Thread by @RaviGane

Clear directions from venture capitalists on fund raising
1. Acknowledge the new reality that revenues are tending towards zero. Prior valuations and also cost structures were based on revenue projections. Now, costs need to be reimagined from base levels (1/n)

Investors are more than happy to support founders. No investor is saying NO to funds. However, such requests need to be practical and balance obligations. Every founder has to be rational and bring costs down. (2/n)

Founders need to be practical at this time. Valuations were based on GMV, however, now is the time to Be PRACTICAL and accept lower valuations. This also means that a company hoping for a Series D valuation might have to settle for Series C valuation. (3/n)

Heartening to see serial entrepreneurs talk of giving options rather than effecting salary cuts. Options is the best way of keeping your employees motivated #Respect (4/n)

Companies that master unstructured loans shall emerge as the champions in lending. This is the beginning of a revolution in lending similar to the period when EMIs started. SMEs won't be served by banks or NBFCs as their credit scores will go down. Fintech will emerge. (5/n)

Commerce is taking the leap. More brands will move to the O2O model. The Amazon model of warehousing will pave way for the store led commerce model where technology plays a leading role (6/n)

This is the holy grail moment for grocery delivery . Almost everybody is trying their hand at grocery. Even in such times when fear psychosis prevails, the brand delivering grocery is godsend and welcome in the house. People are also not scouting for discounts in such times (7/n)

Post the crisis, online commerce will see a faster recovery than offline commerce. People have tasted convenience offered by e-commerce during this crisis. Foot traffic remains low in China at restaurants, malls, shops even after the crisis has ended there. (8/n)

Tiktok has grown phenomenally and transformed from a casual / family content app to being a lifestyle platform having videos on fashion, cooking, exercise etc competing directly with a YouTube. (9/n)

Social platforms will aggressively counter influencers and social commerce. This will be true of all platforms including Facebook, Tiktok, Instagram which are using AI to control visibility in the news feed and restricting forwarding. The era of free publicity is over. (10/n)

The utility of influencers will largely be as content creators. Social commerce will also transition to owned platform rather than third party platform as Facebook will increasingly monetize commerce. (11/n)

Education from home will become mainstream. Two models will emerge - classic marketplace model and proprietary content model. The coaching industry headquartered in Kota will move online to offer JEE preparation. Digital will enable enhanced access to reputed institutions. (12/n)

Remote recruitment and work from home will facilitate access to talent in small cities. Talent in small cities, reluctant to move to the larger cities can be utilized. Remote working can become mainstream and these will help bring down office occupancy costs. (13/n)

Remote working has proved to be more efficient in structured organizations where delegation of work happens as opposed to organizations with flatter structures. Delegation of work matters more as bosses do not have regular oversight. (14/n)

Hospitals will emerge as care ecosystems and not just physical centres of medicine. Their business models have been disrupted and they are hitting the refresh button. Insurance will follow hospitals. Consumers will expect holistic services and longitudinal tracking. (15/n)

Doctors will need formal certification in telemedicine. Liability will shift from the technology provider to the doctor. Voice recording of conversations shall become the norm and patients will also need to be educated on the modalities. The interaction must be addictive! (16/n)

Coronavirus has already been declared force majeure. However, going forward, insurance companies will come up with newer products specifically covering pandemics such as Corona Insurance. We have already seen Cancer Insurance, but a Corona Insurance will definitely fly. (17/n)

Spray and pray model of user acquisition will end in the short term. VCs will not hesitate to spend, but expenses, particularly the risky ones will not be funded. Big cheques won't come easily. Marketing budgets will be redeployed into operations. (18/n)

Tourism, which is facing the biggest disruption, needs upskilling to create a sophisticated workforce. Just like what Egypt did in the aftermath of Arab Spring. Invest in infrastructure building that also aids construction sector. Prepare to grab a lion's share of global (19/n)

Post the crisis, 80 pc of startups will turn profitable. This trend had started in Q4. No investor will be interested in startups that don't have a viable business model and unit economics. Today, 18 pc of startups are well funded, yet deeply unprofitable. Need to change. (20/n)

Demonetization and the payments stack led to a robust payments ecosystem in India. Now this will happen in health sector. ISpirt is India's stack for health. In the coming years, we will have a dozen unicorns in health. As told by @RajanAnandan (21/n)

HealthID will determine everything - fitness levels, disease management, insurance. Travelling and immigration shall require a Health Passport. Covid will emerge as the generic pharma moment for APIs and medical devices startups. (22/n)

Lenders have gone underground. Their business models were unprepared to handle this risk. Credit behaviours of customers have changed. Current problem is not of TAM but one of recovery. Cash access needs to be enhanced without undue risk. (23/n)

Grocery was an $800 bn industry, of which online was 1 pc whereas modern trade was 3.5- 4 pc. Overnight, there was an expectation for #BigBasket to scale from $1 bn to $200 bn. Scaling the infrastructure is a challenge. People celebrate when they get a slot today. (24/n)

Advice for founders from @RajanAnandan : 1. Extend the runway with existing cash 2. Approach existing investors 3. Take the offer that comes your way, else it will be gone
Focus on building a real business. India has 450 mn DAU - get to first 50000 users without marketing (25/n)

This crisis will impact group mobility and give rise to INTEGRATED MOBILITY, wherein we have goods and people travelling together. We can have parcels in middle seats of flights and grocery items in our Uber. Bike taxis, car pools, shuttles will face difficulties. (26/n)

E-rickshaws, autos, public buses will need to have added safety factor. Mobility economics will not just be about efficiency and affordability, but also safety. Supply side is choked in India, demand elasticity exists to limited extent as higher costs will be an issue (27/n)

Within shared mobility, consumers will lean towards options where people to people contact is not involved. Given postponement of vehicle purchases, rentals will do well as long as there is an assurance of sanitization of vehicles. Ownership will also increase as in China (28/n)

Hardware design of group mobility options will change drastically. Social distancing norms will need to be implemented in mobility options Innovations are the need of the hour. E- rickshaws might have a ply as a separator. Govt surveillance of shared mobility will go up. (29/n)

For venture capitalists, LPs have been supportive, although there are concerns for portfolio companies. Valuations will correct by 25-30 pc for Series B and above. In 2008, they took 6-8 qtrs to recover. Check sizes will reduce in early stage as also the planning duration (30/n)

Watershed moment for edtech. Schools and teachers are going online and this validates online learning - people trust schools, teachers. Adoption has shot up and behaviours will stay. Monetization will be strong. It is a sector, which is comparable to West in terms of size. (31/n)

Education is an investment in future, people sacrifice vacations for education. School segment is ready. Tuition, test preps, colleges are also moving online. Upskilling segment was already online. More than 40 universities approached BYJUs to take their courses online. (32/n)

Edtech demand from Tier 2/3 cities. More so, because quality of supply is weaker. BYJU serving more than 20000 pincodes. Need fair pricing given low per capita income in these markets, as also language options - both Hindi and regional in content. (33/n)

BYJUs started in 2015 and did not have a live offering given bandwidth. Now, they have launched. We are now seeing specialized edtech startups which can monitor attentiveness of students, how well concepts are understood and devise means of engagement. (34/n)

SAAS based startups like Freshworks and ZOHO have been immensely successful. We will see unicorns emerging in this space and Indian companies will dominate the world in innovation in next 1-2 decades. India is not an easy market and success here is easy to replicate abroad (35/n)

Unbundling in start up parlance has been a question of the depth of demand. Justdial got unbundled and Zomato, UrbanClap were created. Nykaa is a case of successful unbundling of cosmetics from ecoms. PayTM and healthcare are getting unbundled now. Next in line is Zoom. (36/n)

In healthcare, Unbundling is happening with specialized medicine delivery platforms, testing labs, and even hospitals. We have seen emergence of Cloud9 hospitals. People will not be comfortable going to a place where those with other diseases might be in the same elevator. (37/n)

A system needs to be #antifragile like airlines. With each crash, it becomes safer to fly! For building antifragility, need skin in the game, redundancy to absorb shocks, optionality, flexibility, tinkering (startup), falsification and No Neomania #NassimNicholasTaleb (38/n)

OTA platforms were disrupted due to C19. Most were unprepared even 4-5 wks back. It was unprecedented - travel was at the centre. First time ever that demand has come to a grinding halt and with no alternative. Existing rules of physics have collapsed in a black hole (39/n)

@ixigo had just turned profitable and innovated to survive - launch of insurance for refunds, humanitarian approach, extreme transparency in communication, ruthless cost saving all fronts, engaging through content entertainmt and games to arrest DAU #Respect @alokebajpai (40/n)

@SetuAarogya has the potential to be the most used app. Can be used for screening travellers. They may open APIs. E-Pass feature can be made mandatory for all. Indian version of China QR codes. Cabs can have physical plastic compartments for drivers ( happened post SARS). (41/n)

Aftermath of C19, nations will promote domestic tourism. Remote offbeat places like NE will become popular. Experiential travel, andvhence, discovery platforms will grow. MICE impacted till end 2020, domestic will pick up in Oct. Business travel and bleisure will reduce. (42/n)

Cryptocurrency (Bitcoin) has got decentralised over the years after each Halloween event. Today, Bitcoin prices can absorb shocks given the prices at which it sells. Amidst C19, Bitcoin has emerged as the DIGITAL GOLD. It has retained value despite a fall in market cap. (43/n)

M&A activity is likely to pick up during downturns like C19. Companies which don't manage to raise cash won't have an option. Particularly true of those with poor unit economics. Right now, stock based deals will happen rather than cash based deals and cash exchanges. (44/n)

Retail industry wants to adopt tech - order management systems to turn stores into delivery hubs. However, they want partnerships based on joint outcomes and revenue sharing like telecom towers. C19 might lead to a decline in fee based business models #MitigatingRisk (45/n)

Other side of the world exists which is longing to celebrate. Wedding halls for Q4 are being pre-booked right now. #RajivBajaj says orders from Austria n Poland have increased 50 pc. We might see spurt in Indians going abroad as travel industry offers discounts unheard-of. (46/n)

Alternative business models will emerge in food retail such as @ScootsyIt asides e-grocery. Consumers seek 360 deg convenience, incl product origin and genuineness . Also, they won't take risk for buying essentials and ask children to stay away from brands they disapprove. (47/n)