The lockdown to contain the Covid-19 pandemic has immensely impacted the world of technology. Since the shutdown, online travel platforms, hotel aggregators, flight booking sites, cab-booking apps and real estate-related online services has had zero sales. Despite the present relaxations in the lockdown, there has been no significant improvement in these businesses and the scenario is unlikely to change for quite some time. Though online sale of groceries and food items have surged in this period, there has been negligible sale of everything else, including electronics and mobiles which comprises almost 60-70% of the yearly revenues of e-commerce companies.
Innovation in tech start-ups
During the lockdown, people have turned to the internet as a tool of survival and solution. According to media sources, more than 600 Indian start-up ecosystem stakeholders are engaged in driving solutions by working together to leverage technology and combining it with the speed of scaling up. On a global scale, the ‘Coronavirus Innovation Map’ set up as a global directory by StartupBlink shows hundreds of innovations and solutions that help people to cope and adapt to life amid the Covid-19 pandemic. It also helps in connecting innovators.
According to industry insiders and experts, the pandemic may boost the rise of several innovative tech start-ups which will be essential in the post lockdown phase. A report by The Economic Times states that recently, WE Hub has announced a partnership with 23 start-ups in its latest incubation programme. It is expected that these innovations will be able to solve problems for industries such as manufacturing, FMCG, EdTech, fintech, e-commerce and deep tech.
An executive at a software start-up spoke about some of their projects. He told BE, “With the advent of Covid-19, there was a spike in the demand of certain products, while some products have witnessed a decline in sales. Due to shutdowns in factories, the supply chain is broken. Hence, it is important for the retail and CPG (consumer packaged goods) companies to identify such products and take necessary steps to mend the broken supply chain.”
He further added, “With the help of different analyses, factories and warehouses were identified which required immediate attention. Customers buying patterns were also observed to get a better idea of the type of products needed to be manufactured more for that region.”
EdTech and online payments witness a rise
Even in this challenging situation, there has been a rise in the EdTech sector and it has witnessed a rise in interest from investors. According to media sources, in the first quarter of 2020, Byju’s and Unacademy raised $400 million and $100 billion respectively. Schools and colleges in the country have been shut and more and more young learners are subscribing to these online EdTech platforms. Available data states that in March alone, Byju’s saw six million new students accessing free lessons on its platform. Another EdTech app, Toppr saw a 100% growth in the month of March. A Byju’s executive informed BE, “Our company has done good business in the last few months. Byju’s has also started several home learning programmes that offers a wide variety of subjects and that has attracted a lot of subscribers.”
Additionally, online payment apps have also seen a significant rise in usage. Available data states that 42% of Indians have increased the use of digital means of payments. Google Pay and Paytm are among the top digital payment apps that are being used by Indian customers.
Start-up owners are of the opinion that their sector will have an important role to play in reviving the Indian economy. However, the Finance Minister’s announcements have received mixed reviews from the start-up community. Some feel that as the start-ups are a part of the MSME sector, the segment will be benefited directly or indirectly. Many other industry observers have also noted that the funding route availed by the start-ups and MSMEs are different. While the former gets funding from banks, the latter usually go to venture capitalists or angel investors for funds.