Is it a slow wave of dot-com boom in india? Why are people putting their money on dotcoms….what i fail to understand is the fact that dotcom was written off as dead, but now its springing up bring some investments. WestBridge Capital Partners announcing an investment of $8 million in Shaadi.com. Makemytrip taking B-series funding of $6m. Now can anyone please tell me whats the funda in these investments in dotcom?
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Shaadi.com is no longer internet pure play. They are also entering the brick-and-motor model with the introduction of Shaadi Points.
Here is a link to an article which explains the same.
“Shaadi.com offline version in city soon”
http://www.tribuneindia.com/2005/20050116/biz.htm#3
Over time, Indian dotcom have matured and these dotcoms (Shaadi, MakeMyTrip) also caters the growing NRI’s need.
Ravi Venkatraman
eClickSmart Inc
http://www.ApnaGuide.com
In the last time window, the entire betting was based purely on projections with no evidence of then existing customer base or infrastructure. Internet in India at that point of time was a rather “disruptive ” technology.
Now however, we have crossed a critical mass of both the userbase and their purchasing power. It is thus now a natural progression and projections are very unlikely to go wrong. Add to it the support system such as low computer costs, easy cheap availability of internet connectivity, facilities for online financial transactions, increase in credit card use, and wordlwide developments such as large scale adoption of common standards (for xml etc) has made it just right for conducting any .com business.
Moreover, most verticals in US market have now either started to saturate or face fierce competition. The stronghold of the big three makes it further difficult. In India, the big three are yet to make a presence.
For all these reasons, its only logical for the investors there to take India seriously.
The level of readiness of the market has been reassessed — During the last dotcom boom, there were only 4 million internet users, now there are 30-40 million depending on who you believe. There are few businesses that have been demonstrated to do a runrate of $20million or above in revenues, so to that extent scale is visible.
US based VCs have woken upto India opportunity, and perhaps the easiest models that can be migrated from US (and hence these VCs can understand) are dotcom models. Local market opportunities in other sectors are still too complex to understand, and perhaps riskier.
Of course, what this has done is to bid up the entire sector (mirroring what is happening to Internet even in US again). Rediff is valued at $650 million on nasdaq with around $20 million revenues…