Vijay Shekhar Sharma, founder of PayTm, is the poster boy for India’s recent success story in the startup sector. He swung between colloquial Hindi and English, leaving the audience in splits with his unusual but brutally honest observations, as took centre stage in a one-on-one with Abha Bakaya at the recently held Global Hospitality Conclave 2018.
India: a great opportunity for startups
Vijay Shekhar Sharma emphatically brushed aside concerns around country’s growth trajectory and demonstrated faith in the future of “new India”. He stressed that the “new India was different” and the country was forecasted to become a 4-5 trillion US dollar economy by 2025.
He challenged ‘traditional wisdom’ of business, stating that times had changed. He took a dig at pundits who had termed several growth stories in sectors as financial bubbles waiting to burst but “failed to understand that it was not a bubble but growth.”
Once dubbed “illusive”, the middle-class was driving sectors like airlines and startups, he said. India had become a two trillion dollars economy in 70 years while another two trillion US dollars were going to be added in the next seven years, providing a great opportunity to startups, Vijay Shekhar Sharma added.
He argued that the capital for investment in to businesses was going to come in to India “eventually”, irrespective of where it came from, he said.
Race against time to expand business
Linking user frequency of any service to its directly proportional impact on revenue generation, Vijay Shekhar Sharma suggested that PayTm was expanding its service to diverse segments to “widen the arc of service to cover a larger base of users”.
PayTm chief, however, exhibited no inhibitions in accepting that he was racing against time to cover “as much ground as possible” before global giants with bigger pockets jumped in the fray. “We understand that we have only that much time to expand our business. Some time, Amazon will enter the space and throw in a billion US dollars and we will put in a couple hundred million USD,” he said.
Giving a peak in to PayTm’s scale of operations, he shared that the online wallet had sold over 1.8 million (18 lakh) insurance policies in 2017 and recorded a healthy 40 percent profitability doing so. “PayTm did over 3.4 million travel (34 lakh) bookings in December 2017 alone,” he added.
He also noted that cash flow was more important for business than profitability.
On what drives innovation
Traditional companies opted to buy technology, but real technology and innovation was driven by people “who were in touch with their customers,” he stressed.
He suggested that convenience and choice were key priorities of a digital customer and “the digital age had dawned.” Consumers were increasingly becoming ‘internet-first’ then opting for any other service, he added.
He forecasted that digital banking was going to become ubiquitous and a primary source of business model. “Brick and mortar banks will remain, purely because of government’s commitment to universal service, but not as a primary bank business model,” he added.
On the hospitality industry
He, admittedly, made a soft-pitch for PayTm to a room full of hoteliers, suggesting that technology could assist in easing processes, both, for hotels and consumers. “You could have a check-in through the app and we can provide you (hotels) with customers KYC and credit card details. It will make the entire process much easier,” he claimed.
Life before and after demonetization
He backed demonetization and noted that “it was sheer luck” that the company had deployed adequate resources in place to take advantage of the opportunity. “We were the most aggressive payments company and had already invested around 700 million USD (4000 crores INR) in developing systems and processes,” he said, explaining his stance on the government diktat.
On becoming India’s youngest billionaire
Vijay Shekhar Sharma was modest, and shrugged off any speculation around how his life had changed after becoming India’s youngest billionaire. He called himself the “anti-thesis” of luxury to a room full of people representing luxury, pointing out towards his casual attire.
