Nakamichi: The Story of India’s New Age Entrepreneur

Central India Triumphs: Stories of India’s New Age Entrepreneurs

Bala Srinivasa & TN Hari

penguin random house

Pp304, £599

For those familiar with the concept of luck at the bottom of the pyramid made famous by CK Prahalad, Winning Middle India will bring a sense of déjà vu. In fact, the idea is the same, but the context is more modern, which is why this book is so relatable. This segment typically has an income of Rs 3 lakh to Rs 20 lakh and fits the bill of Central India. Authors Srinivasa and Hari focus on this class and suggest a route to bring prosperity to these people. It’s not about making a big deal, it’s about establishing a commercial business model that works for your target audience as well as your company. That means changing the approach to doing business by looking at the masses of the market, whose individual wallets may be small but with big dreams.

India’s middle class has been written about quite often and has become a major attraction, especially for foreign investors. Because even this class has increased purchasing power, and with increasing prosperity cakes are getting progressively larger in size. So while the small sachet concept was pretty revolutionary to get to the bottom of the pyramid, technology will pave the way as we look to the middle where value-added products are offered. The emphasis is clearly on how companies leverage technology to gain solutions and reach out to a wider canvas.

While the Amazon and Flipkart models are legendary, there are some startups in India that are effectively leveraging technology platforms to offer services closer to the hinterland. This can take the form of pure information about train or commodity movements or commodity prices. These products are tailored to reach more people and ensure value. The new wave of entrepreneurs are qualified management and engineering graduates looking to do something different from their traditional jobs. This has encouraged fast-paced innovation that merges with people’s aspirations.

The book is also a kind of tribute to the new breed of entrepreneurs who have made the effort and risked to try something new. The focus is not only on developing new products, but also on providing a technology-driven market for existing goods and services. For example, Urban Company connects homes with plumbers, carpenters, electricians, and others who need upskilling to provide more value-added services and increase their income.

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The authors provide a playbook that you can follow for best results. These are interesting. They advocate customer segmentation across age groups rather than the traditional mode of rural and urban markets, and this makes sense. It should be designed with what you are looking at in mind. Next, let’s talk about customer trust. This is from the perspective of being able to use technology. It’s common to do things online, but when targeting customers you need to make sure things don’t go wrong. The author correctly points out that we do not try to trade losses for Farmers don’t migrate to another crop just because they can get a better return. This cannot be disputed and should be kept in mind.

We all know that most startups close in 4-5 years. Although this has not been flagged by the authors, we are always aware that such failures may be related to violations of these seven principles. It is related to acquisition costs that need to be kept low, especially for new product offerings.

Also, no one can start with a single product and a strategy must cover multiple products for success. It’s not enough to just offer plain student loans on an app, other products like investments and insurance should be part of the bouquet. And of course you want ease of operation, or what is called low friction for onboarding. Otherwise they can be a deterrent.

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The future is certainly exciting for business-challenging entrepreneurs, and technology will be the vehicle. And these companies are eyeing this growing demographic segment to target their business. You will find that competition will increase as some platforms or marketplaces are created to reach out to the middle class. We must be willing to use innovative methods to provide solutions. This is the way to go for startups and the authors believe it will make their dreams come true. We’ve seen digital solutions reshape industries like finance and agriculture, along with others like healthcare and logistics. Clearly, the canvas is vast.

Madan Sabnavis is Chief Economist at Bank of Baroda.