Tu Beer Hai – Startup Bubble is Bursting khalidraza9.wordpress.com /2016/06/09/startup-bubble-is-bursting/

Disclaimer: I believe in the potential of startups and as a consumer of many of them (For example: Uber, Inshorts,Flipkart, TinyOwl, Quikr, …and many more) I feel they have made a difference and are needed.

Yesterday I opened a nifty startup news app to read that Flipkart deferred (read declined) the joining of some veryglossy IIM A MBA grads , to whom they promised hefty packages (and created artificial talent wars). While Iunderstand that there is some internal structuring going on but a company which is leading the current e-commercescene, not only in terms of losses, really has not gotten its act together. In April, Puneet Soni, Flipkart’s ChiefProduct Officer and expensive import from Silicon valley, left Flipkart within 14 months of joining.

Snapdeal and Flipkart have reported losses in financial year 2014-15. Snapdeal’s financial report revealed a lossof Rs 1,328.01 crore. The highest loss reported last financial year was by Flipkart at Rs 2,000 crore.

2 days ago, Anand Chandrasekaran left Snapdeal. Anand, a former Yahoo executive, returned to India in 2014 torun product for the carrier Bharti Airtel. He jumped to Snapdeal last June, and led an effort to integrate moreservices, like Uber, into the company’s flagship app, a model similar to China’s popular WeChat.

3 days ago, Tiny Owl, another start up shut all his India operations, except Mumbai. Wonder why that was left. TheMumbai-based company was operational in 11 cities, including Delhi-NCR, Bengaluru and Chennai, but will nowoperate only in select areas of its home city. It laid off 160 employees in August. In November, it shut operations infour cities — Pune, Delhi, Hyderabad, and Chennai, and laid off another 100 employees.

Housing.com, which is backed by SoftBank and witnessed a management change after founder Rahul Yadav wasevicted following a boardroom battle last year, posted a loss of Rs 279 crore on a revenue of Rs 12.7 crore, up fromRs 48.9 crore in the previous year.

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Sulekha went to Rs 98.5 crore from Rs 80.9 crore, and AskMe’s revenues grew to Rs 43.4 crore from Rs 42.7crore. Losses, however, went up massively, with Quikr and AskMe posting a combined loss of Rs 704.9 croreduring FY15, up from Rs 380.9 crore in the previous year.

Zomato, which posted revenue of Rs 96.7 crore during FY15 had an employee cost of Rs 130.3 crore, whileFoodPanda, with revenue of Rs 4.6 crore, had an employee cost of Rs 5 crore. Earlier this week, however, Zomatosaid it has reached operational profitability in six markets, including India.

Uff, stop it! So whats now?

The startup bubble is bursting!

Let’s understand what I mean here: The valuations… read more

Tagged: flipkart, Flipkart loss in 2015, Flipkart Losses, Housing.com, IIM A, Inshorts, Puneet Soni, SnapDeal,SoftBank, Startup, Startup Bubble, Startup bubble is bursting, Tinyowl, Tu Beer Hai, Uber, Zomato

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