Start-up: An Idea Worth Billions Of Bucks

They say times have changed. Have they? I am of the view that idea generation defies time periods. The word start-up has become commonplace and which is why needs special attention. We should take a, if not “the”, flagship example of start-up successes. You may figure out easily what company I am talking about. Yes, you were right to think of Apple Inc. and, of course, its founder Steve Jobs. Jobs was always one step ahead of the time. If one believes in the idea of being ahead of the time he/she needs to be more or the same like Jobs. Start-ups entail enormous uncertainty and most fail. But a few with severe beliefs in their goals do succeed. As we know in the early days it also took Apple gigantic efforts and people like Steve jobs to get to the stable grounds. Markets did not accept Apple computers quickly. Nevertheless Jobs kept on innovating. And the rest is history.

Perhaps most hyped start-ups today are e-commerce ones. Alibaba Inc. is the new poster boy of the segment. Alibaba has penetrated markets from selling cars to movie production. This also underscores a person’s hard core belief in his idea. Success of Alibaba has made its founder Jack Ma the richest man of china.

There are many such start-ups in India too which are thriving to go global. Flipkart and Snapdeal are two popular start-ups which are headed for their initial public offerings in the near future. They have been aggressive in making relevant acquisitions and building their markets.These e-commerce companies can look into how Alibaba has made its way to a publicly listing. To illustrate, Alibaba used its Alipay, an online payment platform, to enlarge its customer base in its early days. Indian players still need to find an online payment mechanism which will help them accomplish stable market.

There are so many unorganized markets in India that some people with visionary ideas can build successful businesses. For example, milk production and selling, food industry, coffee and other beverages industries etc. are a few examples. Zomato and Holachef are two online restaurant aggregators which deliver food to the doorstep of the customer. Ratan Tata recently has invested in Holachef marking his belief in Holachef’s success going ahead. Along with Holachef Ratan Tata has betted on the success of other start-ups such as Not only he invests in these ventures but also provide his valuable expertise in the subject company.

In a nutshell, it is of paramount necessity that the entrepreneur along with investors has to have sheer faith in his idea and excellent competence in executing on that idea to transform an uncertain start-up into a large accomplished publicly listed corporation.

This blog is written by Sidharth Chhikara, CFA Level III student, Semester III, MBA (FA), ICoFP Delhi Campus.

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