E-commerce Startups are Raising Big Money!

While e-commerce portals are set up by tech oriented entrepreneurs, they have very little or no experience of the technological pitch and the logistics involved in delivering products to distant areas. But these entrepreneurs are innovative and have been able to bring up many new e-commerce businesses, outshining their older counterparts. Some companies like Myntra, SnapDeal, Fashion and You, Naptop, Flipcart, Bigshoebazaar (now Yebhi.com) and Tradus have been able to raise funds.

VCs however play a major role in funding as well as guiding such new ventures today. E-commerce entrepreneurs should think of VCs as more than just sources of money. VCs can help decide between tough directional choices and can add ideas, insights and connections from their experiences and exposure to a variety of relevant fields and other geographies, says Anupam Rastogi, VC investor, Nokia Growth Partners.

At an abstract level, VCs also indirectly shape the evolution of capital intensive spaces such as e-commerce by picking the models that they fund, as new industry segments eventually tend to get dominated by well funded players. Its not easy for a new venture to secure funds.

Even if I had the dream project, I need funds and infrastructure to make it materialize. So new ventures need to have great partnership between strong professionals and strong incubator and entrepreneurial investor with great ideas and connections with funds, says Uppal, whose venture (Fashion and You) is just about 11 months old and has already tasted success.

A VC with entrepreneurial experience is truly someone who can understand the initial hurdles faced by new ventures, and joining hands with such incubators can help form a great eco-system for the benefit of the company.