How many Startups have actually made money in the frenzy of the last few years that they have been the craze - especially in India ?! The best of them ( including Snapdeal and Flipkart ) are yet to turn in a profit. Most they have done is build a brand and possibly a functioning logistics chain so far - that itself is creditworthy - but it needs to be balanced with the amount of money they have splurged in doing so ! And thereon, how much will they be able to capitalize on the brand value they have created to generate future profits - is the all important question !
Although very glamorous they may sound, Startups are basically new businesses being tried very frequently by starry eyed youngsters aiming to be a unicorn like Google, Facebook or Tesla ! But it is often forgotten that it takes either sheer Genius or years of building an excellent team with very careful and fail safe plodding to make it big in the cut throat world of building a really successful business. Coz every Business finally survives and thrives only when there is black ink on the bottom line and not red. Vijaya Mallaya and his Kingfisher learned it the hard way - no amount of glamor could save an inherently careless and failing business model. When this cardinal rule is ignored - the result is what we see all around in the Indian Startup sector - 95 % failure rate !
Cheers still to the brave hearts who plunge ahead - in their own way, they are trying to bring about a change in the status quo - a pity really that a lot of them ( and their Angel investors ) have to pay such a heavy price for it. With a little more focus on bottom line and less on glamor or capturing market share, they just might do a lot better !