NEW DELHI, India — India's startup scene is running a decade or so behind China's, but it's on the same path to creating scores of billion dollar internet companies, according to World Startup Report founder Bowei Gai.
Early leaders — like e-commerce company Flipkart, travel portal Makemytrip, and ticket booker Redbus.in — have succeeded by helping people overcome some of this country’s byzantine infrastructure problems. The next wave of innovators are thinking bigger, disrupting the TV and advertising business, reinventing location-based services, and even helping out the embattled Indian farmer. In doing so, they may very well be inventing tomorrow for millions of people.
Here are some dynamic startups to watch.
Most Indians lack identity documents, creating a huge opportunity for Incights. Jen Hardy. Flickr Commons.
Identity verification is a huge problem everywhere, but much more so in India — where documents are frequently forged and only 2 percent of the population use credit cards.
With Incights' voice recognition software, banks and other companies that rely on the telephone to complete transactions can eliminate passwords and PIN numbers, offering better protection and greater simplicity for their customers.
Unlike competitors’ technology, Incights' voice recognition system works over the end-user's mobile phone, even if it's the most basic model available. There's no “last mile device” for customers to buy and roll out to their branches and franchises, a feature that could make Incights a winner as India pushes forward with plans for mobile banking.
It's a big opportunity. The Reserve Bank of India plans to bring the three-fifths of the population who don't have accounts into the banking system. This will require outsourcing to local shops and to one-man bank branches in remote areas where ID proof is hard to come by.
“If you look at the Indian market, we are at a place where authentication is required,” said Incights founder Varun Chandra. “There's a lot of fraud.”
CropIn has partnered with Pepsi to make farming more profitable. Noah Seelam. AFP/Getty Images.
Started by 30-year-old Krishna Kumar with a $200 loan from a friend in 2010, CropIn has partnered with companies like Pepsi to make farming more profitable through better planning. A desktop “dashboard” lets product managers follow agricultural experts into the field, where they input data on the farms they monitor.
For Pepsi, the app ensures that extension workers — 45 experts running quality control for 3,500 small farmers — actually make their field visits. It also vastly increases efficiency. Previously, three field managers could only cover about 15 acres a day. With these GPS-enabled apps, five people can cover 600 acres.
Farmers benefit through immediate access to custom advice on fertilizers and pesticides. This year, CropIn booked a milestone 10 million rupees ($200,000) in orders.
90 percent of Indians live beyond reach of healthcare. Noah Seelam AFP/Getty Images.
Forus Healthcare aims to eliminate the leading causes of blindness among the 90 percent of Indians beyond reach of the healthcare system. Its low-cost device allows barefoot doctors to screen patients for glaucoma, macular degeneration and diabetes-related retinopathy. India has 110 million diagnosed diabetics, and far too few ophthalmologists to conduct their required annual eye screenings. Moreover, via telemedicine, ophthalmologists can interact immediately with non-profit “eye camps” — meaning new revenues as well as fewer blind people.
Forus has enormous potential for revolutionizing ophthalmology as well. Its 3Nethra scanner could replace up to four hospital devices, saving clinics as much as $80,000 on equipment. And because the data are analyzed by computer, anyone with basic training can operate the device, allowing ophthalmologists to focus on patients whose results come up positive.
When co-founder Shyam V. Rao showed 3Nethra to then Secretary of State Hillary Clinton as part of a program to encourage innovation around the world, he says she immediately saw potential for the device in the US. With 3Nethra, a general practitioner could perform an eye exam and confer with an ophthalmologist online, saving the patient time and the government money.
Nowfloats.com enables companies to dispense with website techies. Sam Panthaky. AFP/Getty Images.
Tired of ornery techies? Send three text messages to Nowfloats and the company's software engine will have your small business website up and running in 13 minutes or less – automatically optimized for local search, enabling your store to score via Google.
The market's a large one. Only about 600,000 of India's 10 million small and medium enterprises are online, according to Nowfloats co-founder Ronak Kumar Samantray.
Once the site is up, Nowfloats allows store managers to update their sites with new inventory or discounts by text message, as well as send alerts to their registered users.
Companies like Nokia have adopted the service for their franchisees; Customers searching for a particular phone are directed to a store that has it in stock, at a discount price. “In India, any solution has to be really simple,” said Samantray. “SMS is something that anybody can do.”
A man withdraws money in New Delhi. Cutting energy costs at thousands of ATMs means profits for Autoboxx. Adeel Halim. Getty Images.
Here’s a novel way to earn money: cut energy costs.
Starting with India's many ATMs, Autoboxx aims to cut electricity demand by 20 percent or more with a low-cost, software-based power management system that switches off lights and air-conditioning systems when they aren't needed. The idea is not entirely new, but big companies like Honeywell have focused on factories and warehouses larger than 10,000 square feet. As such, Autoboxx enjoys a “blue ocean scenario” with few competitors, according to founder Ramandeep Singh.
Autoboxx has already made an impact for major companies like Airtel, Reliance and ICICI Bank. Several other national bank orders are in the pipeline.
The savings go beyond the electricity. Companies here rely on diesel generators to power things like cell phone towers during India's frequent power cuts. And because this is India, site managers all too often over-report these outages and sell the fuel that was supposedly burned by the generator. With Autoboxx's web based application, clients know exactly how long their generators run every month, so they can eliminate fuel theft.
In a country where cheap mobile phones are everywhere, Hoppr sees opportunity in developing a check-in service tailored to them. Narinder Nanu. AFP/Getty Images.
Location-based search and customer loyalty outreach are both hot areas in India. The challenge: cheap mobile phones are ubiquitous but almost nobody has an internet connection.
That's where Hoppr comes in.
Its software maps customers' locations by triangulating cell towers, allowing users to “check in” via text message. Like Google Places, Hoppr helps users find businesses within striking distance, wherever they are, without the internet if they have a basic phone or with an app if they're among India's fast-growing community of Android users.
For companies that sign up, it offers more than that.
When users “check in,” they get points for specials or coupons. At the same time, they let local businesses know they're in the area, so merchants can text them deals. Another function allows users to “love” a local business, which in helps companies engage with their customers.
“We launched Hoppr in May-June  and we already have almost 90 million check-ins,” said company founder M.D. Imtiaz. That's 90 million consumer data points we have. Everyday we do close to 500,000 check ins.”
Amagi seeks to re-invent India's TV business. Sebastian D’Souza. AFP/Getty Images.
Half broadcaster, half ad agency, Amagi — which means “freedom” — is out to reinvent the TV business. The company's software allows broadcasters to send programs and ads to cable operators over the internet, cutting out the most costly part of the business — the satellite.
The delivery method means ESPN or Discovery can cheaply tailor its product basket for individual markets like Malaysia, with its Muslim sensibilities, instead of adopting a lowest common denominator approach for a big whack satellite broadcast. And companies like India's Viacom 18 (MTV, Colors, VH1, Nick) have found the Amagi net feed is actually more reliable than the dish — which is subject to storms and other interference.
Amagi could be highly disruptive due to a market oddity: Remarkably, companies in India spend more on ads in print than on the airwaves. Because local TV advertising is essentially non-existent, Amagi actually buys national time, slices and dices, then resells it to local and regional advertisers, a business model that required co-founder K.A. Srinivasan to set up a studio so the company could shoot its own “Come on down”-style local ads.
“We're trying to change the economics of broadcasting,” Srinivasan said.
Sparsha Learning Technologies
Students present a computer generated solar eclipse model at Kennedy High School in Hyderabad. Noah Seelam. AFP/Getty Images.
Frustrated by the poor quality of technical education, Sparsha Learning Technologies develops software that allows universities and distance learning programs to create “virtual laboratories” where students can get the practical training, reinforcing lectures, readings and problem sets.
Its first product, docircuits.com, lets students of electronics build and test circuits online with off-the-shelf diodes and resistors. The virtual lab can be up and running for less than a tenth of the cost of a real one. And the software corrects students' work automatically, so no lab teacher is required.
Next up is a virtual lab for computer programming that will allow students to write software on the cloud.
With Indian universities facing a 40 percent faculty shortage even as colleges mushroom to improve the country's dismal 16 percent gross enrollment ratio, the local market is already large. There are opportunities abroad, too. Sparsha is in talks with US-based distance education leaders University of Phoenix and DeVry University.
In engineering, “a student can get the right competencies only by actually building stuff,” said Sparsha co-founder Debabrata Bagchi. “But if you look at how education happens in India and a lot of other places, it's a traditional classroom model.”
Skeptical about mobile's revenue potential? Just wait for 3D mobile "augmented reality" ads. Pascal Le Segretain. Getty Images.
This startup could just as easily be located south of Market Street in San Francisoc. Visarity's co-founders are pioneering a new form of 3D mobile ads using so-called “augmented reality.” Point your phone at a poster for Skyfall or Bollywood's Dabbang 2, and a 3D animation allows you to watch trailers, play games, set a song as your caller tune, use virtual scratch cards, or do whatever else ad agencies can dream up.
Visarity gives agency creative departments a much wider palette to work with on the mobile, where HTML and HTML 5 have proven to be a bust. As for the nuts-and-bolts, the software caches all the content and uses both Visarity's proprietary compression and your phone's native compression. That means it's less than half the size of an HTML 5 ad, despite the 3D. Meanwhile, Visarity's 3D engine only takes 300 kilobytes, compared with 7-10 megabytes for a video game development tool like Unity.
“The way we pitch it to brands is that it's augmenting your traditional advertising,” said co-founder Harsha Padmanabha. “If you go with TV, any magazine, in-store, anything, how do you augment this to get a higher engagement?”
A man holds a new UBI surfer notebook laptop at the product’s launch in 2010. Sajjad Hussain. AFP/Getty Images.
Pioneered by a US returnee who tried to start a video streaming business in 1997 – i.e. before Mark Cuban cashed out of broadcast.com — Layer3Media promises to be Netflix meets Fort Knox. With a patented, constantly changing encryption technology, founder Aniruddha Gupta believes he has the magic bullet to kill piracy — allowing virtually any content owner to stream shows and movies without leaking everything to PirateBay.
The secret? Movies are encrypted with a unique combination of algorithm, key format and randomly generated keys. And even if a pirate breaks the algorithm and key for one file, the same algorithm won't work on the next one. Meanwhile, video files are encrypted several times using different algorithms and keys across the system and distributed across the system as multiple files with the same name. Only Layer3Media's player can recognize which of these files it's dealing with — so a user who cracks one file can't even share it with someone else.
“We take a transaction fee every time somebody pays for a video (single view 3-day license, purchase, whatever…),” said Gupta. “This means that revenue will be explosive as soon as we hit one good/viral item of content.”
A bonus: Netflix is not available in India.