Future Group Chief Executive Officer Kishore Biyani on Wednesday said Indian startups were hopeless and that 90% of them were “not going anywhere”, PTI reported. Addressing the Economist India Summit in New Delhi, Biyani said the businesses looked “sexy because of one-page advertisements in newspapers”.
Biyani added that startups need to work on a larger scale to create employment opportunities and contribute to the Indian economy. "In the next three-four years, the revenues of these companies will not be more than Rs 3,000 crore to Rs 4,000 crore," he said.
He added, "Let us take taxi aggregation. The revenues could not be more than Rs 3,500 crore. They are not creating any new economy. They just meet people's needs to commute from point A to point B."
Biyani also said that venture capitalists simply put in an initial investment, then sell a majority of the shares to corporates, thus raising questions about how the whole funding system works.
Although the Future Group has recently acquired online furniture supplier Fab Furnish, Biyani said it was not feasible to run e-commerce enterprises in India. “Even if 10% of the business is online, someone will need to do the remaining 90%."
The entrepreneur had recently announced that his group would close its online retail enterprise, Big Bazaar Direct, as it was no longer making profits. He said, "I have attempted e-commerce four times in my life. We have opened and shut Future Bazaar. We will close Big Bazaar Direct within a week." Future Group has also joined hands with cell phone-based online marketplace, Paytm, as a platform to sell its products, Business Standard reported.
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