India 1.0 + India 2.0 = One Big Indian Market
I’ve been in India for little over a week now. And every time I talk to people doing business in India, there’s a recurring theme with a underlying message. India, with a population of over 1.1 billion people, is not one big homogeneous market. There’s a small high-end segment that’s typically less than 10% of the potential market. Beyond that, it’s a highly fragmented market segmented by various attributes, among other things culture and language (about 20 official languages and hundreds of dialects).
Some stats that I have gathered from talking to people. These numbers are approximate, so take it with a grain of salt. If they’re inaccurate by a wide margin, drop me a note or leave a comment.
- A little under 10% Indians are comfortable English.
- The PC penetration is about 2-3%, so there are only about 25-30M installed PCs in India. About half, a little over 15M, have internet connection.
- Less than 15% of Indians own a credit card. Indians, currently, spend just 1% of their total purchases through credit cards.
- About 300M mobile phone users in India, of which only about 10% have GPRS enabled (mobile web enabled) phones. Of the approx 30M web-enabled mobile phone users, only about 10-15M actually browse the web from their mobile devices.
- Of the 300M mobile subscribers, only 10% are post-paid and have a monthly recurring subscription. The bulk 90% are pre-paid, they pay for wireless talk minutes upfront and pay as they go.
- However, 35% of revenues for mobile operators comes from the 10% post-paid subscribers, and the remaining 65% from the 90% pre-paid subscribers.
- Typically only 10% of revenues for mobile operators comes from VAS (value added services) that includes SMS. The bulk 90% of revenues comes from basic voice services. The mobile operators are running out of bandwidth to support the 300M mobile users, so a bulk of the soon-to-be-available 3G spectrum will go towards supporting voice for existing and new mobile users.
People I have talked to, frequently refer to this divide in the Indian market as the Tier 1 India and Tier 2 & 3 India. Someone I talked to recently, referred to it as India 1.0 and India 2.0. India 1.0 and 2.0 just sounds better from the company’s perspective -
- India 1.0 is the company’s India entry strategy, targeting the high-end market that probably already has brand awareness and willingness to pay. These users are a natural fit with the company’s existing brand and product, and hence relatively easy to acquire. But that’s just a fraction (10% or less) of the addressable market.
- India 2.0 is the company’s growth/expansion strategy in India, going after a market that’s hard to crack. The India 2.0 strategy targets the fragmented 90% Indian market, and this requires product and market innovation and willingness to adapt.
Entrepreneur.com has a good article on big-name brands sharing their experiences of going after the Indian market:
“Our learnings were clear: ‘Ask not what percentage of an existing market your brand can achieve. Ask how large a market your brand can create by putting resources behind creating a category,’”

I don’t watch TV regularly, but a show called Startup Junkies caught my attention as I was channel surfing.
If you are a small business under 10M in sales revenue, you have the option of either using cash-based or accrual-based accounting. And if you’re in a business that has a high percent of Account Receivables, you’re better off using cash-based accounting. Why? Because you’re paying taxes upfront on income you won’t be receiving for another 90-120 days (depending on the payment terms you’re offering your customer).
Livmint 
I never paid attention as to who’s on my school’s board, not when I enrolled to Datta Meghe College of Engineering (DMCE) for my Bachelors or at NYU Stern for my MBA. I don’t think any student ever does. But I would imagine the board of directors/trustees are important people entrusted and responsible for the management of the school.
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