Indian SaaS companies could potentially corner 8% of the global small and medium business market for SaaS products by 2025. The expectation is that the next 12 months will see four or five of these companies achieve $50 million-$100 million in sales, which, in turn, will set the ball rolling for others in the pipeline.
From the product and technology perspective, things are sorted for these companies. While the cost advantage continues to be an attractive selling point, SaaS companies are equally focusing on geographical expansion and broadening their array of products to boost top-lines.
However, it’s not a revelation any longer that the Indian startup ecosystem has gained momentous height in the niche global market but PlayShifu, an Augmented Reality based educational games startup, has proved that not just SaaS startups, but product-based startups can also mark their print in the very discerning global market.
Sharing some Gyan on the evolution of the Indian startup ecosystem from a mere service provider to product provider is Vivek Goyal, Founder of PlayShifu. In a short span of time, PlayShifu launched its consumer tech products significantly in 11 countries and have been a part of the biggest trade fairs around the world, namely New York Toy Fair, Hong Kong Toy Fair and Nuremberg Toy Fair.
With its tech prowess, PlayShifu could spread its wings on Kickstarter, a New York-based crowdfunding platform where the founders used Kickstarter strategically to get global traction. Last year, PlayShifu’s AR enhanced Orboot, was immensely appreciated on Kickstarter and gained 1633 backers from 60 countries. The company’s global market strategy has helped them to grow 10x in the last year and has opened up new avenues for the nascent Indian STEM toy market.
At PlayShifu, Vivek Goyal has developed an augmented reality learning platform for children that makes learning fun while gaming. With Voice&Data Goyal shared his knowledge on AR and its impact on gaming and more essentially on how Indian product backed digital companies are making a significant mark in the startup world.
Voice&Data: How are product-based startups mushrooming in India?
Vivek Goyal: With the smartphone and connectivity penetration reaching new heights in India combined with the e-commerce boom since 2010, Flipkart and Ola of the world made rapid inroads in consumer product market in India. By 2015, users across Tier 1 and Tier 2 cities in India were well versed with transacting on mobile, using wallets, booking flights and trains, all on the smartphone. This led a large scale VC investments pouring into India for the consumer product market.
With the capital influx, entrepreneurs took bold bets on the consumer market side, innovating for the local markets and local consumer needs. Enterprise tech and SaaS always existed in India, but they used to focus on the overseas market and were service oriented. Then came SaaS startups that started solving problems locally and expanding globally. These startups had customizable products, rather than a unique product for each customer. Taking the next big step, few startups have started creating innovative concepts and are rising above the crowd.
Voice&Data: In your opinion, how would you view the ease of selling SaaS products globally from India if one has a good product?
Vivek Goyal: Scaling any startup is a mammoth task and comes with its own set of challenges. It requires perseverance, innovation, and hard work. But in the case of SaaS, the benefit is that your customer’s behavior doesn’t change drastically from one geography to another. Whereas in a consumer space, it varies almost all the time.
Voice&Data: How is the product based Indian market diﬀerent from the US market?
Vivek Goyal: India is a price conscious and sensitive market, thus the value proposition changes. The US and other developed markets have moved more into a zone where they spend for comfort rather than the necessity. This leads to a diﬀerence in the pricing of the product, and consequently the quality of oﬀerings. Also, cultural diﬀerences creates variation in people’s behavior, which changes business models. For example, the western world is a lot more open to subscription service or in-app purchases.
Voice&Data: What is the current scenario in the online gaming market in India?
Vivek Goyal: The combination of smartphone/internet penetration and increased disposable income at hand has given a huge boost to the Indian digital games scenario. Most mobile games in India still have a very low average revenue per user, except the Casino & Card games category. Understanding this usage pattern, at PlayShifu too, we did not bank on in-app purchases and rather chose to make diﬀerent variants of our AR experiences as physical toys that the consumers can buy from online and oﬄine channels (Amazon, Hamleys, ToysRUs, Flipkart or our website). We even kept the app updates free.
Voice&Data: How do you suggest a product startup to launch its products in a global market?
Vivek Goyal: From a product perspective, i.e. companies which have physical components that it ships to users, the first step is to create innovative products that solve real user need. Once one has achieved to develop a product that has the right market fit, the products have multiple avenues to take it global.
My suggestions are: Kickstarter is a good option for a global launch; participation in international trade fairs can establish international distributor relations; leveraging Amazon’s global seller program – if you have a good sell-through rate on Amazon India – one can access Amazon US, Canada, UK, Japan, Germany, etc.; maximizing social media marketing can be very beneficial; it is important to understand the product’s consumers, crunch data, give what customers essentially want.
Finally, a product startup cannot become complacent. If the product has achieved a certain height, that would not mean one should not raise the roof. It is important to innovate and build new products and repeat the steps to build a brand.
Voice&Data: PlayShifu has an active integration of online and offline gaming. From your experience can you tell how kids can learn and play by merging the two worlds?
Vivek Goyal: There is no dearth of toys in the Indian market. Toys for every age group, catering to all price ranges are available in abundance and new gaming concepts are introduced every year-on-year. Aﬀordable as well as expensive, branded toys are equally popular. But what seems missing are toys that engage and merge education with playtime. Augmented Reality is now taking over the world, impacting many industries and business. The toy market too has embraced AR, making innovative toys that are interactive as well as educational. Augmented reality or AR creates a link between the real and digital world.
For example, AR can be utilized with a physical toy in combination with an app on a tablet or a smartphone that views or scans a real-world object (flashcard or image of a tiger). This scan will bring up a wealth of information over the object in real time (like a 3D figure of the tiger in its natural habitat). The power of AR lies in making a toy interactive and immersive. The strength of a tech-toy making company lies in creating meaningful play experiences using revolutionary technology like AR.