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Keshav Tayal
Founder, trnch • 3m
Why is no one talking about the Indus Valley report? The Indus Valley represents the entire Indian startup ecosystem, which is spread throughout the nation with a Jugaad attitude. Key Takeaways: - Consumption & Services drive the Indian economy (individual spending and service industries like Finance, IT, and Retail), unlike China, where investments and manufacturing play a key role (production and export). - The Indian market is steadily shifting towards organized, branded, and formal structures. - India is the world’s second-largest consumer of gold due to cultural factors, poor land records, and challenges in using land as collateral. - India has historically struggled to grow its manufacturing sector, though it's now making a strong attempt with bans, tariffs, and production-linked incentives. - India is a Digital Welfare State, leveraging DPI protocols (like UPI, BHIM, and Co-WIN) to deliver cash and in-kind benefits directly to users. - India is divided into three economic classes: India 1 (Top 10%) – The primary consumers for most startups. India 2 – The aspiring class. India 3 – Those with limited discretionary spending. - Companies are going public earlier, with 42% lower revenue and 37% lower market cap compared to 2018 levels. (2024: A record-breaking year for Indian IPOs) - Quick Commerce is booming, with 24x growth in order value since FY22 and a doubling user base YoY. Key Challenges: - India’s savings rate is lower than other countries, limiting investment in productive assets (e.g., property, stocks). - Poor land records make gold a preferred collateral, slowing the development of the housing mortgage market. - Underinvestment in primary and secondary education is a long-term concern, hampering human capital development. - Quick commerce survivability is limited due to a small customer base (India 1 – Top 10%). - High return rates in e-commerce, especially in apparel and footwear, impact profitability.
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