BackForeign entrepreneurs jump into India’s start-up mix
How three fledgling companies started by foreigners seeking to cash in on India's growth story are faring
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India has become one of the top destinations for start-ups. While Bangalore was ranked 19th in the Start-up Genome’s Start-up Ecosystem Report, 2012, Delhi is another emerging hub, experts say. More cities are getting added to the list, attracting many foreign entrepreneurs in the process. While some are enticed by the mystique behind Indian culture, others want to explore the country and travel its length, but one thing that everybody agrees on is that there is a vast opportunity in the country. In the words of David Back, co-founder of ZoomCar: “What works abroad doesn’t necessarily work in India, but a whole lot of other things do work in India. There are lots of opportunities to be tapped, and there is scope for humongous growth in this country." Mint identified three such fledgling companies, launched by foreigners in the hope of making it big in India.
Pick your own self-drive car
Entrepreneurs: David Back and Greg Moran
Company: ZoomCar India Pvt. Ltd
Founded: February 2013
David Back and Greg Moran met almost a decade ago at the undergraduate school of the University of Pennsylvania. They went on to do different things after school, but kept an eye on opportunities abroad. By 2011, Moran had spent a good chunk of time in India, thanks to a consulting job in the clean energy sector, while Back finished his Juris Doctor in law from Harvard Law School.
As Moran travelled across India, he realized that the concept of self-driven cars did not exist here. Back, who was just a phone call away, was as excited by the idea of bridging this gap as Moran was. The idea grew into a full-fledged business in the next year.
Both of them, who were by now enrolled into MBA programmes in different continents, decided to drop out of their respective schools to pursue the idea, and finally launched ZoomCar in February 2013. “The scale of the opportunity to make a huge company in India was present. We wanted to democratize travel and decrease private car ownership in India," said Back.
ZoomCar, launched first in Bangalore, provides self-drive cars to consumers. The cars are stationed at various locations in the city, and can be picked up after ordering it online. The cars include the Reva, Ford Figo, Mahindra Scorpio and BMW, costing anywhere between ₹ 80 and ₹ 750 per hour to hire.
When ZoomCar started, it was present in three locations and had seven cars. Today, the company, which has received “almost 10,000 reservations in Bangalore till date", is present in over 20 locations with more than 150 cars.
The company raised funding from mentors in most of the educational institutions where Back and Moran had studied—including angels from the Judge Business School, Harvard Law School and Wharton Business School. They also have institutional funding from venture capitalists in the UK and the US.
Giving a taste of American burritos
Entrepreneurs:Bert Mueller, Gaelan Connell and Dharam Khalsa
Company:Burrito Restaurants Pvt. Ltd
Founded: October 2012
The three founders, Bert Mueller, Dharam Khalsa and Gaelan Connell, have been friends for their entire lifetime—all of them are under 25 years of age. They each have a reason for starting a burrito chain, California Burrito, in India.
Mueller, a film and media studies graduate, who spent a year in Jaipur on an exchange programme with other international students, craved for his favourite Mexican fast-food joint Chipotle in India. When one of his Mexican friends hosted a party in India and served traditional Mexican food, Indians lapped it up. Confident that Mexican food in India was not too risky an idea, Mueller spoke to Khalsa and Connell.
And Khalsa, though his surname sounds like one, isn’t Indian. His American parents, who are avid yoga fans, converted to Sikhism in 1969—a reason that drew him to the country since his birth. As for Connell, who loves travelling, this was the opportunity he was always waiting for—to come to India.
The founders decided to zero in on the idea of serving the Californian burritos—slightly different from the Mexican ones—in India. They chose Bangalore because of its “weather and cosmopolitan population".
Though a little sceptical after Taco Bell’s failure in India, California Burrito launched its first store inside the technology park Embassy Golf Links in 2012. “The response was insane. Our only worry would have been if Chipotle decided to come to India," said Mueller, adding their research indicated that the American-Mexican fast-food chain had no such immediate plans.
In less than two years since the launch, the company has six outlets. California Burrito’s success can be attributed to the decision to keep prices low and customize menu options to provide more vegetarian options than non-vegetarian ones. Their meals—burritos or rice bowls—are priced between ₹ 150 and ₹ 350.
The company raised almost $1 million from friends and family. It plans to run 12-14 stores by the year-end and enter cities such as Pune, Mumbai and Chennai.
‘Re-commerce’ platform for electronics
Entrepreneurs: Alexander Souter and Saptarshi Nath
Company:Exit10 Marketing Pvt. Ltd
Founded: October 2012
Alexander Souter was posted on work in Delhi for over four years. During this time, he realized that India did not have an online platform to resell electronic gadgets and video games.
“It was a challenge to find video games online. But gaming buffs are an obvious source of games, because you know that once you finish a game, there is no use for it after that. Same goes for a lot of other electronic stuff and gadgets," said Souter.
Over the next few months, he and another friend of his, Saptarshi Nath, founded the platform, Bootstrapp, in October 2012. It is a platform that helps consumers buy and sell refurbished, pre-owned, unboxed and excess stock products in the categories of cameras, mobiles, laptops, games, and accessories.
“It is not like an eBay of electronics, but it does follow the marketplace model, except that we perform quality checks and provide warranties for all products," said Souter, a French native, who grew up in the UK.
A typical product could be an iPhone 5S, which “mistakenly has a warranty two months less than the intended warranty by Apple Inc. This product is, then, sold at almost ₹ 10,000 lower than the marked price".
The platform also offers a pick-up service from the seller’s place. However, pick-up services for smartphones and tablets are limited to the National Capital Region, whereas video game pick-ups are available in 15 cities across India.
Bootstrapp, which raised $25,000 from the GSF Accelerator fund, plans to expand to Mumbai and Bangalore in the next few months.
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