India’s abundant and relevant software talent, plenty of affordable raw materials and labour offering low production cost and universally viable products. Indian SaaS companies have well-leveraged all that together and have made India a minefield for SaaS companies.
The Rise of the SaaS
The yesteryear’s software was of a variety called on-premise. The companies had to buy and run the software on the site. This included the complexity of firstly having the devices that could meet the needs of the software.
And secondly needed highly proficient technicians who could integrate the software properly while meeting the time factor. Time factor because previously, the skilled engineers were few, and as the software was a new product, the demand was high.
However, it was not all doom and gloom, as Cloud Computing business models gave the industries a silver lining. Cloud computing rose to try to give smaller companies and even larger ones that demanded more flexibility with their software, other options.
Salesforce in the US and Zoho in India were the poster boys in the cloud computing field. They provided SMB’s and mid-market clients the opportunity to deploy computing power, without going through the hassle of building their own servers or having to pay massive deployment costs.
Very quickly, SaaS became the software of choice amongst the masses due to the space benefit and usability across the globe. However, in India, the rise of SaaS meant something more and something bigger. If the software didn’t have to be installed in person and could be deployed and managed over the internet – we could do it from here.
SaaS in India in the recent years
Companies from around the globe started focusing on investing in India, due to the availability of affordable labour, and the hunger India has to turn into a developed country.
According to the information made available by data-tracking organisations like Tracxn and Xeler 8, more than one-third of the SaaS startups have been partially or completely funded by foreign investors. Along with capital infusion from foreign investors, Indian SaaS companies also have the benefit of:
● Capital Efficient SaaS Startups
SaaS companies are extremely capital-efficient. A significantly lower (75- 85%) personnel costs compared to developed countries for similar talent in sales and development helps the business founders cut out on liabilities. This helps them in infusing that part of the capital in growth expansion and in advanced technology.
● Better Traction compared to peers
Indian cloud-based ventures have already proved in recent years that they are ready for the big game by attracting a large number of audiences and marketplaces. India has the ability to sell the product or service available to most of the marketplaces and audiences, due to the fact – India never sleeps. Be it companies operating in double or triple shifts or working even on weekends (A culture not popularised in other parts of the world ), Indian companies have flexible models like around-the-clock service with a trained service workforce from our IT and BPO industries.
● Foreign Currency Infusion
Along with foreign investors, Indian SaaS companies are also attracting foreign clients. With the talent India possesses at its disposal, along with the opportunity government has opened up by allowing FDI’s to invest in India, a large amount of revenue received by these companies are in the form of US dollars.
● Wide acceptance of Indian Talent
In addition, now there’s a wide acceptance of world-class products built and managed by Indian founders across the globe. As always is the case – the technology that would be outsourced to the other parts of the world would have a greater implementation in its own country. Moreover, the government is motivating more and more startups in India for the Make In India concept, by giving benefits across various fronts.
All these benefits have compounded together to make Indian SaaS companies and startups make giant strides. The foreign investors believe that this is just the beginning of a revolutionary phase of India. And they are here to tap the potential Indian startups possess over other countries so that they can themselves reap the rewards as well.
(This article is written by Kushang Kumar, Co-Founder and CEO – Supplynote. The views expressed in this article are of the author.)