A perfect example of innovation from India – By Alap Bharadwaj

Recently, in a meeting with a VC from a tier 1 global fund, the conversation turned to India’s tech companies and the ideas that these companies are built on. The VC made an all encompassing statement to the effect that every single venture funded Indian tech startup recently has ‘absorbed’ its basic idea from a similar company in the US. The statement was loaded but one that could not, for the most part, be countered. It made me feel disappointed and put a serious question mark on the creativity of nouveau Indian entrepreneurs. I have blogged about this before, and to be perfectly honest – the apparent “apathy” tech entrepreneurs are showing towards actually building out a unique idea SUCKS. Has an Indian company come up in the recent past with an idea before its western counterpart? I am sure many have, but have they been able to drive scale using technology before the western equivalent? I am thrilled to report; the answer came to me on a recent trip to Hyderabad.

Travelling from my house to the Bangalore airport, and then to various meetings in Hyderabad and back was all enabled by one phenomenal Indian company – Meru Cabs. Meru, since 2007 has leveraged GPS to the maximum, efficiently allowing cabs to service customers closest to them, provide great service, reduce a ton of consumer frustration and make entrepreneurs of over 5000 drivers in India. I know what you’re thinking right now – so which western equivalent did they beat out to the implementation of this idea? That would be San Francisco based Uber – a company that has been getting rave reviews from the TechCrunch faithful for months now.

An analysis of the two companies will reveal differences in their business models. While Meru is more of a supply player (the company owns every single one of their 5000+ cabs) Uber is an intermediary that consolidates demand via a mobile app. The secret sauce of both companies is the same though – the ability to track, in real time, a cab’s location and then push relevant demand of transportation services to these cabs. Isn’t Uber better in terms of payment you ask? Uber allows users to pay using the credit card that is on file with the app, while Meru allows their customers to pay via a swipe of their credit card right in the cab as well.

The best part about Meru though is the “Indian-ness” of their model, in allowing so many cab drivers to make a better living by allowing them to offer a better service backed by robust technology. To say I’m impressed with Meru is an understatement, but I’d like to end by stressing that I am not in any way shape or form running down Uber. They are a fantastic American startup with a truly disruptive idea, backed by an amazing set of early investors in First Round, Lowercase Capital and a host of angels. I am just ecstatic, as an Indian, to have such a compelling business model be executed so well in India before it was done out of the Valley!

Do let me know the other Indian companies who, in your opinion, have implemented a disruptive idea before Silicon Valley has.

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About Deepak
Venture Capital and M&A advisor, Entrepreneur, Startup enthusiast..

2 Responses to A perfect example of innovation from India – By Alap Bharadwaj

  1. kg says:

    I disagree with your observation that Indian entrepreneurs are indifferent from trying new ideas that are innovative and not a copy of valley ideas.

    I disagree because the issue is mostly from the investors end. Investors in India need insurance for thier investment, some kind of moral backing that the business will work. To the extent possible, they want to play a PE game rather than betting on an idea or experiment.

    My own experience is with the start up http://helloexpert.com which is founded in India and aimed at global audience. It was one of the few select startups across the globe selected for TechCrunch Disrupt’10 inaugural event in NY. Yes, none of the investors are ready to take risk. I put in all that I could but there comes a point where you need to raise investments.

    I strongly think that there is no dearth of innovation in India. Unfortunately, the venture eco system is not matured yet, unlike in US. Investors just dont want to invest in anything that they think is an experiment or new to market. They are just unsure- which is not the case in US, even a seemingly an average or stupid idea can get funded.

  2. Dear Deepak,

    Just to mention a fact: Singapore has had the “Meru Model” about 10 years before ” Meru” started.

    Arvind Mathur

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