The regulatory environment is moving at breakneck speed. In sectors like tech and finance, where governments are trying to stay ahead of technological advancements and emerging risks, the problem is especially pronounced.

AI is a prime example of how technology is shaping the regulatory landscape. In fact, a recent analyst study predicts that by 2028, 60% of governments worldwide will adopt a risk management approach in framing their AI and generative AI policies.

AI is just one facet of regulatory compliance that is driving change for today’s businesses. New and existing regulations impact many areas of commerce – employment, environmental, social, and governance (ESG) commitments, international and domestic trade, and financial operations, to name a few. Complicating matters further, regulations often vary across borders, trade blocs, and even languages. 

While regulation is imperative, it also creates huge compliance challenges that, if not properly managed, could have significant financial consequences for enterprises.

But there’s hope on the horizon. 

Impact Of Fast-Moving Regulations

To avoid negative financial consequences, business leaders must understand what’s at stake with non-compliance. Significant financial penalties, litigation, and reputational damage can erode revenue and threaten a company’s long-term stability and growth. 

For instance, the EU’s AI Act, a first-of-its-kind legislation, came into force across 27 member states in August. It emphasises monitoring the regulatory compliance of companies and their responsible use of AI. 

Failure to comply could result in fines at varying levels, depending on the severity of the violation and the company’s size. For example, non-compliance with high-risk AI systems could lead to fines of up to 7% of a company’s annual turnover or a maximum of 35 Mn EUR, whichever is greater.

Every relationship across the business ecosystem – whether with customers, partners or suppliers – represents a potential weak spot. But where there’s a business relationship, there’s also a contract and an opportunity to enforce regulatory standards. This makes contracts one of the most valuable resources in today’s environment, serving as the foundation for every great compliance strategy.

The ability to derive insights from contract data, gain visibility into potential risks, and drive contract performance is essential to ensure that regulations are met while protecting the bottom line. However, this is easier said than done, particularly when you have limited resources and time. 

AI Is Transforming Contracting

AI isn’t just the technology being regulated – interestingly, it’s also the tool that can help businesses comply with stringent and complex regulations globally. Beyond AI regulation, GenAI, in particular, can streamline compliance across various regulatory landscapes, reducing risk and enhancing efficiency. By integrating data across thousands of contracts, AI empowers decision-makers with visibility into business outcomes tied to revenue, savings, and risk. 

Whatever the regulation, AI-powered contracting solutions can extract obligations at scale to help businesses improve the transparency of their relationships and ensure that regulatory compliance clauses are fully realized and adhered to. And it does not stop there – with powerful GenAI-driven agentic frameworks that are evolving quickly, these solutions can also verify that those obligations are met in the normal course of business.

With critical information about business relationships at their fingertips, all leaders – from CFOs, and CPOs to general counsels – are better equipped to set their strategy in this rapidly shifting regulatory environment.

Automating Compliance

Implementing AI-driven solutions offers substantial benefits. With full visibility into contracts across the enterprise, teams can easily identify potential areas of non-compliance and continually monitor relationships to detect unauthorised terms and regulatory violations.

When new regulations are passed, business leaders can automatically pinpoint which business relationships are no longer compliant. For example, AI can assess risk during the negotiation process and ensure critical clauses are not overlooked when new contracts are signed.

AI can also suggest compliant language to optimise the contract, ultimately streamlining reviews while protecting the organisation. This enables legal teams to focus resources on negotiating high-risk agreements that require closer review, rather than touching every contract.

With agentic frameworks and more “thoughtful” large language models (LLMs) like OpenAI’s o1, it is now possible to analyse whether the transactions that result from these business relationships are compliant with the language and obligations in the contract. This adds tremendous value to the 70% value chain of the contract – the life of the contract beyond the negotiation and execution.

Compliance As A Driver Of Financial Stability

With AI as a partner in the regulatory arena, business leaders can focus on what matters most – saving money and driving revenue.

Contracts are the bedrock of business. But they can be a forgotten asset. AI in contracting ensures the full intent of every business relationship is realised in the real world, bringing potential cost- saving and revenue opportunities to the surface that might otherwise be overlooked.

Contract Intelligence finds value in agreements immediately and then enables continual performance across relationships well into the future, safeguarding your company’s financial health by preventing unwanted revenue leakage that eats away at cash flow and undermines the balance sheet.

Now that’s the sort of AI that everyone can get behind.

The post How AI-Powered Contracts Are Strengthening Financial Health In A Regulatory Shift appeared first on Inc42 Media.

India is on the brink of a major transformation in its transportation sector, with electric vehicles (EVs) poised to play a crucial role in reducing pollution and dependence on fossil fuels. However, widespread adoption of EVs faces significant hurdles, primarily concerning battery charging and replacement infrastructure. 

Two prominent solutions—battery swapping and conventional charging infrastructure—are being evaluated for their potential to accelerate EV adoption in India. Understanding these approaches and their implications can provide valuable insights into the future of India’s electric mobility.

The Present State Of Electric Vehicle Adoption In India

According to the Bain and Company report of 2023, India’s electric vehicle (EV) market is at a pivotal juncture, with EVs currently making up about 5% of total vehicle sales between October 2022 and September 2023. 

Projections indicate that EV penetration could exceed 40% by 2030, driven by strong adoption in the two-wheeler (2W) and three-wheeler (3W) categories, where rates are above 45%. This shift is expected to transform the Indian automotive market, with EVs potentially capturing over 40% of the market and generating more than $100 Bn in revenue by 2030.

Government initiatives like the Faster Adoption and Manufacturing of Hybrid and Electric Vehicles (FAME) scheme and the National Electric Mobility Mission Plan (NEMMP) underscore India’s commitment to accelerating EV adoption. Nevertheless, progress remains slow due to high upfront costs, limited vehicle range, and inadequate charging infrastructure. As a result, India’s EV density remains relatively low compared to global leaders, highlighting the urgent need for innovative solutions to overcome these barriers.

Battery Swapping: A Promising Alternative

Battery swapping consists of exchanging a depleted battery for a fully charged one at specialised swapping stations. This model offers several advantages over traditional charging methods, particularly in the context of India’s unique needs:

• Reduced Downtime: Battery swapping can significantly reduce vehicle downtime. Traditional charging can take anywhere from 30 minutes to several hours, depending on the charger and battery capacity. In contrast, swapping a battery typically takes less than five minutes, allowing drivers to quickly get back on the road. This is particularly beneficial for commercial EV fleets such as taxis and delivery vehicles, where downtime can directly impact business operations.
• Less Infrastructure Demands: Setting up battery swapping stations might require less investment compared to establishing a widespread network of high-speed charging stations. Each swapping station would need to stock a range of batteries and manage their charging, but this could be more manageable than ensuring that every public and private charging location is equipped with fast chargers.
• Reduced Charging Time and Flexibility: With swapping, the challenge of long charging times is effectively mitigated. Users can simply replace their battery and continue their journey, making it an attractive option for users who need to minimise wait times.

Challenges Of Battery Swapping

Despite its advantages, battery swapping presents several challenges:

• Standardisation: For battery swapping to be effective, a standardised battery design is necessary. This requires collaboration among manufacturers, which may be challenging in a diverse market with numerous players.
• Initial Costs: The setup of swapping stations and inventory management can be costly. Moreover, there are concerns about the maintenance and lifespan of the batteries used in swapping systems.

Charging Infrastructure: The Conventional Approach

Charging infrastruture remains the most widely adopted method for supporting EVs. It involves installing charging stations where EVs can be plugged in and charged over a period of time. This approach offers several advantages:

• Infrastructure Development: The development of a robust charging infrastructure can cater to various types of EVs and is not limited to specific battery models. With ongoing advancements, charging times are gradually decreasing, making this a more flexible solution in the long run.
• Ease of Integration: Charging stations can be integrated into existing infrastructure, such as parking lots, residential areas, and commercial spaces, making it relatively straightforward to scale up as EV adoption increases.
• Government Support: Many government policies and incentives are focused on expanding the charging infrastructure, including subsidies for setting up charging stations and regulations to support their installation.

Challenges of Charging Infrastructure

However, charging infrastructure also faces hurdles:

• High Costs: The installation of charging stations, especially fast chargers, can be expensive. Additionally, maintaining and upgrading the network to keep pace with technological advancements adds to the costs.
• Range Anxiety: Despite improvements, range anxiety remains a concern for many potential EV buyers. The perception of limited charging points, particularly in rural and underserved areas, can deter adoption.
• Grid Capacity: Increased use of electric vehicles could put additional pressure on the electricity grid, requiring significant upgrades to support widespread EV charging.

Conclusion

Both battery swapping and traditional charging infrastructure have the potential to accelerate EV adoption in India, but they address different needs and challenges. Battery swapping offers a quick and efficient solution for high-usage scenarios while charging infrastructure provides a scalable and universally compatible approach.

For India to achieve its EV adoption goals, a hybrid strategy that leverages the strengths of both methods may be the most effective way forward. Strategic investments, policy support, and technological advancements will be key in ensuring that both approaches complement each other, driving the country towards a cleaner, more sustainable future.

The post How Battery Swapping & Charging Stations Could Shape India’s EV Future appeared first on Inc42 Media.

In its recent India Development Update, the World Bank reported that India continues to post healthy growth despite subdued global conditions. The World Bank revised the growth forecast for FY25 to 7% from the earlier estimate of 6.6%. 

This positive development came just after the IMF revised India’s FY25 growth forecast upwards to 7% from its earlier estimate of 6.8% on account of improved prospects for private consumption, particularly in rural areas. 

The IMF’s latest data release shows that the Indian economy has outperformed the major economies in the last ten years. India’s GDP has doubled from $2 Tn in 2014 to $3.9 Tn in 2024, a massive increase of 93.1%.

India is expected to become an $8 Tn economy by 2032, while our household wealth has the potential to become $40 Tn. We are in a scenario wherein our HNI population is growing at 16% while our UHNIs are increasing at a double-digit growth, which is exceeding our overall population’s growth. 

It is interesting to note here that the HNIs and UHNIs are unlocking value from their traditional businesses by selling promoter stakes and ESOPs, leading to huge wealth creation in the country. This segment of investors has traditionally invested a large part of their wealth in real estate and now is focusing more on growth-oriented assets (equity products such as mutual funds, PMS, AIFs, or alternate asset classes). 

In the alternate space, their maximum allocation is towards the unlisted space and international investments. Although there are many options for investing in global markets, one of the emerging segments in this space is the GIFT City. This is turning out to be an attractive option to several HNIs and UHNIs who wish to invest via India’s only approved International Financial Services Centre (IFSC).

GIFT City Offers An Array Of Benefits To HNIs And UHNIs

The GIFT City aims to become a hub for international businesses and a price setter instead of a price taker for a few financial instruments, namely bullion. By encouraging entrepreneurship, helping startups expand their domestic businesses, and setting up a world-class infrastructure, GIFT City is making all efforts to be comparable to any other leading IFSC in the world. 

The opportunities and services provided by the GIFT City can help HNIs/UHNIs diversify their portfolios, create assets, and gain exposure to overseas markets.

• Indian residents can easily invest in this option by opening a foreign dollar-denominated bank account with a bank branch based in GIFT City. Both individuals and non-individuals can make outbound investments in equity, debt, or commodities. 
• Individuals’ investment amounts are restricted to LRS Limits of $ 250K. Non-individuals, on the other hand, can invest up to 50% of the entity’s net worth via the Overseas Portfolio Investment (OPI) route.
• NRIs and foreign investors can also invest in Inbound funds (funds that invest in Indian securities). These investments can be made without a PAN card and remain in dollars, too.
• For individuals and non-individuals, the taxation is 20% post-indexation if held for 36 months and 20% post-indexation after 24 months for listed securities on IFSC. The other tax benefits are exemption from STT, CTT, and stamp duty for transactions carried out on IFSC exchanges.
• Additionally, for AIFs registered in IFSC, there is no limit on outbound investments, and a 100% tax exemption can be claimed for ten consecutive years out of a block of 15 years. There is no GST, STT, or CTT, and no concentration norms, while funds can be heavily concentrated, and the setup and operating costs are lower.

Our Take On The GIFT City

The Gift City is an interesting investment opportunity because it allows investors to diversify their portfolios globally rather than parking all their surplus into one asset class/geography. The relaxed investment limit, taxation, regulatory, and operational norms for businesses set up in IFSC make this an exciting option to explore in the coming years. 

In addition, many investment opportunities have opened up for foreign investors, which could only boost foreign inflows into India. Although GIFT City is only in an evolving stage, it has the potential to reshape India’s financial landscape and contribute significantly to India’s journey toward becoming a global economic powerhouse. 

As India continues to be the fastest-growing large economy in the world, the huge wealth creation and the financialisation of savings can significantly benefit investment options like the GIFT City, as investors will continuously look to diversify their portfolios.

The post GIFT City: A Game-Changer For HNIs Seeking Global Investment Opportunities appeared first on Inc42 Media.

For those engaged in the startup ecosystem, understanding and having knowledge of effective tax strategies is essential to achieving long-term success. The Income Tax Act, 1961 (“Act”) has some critical provisions and amendments that could influence your approach to investing, scaling, or exiting your startup. 

In this article, we’ll explore three important sections—reduced taxation of slump sale, updates to buyback taxation, and the end of the angel tax—that are essential for maximizing startup’s potential and minimising tax liabilities on your investments.

Reduced Capital Gains On Slump Sale 

The Budget 2024 has made slump sale transactions an attractive option for companies, with the tax rate on long-term capital gains reduced to 12.5% from the initial 20%. This significant reduction will lead to increased adoption of slump sales as a M&A Structure under following scenarios:

• When companies need to redeploy cash within the transferor company. 
• Facilitating strategic joint venture structures. 
• Other forms of business restructuring like mergers or demergers. These structures are tax and cash neutral. However, the lengthy approval process from SEBI and NCLT makes slump sale transactions more appealing as they don’t require regulatory approval.

This makes slump sale transactions an efficient and tax-effective way for companies to restructure, making it an increasingly popular choice for business reorganisation and exits.

Replacement Of Sec 115QA (Buyback Taxation Law)

The standard practice for angel investors and venture capital funds typically involves an exit clause in the Shareholders Agreement (SHA), usually set for a period of 3 to 7 years. At the end of this period, companies are required to facilitate an exit for investors, either through a secondary sale or by buying back the shares.

Previously, companies were subject to 20% tax (plus surcharge/ cess) on the difference between the amount paid on buy-back of shares and the amount received by the company on the primary issuance of shares under Section 115QA of the Act. Furthermore, the proceeds from the buyback are tax free in the hands of shareholders under the Sec 10 (34A) of the Act. 

However, under the Finance Act of 2024, the tax burden for buyback has shifted from companies to investors, which will be applicable from October 1. The entire buyback amount will now be taxable to investors under the “Income from Other Sources” (IFOS) category. 

While the Capital loss would be available to the extent of cost of acquisition, they cannot be offset against the income under IFOS, leading to upfronting of taxation through deemed dividend. 

This presents a significant tax challenge for angel investors, who are often high net worth individuals (HNIs) subject to the highest income tax rate of ~40% resulting in an additional tax burden of ~14%. This shift in taxation could discourage the use of buybacks as a viable exit strategy for angel investors and venture capital funds.

Abolishment Of The Angel Tax Provision [section 56(2) (viib)] 

The angel tax, introduced in the 2012 Budget was aimed to curb money laundering but inadvertently became a significant hurdle for startups. High Net Worth Individuals (HNIs) and other investors, known as angel investors, who provided capital to startups often faced taxation on the premium paid over the Fair Market Value (FMV) of shares. This premium was taxed as ‘Income from Other Sources’ at an effective rate of 30.9%, leading to what became known as the ‘Angel Tax.’

Recognising the challenges this posed to the startup ecosystem, the central government abolished the angel tax in the 2024-25 Budget. This move is widely seen as a positive step toward creating a more conducive environment for innovation and investment in India. Abolishment of this tax is expected to bolster the startup ecosystem, enhance investor confidence, and stimulate economic growth by reducing the financial burdens on startups and encouraging greater investment in the sector.

The recent tax reforms in India, such as lower taxes on slump sales and the removal of the angel tax, are reshaping the startup ecosystem. These changes reflect a more dynamic tax environment, requiring startups to be agile and well-informed to thrive in this new landscape.

The post A Guide To Tax Laws For Angel Investors, Startup Founders And VCs appeared first on Inc42 Media.

The rapid evolution of Generative AI (GenAI) is transforming business operations and innovation. What started as a niche technology has now become a driving force across industries, from chatbots to content creation. 

With LLMs like GPT-4o and Llama, AI is expanding creative and analytical possibilities, propelling technology into the mainstream and fueling both excitement and skepticism. 

On one hand, companies like Nvidia have seen their stock prices soar, AI-related job postings on LinkedIn have increased 21-fold since November 2022, and AI startup funding surged from $22 Bn in 2022 to $36 Bn in 2023. 

On the other hand, according to AWS, only 6% of GenAI solutions are in production and  McKinsey notes that only 21% of those solutions are integrated across use cases

These mixed signals leave business leaders questioning whether to bet big on GenAI or adopt a more cautious approach.

Investment Dilemmas For Business Leaders

For business leaders, particularly in mid-to-large companies, deciding to invest in GenAI is fraught with uncertainty. They often question the necessity of GenAI when their existing machine learning and analytics solutions seem adequate. 

Moreover, the challenges of hiring AI engineers, building scalable teams, managing costs, and ensuring reliable insights add further complexity. A key concern is identifying which business use cases are truly suited for GenAI. 

Recommendations For Business Leaders 

• Business Metric – A recommended approach involves creating a small, internal GenAI task force composed of data scientists, engineers, and software professionals. This team can start by identifying a relevant business use case and conducting a proof of concept (POC). The success of this POC should be closely tied to measurable business metrics, and only if it demonstrates significant impact should the solution be scaled for production. 
• Data Quality – The success of a GenAI project heavily depends on the quality of enterprise data; thus, it’s crucial to streamline the organisation’s data strategy before embarking on the GenAI journey. 
• Governance & Monitoring – To navigate these challenges, business leaders should establish a robust GenAI governance and monitoring plan. This ensures that GenAI outputs are reliable, consistent, cost-effective, and compliant with the company’s information security standards. 

In essence, for business leaders, the strategy should be to ‘Bet and Check’, starting small, identifying a business metric as success criteria and scaling only when the value is clear.

Consulting Challenges

AI practitioners, especially in consulting, face their own set of challenges. While traditional data engineering, data science, and analytics projects still constitute a significant portion of their revenue, the rise of GenAI presents both a threat and an opportunity. 

The fear of missing out (FOMO) on the GenAI wave is palpable, yet there’s a risk of losing credibility if they invest too heavily without clear returns. Consulting firms are expected to be trusted advisors and must navigate the hype and reality of GenAI before their clients do.

The GenAI landscape is dominated by hyperscalers like Azure, Google Cloud, and AWS, each with its own set of challenges and maturity levels. Choosing the right partner is crucial but far from straightforward. 

Recommendations For Consulting Partners

• AI-First Culture – To succeed, consulting firms need to embrace an ‘AI-first’ culture, establish GenAI centers of excellence, and start with targeted POCs. 
• Market Differentiation – By identifying key business domains and use cases where GenAI can add tangible value, they can develop differentiated solutions that showcase their expertise and build trust with clients. The goal should be to solve real-world business problems, avoiding the temptation to create “shiny toys” that impress but lack substance.
• Strategic Alliances – Strategic partnerships with the right hyperscaler can significantly enhance a consulting firm’s ability to deliver impactful GenAI solutions. 

For consulting partners, the advice is to ‘bet big in pockets’, focusing on specific areas to build market differentiation and credibility.

Skill Evolution For Engineers

For data professionals—data scientists, engineers, and analysts—the pace of GenAI development is both exciting and intimidating. The rapid automation of tasks raises concerns about obsolescence, and the steep learning curve associated with GenAI skills adds pressure. 

These professionals must decide whether to invest in learning these new technologies or risk falling behind. However, while GenAI may require specific skills, the foundational principles of software engineering and programming remain essential. 

Recommendations For Engineers

• Core Competency – Data professionals should continue to hone their software engineering and programming skills, as these are still vital in the GenAI era.
• Expand Knowledge Horizon – Engineers should focus on expanding their expertise both ‘left and right’, meaning they should deepen their understanding of the business use cases they support and the insights their work generates. For instance, a data engineer should not only build data pipelines but also understand the business context of the data and how it is used to generate insights that add value. This holistic approach is critical in the GenAI world, where engineers who fail to broaden their skills risk becoming obsolete.
• Beginner’s Mindset – Adopting a beginner’s mindset, as embodied in the Japanese concept of Soshin, is crucial. This mindset fosters continuous learning and adaptability, ensuring that professionals remain relevant even as technology evolves. 

For data professionals, the clear recommendation is to ‘Go All-In’ on GenAI, embracing the opportunity to learn and grow with the industry’s advancements.

The question of whether to bet big or check on GenAI is one of the most pressing issues facing businesses today. In a world where GenAI could be the next big wave or just another hype cycle, informed decision-making is critical for success.

The post The All-In GenAI Gamble: Who Should Bet Big And Who Should Check? appeared first on Inc42 Media.

A survey report by LocalCircles in March revealed a startling fact: more than 70% users may stop transacting via UPI if there is a fee. The debate over fees for UPI transactions drew everyone’s attention in August 2022 when the Reserve Bank of India (RBI) released a discussion paper proposing a tiered fee structure for UPI payments. 

However, the proposal was not taken forward and the government said it would not levy any charges since UPI is a ‘digital public good’. Interestingly, the topic rekindled a discussion among industry stakeholders, experts and small UPI players: how to make UPI sustainable?  

Let’s look at what UPI does today. 

According to the National Payment Corporation of India (NPCI), UPI facilitated more than 48 Cr transactions per day while the monthly value reached 20.64 Lakh Cr in July. The sheer size of UPI – both in terms of volume and value – makes it a strong driver of financial inclusion as it enables millions of Indians from across varied socio-economic strata to make and receive payments. 

The number of participating banks on UPI, according to NPCI, has grown to 605 in July. Despite its popularity and widespread use, the UPI ecosystem currently operates with little direct revenue generation from users or merchants. Instead, according to government data shared with an online news portal, INR 3,600 Cr was spent between 2021 and 2024 to promote UPI and RuPay. 

Considering its growth, digital banking consultants have suggested that introducing fees could ensure UPI’s long-term sustainability. The Reserve Bank of India’s (RBI) Payments Vision 2025 also presents a strategic plan designed to enhance India’s digital payments ecosystem. 

A central focus of this vision is the acknowledgment of the costs associated with delivering digital payment services, such as switching fees and interchange fees. 

The Need To Introduce Fees For UPI Transactions 

The previous RBI proposals, which aimed to introduce charges for UPI transactions, included the possibility of implementing a tiered fee structure based on different transaction amount bands. This approach could help balance the interests of various stakeholders while ensuring the sustainability of the digital payments ecosystem.

One key advantage of UPI for merchants is the relatively low cost of infrastructure required for acceptance. Unlike card-based payment systems, which often necessitate the installation of expensive point-of-sale (POS) terminals, UPI relies on QR codes. This technology is more affordable and easier to implement, making it accessible to a wider range of merchants, particularly small and medium enterprises.  

Comparison With Other Digital Payment Methods

UPI is preferred for its cost-free transactions, unlike other digital payment methods, such as credit and debit cards, which typically charge a fee. However, this no-fee structure might limit UPI platforms’ ability to invest in new features, security measures, and customer acquisition.

Chief financial officers of international UPI companies suggest that merchants’ fees on UPI transactions encourage investment in the platform by creating a revenue stream to support ongoing development.

Maintaining Competitiveness With Other Payment Methods

Notwithstanding financial inclusion as one of UPI’s key goals, if implemented thoughtfully, fees could also provide resources to expand UPI’s reach and capabilities, benefiting more users. RBI discussion paper suggests that UPI, functioning similarly to other payment systems such as Immediate Payment Service (IMPS), should have a fee structure that reflects its operational costs. 

The RBI has noted that various stakeholders incur an average cost of around ₹2 per UPI transaction, which could justify the introduction of a tiered charge based on transaction amounts.

There are charges already levied on Credit lines from UPI, but it should also come up for bank accounts as well, so that everybody gets to have a little bit of share for the value they add in the ecosystem in order to remain competitive. Additionally, a reward system should also be introduced for those customers willing to pay charges, similar to that of Credit Cards.

This way UPI will enhance the overall ecosystem alongside supporting financial inclusion. This competition of charges can lead to a “better customer experience,” benefiting users through improved services and options.

Market Dynamics: Dominance And Competition

The UPI market is currently dominated by Google Pay and Walmart-owned PhonePe, which account for approximately 80% of transactions. Another major player, Paytm, has seen its UPI transactions drop from 1.4 Bn in February to 1.3 Bn, partly due to regulatory limitations over claims of non-compliance. 

This dominance by a few large players poses challenges for small merchants, especially roadside vendors, who might be most affected if a flat Merchant Discount Rate (MDR) structure were introduced. Although a tiered MDR structure based on average monthly volumes is more likely, the concern remains that some vendors might go back to preferring cash transactions. 

However, introducing fees could encourage smaller businesses to focus on acquiring new customers and competing more effectively with these giants, thereby leading to a more dynamic and competitive market landscape, benefiting consumers with better choices and services.

Way Forward

As the RBI and stakeholders engage in discussions around the introduction of charges for UPI transactions, it’s essential to consider the cost advantages that UPI offers to merchants. The debate should also factor in the challenges and the opportunities of sustainability, competition, and user expectations in India’s digital payment ecosystem. 

A well-designed tiered fee structure could help maintain the affordability of UPI for merchants while ensuring the financial sustainability of the payment ecosystem. Although experts suggest a minimal fee structure that won’t deter users, it’s clear that personal/peer-to-peer UPI transactions should remain free to support widespread digital adoption.

Finally, finding the right pricing balance will be crucial for UPI’s continued growth and its role as a cornerstone for an inclusive global digital economy.

The post The UPI Fee Debate: Striking A Balance Between Affordability And Sustainability appeared first on Inc42 Media.

The festive season in India is a significant opportunity for ecommerce businesses, with immense potential for record-breaking sales. However, competition is fierce, making it crucial for brands to understand evolving consumer behaviors and leverage new technologies to thrive.

The Significance Of The Festive Season In Ecommerce

The Diwali season marks the peak for ecommerce in India, with platforms seeing high traffic driven by discounts and exclusive deals. Beyond the discounts, brands need to strategically align with changing consumer expectations.

The 2024 festive season will continue to boost brand visibility and expand market reach. By analysing past trends and current market dynamics, companies can refine their strategies to capture a larger share.

Comparative Analysis: Festive Sales From 2023 To 2024

A comparative analysis of festive sales from 2023 to 2024 reveals several key trends and strategies shaping the ecommerce landscape: A comparative analysis of festive sales from 2023 to 2024 reveals several key trends and strategies shaping the ecommerce landscape:

Increased Emphasis On Mobile Shopping  

During the previous holiday season, 61% of shoppers’ online purchases were made on a smartphone, a 27% increase YoY. Hence, this huge rise requires sellers to make their platforms mobile-friendly as well as offer exclusive mobile offers to capture this growing market.

For the year 2024, mobile optimisation is said to remain as the most crucial focus because businesses are expected to continue to improve users’ interactions with mobile users in order to retain consumers and clients.

Enhanced Personalisation

The use of AI to enhance the shopping experience is on the rise. Personalisation techniques, powered by AI, provide targeted product recommendations and tailored promotions, significantly increasing conversion rates.

In 2023, sellers who focused on personalisation saw higher customer engagement and loyalty. For 2024, advancements in AI and machine learning will allow businesses to further refine these experiences, offering customers what they need before they even ask.

Fast Delivery As A Competitive Edge

Fast and reliable delivery has become a key differentiator. In 2023, the number of one-day deliveries increased, reflecting growing consumer demand for quick fulfillment. As competition heats up, brands will need to optimise their supply chains to offer faster, more reliable delivery services, using micro-fulfillment centers to meet the logistical challenges of the festive period.

Rising Popularity Of Tier II And Tier III Cities 

In 2023, for instance, the sales growth of products in the various tiers of cities proves that customers in the second and third-tier cities are more dynamic than their counterparts in the advanced first-tier cities. 

This new and growing consumer base should be targeted in an area where sellers need to come up with particular strategies that can be used to appeal to these classes of consumers within the regions in question. A similar trend is anticipated in 2024. whereby localised marketing strategies and localised products are expected to dominate the market.

Emerging Trends For The 2024 Festive Season

The 2024 festive season brings new opportunities and challenges for ecommerce players: 

Flash Sales And Early Access

Creating a sense of urgency is a proven strategy to boost conversions. Flash sales, characterised by limited-time offers and countdown timers, encourage customers to make swift purchasing decisions. Early access promotions for loyal customers or subscribers can also drive engagement and reward brand loyalty.

• Urgency Drives Action: Flash sales tap into the fear of missing out (FOMO), prompting customers to act quickly to secure deals.
• Exclusive Offers: Providing early access to sales for repeat customers enhances their shopping experience and fosters long-term loyalty.
• Strategic Timing: Scheduling flash sales during peak shopping hours or aligning them with key festive dates can maximise their effectiveness.

Sustainability And Eco-Friendly Products

With growing environmental awareness, consumers increasingly prefer brands that prioritise sustainability. Offering eco-friendly products and sustainable packaging not only meets consumer expectations but also differentiates brands in a crowded market.

• Eco-Conscious Consumers: 72% of US consumers are aware of sustainability issues and seek eco-friendly options in their purchases.
• Sustainable Packaging: Utilising recycled materials and minimising waste in packaging can enhance brand image and appeal to environmentally conscious shoppers.
• Transparent Practices: Clearly communicating sustainability efforts builds trust and encourages repeat business.

Omnichannel Shopping Experience

Providing a seamless shopping experience across multiple channels is essential for meeting modern consumer expectations. Omnichannel strategies integrate online and offline touchpoints, allowing customers to switch effortlessly between platforms.

• Seamless Integration: Ensuring consistent messaging and user experience across websites, mobile apps, and physical stores enhances customer satisfaction.
• Click-And-Collect Services: Allowing customers to purchase online and pick up in-store caters to diverse shopping preferences and increases convenience.
• Unified Customer Data: Leveraging data from all channels to personalise interactions and offers ensures a cohesive and tailored shopping journey.

Implementing These Strategies

To effectively incorporate these emerging trends, ecommerce businesses should:

• Invest In Technology: Utilise advanced analytics and AI to identify optimal times for flash sales and personalise sustainability messages.
• Enhance Supply Chain Efficiency: Streamline logistics to support flash sales and ensure timely delivery of eco-friendly products.
• Foster Cross-Channel Collaboration: Ensure that all departments work together to maintain a consistent omnichannel presence.

Leveraging Insights From Mid-Year Sales Events

Mid-year sales events, such as Independence Day sales, offer invaluable data that can help ecommerce businesses fine-tune their strategies for the festive season. By analysing these sales, companies can identify consumer preferences, top-selling categories, and the most effective marketing tactics. Here’s how these insights can drive success during the festive season:

Identifying Top-Selling Categories

Mid-year sales provide a snapshot of which product categories resonate most with consumers. By reviewing the performance of various products during these events, businesses can make informed decisions about which items to promote heavily during the festive period. For instance, electronics, fashion, and home décor typically see spikes in demand during festive sales.

Refining Personalisation And Marketing Strategies

Data from mid-year events reveals which personalisation techniques have the most impact. Successful use of AI-driven product recommendations and targeted offers can increase conversion rates, as seen in 2023 when brands that personalised their offerings saw higher engagement​.

These insights help refine future festive campaigns by focusing on customer segments that responded well to specific promotions.

Improving Logistics And Delivery Speeds

Analysing logistics performance during mid-year sales can uncover areas for improvement in supply chain management. Whether it’s optimising last-mile delivery or improving fulfillment speed, understanding the bottlenecks experienced during mid-year events allows businesses to make adjustments before the high-demand festive season​

Testing New Sales Tactics

Mid-year sales serve as a testing ground for new sales techniques, such as flash sales, buy-now-pay-later (BNPL) options, and early access promotions. Brands can experiment with different strategies to see what drives urgency and higher conversions, then apply the most effective tactics during the festive period.

The Impact Of Dynamic Pricing Optimisation

Dynamic pricing is an essential strategy during the festive season. By adjusting prices based on demand, competitor pricing, and inventory levels, companies can remain competitive while maximising profits.

In 2023, dynamic pricing helped businesses capture more sales without sacrificing profit margins. For 2024, brands will continue to use real-time data to tweak prices during flash sales and peak demand periods, ensuring they remain agile and responsive to market changes.

Final Thoughts

As the 2024 festive season approaches, ecommerce businesses must adapt to evolving consumer expectations. From the rise of mobile commerce and AI-driven personalisation to the importance of fast delivery and dynamic pricing, the keys to success lie in understanding these trends and making data-driven decisions. 

Leveraging insights from mid-year sales, improving logistics, and embracing sustainability will help brands thrive in an increasingly competitive market. By continuously innovating and staying customer-centric, businesses can navigate the festive ecommerce landscape successfully.

The post 2024 Festive Season Playbook: Trends & Tactics For Ecommerce Brands appeared first on Inc42 Media.

Over the past decade, India has transformed into a thriving startup ecosystem, with over 1.28 lakh startups as of April 2024, up from just 450 in 2016. The country, backed by its trailblazers from the robust startup community, has solidified its position as a major global center for innovation and entrepreneurship.

However, to sustain the momentum and take this growth to the next level in a more holistic manner, we need to look at empowering small-scale and early-stage startups alike. 

These young startups must focus not only on acquiring customers but also on retaining them. Here’s why and how customer retention can be the key to sustainable growth.

The Cost Of Acquisition VS. Retention

Acquiring new customers is notoriously expensive. Studies indicate that acquiring a new customer can cost five to twenty-five times more than retaining an existing one. For early-stage startups operating with limited budgets, this can be a significant burden. 

Often, startups spend heavily on customer acquisition, only to find that these customers do not return, creating a ‘leaky bucket’ situation.

Retention, on the other hand, is more cost-effective and crucial for long-term profitability. According to the book Marketing Metrics, the probability of converting an existing customer is 60-70%, compared to just 5-20% for new customers. This stark difference highlights the importance of focusing on existing customers.

Building A Foundation For Retention

To effectively retain customers, startups must get the basics right. While many martech solutions are available to aid in customer retention, they can be complex and costly. Startups need simplified, cost-effective solutions and comprehensive training to utilise these tools effectively. Growth & accelerator programs can be invaluable in providing the necessary support and guidance.

Chasing The Right Kind Of Growth

Startups often aimlessly focus on widening their customer base without considering the potential of retaining existing customers. Real growth and profitability comes from repeat purchases. For example, if a startup sells a product for ₹100, with a production cost of ₹30 and spends ₹40-50 on marketing, the margin is minimal. 

However, when a customer makes a second purchase, the startup no longer bears the acquisition cost, leading to higher profitability.

Understanding why customers return and leveraging this data is crucial. By analysing customer behavior and preferences, startups can tailor their offerings to encourage repeat business, fostering long-term loyalty and growth.

Leveraging Data For Intelligent Decision-Making

Comprehensive customer data is essential for understanding behaviors and preferences, enabling personalised experiences that drive retention. Combined with AI and technology, first-party data allows startups to build accurate customer personas and make strategic decisions. This approach enhances customer satisfaction and retention rates.

For instance, personalised shopping cart recommendations have influenced 92% of online shoppers to make purchases, according to a study by Instapage. By harnessing these insights, startups can improve their products and services, thereby increasing customer loyalty.

Overcoming Barriers To Retention

Despite the benefits, many early-stage startups struggle with retention due to high investment costs, lack of awareness, and the complexity of martech tools. According to the Mirum India MarTech Report 2023, 57% of respondents were unsure about the ROI of using martech tools, 46% found implementation too complex, and 33% struggled with choosing the right tools.

To overcome these barriers, young startups should consider accelerator programs that offer tailored support and guidance to get started. Additionally, adopting a ‘flywheel’ approach of acquisition, engagement, and retention can help startups balance their strategies and achieve sustainable growth.

The Flywheel Approach

In the early stages, startups must balance acquisition and retention. Over time, as the business matures, the ratio of revenue from acquired versus retained customers should evolve. Mature businesses derive most of their profitability from retained customers while continuing to acquire new ones steadily.

Key Takeaways

• Invest in simplified martech solutions and training.
• Focus on retaining customers from the start.
• Use data-driven insights to personalise customer experiences.
• Balance acquisition with retention for sustainable growth.

In today’s volatile market, focusing on customer retention is not a luxury but a necessity for early-stage startups. By building strong relationships with existing customers, startups can achieve cost efficiency, sustainable growth, and long-term profitability.

 Utilising data-driven insights and personalized engagement strategies, startups can transform themselves from fleeting ventures into resilient, successful businesses.

In this scenario, customer retention doesn’t anymore remain a good-to-have but becomes a ‘must-have’ for early-stage startups, if they truly want to aim at unhinged growth. By focusing on customer retention, startups can build a solid foundation for long-term success, ensuring they thrive in competitive markets.

The post Why Retention Is The Secret Sauce For Early-Stage Startups’ Growth appeared first on Inc42 Media.

A significant trend in the HNI and UHNI space is that substantial value creation in traditional businesses is leading them to go public, supported by favorable market conditions. These businesses are experiencing annual growth rates of 10-15%, so there is a strong case for unlocking value. 

As a result, many of them are setting up their own family offices, and the growth of family offices is exceeding that of our population. While the overall population is growing at 2% per annum, HNIs are growing at 16%, and UHNIs are at a double-digit rate. Consequently, HNIs and UHNIs are considering diversifying beyond their core businesses, which have been their primary asset class to help mitigate risk. 

At the balance sheet level, this client segment is revisiting their asset allocation and wants to demarcate their business and personal wealth. Since they are traditionally heavily invested in property, they are now looking to allocate a significant portion of their assets to growth-oriented portfolios, which may include equity products such as mutual funds, PMS, AIFs, or alternate asset classes, wherein their focus will be on unlisted space. 

Unlocking value from businesses also means they will invest in venture capital through funds or direct opportunities and scout for opportunities in the international markets.

In the current scenario, four significant trends result from the massive wealth creation among HNIs and UHNIs in the last few years.

1. The financialisation of savings has become a game changer, and hence, the share of allocation in physical assets has come down while there has been a rise in investments in financial assets.
2. Equities have emerged as a mainstream asset class, and within this segment, there is a rising allocation to PMS and AIFs compared to mutual funds. There is also a higher allocation to alternate asset classes, with a bias towards the unlisted space.
3. The unlocking of value in traditional businesses is leading to investments in new-age businesses within and outside India.
4. Diversification is happening beyond traditional asset classes and India. Global diversification is achieved through offshore investments or by creating a Plan B, wherein residency options are explored in other countries through specific investment programs.

One of the main reasons for these trends can be attributed to the fact that as wealth is created, the opportunities to get real rates of return from fixed deposits or fixed income mutual funds have diminished as post inflation and taxes, they are hardly able to provide a decent rate of return. In this scenario, investors have had to diversify their wealth between physical and financial assets to achieve real returns. 

Traditionally, Indians have been far more exposed to properties than the world average and far lower in equities than the world average. There is a shift towards rebalancing portfolios by increasing the allocation to equities. In this way, their investment strategy aligns with sophisticated investors in the West. Hence, the HNI and UHNI segments have made significant investments in India.

This can be seen from the fact that individual investors and domestic mutual funds (18.8%) own a higher share of India Inc. than FPIs (17.6%).

However, in the unlisted space,~ 80% of the capital invested in Indian entrepreneurs’ businesses still belongs to foreign investors, who take advantage of the India story regarding growth prospects and returns. Nevertheless, we expect this trend to change as more HNIs, UHNIs, and multi-family offices increase their allocation to the unlisted space. When it comes to global investments, these clients have a Plan B in place. 

This could be getting EB5 visas for their children to provide the best education, setting up a business subsidiary in Dubai or Singapore, or seeking entry into the European region by taking a golden visa for Portugal. This diversification ensures that a small portion of their wealth is invested beyond India, offering security in case of any challenge to India’s growth story. We believe this diversification strategy is the best investment philosophy for these investors.

In conclusion, the family office’s thought process is to diversify and separate business wealth from personal wealth. HNIs and UHNIs have realised that businesses should be one of their investments, not their sole focus. They should not be recognised only based on that investment.

To minimise risk and promote growth, the businesses should be just one part of their wealth. As the scale of business increases and more wealth is created, this awareness among wealthy families will go a long way in promoting investments into growth-oriented asset classes.

The post How The Rise Of Family Offices & HNIs Is Boosting Venture Capital Landscape appeared first on Inc42 Media.

Imagine stepping into a hotel and a robot concierge greets you at your hotel, remembering your preferences. In nearby warehouses, robots manage inventory and streamline deliveries. On the streets, robotic assistants optimise traffic and public transportation, reducing congestion and emissions. This is not a distant dream but an imminent reality, driven by the relentless advance of AI and robotics. 

Earlier this year, the tech world buzzed with excitement as Jensen Huang, CEO of Nvidia, took the stage at the GPU Technology Conference in San Jose, USA, to unveil the Project GROOT Foundation AI model. This revolutionary model, designed to enhance humanoid robots, marked a quantum leap in robotics. Alongside it, the launch of Thor, a specialised system-on-a-chip for robotics, signaled the dawn of a new era in robot sophistication.

Huang’s announcement was more than just a tech showcase—it was a beacon, drawing the collective gaze of the world’s leading tech giants. Open AI, Microsoft, Tesla, Amazon, and Intel are all converging on this new frontier, eager to redefine the global industrial landscape. Their shared vision is bold and transformative: humanoid robots are not just the next step in technological evolution—they are poised to revolutionise industries and redefine the very fabric of our everyday lives.

The Compelling Case For AI-Enabled Robotics

The proliferation of datasets, enhanced computing power, and connectivity in the digital age have fueled the growth of humanoid robotics. These robots stand out due to their ability to process data from sensors, IoT devices, and cloud platforms. They learn from prior experiences to optimise strategies, generate insights, and make informed decisions, providing an edge over traditional robots.

A recent Goldman Sachs Equity Investment report predicts the total market for humanoid robots will touch $38 Bn by 2035, a more than sixfold increase from previous projections. This optimism stems from advancements in end-to-end AI—a machine learning technique that trains neural networks akin to the human brain for complex tasks and multi-modal AI algorithms, which can process various data types like text, video, and audio.

These technological strides promise rapid progress in humanoid robot creation, with the necessary hardware already in place.

Economic And Technological Drivers

Goldman Sachs report also sheds light on a striking development — a 40% reduction in the cost of materials, components, and sub-assemblies for manufacturing high-tech robots over the past year. This cost-cutting is speeding up the adoption of cc in factories and consumer industries. Technological advances now allow manufacturers to automate a wider range of processes, customise workflows, and quickly adapt to market changes, enhancing efficiency and competitiveness.

Additionally, ScienceDirect reports that adding just 1.34 robots per 1,000 workers can reduce workplace injuries by 1.2 per worker, highlighting the significant safety benefits of automation.

Shaping Industries

The future demands more complex and customised products, propelling humanoid robots to center stage across various industries. Logistics companies will use these robots to automate inventory management and optimise routes, while the automobile sector will leverage them for precise EV assembly and component sorting. These robots, adept at navigating hazardous environments, mark a significant evolution from traditional industrial robots.

AI-powered robotics are also fueling demand in smart infrastructure and urban development. Imagine humanoid robots enhancing city planning, managing transportation systems, and revolutionising public services. This isn’t just about convenience—it’s about sustainability and improving quality of life in our urbanising world. The age of humanoid robots is here, ready to reshape cities and industries with unparalleled intelligence and adaptability.

The Investor’s Perspective And Vision For Future 

As tech giants race to develop more sophisticated robots, investors have a unique opportunity to participate in an industry poised for exponential growth. Humanoid robots are more than a technological marvel—they are the harbingers of a new industrial revolution. Their potential to transform industries, improve efficiencies, and create safer workplaces makes them an attractive proposition for investors worldwide.

As we stand on the brink of this new frontier, those who recognise and capitalise on these opportunities will lead the way in shaping a future where humanoid robots are an integral part of our daily lives and industries.

The post Humanoid Robots: The New Frontier For Global Investors appeared first on Inc42 Media.

Water scarcity is one of the most pressing issues faced by small-scale farmers in arid regions. With changing climate patterns and increasing demand for water resources, these farmers often struggle to sustain their livelihoods. However, advancements in water generation technologies are providing new solutions to address this challenge.

Atmospheric Water Generation

Atmospheric Water Generation (AWG) is a cutting-edge technology that extracts moisture from the air and converts it into potable water. This technology is particularly beneficial in arid regions where traditional water sources are scarce. AWG systems can operate in a variety of environmental conditions, making them a reliable water source for small-scale farmers.

Benefits for Farmers

• Reliable Water Supply: AWG systems provide a consistent and reliable water supply, reducing farmers’ dependency on erratic rainfall and depleting groundwater sources. This ensures that crops receive adequate water, leading to better yields and increased food security.
• Cost-Effective: Once installed, AWG systems have relatively low operating costs. They reduce the need for expensive water transportation and storage infrastructure, making them an economically viable option for small-scale farmers.
• Sustainable Agriculture: By providing a sustainable water source, AWG systems enable farmers to adopt sustainable agricultural practices. This includes efficient irrigation techniques such as drip irrigation, which minimises water wastage and maximises crop productivity.
•  Resilience to Climate Change: As climate change exacerbates water scarcity, AWG systems offer a resilient solution. They can continue to generate water even in extreme weather conditions, ensuring that farmers have access to water year-round.

Supporting Indoor Farming And Hydroponics

AWGs are also proving to be invaluable for indoor farming, particularly hydroponics. Hydroponics is a method of growing plants without soil, using mineral nutrient solutions in an aqueous solvent. This method requires a consistent and reliable water source, which AWGs can provide.

• Micro Farms: AWGs enable the setup of micro farms in arid regions where traditional farming is not feasible. These micro farms can be established indoors, providing fresh produce year-round, regardless of external weather conditions.
• Consistent Water Supply: Hydroponic systems thrive on a consistent water supply, and AWGs ensure that plants receive the right amount of water and nutrients at all times. This leads to healthier plants and higher yields.
•  Efficient Water Use: Hydroponics combined with AWG technology ensures efficient use of water, reducing wastage significantly. The closed-loop system of hydroponics recycles water, and AWGs replenish any lost moisture, making the system highly sustainable.

Other Innovative Water Technologies

In addition to AWG, several other water generation technologies are making a positive impact on small-scale farming in arid regions:

• Desalination: Desalination plants convert seawater into freshwater, providing an abundant and reliable water source. While traditionally used in coastal areas, advancements in portable desalination units are making this technology accessible to inland farmers as well.
• Rainwater Harvesting: Collecting and storing rainwater during the wet season is a traditional yet highly effective method. Modern rainwater harvesting systems are equipped with filtration and storage solutions, ensuring that water remains safe for agricultural use throughout the year.
• Solar-Powered Irrigation: Solar-powered pumps and irrigation systems harness renewable energy to extract and distribute water efficiently. These systems are particularly beneficial in off-grid areas where access to electricity is limited.

Challenges And Future Prospects

Despite the promise of these technologies, there are challenges to their widespread adoption. High initial costs, lack of awareness, and limited technical expertise can hinder implementation. However, with increasing governmental and non-governmental support, these barriers are gradually being addressed.

Public-private partnerships are playing a crucial role in scaling up these technologies. Subsidies, training programs, and awareness campaigns are helping small-scale farmers understand and adopt water generation technologies.

Conclusion

Water generation technologies like AWG, desalination, rainwater harvesting, and solar-powered irrigation are transforming agriculture in arid regions. By providing a reliable and sustainable water supply, these technologies empower small-scale farmers to enhance their productivity and resilience against climate change.

As we continue to innovate and invest in these solutions, the future holds great promise for farmers in arid regions, ensuring that they can thrive despite the challenges posed by water scarcity.

The post How Water Generation Technologies Are Boosting Agriculture appeared first on Inc42 Media.

Big data integration has revolutionised the healthcare industry in recent years, presenting new opportunities to customise care and enhance patient outcomes. The phrase “big data in healthcare” describes the gathering and examination of enormous datasets, such as those from genetics, electronic health records (EHRs), pharmaceutical prescriptions, imaging, and insurance information.

In addition, real-time data from smartphones, wearable technology, and Internet of Things (IoT) devices has increased the potential even further. The objective is quite clear: minimise medical errors while lowering expenses, increasing efficiency, and improving the quality of healthcare.

From Reactive To Preventive Care

The field of diagnostics is one where big data is creating the biggest impact. The sheer amount of medical data that is currently accessible, such as genetic data, lab results, and EHRs, enables quicker and more precise diagnosis. 

Advanced analytics and machine learning algorithms can sort through this data and find patterns that the human eye might overlook. When diseases like cancer are detected early, treatments can be implemented at their most effective time. Thus, patients have better odds of recovering, fewer problems, and better prognosis.

Healthcare is increasingly moving toward a preventive model, thanks to predictive analytics. By analysing trends across large datasets, healthcare professionals can identify individuals at high risk of developing certain conditions and intervene before symptoms escalate. 

For example, patients with early warning signs of heart disease or diabetes can be flagged for preventive measures, such as lifestyle changes or medications. This shift from reactive to preventive care not only improves health outcomes but also reduces the financial and logistical strain on healthcare systems by avoiding the costs associated with treating advanced stages of diseases.

Personalised Treatment Via Enhanced Health Monitoring

Patient monitoring has undergone many significant changes as a result of the combination of wearables, sensors, and mobile health applications. Healthcare practitioners can receive data immediately from devices that track blood pressure, glucose levels, heart rate, and other parameters in real time. Proactive treatments are made possible by this real-time data, which lowers the need for re-admissions to the hospital and enhances patient outcomes.

For instance, doctors can watch a patient recuperating after surgery from a distance, which enables them to identify issues early on without the patient having to come into the hospital. Patients who live in rural locations or have restricted access to medical services may especially benefit from this.

Healthcare professionals can develop individualised treatment plans that are updated in real time using patient data by using data analysis. Artificial intelligence (AI) models are capable of analysing test findings, vital signs, and even facial expressions to provide clinicians with exact treatment recommendations and actionable insights. With this dynamic method, medicines are always tailored to the specific patient, improving results and minimising unwanted effects.

A Lifeline For Chronic Disease Management

Chronic diseases including diabetes, high blood pressure, and heart disease are long-term issues that need constant attention and care. In addition to their widespread occurrence, these illnesses can induce complications and hospital readmissions when left untreated, which contribute significantly to global healthcare expenses. But thanks to big data’s potential, chronic illness management is changing, improving patient care while cutting expenses.

Big data is powerful because it can anticipate problems and take action before they arise. Healthcare providers can spot early indicators of a possible health catastrophe by looking for patterns in a patient’s data. For instance, persistently high blood pressure readings in hypertensive patients may indicate a higher risk of heart attack or stroke.

Physicians can use this information to plan emergency procedures, suggest lifestyle modifications, and modify medicine before the patient’s condition gets worse.

This preventative strategy lowers the risk of hospitalisations and emergency visits in addition to the possibility of life-threatening consequences. Consequently, this enhances the patient’s standard of living and lessens the financial strain on the healthcare system and the patient.

Empowering Patients, One Stat At A Time

Big data is not only changing the way doctors treat long-term illnesses, but it is also giving patients more authority to manage their own health. People can better manage their medications, track symptoms, and keep an eye on their own vital signs when they have access to wearable technology, smartphone health applications, and online patient portals.

Patients can make well-informed decisions about their daily routines, including nutrition, exercise, and medication adherence, with the assistance of these technologies, which offer real-time feedback and practical insights. 

Improved self-management results in better health outcomes, fewer hospital visits, and an overall higher quality of life for individuals with chronic illnesses by encouraging a greater sense of self-awareness and responsibility.

The Way Forward For Data-Driven Healthcare

Big data is transforming healthcare by making it possible to provide more proactive, efficient, and individualised care. The incorporation of large datasets into healthcare systems is creating new opportunities for resource optimisation and patient outcome improvement, ranging from precision medicine to predictive analytics.

Notwithstanding, several obstacles persist, including worries about data privacy, difficulties with integration, and guaranteeing fair access to new technologies. The future of individualised treatment will surely be greatly influenced by the power of data as the healthcare sector continues to change.

The adventure is only getting started, but the potential is enormous. In order to guarantee that every patient reaps the rewards of big data and precision medicine, the healthcare industry must embrace this transition.

The post Analysing The Power Of Data In Transforming Personalised Healthcare appeared first on Inc42 Media.

Navigating different avenues to raise capital has always been daunting for businesses, particularly for startups and small and medium enterprises (SME) with limited expertise in banking and finance. Today, many of them are exploring debt funding as raising equity gets harder. It is the right time as the lending environment gets increasingly favourable to startups and SMEs. But for that, companies need to improve their internal processes and boost their risk profiles.

A stable interest rate regime is expected to boost debt financing. Economists are forecasting the current high-interest rate cycle to end soon. Major economies, including India, have witnessed high interest rates over the past few years. However, with inflation cooling off, central banks have taken a more dovish stance towards borrowing. As interest rates plateau, debt financing becomes an attractive proposition for companies.

Moreover, the central government announced a slew of measures in Budget 2024 to boost credit availability for micro, small and medium enterprises (MSME), such as a credit guarantee scheme for MSMEs in the manufacturing sector and credit support during financial stress. The proposal to allow public sector banks to adopt in-house methods for credit assessment, including incorporating data from a company’s digital financial footprint, is another positive move.

Choosing Debt Over Equity

Traditionally, equity and debt have been the two basic types of financing. According to the latest Indian Tech Startup Funding Report by Inc42, the share of debt funding in Indian startups is growing. The value of debt investments in the first half of 2024 reached $576 Mn, more than double the amount raised in 2023.

Interest in debt funding is growing for several reasons. Founders can retain their stake in the business and reduce the cost of raising capital. They can use interest payments as a tax-deductible expense. Moreover, a fixed repayment schedule makes it easier to forecast cash flows. 

But there are disadvantages too. Businesses find it difficult to find the right partner to bank with. Besides banks and non-banking finance companies, there are venture debt funds, a new class of debt funding. 

Secondly, although fixed repayments are good for financial forecasting and modelling, they can exacerbate financial difficulties when a company experiences irregular cash flows.

Pre-Requisites For Raising Debt

It takes much more than a sleek marketing campaign to convince lenders of a company’s ability to honour repayment terms. Founders need to demonstrate business viability and robust financials to lenders.

• Lenders require businesses to have a proven track record of profits or an uptrend in their bottomline. That indicates that a borrower can comfortably repay the principal and interest.
• Business owners must contribute to the company’s capital. Their conviction in the business is evident when they have contributed a substantial part of the capital.
• Companies need to provide assets with real value to back up their loans. Assets may be tangible or intangible, but the value should be such that it can be mortgaged or hypothecated to the lender. 
• The credit profile and risk rating of owners and companies give empirical credibility to the business. A good credit standing enables a business to get better terms on loans.
• A new business with no performance data to back up financial projections can rely on the credentials and credibility of the founders. A founder’s track record of setting up or running a successful business boosts lenders’ confidence.

Establishing Internal Practices 

Critical factors that ensure a positive outcome of a loan application are the company’s internal risk rating and its ability to map its requirements to the fast-evolving, complex lender ecosystem.

• Accounting Practices: Lenders evaluate a company’s financial health by looking at many parameters, including past income and expenditure statements, balance sheets, cash flow statements, customer acquisition cost, the cash burn rate, monthly recurring revenue and projected financial statements. Companies need to monitor these key performance indicators and establish accounting practices that can withstand scrutiny.
• Personal Credit Assessments: Business owners need to have a good personal credit score, while also building the commercial credit score of their business. A strong personal rating depends on factors such as the borrower’s repayment history, the amount of credit limit still available and the length of credit history. The advice of banking professionals is critical in understanding how to assess and boost financial credibility.

• Lender Relationship Building: Startups and SMEs struggle to keep pace with and understand new government schemes or a new class of debt instruments. Besides, they need to be aware of different lenders’ preferences and lending capacity. A lender may have an industry preference or a quota to fill. Founders who have access to professional banking advice stand to gain immensely.

The external environment for debt financing is encouraging for MSMEs. However, business owners need to display long-term commitment and prepare their organisation to move in that direction. Strong internal practices and professional help for a nuanced understanding of the market will go a long way in securing funding. 

The post Raising Funds Through Debt: What Startups And SMEs Need To Know appeared first on Inc42 Media.

In today’s competitive job market, a strong Employee Value Proposition (EVP) is no longer a luxury; it’s a necessity. Companies that excel in crafting and delivering a compelling EVP are not only able to attract top talent but also retain and engage their workforce more effectively.

However, merely having an EVP in place isn’t enough—organisations need to measure its effectiveness to ensure it’s driving the intended outcomes.

Here’s how companies can gauge the impact of their EVP, supported by industry figures, examples, and actionable metrics.

Employee Engagement And Satisfaction Surveys

Employee engagement and satisfaction surveys are among the most direct ways to assess the effectiveness of an EVP. By measuring how employees feel about their roles, the company culture, and overall satisfaction, companies can glean insights into whether their EVP resonates with the workforce.

For instance, the tech giant Google, known for its strong EVP centered around innovation, growth, and well-being, frequently surveys its employees. According to Google’s internal reports, they maintain an employee satisfaction rate of over 80%, significantly above the industry average. This high rate indicates that their EVP is not just well-crafted but also well-received.

Retention And Turnover Rates

A key indicator of an EVP’s success is employee retention. A well-implemented EVP should ideally result in lower turnover rates, as employees are more likely to stay when their needs and values align with those of the company.

According to a study by the Society for Human Resource Management (SHRM), companies with a strong EVP experience a 69% lower turnover rate compared to those with a weaker or non-existent EVP. For example, Unilever, with its EVP focusing on sustainability, diversity, and career growth, reported a 20% reduction in turnover after revamping its EVP in 2019.

Talent Acquisition Metrics

The effectiveness of an EVP is also reflected in a company’s ability to attract new talent. Key metrics include the time-to-hire, quality of hire, and offer acceptance rates. Companies with a strong EVP often see a reduction in time-to-hire and an increase in the quality of candidates.

Take the case of Microsoft. After enhancing its EVP to emphasise inclusivity, innovation, and work-life balance, the company saw a 30% increase in offer acceptance rates in 2022. This shift not only made the hiring process more efficient but also ensured that Microsoft attracted candidates who were a strong cultural fit.

Employer Brand Strength

Another way to measure EVP effectiveness is by assessing the company’s employer brand strength. This can be done through external surveys, rankings, and social media sentiment analysis. A strong employer brand indicates that the company’s EVP is not only resonating internally but also externally, attracting potential candidates.

LinkedIn’s Employer Brand Report 2023 revealed that companies with a strong EVP saw a 31% increase in job applications compared to those without. Companies like Salesforce, which frequently tops employer branding rankings, attribute their success to a clear and compelling EVP that emphasises innovation, equality, and customer success.

Employee Net Promoter Score (eNPS)

The Employee Net Promoter Score (eNPS) is another powerful metric for measuring EVP effectiveness. It asks employees how likely they are to recommend their company as a place to work, providing a clear indication of employee satisfaction and loyalty.

For instance, Netflix, known for its EVP centered around freedom and responsibility, regularly measures its eNPS. The company consistently scores above +60, which is considered world-class, indicating that its EVP resonates strongly with its employees.

Financial Performance Correlation

Finally, companies can correlate their EVP effectiveness with overall financial performance. Research by McKinsey shows that companies with strong EVPs outperform their peers by up to 20% in profitability. This is because a strong EVP not only attracts and retains talent but also enhances productivity and engagement, leading to better business outcomes.

Conclusion

Measuring the effectiveness of EVP gives companies a competitive edge in the talent market

By using a combination of engagement surveys, retention rates, talent acquisition metrics, employer brand strength, eNPS, and financial performance analysis, companies can gain a comprehensive understanding of how well their EVP is performing. In doing so, they can make data-driven decisions to refine and enhance their EVP, ensuring it continues to deliver value to both the company and its employees.

The post 6 Ways Companies Measure The Effectiveness Of Employee Value Proposition appeared first on Inc42 Media.

In the fast-changing landscape of modern workplaces, employee engagement has emerged as a critical factor for organisational success. Employees who are engaged are more productive, imaginative, and dedicated to their employers. 

Traditionally, HR departments have relied on surveys, feedback forms, and periodic reviews to gauge and enhance employee engagement. However, the advent of Artificial Intelligence (AI) is revolutionising this space, offering more dynamic, real-time, and personalised approaches to fostering engagement. 

This shift is particularly relevant in regions like India, where the 2024 Gallup State of the Global Workplace report highlighted that 86% of Indians felt they were either struggling or suffering—significantly higher than the global average. 

Furthermore, only 14% of Indian employees reported feeling they were thriving, compared to the global average of 34%. These statistics underscore the urgent need for more effective engagement strategies, making AI a game-changer for industries worldwide.

Personalised Employee Experience

AI has the potential to improve the employee experience by offering highly personalised engagement strategies. Through advanced data analytics, AI can analyse individual preferences, work patterns, and feedback, enabling organisations to tailor engagement initiatives to each employee. 

For example, AI-driven platforms can recommend personalised learning programs, suggest wellness activities, or customise recognition programs based on an employee’s profile. This level of personalisation helps employees feel valued and understood, significantly enhancing their engagement levels.

Real-Time Feedback And Analytics

Traditional methods of gauging employee engagement, such as annual surveys, often miss out on capturing real-time sentiments. AI bridges this gap by offering continuous, real-time feedback and analytics. 

By analysing communication patterns and employee sentiment through natural language processing, AI can provide immediate insights into the workforce’s mood and engagement levels. This enables HR teams to address issues proactively, make informed decisions, and implement timely interventions to maintain high engagement levels.

Predictive Analytics For Proactive Engagement

One of the most powerful applications of AI in the workplace is predictive analytics. By analysing historical data, AI can predict trends and potential challenges related to employee engagement. For instance, it can identify patterns that may indicate a risk of high turnover or decreased productivity. 

With these insights, organisations can take proactive measures to address these issues before they escalate, thereby retaining top talent and maintaining a motivated workforce.

Enhancing Employee Well-being

Employee well-being is an important aspect of engagement, and AI plays a crucial role in encouraging it. AI-powered wellness programs can monitor and analyse employees’ physical and mental health data to recommend personalised wellness activities, such as exercise routines, mindfulness sessions, or ergonomic improvements. 

Additionally, AI can provide early warning signs of burnout or stress, enabling organisations to take timely action to support their employees’ well-being.

The impact of AI on employee well-being and engagement has been demonstrated through data provided by Amara.ai. For instance, a client case study revealed that after implementing Amara’s AI-driven engagement tools, the employee engagement score increased by 30% within six months. 

Additionally, key performance indicators (KPIs) showed a 25% rise in productivity across departments, and employee turnover rates decreased by 20% in the first year. These metrics highlight the significant role AI can play in enhancing employee well-being and overall organisational performance.

AI Adoption In Southeast Asia And India

The adoption of AI technologies in Southeast Asia and India is rapidly accelerating, fueled by the urgent need for digital transformation and a desire to enhance competitiveness on a global scale. According to a report by KPMG, AI investments in Southeast Asia saw a significant increase of 33% in 2022, underscoring the region’s commitment to integrating advanced technologies. 

This trend is further supported by proactive government initiatives, with countries like Singapore and India taking the lead in national AI strategies. Singapore, for example, aims to deploy AI in critical sectors such as healthcare, transport, and education by 2030 as part of its National AI Strategy. 

In India, the AI workforce is growing swiftly, with LinkedIn’s Emerging Jobs Report highlighting a 74% increase in AI Specialist roles over the past four years, making it one of the fastest-growing job categories in the country.

 Additionally, a Gartner survey revealed that 59% of enterprises in Southeast Asia have already deployed or plan to deploy AI solutions within the next two years, highlighting the strategic importance of AI in business planning and operations across the region.

In conclusion, the integration of AI in employee engagement strategies is not just a trend but a necessity in today’s fast-paced and competitive business environment. By leveraging AI, organisations can create a more personalised, proactive, and efficient approach to engaging their workforce. This enhances productivity and innovation while fostering a positive and fulfilling work environment. 

As AI continues to evolve, its potential to transform employee engagement will only grow, making it an indispensable tool for organisations striving to achieve long-term success. Investing in AI-driven engagement tools ensures that employees are not just satisfied but truly engaged and motivated, paving the way for sustained growth and success in the ever changing business landscape.

The post Leveraging AI For Employee Engagement And Well-being In Modern Workplaces appeared first on Inc42 Media.

Since time immemorial, innovation has remained the pillar of the sports industry. Enhancing performance, captivating spectators, and improving accessibility are some of the ways in which this industry has evolved. Additionally, the emergence of Virtual Reality (VR) and Augmented Reality (AR) have also been game-changing for the sports industry. 

These technologies are not only transforming how athletes train and make strategies but also how spectators view sports. They not only increase the precision and effectiveness of training but also ensure that everyone enjoys and can become an indispensable part of sports. With respect to that aspect, this article delves into how AR and VR are changing the face of sports with regard to broadcasting and training.

The Traditional To Technological Evolution Of Sports Training

Traditionally, sports training relied on combining physical practice, manual analysis, and coach-driven feedback. Athletes sharpened their skills through repetition, while coaches offered guidance based on observation and experience. Although this approach was effective in its own right, it was limited by human error and the inability to precisely measure and analyse every detail about an athlete’s performance.

The introduction of technology has changed the game altogether. Through video analysis, coaches can now look back at match footage and use that as a basis for feedback. However, it was only after the rise of AR/VR technologies that things took off. Hence, these technologies provide athletes with simulated environments where they can improve their game with great accuracy and receive feedback in real-time.

How Are AR And VR Transforming Sports Training?

AR and VR technology are also revolutionising athletes’ training methods. They provide athletes with life-like situations in which they can rehearse particular abilities, analyse their movements, and even simulate game scenarios.

For example, virtual reality headsets enable athletes to make adjustments to their techniques and prepare psychologically for competition by simulating a real match situation. Similarly, augmented reality glasses can project important data like player movement patterns, helping them to make more informed decisions immediately.

In addition, by utilising a virtual atmosphere for training, athletes are spared from the strain of doing repeated drills. Henceforth, the chance for overtraining is greatly diminished, and less time is wasted. Moreover, these tools can create a number of scenarios, like unfavorable climatic conditions or public outcry, thus helping competitors prepare for unique obstacles they may come across during a match.

Enhancing Experience For Players, Coaches, And Audiences

The effects of AR and VR go further than simple training. They are reshaping how sports are played by both athletes and fans alike. In terms of advantages, it is easy to see why more athletes are turning to AR and VR. Accessing immediate data and feedback helps athletes improve their techniques or tactical awareness more effectively than before. Coaches also benefit from such tools to a certain extent. 

For example, they can simulate game situations that help them develop appropriate methods under controlled conditions. This ability to experiment with varied tactics without the risk of losing a real game can be crucial during competitive sports events.

Audiences, too, gain from AR and VR, as these technologies help spectators comprehend and engage better during live events. For example, AR can serve as an overlay to live broadcasts, thus allowing viewers to gain a deeper insight into the game through interesting statistics and insights. In tennis, for instance, fans may watch matches from the perspective of their favorite players, making the viewing experience more immersive and engaging.

Making Sports More Accessible With AR And VR

The ability of AR and VR to make sports accessible to a wider audience is their most important impact. In India, cricket was once the only sport that could be played widely because it was well-understood and followed. However, other sports have since gained popularity since the introduction of AR and VR.

These technologies are dismantling the barriers that previously restricted access to sports. For instance, virtual reality (VR) can imitate sports experiences for the physically challenged, allowing them to participate in sports that were previously impossible. Conversely, augmented reality (AR) enhances events in real-time through captions or sign language interpretation for individuals with eyesight or hearing impediments. Furthermore, augmented reality (AR) and virtual reality (VR) are used to bring sports to regions and communities where conventional sporting facilities are limited. This allows individuals to experience and participate in sports without the need for expensive equipment or facilities because such technologies facilitate the creation of virtual environments.

Minimising Injury Risk With AR And VR

Injury prevention is another area where AR and VR are playing a significant role. Traditional training methodologies usually consist of monotonous tasks, which result in more injuries through overuse. Unlike before, with VR, athletes get an opportunity to practice these drills virtually, hence reducing the physical strain on their bodies.

AR aids in lowering injury probabilities as it gives real-time feedback about an athlete’s form and technique. For example, AR headsets can show if athletes have incorrect postures or movement patterns that could lead to an injury. This is important, especially in contact sports like rugby or American football, where a wicked approach could cause painful wounds. Besides this, VR is also being utilised in rehabilitation programs to facilitate better recovery. Athletes can regain their skills and self-belief using VR in an environment resembling the real world, lessening their chances of re-injury.

The Role Of AR And VR In Sports Broadcasting

Another sector that has undergone a major transformation through the use of augmented and virtual reality is sports broadcasting. These technologies have brought about an era in which sport can be better explained and appreciated by spectators. The use of AR enhances live telecasts by overlaying graphics, statistics, and other data on the screen. This helps viewers keep an eye on what’s happening and, hence, better understand team and player strategies.

On the other hand, virtual reality offers the ultimate immersive viewing experience. Using a VR headset, supporters can watch a match as if they were actually at the venue, feeling all the sights and sounds in real-time. This technological advancement is beneficial for sporting activities when one cannot physically attend such international competitions or those played in remote locations.

Final Words

The rise of augmented and virtual reality technologies is likely to evolve the world of sports as we know it. Future possibilities include a complete fusion of AR/VR across all aspects of sports, from training through injury prevention, broadcasting, and fan engagement.

The potential of these technologies is immense, and their continued development will undoubtedly shape the future of sports. Both AR & VR will be well adopted by athletes, coaches, and fans to transform into a broader perspective for the sports industry. Today’s sports are no longer defined by who wins on the field, instead, they have been given a new lease on life through technological interventions.

The post Tweaked Future Of Sports: Virtual Reality And Augmented Reality In Training appeared first on Inc42 Media.

The best way to predict your future is to create it. The journey of a startup is fraught with challenges, but mastering the skill of negotiation can turn the challenges into the opportunities. Almost all the current high valued startups had negotiated aggressively in the past, to protect their rights and interest. 

Imagine the conversation in the 1980s between Microsoft, a fledgling software company without a ready-made operating system, and IBM, a dominant player in the hardware industry wherein IBM struck a deal with Microsoft to provide an operating system to IBM for their new personal computers.

The real genius lay in negotiation with IBM, wherein Microsoft instead of selling the operating system outright, retained the rights to license that operating system to other manufacturers. IBM failed to foresee the explosion of the personal computers market, agreed. The licensing rights not only allowed Microsoft to become a critical player in personal computing but also laid the foundation to become one of the most powerful companies of the world.

Another example of negotiation genius could be WhatsApp’s acquisition by Facebook. Apart from valuation and other commercial rights, founders of Whatsapp fought tooth and nail for the continuance of WhatsApp’s strict privacy standard, end to end encryption of the messages and no ads. Facebook agreed to these terms and conditions, which was a significant deviation from its business model.

India has the third largest startup ecosystem in the world, and it is riding high on creativity. In the coming years, we can overthrow all the incumbent champions of any field. When we delve into such a vastly paced ecosystem of early-stage startups, it is essential to understand that negotiation table is where dreams meet reality. 

On one hand founders come with a vision of innovation and ambition and on the other hand, investors come with a pragmatic sense of business, but the true challenge lies in bridging the gap. 

In this high-stakes environment, where every term sheet detail can shape the future, mastering the art of negotiation is not about securing funds – it is also about building a relationship that can withstand the tumultuous journey of entrepreneurship.

For both entrepreneurs and investors, understanding the intricacies of early-stage investment negotiations is paramount to success in this dynamic market. This guide provides a detailed overview of key issues and standard positions in venture capital financing rounds in India, offering valuable insights into the complexities of deal structuring, governance, and exit strategies.

From the types of securities offered to the nuances of founder obligations and liquidation preferences, we’ll explore the essential elements that shape early-stage investments in the Indian context. Whether you’re a founder seeking funding or an investor looking to capitalise on India’s startup boom, this comprehensive breakdown will equip you with the knowledge to navigate negotiations effectively and make informed decisions in the fast-paced world of Indian venture capital.

Types Of Securities

• Preference shares are usually created with a set of “preferred” economic and governance rights relative to those enjoyed by the equity shareholders and are distinct from equity shares (which the founders typically hold). Investors may also be offered compulsorily convertible debentures, where the commercial agreement is for the investors to get a portion of the pay-out in the form of coupon/ interest. Neither preference shares nor compulsorily convertible debentures can be redeemed/ cancelled by the company and must contain provisions for mandatory conversion into equity shares.
• However, the investors may opt for convertible notes, compulsorily convertible debentures and debt instruments depending on the residential nature of the investor and the commercial terms related to the investment.

Valuation And Investment Amount

• Typically, a round size and the percentage stake in the company for the investors participating in the proposed investment round is commercially determined. However, as a regulatory matter, the entry valuation must be supported by an independent valuation report from a professional valuer – usually there is headroom between the regulatory valuation and the commercial entry valuation to allow for post-closing adjustments to the conversion ratio (including for anti-dilution protection).
• In early-stage funding rounds, investors usually insist the company reserves a certain percentage of shares (in the range of 10% to 15%) as a notional employee stock option pool (ESOP) for the benefit of the employees. This is usually taken out of the promoter’s share or sometimes shared between the investors and founders on a disproportionate basis.

Further Funding And Valuation Protection

• Investors usually obtain a pre-emption right requiring the company to first offer any future shares to the investors before offering to any third party. Investors may also seek a mop-up right, a right to subscribe to the unsubscribed portion of the shares offered to existing investors. In early-stage funding rounds, a mop-up right may not be fully aligned with the company’s interests of diversifying their capitalisation table and if agreed to, the company may negotiate to limit the mop-up right to be exercisable only until the next funding round.
• Anti-dilution rights deal with dilutive events which otherwise reduce the value of the shares held by the investors (relative to the price paid by them at the time of investment). Anti-dilution is usually affected through adjustment to the conversion price of the preference shares/ debentures (in case of foreign investors, this is subject to the pricing guidelines under the exchange control regulations). Typically, anti-dilution protection is offered on a broad-based weighted-average basis. In the past, full ratchet was also prevalent.

Governance and Information Rights

• The number of board seats is a matter of negotiation and depends on the overall size of the board as well as the size of the investment being made. In early-stage funding rounds, the founders would want to maintain a majority on the board and insist on appointment of additional nominees to top-up the additional board seat occupied by the investors to maintain parity on the board .The investors in such instances assess whether the collective shareholding of the founders forms a majority on the capitalisation table. In case the investors exercise their right to nominate a director/observer to the board, the company may seek to protect its business by imposing that the appointed directors on its board are not the same as on the board of its competitors – investors push for the flexibility to be able to carry out investments in competing business without any restrictions.
• Typically, where a company has multiple institutional investors, consent rights are usually exercised on the basis of a certain investor majority (a typical formulation could be 75% of investors with holding above a minimum threshold, say 3%). Typically, this majority percentage is determined in such a manner that no individual investor has an effective veto (i.e. if any investor holds 25% of the aggregate investor holdings, then this threshold may be set at 60%). 
• Irrespective of whether the investor has a right to appoint a director or observers, investors insist on standard information rights such as the right to receive: (i) audited and unaudited financial statements of the company; (ii) certified true copies of minutes of meetings; (iii) business plan, annual budget and headcount for the following financial year; (iii) any litigation involving the company/regulatory notice; (iv) notification of any event which is likely to cause material adverse effect; and (v) audit reports. In large size deals, investors generally negotiate that a big four audit firm is appointed as its statutory auditor.

Share Transfer Restrictions

• In case of any proposed share transfers by the shareholders, depending on the existence of share transfer restriction provisions (in the form of a right of first offer or a right of first refusal), the price discovery is either amongst the shareholders (if structured as a right of first offer) or third-party purchaser. Transfer restrictions provide the investors the first opportunity to purchase the shares (pro-rata to their shareholding) if they desire to do so. In certain cases, the investors may also seek mop-up rights in these scenarios. Typically share transfers by institutional investors are not subject to such ROFO or ROFR restrictions but share transfers by the founders, employees, and angel investors would be subject to these restrictions.

• Where the share transfer is by the founder, the above rights are typically paired with a tag along right, which allows the investor (who has not participated in the right of first refusal/offer) to partially exit (pro-rata to their shareholding) from the company along with the selling shareholders. Where such transfers constitute a change of control, typically investors get a full-tag. Where the holdings of the founder/ promoter get diluted significantly (i.e., promoters hold less than 25% of the company), this tag-along right may be amended such that on any change of control transaction (including sales by investors) the other investors will have a full tag. 

Founder Obligations

In order for the founders to be incentivised to continue running the company, the following obligations with respect to their shares in the company are generally negotiated: 

• A lock-in period (typically 3 years to 5 years or linked to the complete exit of the investors) during which the founders cannot transfer their shares, without the investors’ consent. Founders may seek to provide for exceptions to the restrictions on share transfers and the investors typically agree to exempt certain transfers for estate planning purposes up to a certain threshold (ranging from 2% to 5%). 
• Vesting schedule determines the intervals in which the shares held by the founders’ vest – typically restriction applies to 75% of their shareholding vesting in monthly intervals over 3 to 4 years (measured either from the date on which the founders have purchased the shares or from the closing date) and 25% are treated as already fully vested. 
• Good leaver and bad leaver: The company’s right to buy back the shares held by the founders, triggers if the employment of the founder ceases for any reason. In “good leavers” situations (such as death, disability or dismissals for other than cause), shares are bought back at the fair market (current) value of their shares, while in the “bad leavers” situation (such as ‘Cause’ based termination events), the shares are bought back at the nominal value of their shares (the value at the time when they received the shares). The investors typically would want both the vested shares as well as the restricted shares to be bought back in a bad leaver situation. 
• Cause events (that include fraud, gross negligence, theft, breach of employment agreement executed by the founder, disparaging statements that are adverse, to the interests of the company) prompt the investors to terminate the employment of the founder and also exercise their right to call an event of default. 
• The founders and key employees are required to undertake that they will not directly or indirectly engage in or carry-on similar business as the company. Non-compete and business exclusivity clauses are primarily drafted to capture such restrictions – the period of non-compete is a matter of negotiation and usually ranges from the period of employment up to 3 years post the termination.

Exits

The investors rely on contractual promises made by the founders to facilitate an exit either by creating liquidity through IPO or by sale to third parties or by buying out the investors stake:

• IPOs: As per the securities law in India: (i) existing shareholders can sell their shares in the IPO if (a) their shares are included in and registered as part of the offering and (b) such shares have been held by the selling shareholders for a period of at least 1 year prior to the filing of the Draft Red Herring Prospectus with Securities Exchange Board of India; (ii) upon listing, the special rights vested in a shareholder (under a shareholders’ agreement) fall-away; (iii) no convertible securities are permitted to remain outstanding as on the date of filing of the Red-herring Prospectus and convertible equity instruments are converted at agreed terms; and (iv) the entire pre-issue share capital is required to be locked in for a period of 1 year after the IPO to ensure an orderly after-market. 
• Trade Sale is preferred if (i) market conditions are unfavorable for IPOs or (ii) listing is not desired at the time of the exit. Acquirers in a trade sale typically conduct due diligence and ensure that the sellers underwrite the risks and liabilities identified. Acquirers address their concerns by way of price adjustments, indemnities, warranties and other protections. Investors may have to provide representations and warranties and consequent indemnities, in relation to the instruments being transferred as well as operations of the company, depending on the operational involvement of such investors in the company. It may be noted that warranty and indemnity insurance is not very common in India and both timelines and premiums on insurance coverage are substantially higher than in mature markets. Despite the above, as part of the deal documents, investors typically negotiate provisions to limit the obligation to provide representations and warranties only to fundamental warranties and title to shares.
• Buybacks by an Indian company is subject to the buyback offer being made to all shareholders. The proposed limit for a buyback is 25% of the cap table. For an effective exit through this route, the other shareholders would need to waive their right to participate in the buyback process. Investors obtain contractual commitments from founders and other shareholders agreeing not to tender their shares in any buyback so as to not exhaust the statutory limit. This is not a very popular route to achieve exits since the pay-out for the buyback must be made out of profits/ reserves of the company and cannot be financed through other means.
• A drag-along right allows investors to force a sale of the company if certain conditions are satisfied such as if the exit has not been provided within the exit period or as a consequence of event of default. The types of transactions triggering the drag, majority requirements for triggering the drag-along right, price protection for the drag (including the shares held by the founders), and the distribution of proceeds of the drag sale are typically negotiated given that this involves a squeeze out of the founders. A drag along right is useful from the perspective of a majority shareholder who has the option to drag along the minority shareholders in the company. The promoters may also seek to protect themselves from being ‘dragged’ with a minimum price requirement if the sale transaction is unfavourable. Drag against other institutional investors is uncommon though it is quite common against angel investors and employees holding shares of the company.

Liquidation Preference

• In specific liquidation events (where the company is being liquidated or is sold in an M&A transaction), the liquidation preference governs the distribution of sale proceeds and may take a shape of (i) non-participating liquidation preference (equals the investment amount along with any accrued and unpaid dividends); and (ii) participating liquidation preference (the equals the investment amount along with any accrued and unpaid dividends plus any surplus proceeds available for distribution on an as-converted to equity basis). The latter is more common;   
• If the liquidation proceeds are inadequate, investors generally negotiate for the entire proceeds are distributed inter-se on a pro rata basis. The remaining shareholders (if any) and the founders are required to waive their right to receive proceeds from the liquidation event in such circumstances. 

Termination Rights

• Investors seek termination rights: (i) if the conditions precedents are not fulfilled; (ii) material breach of the warranties; (iii) there is a material adverse change; (iv) the updated disclosures qualifying the warranties are not acceptable to the investor. To help enforceability, the investor may seek to make the trigger dependent on its opinion, and the company may seek to limit instances of terminations based on opinions of the investors and would prefer to set an objective test for the termination event.

Conclusion

The culmination of a deal is a summation of various factors, where the both the parties try to protect their interests and at the same time cede some ground to accommodate the other party. The art of negotiation does not include strong arming the other party to get a favourable deal, it is an exercise to create a win-win situation for both the parties. Even seemingly impossible deadlocks and conflicts can be resolved if we shed the assumption that our only sources of leverage are money and muscle.

As rightly said by Tom Wingfield “Yes, I have tricks in my pocket. I have things up my sleeve. But I am the opposite of a stage magician. He gives you illusion that has the appearance of truth. I give you truth in the pleasant disguise of illusion.” Effective negotiators know that how you articulate or structure your proposals can be as important as what you are proposing.

The post Negotiating Early-Stage Investments In India appeared first on Inc42 Media.

As consumers across the world embrace ecommerce businesses, OSA has become extremely critical in the current and future online markets. With the latest numbers from Future Market Insights, the global on-shelf availability solution market is set to hit the desired figure of $4.8 Bn by 2024. 

Analyses show that this market will even continue to grow to a whopping $ 11.6 Bn by 2034, such that there is a healthy CAGR of 9.1% in the market during the research period of the forecast. These figures explain the growing need to manage OSA as ecommerce firms seek to deliver what consumers want, especially during holidays such as this festive season.

On the one hand, the festive season is a unique chance to boost sales and make customers happy for ecommerce organisations. But with the growing demands comes the question of availability – having the right product at the right time and place.

OSA is important during this period because a stockout situation will mean no sales, unsatisfied consumers, and loss of brand loyalty. For ecommerce businesses gearing up for the festive season, here is the ultimate guide to improving on-shelf availability.

Demand Forecasting And Inventory Planning

Accurate demand forecasting is the foundation of high OSA during the festive season. Ecommerce businesses must analyse historical sales data, market trends, and competitor behavior, while also considering potential events, holidays, and promotions that could drive demand. Leveraging analytics and artificial intelligence can significantly enhance these forecasts, ensuring that inventory levels are aligned with expected demand. 

Inventory planning should be conducted in tandem with demand forecasting, taking into account supply chain disruptions, supplier capabilities, and lead times. While it’s advisable to stock up on frequently sold products, businesses should avoid overstocking to minimise holding costs and prevent markdowns postseason.

Strengthening Supplier Relationships

The festive season is one of the important periods requiring suppliers to meet their commitments at high levels. It is necessary for ecommerce businesses to clearly convey the demand that they expect in the future to their suppliers so that the required capacities are available to meet such demands. 

Loyal supplier relationships mean that a company will be accorded special treatment, including priority on the stocks to be restocked and the time that it takes to have them restocked. Also, risks of supply chain disruption may be addressed by the expansion of the suppliers’ list. This means that if one supplier is unable to supply essentials, having other sources available can help minimise the chances of running out of stock.

Leveraging Technology for Real-Time Inventory Management

Organisations need to employ real-time inventory management systems in order to maintain OSA during the festivities. These systems facilitate the monitoring of stock in different sales outlets and stores, giving a clear view of inventory. These systems can then be linked to ecommerce to automatically update stock status so that the customers do not get a wrong impression of what is available in the warehouse. 

Furthermore, real-time inventory means that inventory management decisions have to be made in a short span of time. In cases where a particular product is selling much faster than expected, call for automatic reordering or transfer of stock in anticipation of the popular item.

Optimising Fulfillment And Logistics

The idea of smooth functioning of fulfillment and logistics is key to sustaining OSA during the festive period. Fulfillment centers should be evaluated and possibly altered to make certain that the products are picked, packed, and shipped as quickly as possible. This might have entailed efficiencies in the processes of the warehouse, hiring of more workers, or outsourcing the extra load to a third-party company. 

Another important element that must be taken into consideration is last-mile delivery. Cutting costs and improving delivery reliability can be accomplished through choosing credible courier services and providing numerous delivery choices for customers, and they can also help minimise stockouts. One might also suggest adopting the distribution center strategy, which means warehousing is closer to certain key markets to reduce lead time and increase OSA.

Dynamic Pricing And Promotions Management

For OSA, particularly during the festive season, price and promotional strategies can play a great deal. It is recommended that ecommerce businesses should implement dynamic pricing models as a way of controlling the demand, especially where the retail price can be changed based on the existing sales data and available stock. 

For instance, if a given product is going around very fast in the market, some price increases can be made in order to regulate demand and scarcity. Promotions also must be accurately determined and controlled. Although using discounts and special offers promotes the products, it also contributes to exhaustion. Promotion decisions should be made with consideration to stock status, firms should offer either substitute options or pack slow-movers together with the best sellers in order to ensure equal sales of all stock.

Enhancing Customer Communication

It demonstrated that customers should be informed clearly and in advance when OSA is in operation during the festive season. If a product is unavailable or lost, it is important to advise the clients to prevent cases of disappointment. That is why revealing similar goods’ availability, giving options to pre-order, or offering back-in-stock notifications also contribute to maintaining customers who might switch to other suppliers. 

Moreover, businesses should employ customers’ information to get in touch with the customers in subsequent purchases and remind them of potential products they have bought in the past or related to. This does not only improve the experience of shoppers but also creates demand for the available products in the market.

Post-Season Analysis And Continuous Improvement

After the festive season, conducting a thorough performance analysis based on OSA key indicators is crucial. Businesses should evaluate areas of success and identify opportunities for improvement. Key metrics to assess include the number of stockouts, replenishment times, and the accuracy of demand forecasts. Insights gained from this analysis should be used to refine processes, strengthen supplier relationships, and enhance inventory management for future high-demand periods.

Maintaining availability during the holiday season is a difficult but essential process for many ecommerce companies. Through demand forecasting, building supplier relations, being able to manage inventory in real-time, choosing the best options for fulfilling orders, using dynamic pricing options, being able to communicate effectively with customers, and analysing data after the season, businesses can increase their sales while also providing a good shopping experience for the consumer. These strategies assist not only in getting through the holiday season but also in excelling during the period.

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The spirit of digital transformation in India is gaining significant momentum, particularly among MSMEs. These enterprises contribute 45% of industrial output 40% of exports, and produce over 8,000 high-quality products for domestic and international markets. 

MSMEs have significantly contributed to the country’s economic growth recently, but there is still room for improvement. Enhanced regulatory compliance has made it essential for them to leverage advanced tools and technology. For example, e-invoicing introduced by the GST council initially became mandatory for businesses with a turnover exceeding INR 500 Cr—a threshold that has recently been revised to INR 5 Cr. 

E-invoicing can significantly reduce the risks associated with manual invoice processing, including high time and staffing costs, strained supplier and customer relationships, and the risk of inventory shipment cut-offs.

The government aimed to simplify the tax system and promote digital inclusivity in a phased manner. Initially introduced for large organizations, e-invoicing has become necessary for small businesses. By including MSMEs in the e-invoicing fold, they can become part of the formal economy and contribute substantially to the country’s economy.

Tech Solutions For GST Compliance And MSME Growth

The GST system has streamlined transactions, billing, enhancing compliance and increasing tax revenues. However, challenges remain, including fake invoices, fraudulent registrations, and improper input tax credit claims. To address these problems, advanced technology solutions across value chains are essential. The government has implemented several measures to combat these issues, such as e-invoicing, the e-way bill system, auto-population of key information, and mandatory invoice matching for input tax credit claims.

MSMEs require advanced tools and innovative software solutions to stay compliant with evolving GST norms, achieve sustainable growth, and remain competitive in domestic and international markets. However, financial constraints and the high cost of a skilled workforce make it challenging for them to upgrade to advanced technology. Therefore, MSMEs need an affordable and effective solution for regulatory compliance. The answer lies in embracing SaaS solutions.  

SaaS Technology Combating  Fraud 

Fintechs recognise the above benefits and the government’s aim to improve the GST filing processing and step up to contribute to achieving them. They offer SaaS-based invoicing platforms that replace manual paper invoice processing with streamlined electronic systems, including validation, approval, and simplified global invoice payment and reconciliation. These platforms aim to prevent fraud and errors while ensuring compliance with tax regulations. 

This approach will help to expand the GST base and improve transparency in the taxation system by facilitating better synchronisation of sales data and input tax credit claims. The significance of this approach was highlighted in December 2023, when 4,153 bogus firms suspected of ITC evasion totaling approximately INR 12,036 Cr were detected. 

SaaS-based invoicing platforms can prevent fraud by maintaining data integrity, ensuring that the information remains unchanged from when the supplier creates the invoice to when the buyer makes the payment. These automated invoices offer security and fraud protection through secure delivery, advanced encryption, and legally binding security elements like e signatures.  Governments, financing organizations, service providers, and tax authorities are eager to review the insights within this data. 

From a financial perspective, an e-invoicing platform can facilitate access to short-term unsecured loans by enhancing trust among financiers in identifying legitimate trade transactions. Fintechs use digital data and strategic partnerships to offer low-risk supply chain financing (SCF) options to smaller businesses that traditional lenders often overlook. This support empowers credit-constrained MSMEs and fosters sustainable relationships between financial institutions and these enterprises.

Preparing For Future

The growth of globalisation and digital trading has made tax collection more challenging due to increasing incidents of frauds, but SaaS-based invoicing is a powerful platform for reducing fraud and increasing revenue. This is not just a domestic trend; over 55 countries worldwide have adopted or are considering e-invoicing mandates due to its numerous advantages. MSMEs recognise these benefits and are increasingly transitioning to SaaS-based invoicing platforms for daily business operations and financial processes.

The true potential of SaaS platforms is realised when MSMEs collaborate and share data securely. This collective approach allows them to gain valuable insights, predict trends, and make well-informed decisions. These platforms are crucial for automating invoicing processes for transitioning to a real-time economy, where the swift exchange of critical business information between trading partners is key to growth and success. 

Moreover, utilising digital public infrastructure (DPI) like e-way bills enables MSMEs and consumers to achieve greater value for money while reducing compliance burdens for producers. The e-way bill system’s digital record-keeping simplifies compliance, reduces errors, and ensures accurate transaction records, leading to smoother audits and inspections.

Looking ahead, MSMEs can harness SaaS technology to stay compliant and secure in the evolving tax landscape. By adopting digital solutions, MSMEs can streamline their operations, improve transparency, and effectively adapt to regulatory changes, ensuring ongoing growth and resilience in a dynamic business environment.

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Earlier this year, the US investor guru Warren Buffett made headlines by describing artificial intelligence as a genie that “scares the hell out of me.”

The Berkshire Hathaway chairman and CEO has long been known for his extraordinary foresight, something of a genie himself because of his ability to predict lucrative investment opportunities. His words carry weight, and when he expresses concern, people listen.

In this instance, while Buffett’s caution is understandable, the potential of AI may be greater than the risks.

Although disruptive technology is exciting, it can also raise concerns, particularly when even the AI scientists who developed it cannot fully explain the internal workings of its underlying mechanisms, such as transformers in GenAI. It is difficult to explain but the outcomes it delivers often feel nothing short of miraculous. 

The Potential Of Disruptive Technology

I liken GenAI to the dot-com era of the late 1990s and early 2000s, a time when everyone wanted to tap into first-of-a-kind technology in the hopes of discovering new areas for innovation.

Fast-forward two decades, and the power of the internet has been more fully realised. It has improved the way people live and how businesses run. I don’t believe GenAI will take two decades to be realised fully – the world is changing as we speak.

GenAI is just the beginning, marking a step toward artificial general intelligence (AGI), which can perform any intellectual task that can be accomplished by humans. Today’s GenAI already enables AI tools to think logically and creatively like humans. This convergence of human-like reasoning with machines’ vast computational power and data processing abilities is set to fundamentally transform business processes. For example, AI can analyse vast amounts of data at speeds far beyond human capability, identifying patterns and deriving insights that might otherwise go unnoticed. In contract management, this means AI can quickly review and analyse large volumes of commercial agreements to inform better decision-making and increase the pace of business. 

Reimagining Contracts With GenAI 

Contracts form the backbone of global commerce, defining the rules of business for large and small companies everywhere. It is a single source of truth that a business has with its suppliers, partners, and customers, defining compliance, expected obligations, and the intent of the relationship. This makes contract data one of the most valuable untapped assets in the enterprise. 

GenAI’s ability to think creatively and suggest actions within contracts has the potential to elevate commerce by optimising business relationships. This technology not only streamlines time-consuming and error-prone manual processes but also ensures the intent behind business relationships is fully realised. The benefits are twofold: enterprises can save money by reducing costs while also preventing revenue leakage, increasing revenue, reducing risk, and enhancing compliance.

Implementing GenAI In Contract Management

To effectively implement GenAI in contract management processes, businesses can follow these steps:

1. Centralise contracts – In most enterprises, this is no small feat. To build a solid foundation for AI deployment, it may be necessary to phase the process out by department, region, or function. Once contracts are centralised, businesses will benefit from improved visibility and control over their contractual obligations.
2. Identify contract-centric use cases – Focus on examining critical areas such as contract creation, negotiation, and execution, ensuring timely payments to suppliers, tracking customer payment schedules, and assessing specific regulatory risks. Identifying these use cases is essential for understanding where AI can deliver the most value.
3. Automate use cases using GenAI-led contract intelligence – Automating contract-centric use cases can feel daunting for most enterprises. To manage this effectively, consider applying the 70/30 rule – prioritising automation for the use cases that offer the highest return on investment. 
4. Realise the intent: This final step unlocks two significant benefits. First, leveraging AI with legacy contracts allows for a deeper understanding of business patterns. Second, applying GenAI ensures that contact-related transactions, such as payments and regulatory compliance, align with the original intent of the contract, providing greater accuracy and consistency.

When executed correctly, GenAI can substantially enhance business processes and deliver tangible value. It can reduce complexity and friction – the two deterrents to enterprise agility, allowing businesses to operate more efficiently and effectively. By transforming contract-driven processes, enterprises can optimise business outcomes around revenue, savings, and risk.  

Looking Ahead

There has never been a more exciting time in business than now. In 20 years, we’ll reflect and marvel at how little we knew about AI in its early days and how dramatically it has changed our lives for the better. However, to harness AI’s full potential, we must approach it responsibly, starting with a clear understanding of its value within our organisations, its power and its limitations. 

By embracing GenAI, businesses can not only navigate the complexities of modern commerce in today’s ever-changing economic environment but also set the stage for future success in an increasingly AI-driven world.

Get this right, and Warren Buffett will realise he had nothing to fear.

The post How GenAI-Led Contract Intelligence Is Redefining Business Relationships appeared first on Inc42 Media.

To date, the central government has built 31 innovation centers, 15 startup centers, 15 technology business incubators, 7 research parks, and 500 Atal Tinkering Labs. The StartUpIndia initiative has enabled INR 960 Cr of funding for startups. Still, 80-90% of startups fail, many of which are because of lack of funding.

This is especially true in deeptech, where commercial viability is equally vital as it is difficult to assess. 70% of Indian deeptech startups cited funding to scale as their biggest challenge. Long gestation periods create costly uncertainty, and reluctant capital at commercialisation becomes the most common reason for failure.

Government funding has historically been necessary to fill the gaps. After all, public funding created the original lithium-ion batteries long before enabling the smartphone revolution. The US government’s Defense Advanced Research Projects Agency (DARPA) developed the GPS system. Yet, venture capital gets scared when government procurement is fundamental to a startup’s value proposition. Bureaucracy, the traditional wisdom follows, is notoriously difficult to navigate, and funds are limited. In India, R&D spending is just 0.7% of GDP. 

However, that may be changing in India. Why? We now recognise the role domestic innovation has to play in building smart cities, modernising public transportation, and integrating clean technologies into infrastructure, among other endeavors. Today, the government is expanding its capacity as a first market for deeptech products with public uses, answering the all-important question of many deeptech startups: “Who will we sell to?” startups and VCs would be wise to recognise the moment accordingly. 

Learning From Success

Take note of the defense industry. iDEX, established in 2018, aims to increase Indian self-dependence in defense. The program empowers an ecosystem of technologists and innovators making products for the Indian military, expected to spend INR 1.5 lakh Cr (about $18 Bn) a year until 2030 modernising itself. iDEX issues problem statements–pertaining to cyber security to arms transportation–and offers up to INR 10 Cr to winning pitches.

The programme then collaborates with founders, providing infrastructure and support services, and acts as a first market for the product. NewSpace Research and Technologies, an unmanned aerial vehicle innovator, and EyeROV, an underwater inspection robotics startup, are just two success stories to emerge from the program. Such developments have even increased venture funding confidence, with defense-focused funds like MountTech cropping up.

Another industry that has benefited from heavy government involvement is spacetech. Since the 2013 Mars Orbiter Mission, the state has launched 13 high-profile missions, creating new demand from the ISRO for necessary technology. IN-SPACe, an autonomous, single-window, nodal agency for procurement, authorises purchasing, provides infrastructure support, and monitors and facilitates the marketplace for spacetech.

IN-SPACe also offers technical assistance to firms by sharing technologies, best practices, and products. The program has created a “predictable and enabling” regulatory regime, bringing funding from $28 Mn in 2020 to $120 Mn in 2023. 

Industry 4.0 in India is similarly primed for growth. An expanding set of industrial Public Sector Undertakings are demonstrating growing openness to integrating IoT and AI, offering a new customer base for industrially oriented DeepTech. Average contract values are still low compared to the Western players, but are rising steadily. The landscape, largely free of incumbents, will prove easier to navigate as these companies face new demand from a public sector looking to adapt for the modern age. 

Leveraging The Movement

At 8X, we have been looking to capitalise on this opportunity for some time. In 2020, 8X invested in Solinas Integrity, a robotics and computer vision startup earning government contracts to strengthen public sanitation infrastructure. Approximately 75% of Solinas’s business is B2B2G and B2G sales. When it started, Solinas struggled to find backers for its product. It eventually partnered with municipalities and has since worked with channel partners across South India to provide its services. 

Today, our portfolio companies benefit heavily from government procurement. Pantherun, a cyber security innovator, got its first contracts to upgrade systems for BHEL and Indian Railways. They will also work with Bande Bharat this year. XYMA Analytics, an Industrial IoT sensor company that uses waveguide technology, frequently acts as a subcontractor for the government, with roughly 30% of its business B2G.

NDTSP And The Future Of Deeptech Funding

In July, the Government released a policy draft to support the country’s deeptech ecosystem. The policy will correct government fund disbursement’s “slow, fragmented, and siloed” nature. Based on the IN-SPACe model, it will provide a single window throughout the lifecycle of government grants (from disbursal, tracking, and feedback) to streamline and improve transparency for startups.

It also unveils a common grant framework across government ministries that offer INR 200 Lakh for proof of concept and INR 300 Lakh for prototype. This program will continue to open possibilities for deeptech solutions with an array of public applications, from sanitation and water to agriculture. 

Deeptech startups are entering a new era of expanded spending, streamlined procurement processes, and robust infrastructure support throughout development. The sooner VCs recognise that opportunity, the sooner these startups can scale and ultimately solve this country’s most pressing problems. 

The post How Public Contracts Are Powering India’s Deeptech Revolution appeared first on Inc42 Media.

If there were a poll to determine the most influential HR buzzword of 2024, the clear frontrunner would be ‘skills’. Traditional hiring methods are being replaced by skill-based hiring, a more inclusive and flexible strategy that puts candidates’ abilities ahead of their experience, as the labour market continues to evolve. 

This proactive trend is altering the future of recruitment and goes beyond simply adapting to the needs of companies in an ever-changing business environment.

A remarkable 81% of businesses have adopted some kind of skill-based hiring in 2024, up from 73% in 2023 and 56% in 2022, according to TestGorilla’s The State of Skill-Based Hiring 2024 Report. 

It is evident that skill-based recruiting is here to stay, as indicated by the 95% of the respondents who saw it as the future’s dominating recruitment trend as more and more employers try out a more expansive hiring approach, which focuses more on the skills possessed by a candidate.

What Is Skill-Based Hiring?

Instead of focusing only on traditional credentials like years of experience or academic degrees, skill-based hiring considers the particular abilities, knowledge, and competencies a candidate possesses. This strategy aims to improve inclusivity and aligns it more closely with the needs of the modern digital-first economy.

Companies can now attract a more varied pool of candidates by emphasising abilities over academic records as many of these candidates may have gained their talents through unconventional means like self-directed learning, online courses, or real-world experience. 

This change in emphasis guarantees that companies are able to access a larger talent pool while also democratising the hiring process.

Advantages Of Skill-Based Hiring

Skill-based hiring has potential to bridge the gap between recruitment and career advancement. Here’s how:

Increased Employee Retention

Skill-based hiring means that workers are more likely to perform well in their positions and create happier workplaces. Employee retention rates are much higher when workers feel appreciated and content, as this increases their likelihood of sticking with the organisation. The stability of the company benefits from this continuity as well as the professional advancement of the staff.

Career Advancement And Internal Mobility 

Companies can find internal candidates for promotions or lateral transfers more quickly by focussing on abilities rather than job titles or tenure. By enabling workers to move into new positions where their talents are most needed and where they may further their professional development, this strategy promotes career advancement. 

Tailored Professional Development 

Employing people based on their skills motivates businesses to spend money on retraining and upskilling their employees. Employees benefit from this investment by staying up to date on industry trends and are better equipped for roles they will play in the future within the organisation. Employees can progress in their careers by applying for more advanced roles as they gain new abilities.

Better Alignment 

Employers can expect that new hires can contribute right away to important projects and initiatives when they make hiring decisions based on specific talents. Productivity and innovation are increased when employee talents and business needs are in line. When workers prove themselves, they may be given more responsibility, which can help them develop their careers faster with higher productivity.

Opportunities For Inclusive Career Growth

Employing people based on their skills encourages diversity since it values a variety of backgrounds and career trajectories. Companies may promote a more inclusive workplace where all employees have the opportunity to progress based on their abilities and contributions by removing restrictions that traditional hiring procedures frequently impose.

Strategies For Effective Skill-Based Hiring

To maximise the benefits of skill-based hiring, companies need to adapt to modern hiring practices.

• Modify Recruitment Strategies: Employers should make use of focussed sourcing platforms and attend industry events that emphasise skill development in order to draw applicants from a variety of backgrounds and non-traditional career routes. 
• Determine Necessary Talents: It is imperative that organisations specify the precise hard, soft, and cognitive talents needed for every position. Clear, skill-centric job descriptions can be created by classifying these skills using standardised frameworks.
• Provide Clearly-Defined Job Descriptions: Job descriptions should make a direct connection between duties and the abilities required, making it easier for recruiters and candidates to comprehend the essential qualifications for the role. This transparency not only makes the hiring process more efficient, but it also establishes clear expectations right away.
• Invest In Staff Development And Upskilling: Comprehensive staff development and upskilling initiatives should be implemented alongside skill-based recruitment. This strategy improves long-term retention and flexibility inside the company in addition to drawing in motivated applicants.

Thus, skill-based hiring creates a more flexible, competent, and driven staff, which closes the gap between hiring and career advancement. It gives workers more chances to develop and flourish, which eventually results in a more engaged and effective workplace. The future of work will be characterised by a more inclusive and skill-centric paradigm as more businesses adopt this strategy to improve profit.

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Once you have successfully placed your order, it gets irresistibly tough not to check the pop-up notification every hour to see how much progress your order has made from the warehouse. The anticipation builds as the package makes its journey, navigating through the maze of logistical necessities to finally reach your doorstep. This eagerness highlights the critical importance of last-mile delivery, the final step in the logistics chain where the product reaches the consumer. This stage is not only crucial for customer satisfaction but also represents a significant portion of delivery costs and challenges for logistics providers.

The last mile of delivery has always been fraught with complexities, from managing traffic congestion to ensuring timely deliveries in densely populated urban areas. The stakes are high: inefficiencies in this stage can lead to increased costs, customer dissatisfaction, and competitive disadvantage. With the rise of ecommerce, the demand for faster, more reliable deliveries has never been greater. Innovations in artificial intelligence (AI) are stepping in to transform last-mile logistics, making it more efficient, predictable, and responsive to consumer needs.

Keeping Tabs: Real-Time Tracking And Visibility

Tracking a package is now an expected feature for consumers. The lack of real-time tracking can lead to frustration and dissatisfaction. However, with the implementation of IoT devices and GPS tracking systems, businesses can provide real-time updates to their customers. This transparency not only improves customer satisfaction but also enhances the overall efficiency of the delivery process.

For MSMEs, real-time tracking and visibility are essential. By leveraging these technologies, businesses can respond quickly to any disruptions or delays, ensuring that customers are always informed about their delivery status. 

Smart Communication: AI-Driven Customer Interaction

Timely communication with customers is crucial in the logistics industry. AI-driven communication platforms enable businesses to provide real-time updates, reducing the likelihood of missed or delayed deliveries. By managing customer expectations effectively, businesses can enhance satisfaction and foster loyalty.

For MSMEs, ensuring timely communication with customers is crucial. Implementing AI-driven communication platforms helps businesses stay connected with their customers, providing updates on delivery status and resolving issues promptly. This not only improves customer satisfaction but also builds trust and reliability, essential factors for business growth in a competitive market. Many difference makers in the third-party logistics industry have created proprietary software to enhance communication efficiency. For example, it can be a WhatsApp integration tool that can streamline the buyer-seller process by enabling 24/7 order confirmations and updates.

Failure Is Not An Option: Addressing Non-Delivery Issues

Undelivered shipments can be a major headache for logistics providers, leading to customer dissatisfaction and increased operational costs. Implementing a structured process to handle non-delivery reports (NDR) can significantly mitigate these issues. AI-driven systems can analyse delivery patterns, identify common failure points, and suggest improvements to enhance delivery success rates.

For MSMEs, addressing non-delivery issues is vital. By using AI to manage and resolve delivery failures, businesses can ensure that packages reach their intended recipients promptly. This structured approach not only reduces the incidence of undelivered shipments but also helps maintain customer trust and satisfaction. Effective NDR systems are essential for improving delivery reliability and reducing operational disruptions.

Future-Ready: Predictive Analytics And Automation

Warehousing is another area where AI is making significant strides. By automating sorting and packing processes, businesses can speed up operations, reduce errors, and cut labor costs. Predictive analytics helps businesses anticipate demand, ensuring that products are available when and where they are needed.

For MSMEs, the integration of AI and automation in warehousing is transformative. Predictive analytics helps businesses anticipate demand, ensuring that products are available when and where they are needed. This not enhances operational efficiency but also reduces costs, allowing MSMEs to offer competitive pricing and faster deliveries. The adoption of AI in logistics operations positions businesses to meet the growing demands of the ecommerce market effectively.

The Final Gear: Shift The Lever To AI To Reach The Last Mile 

The significance of last mile logistics has soared in recent years due to the exponential growth of ecommerce, changing consumer expectations, and the need for efficient, timely deliveries. Today’s consumers demand shorter delivery times, live tracking, and seamless experiences, forcing providers to continuously innovate and optimise their last-mile operations.The integration of AI in last mile logistics offers transformative capabilities, from optimising delivery routes and enhancing customer communication to predicting demand patterns and automating warehouse operations. By leveraging these innovative technologies, businesses can overcome the complexities of last mile delivery, enhance efficiency, and improve customer satisfaction.

As we look to the future, the role of AI in logistics will only continue to grow. The advancements in AI, analytics, and infrastructure will lead to more widespread adoption and greater effectiveness, positioning businesses to gain a competitive edge in the evolving market landscape. By embracing AI-driven solutions, businesses can ensure faster, more reliable, and cost-effective deliveries, ultimately transforming the last-mile logistics experience for both businesses and consumers.

The post How Is Artificial Intelligence Adding To The Last Mile Mileage For Logistics Companies appeared first on Inc42 Media.

When you ask most graduates today about their first job opportunity, many will quickly tell you it was at a startup. To put things in perspective, India was home to over 1.4 Lakh Department for Promotion of Industry and Internal Trade (DPIIT)-recognised startups as of June 2024, up from 92,683 in February 2023. 

This surge reflects the rapid growth of India’s startup ecosystem since the launch of the Startup India initiative in 2016.

India’s economy has seen the proliferation of startups across key sectors such as technology and ecommerce. These young companies have become a cornerstone of economic development. The recognition of 1,40,803 startups by the end of June 2024 underscores the dynamic nature of the Indian startup ecosystem, which has created over 15.5 Lakh direct jobs and spans 80% of the districts in the country.

Even though ecommerce, enterprise tech, and fintech continue their run as the leading sectors, deeptech has slowly emerged as a bright spot within the Indian startup landscape, attracting increased investor interest and funding deals last year.

In this backdrop, the pressing question remains: What is being done to embolden students to take their entrepreneurial skills to the next level?

Incubators: Catalysts For Startup Success

Higher educational institutions are increasingly establishing technology business incubators (TBIs) to foster a culture of entrepreneurship among students. These incubators provide a supportive environment where budding entrepreneurs can transform their innovative ideas into viable businesses. 

Many of these incubators offer a variety of resources, including state-of-the-art labs, dedicated workspaces, and access to expert mentorship, helping students gain hands-on experience with cutting-edge technologies.

Moreover, incubators also collaborate with corporate partners to extend their impact and help link academia with industry to create a robust startup ecosystem. The success of such initiatives is evident in the number of startups incubated and mentored, showcasing the incubator’s role in nurturing innovation and entrepreneurship.

Blending Theory And Practice

Another effective strategy employed by higher education institutions to spur entrepreneurship is to integrate business-related courses and modules into the standard curriculum. These programs are designed to blend theoretical knowledge with practical skills, preparing students to navigate the complexities of the business world. 

Courses often include subjects like business planning, financial management, marketing strategies, and innovation management. By incorporating case studies, project-based learning, and real-world problem-solving activities, students can develop a holistic understanding of what it takes to build and sustain a successful startup.

These programmes often invite industry professionals and successful entrepreneurs to share their insights and experiences, bridging the gap between classroom learning and real-world application. This approach not only enhances students’ skills but also instils a mindset geared towards innovation and resilience – essential traits for any aspiring entrepreneur.

Enabling Access To Funding

Access to funding is a critical component of a startup’s success. Educational institutions are increasingly recognising this need and are stepping up to provide various funding opportunities and resources to their students. 

This includes seed funding, grants, and soft loans tailored to support early-stage startups. Additionally, many institutions partner with government bodies and private sector players to offer comprehensive financial support packages.

For example, government schemes like the National Initiative for Developing and Harnessing Innovations (NIDHI), Start up India Seed Fund,  TIDE 2.0, among others offer significant grants and seed funding to promote young and aspiring innovators. 

By offering financial assistance, these institutions enable students to create a prototype of their ideas, conduct research, and eventually bring their products to the market. Such support systems are crucial for reducing the financial barriers that often hinder the progress of student entrepreneurs.

Conclusion

Higher educational institutions play a pivotal role in shaping the entrepreneurial landscape by fostering innovation and providing practical exposure to students. Through initiatives like incubator programs, these institutions offer a robust platform for first-generation entrepreneurs to transform their ideas into viable businesses. 

By providing state-of-the-art facilities and expert mentorship, they create an ecosystem where students can experiment, learn, and grow. This support extends beyond mere academic training, emphasising real-world applications and industry collaborations to ensure that students are not only job-ready but also equipped to create jobs and drive economic growth. 

These incubation programs, supported by government and private sector partnerships, illustrate the significant strides educational institutions are making to bridge the gap between academic knowledge and entrepreneurial success – setting the stage for the next generation of global startup leaders out of India.

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