After an extended period of investing in Indian start-ups, investor appetites have waned, as dreams of significant online sales are hit by soaring valuations but still-distant profits. Two of India's best known e-commerce retailers, Flipkart and Snapdeal, have posted significant losses, as they compete for increasing sales through deep discounts. Prime Minister Modi's effort to provide a four-year, $1.5bn government fund to help start-ups is seen as a drop in the ocean. SoftBank predicts Indian e-commerce will surge to $220bn by 2025 up from about $11bn last year. Most of India's tech start-ups are generating losses, following a discount-driven business model to generate revenue from customers that buy and sell goods and services.
After an extended period of investing in Indian start-ups, investor appetites have waned, as dreams of significant online sales are hit by soaring valuations but still-distant profits. Two of India's best known e-commerce retailers, Flipkart and Snapdeal, have posted significant losses, as they compete for increasing sales through deep discounts. Prime Minister Modi's effort to provide a four-year, $1.5bn government fund to help start-ups is seen as a drop in the ocean. Bank of America predicts Indian e-commerce will surge to $220bn by 2025 up from about $11bn last year. Most of India's tech start-ups are generating losses, following a discount-driven business model to generate revenue from customers that buy and sell goods and services.