With the marketplace model, solve a problem from either supply or demand side

In this edition of Venture Upbeat in the “Leaders Talk” series I have a candid chat with Chief Product Officer of Zoomcar, Mr. Rajesh Bysani, on his thoughts on Self Drive Rental Cars in Asian market.

Where do you see the Indian market going with respect to self-drive rental cars, and how could Zoomcar could impact the same?

There are a couple of very interesting macro trends that we are noticing.

One trend that I have personally been noticing is that younger people are becoming increasingly financially savvy. This was not the case 10-15 years back. When we were in our first jobs the most popular investment option was either FD or ULIP, which does not seem to be the case now. The 22-30 year old crowd is now extremely careful about where they would like to spend their money. Hence you see a rise of the sharing economy, right from homes to cabs to furniture. This also means that a car is no longer the first prevalent aspirational purchase.

Another trend is the emergence of new cities like Bangalore, Hyderabad etc., which are seeing a huge influx of migrants. Most of the newer business hubs have infinitely more reasonable rentals than the traditional business centres like Mumbai and Delhi. This means that most of the migrants can afford to stay close to their office, hence reducing the need to own a car.

This is where ZoomCar comes in, makes owning a car viable again thanks to its partial ownership program ZAP. With ZAP, we are able to offer a hyper-local experience to the customer while ensuring better utilisation and lower cost of ownership for the car owner.

What about the need for a marketplace model in different sectors in the near future?

A few years back, when internet was just starting to become mainstream, the primary use case for internet was information. This reflected the popularity of yellow pages kind of services. Most of those companies have now pivoted to service fulfillment kind of models because of changed customer expectations. People are no longer using internet companies as only an information source while carrying the transaction offline, people are now transacting online. This true for everything for movie tickets to recharges to large industrial purchases.

This is a very profound and transformative shift and will soon start impacting even traditional industries. Marketplaces are not a new model. With internet the scale and reach of these marketplaces change, and hence the impact, as well. Marketplaces bring with them high level of transparency, wisdom of crowds, wide choice for the consumer, and efficient reach for the seller. I can’t think of any industry that will not benefit with the advantages of a marketplace.

What are your views on startups focussing on marketplace model?

It is important to identify whether you are a supply-first or a demand-first company. In a marketplace, the dynamics are very important to control, and I have found it easier to execute when the primary stakeholder is clear and well defined. I don’t mean to say that you should ignore the secondary stakeholder. The entire ecosystem needs to be focussed on but your focus would be on the primary actor defined.

It is also possible that early on, this keeps see-sawing between supply and demand ever so often, which is totally fine as long as the focus for the next few months is defined.

What is your advice to startups venturing into aggregator marketplaces? What are the challenges they should be ready for?

I usually see a lot of startups venture into aggregation with an intent of just bringing in visibility and structure in a fragmented market. While there is definitely some merit in this approach, it is not sufficient. It is important to solve a problem from either the supply or the demand side. That is when the network will start seeing value in you and start growing organically through word of mouth. It is also crucial that you identify the value that you would be adding to the entire industry before venturing. More often than not, I find this clarity of thought lacking in a lot of startups in this space.

In the initial days, most of the aggregator marketplaces will face a huge challenge in convincing the businesses to come on board unless the businesses see value. The key point here is to ensure that you ensure little to no disruption to the business in their day to day operations. Just do the bare minimum that would be required to get the business on board. Off-load much of the heavy lifting to yourself and start showing value to the business day one onwards. This creates long term loyal vendors who would then be willing to go out of the way to add value to you.

What are they key touch points that needs to be addressed while handling multiple stakeholders in this market?

I think I have touched upon this in other questions. Let me know if you want me to deep dive into this.

What does future with IoT for Zoomcar look like, and where do you want to focus on?

Our focus is to ensure that we are able to provide a safe, predictable, and fun journey to all our customers. Currently our focus is to ensure that we have a very high visibility into the car itself and that we are able to track the functioning of the car in real time.

Thanks for your thoughts, Rajesh, and for your time for Venture Upbeat.

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Pavan Govindan is part of Bezirk, a Bosch Startup which is an Intrapreneural venture of Bosch Global.

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