain management, this will require huge amounts of energy.

A cashless economy where digital payments become the norm will require huge sources of energy to keep it going. Along with electric vehicles (EVs) which will probably also become prevalent, electricity generation and battery technology will have to keep up. Could there be like blockchain and bitcoin blackouts in cities where power companies try to cope with the energy demand?

It will be industries involved in power/energy generation, battery technology and computer servers that do well on the back of blockchain (and EVs).

DigitalAsian