Business In The Times Of Coronavirus: India And The World
Table of Contents 03
Scope Of The Report
04
Introduction To The Report
05
Executive Summary
06
Coronavirus: A Global Pandemic
12
Impact On Global Economy
19
Impact On Sectors
55
Impact On Startup Funding Listed Companies In India Fundraising In The Times Of Coronavirus
62
Fundraising In The Times Of Coronavirus
69
China: An Analysis
77
Trends Observed Online MICE & Development Of Remote Workplace Operations Increased Adoption Of Enterprisetech In India Adoption Of Mandatory Sick Leave Policy
Automobile
Traveltech & Aviation
Technology & Smartphones
Healthtech
Edtech
Coworking
Work Management & Online Tools
Fintech
Retail & FMCG
Impact On Funding Activity In India
79
Behavioural Changes Observed & The Long Term Impact
82
Methodology & Glossary
83
Bibliography
Scope Of The Report The coronavirus outbreak officially declared a pandemic by the World Health Organization (WHO). It has entered a majority of countries around the globe, with more than two lakh cases. The coronavirus outbreak has not only emerged a public health crisis, but also a threat to the world economy and businesses.
top 15 economies most affected by the coronavirus. The outbreak has cost the country about $348 Mn, according to a UN report dated March 2020. With the impact of the virus entering the business landscape, DataLabs by Inc42 has assessed its potential impact on industries, underlining the possible trends ahead.
India is no different in bearing the brunt. It stares at its position among This report seeks to provide a thorough analysis on: The impact of coronavirus on global economy, various industries and sectors, startup funding activities
3
Contemporary and future operational trends for startups Contingency plans for startups
Business In The Times Of Coronavirus: India And The World
Introduction To The Report Affecting hundreds of thousands people around the world, the coronavirus pandemic has hit businesses really hard. Stock markets have continued to crash globally, and businesses running on limited resources and supply amid fear and panic. Almost every sector is bearing the brunt of the crisis, with tech giants cancelling their tech conferences and suspending their operations in most affected areas. With the panic among people, working from
4
home has become a new norm for employees and stakeholders across the country. However, how services and delivery-focussed B2C companies can manage the majority of their workforce which interacts with thousands of users every day in person is something which they are yet to find an alternative for. As the world awaits a cure of the deadly virus, the world economy is bracing for an impact much more severe compared to its predecessors such as SARS and MERS.
Starting from Wuhan, China, the coronavirus has impacted more than three-quarters of the countries, with South Korea, Italy, the United States and Iran being the most hit. The report seeks to provide a perspective on the situations and implications for the businesses, and an in-depth analysis of sectors as well as businesses impacted by the coronavirus outbreak.
Business In The Times Of Coronavirus: India And The World
Executive Summary
Global Impact
Total Cases:
Total Deaths:
381,598+
16,559
Worst Hit Sectors:
Best-Positioned
Aviation, Travel &
Sectors: Enterprise
Tourism, Traveltech,
tech, Personal
Retail, MICE
hygiene
Total
No. Of Countries
Worst Hit
Recoveries:
Impacted:
Country: Italy
101,806
166+
(6,077 deaths)
No. Of Organisations Working On Medicine: 15+
India Impact Region Total Cases: 508+
Total Deaths:
Impacted:
10
15 States and UTs
Worst Hit State: Kerala (95+ cases) & Maharashtra (87+ cases)
Percentage
Worst Hit
Fall In Domestic
Sectors:
Air Travel:
Aviation,
20 to 30%
Retail
Source: John Hopkins University, DataLabs Secondary Research - *31 December 2019 To 24 March 2020
5
Business In The Times Of Coronavirus: India And The World
Coronavirus: A Global Pandemic
What Coronavirus Is According to the World Health Organization (WHO), “Coronaviruses (CoV) are a large family of viruses that cause illness ranging from the common cold to more severe diseases such as Middle East Respiratory Syndrome (MERS-CoV) and Severe Acute Respiratory Syndrome (SARSCoV). Coronavirus disease (COVID-19) is a new strain that was discovered in 2019 and has not been previously identified in humans. Coronaviruses
are zoonotic, meaning they are transmitted between animals and people. Detailed investigations found that SARS-CoV2 was transmitted from civet cats or bats to humans and MERS-CoV from dromedary camels to humans. Several known coronaviruses are circulating in animals that have not yet infected humans.�
Common signs of infection include:
Respiratory symptoms
Fever
(breathing difficulties, shortness of breath etc.)
Cough
In more severe cases, infection can cause:
7
Pneumonia
Kidney Failure
Severe Acute Respiratory Syndrome (SARS)
Death
Business In The Times Of Coronavirus: India And The World
“Standard recommendations to prevent infection spread include regular hand washing, covering mouth and nose when coughing and sneezing, thoroughly cooking meat and eggs. Avoid close contact with anyone
showing symptoms of respiratory illness such as coughing and sneezing,” according to the WHO.
How It Spreads Simply put, COVID-19 spreads in a way similar to flu.
A coronavirus-positive person releases droplets of infected fluid while coughing, sneezing or exhaling These droplets fall and settle on nearby surfaces and objects - such as desks, tables, telephones etc. Human Contact
Others can catch the COVID-19 infection by coming into contact with contaminated surfaces and then touching their eyes, nose or mouth. Coronavirus can also be transmitted by being close - say one metre - to an infected person by breathing; as one comes in contact with the droplets exuded by an infected person.
Fluid Contact
“Most persons infected with COVID-19 experience mild symptoms and recover. However, some go on to experience more serious illness and may require hospital care. The risk of serious illness rises with age: people over 40 seem to be more
vulnerable than those under 40. People with weakened immune systems and people with conditions such as diabetes, heart and lung disease are also more vulnerable to serious illness,” the WHO explains.
Contaminated Objects
8
Business In The Times Of Coronavirus: India And The World
Geographical Spread Of COVID-19 Around The Globe 381,598+ Cases Reported Around The World
*31 December 2019 To 24 March 2020
The total number of deaths due to COVID-19 during the period stood at 16,559
Top 5 Worst Hit Countries (In Terms Of Deaths) Italy— 6,077
9
China— 3,160
Spain— 2,311
Iran— 1,812
France— 860
Business In The Times Of Coronavirus: India And The World
Asia is the Worst Impacted Continent Followed By Europe 84% (81K out of 96K) conďŹ rmed cases in Asia was from China
10.9 %
87.6 %
Asia
Europe
Other
America
Oceania
Africa
*31 December 2019 To 20 March 2020
10
Business In The Times Of Coronavirus: India And The World
Italy Had The Highest Mortality Rate Countries
Confirmed cases
Mortality rate
Italy
47021
8.6%
Iran
19644
7.3%
Spain
21571
5.1%
In comparison to SARS and MERS, coronavirus is less lethal but far more widespread in terms of the number of individuals infected. The number of confirmed COVID-19 cases so far is 44
UK
3983
4.4%
China
80967
4.0%
times compared to MERS and 13.5 times compared to SARS.
COVID-19 Vs Its Peers
11
Virus type
Time period
Confirmed cases
Mortality rate
COVID-19
As of 21 March 2020
275,434
4.12%
SARS
As of July, 2003
8,098
9.60%
MERS
As of Jan, 2020
2,519
34.30%
H1N1 (Swine Flu)
Apr 2019- Aug 2020
(0.7 to 1.4) Bn
0.02%
*31 December 2019 To 24 March 2020
MERS Had The Worst Impact With A Mortality Rate Of 34%
Business In The Times Of Coronavirus: India And The World
Impact On Global Economy
Stock Markets Feel The Heat US, European, Hong Kong and Indian stock markets suffered sharp losses between January 10 and March 16 50,000.0 41,600 40,000.0
Closing Index Point
31,390 28,824
30,000.0
28,638
23,917
China’s overall exports contracted 17.2 per cent in dollar terms in January and February.
23,064 20,152 17,002
20,000.0 13,958
Consumer expenditure towards traditional sectors such as retail, restaurants, tourism and aviation has declined, and is expected to drop further in the coming months.
10,852 10,000.0
7,588 5,151
0.0 FTSE 100
NYSE
Nikkei 10 Jan 2020
13
According to the United Nations Conference on Trade and Development (UNCTAD), the COVID-19 is estimated to cost the world economy $1 Tn in 2020, besides the damage to human life.
Dow Jones (DJI)
Hang Seng
16 Mar 2020
Sensex
Consumer habits are expected to change, with consumer spend shifting to new-age sectors such as hyperlocal delivery, online conference/meeting tools and e-commerce.
Business In The Times Of Coronavirus: India And The World
Coronavirus Outbreak In China To Cost $348 Mn To Indian Trade As per UNCTAD estimates the total trade impact is $47 Bn, highest in EU and the US $20 K
15597
$10 K
5779
5187
$5 K
3816 1917
1369 1087 1077
733
660
ad a
2645 2296 2165
la nd
Impact (In $ Mn)
$15 K
425
348
di a In
ke y Tu r
C an
ai
ay sia
Th
M
al
la nd
re
ex ic o
itz er
Sw
M
ga po
do m
Si n
am
ng Ki
Un
ite
d
Vi et n
Ta iw an
Ko re a
pa n la
St at es
d ite Un
Eu ro p
ea n
Un
io
n
$0 K
Economies Source: UNCTAD, DataLabs Analysis
14
Business In The Times Of Coronavirus: India And The World
Information In The Digital Era Creating Awareness Using Digital Means At a time when authorities are discouraging physical gatherings, tech companies are coming to the rescue, and the joint efforts by communities are clearly visible. Google has teamed up with the WHO to launch an
SOS alert dedicated to the coronavirus outbreak. Governments around the globe are providing information on the pandemic using consumerfriendly means such as messages in collaboration with telecom operators.
Google Providing Links To Official Websites To Aid The Spread Of Genuine Information On Coronavirus Tech companies are helping the public in the best way possible. Facebook is providing the WHO with free ads for spreading awareness on the health crisis facing humanity, as well as updating its vigilance policies to deal with the spread of disinformation and fake news. Not only Facebook but also many other social media companies such as Twitter, YouTube and TikTok have stepped up vigilance efforts to eradicate the promotion of coronavirus-related conspiracy theories. For instance, the WHO has joined TikTok to suggest measures people can adopt to help in protecting themselves and others. Twitter has rolled out a warning label linking to the Centers for Disease Control and Prevention (CDC) for the search term ‘coronavirus’, and Facebook deployed a box into the news feed directing users to the US agency’s page on COVID-19. The WHO itself has released its own myth buster resources for the public. Not just that, tech giants such as Microsoft, Google and Zoho are providing free access to advanced features enabling collaboration while working from home or from remote areas. 15
Business In The Times Of Coronavirus: India And The World
So, with all the possible ways of easy communication through digital means, government organizations and tech companies have joined hands to ensure public safety in all aspects.
16
Business In The Times Of Coronavirus: India And The World
17
Business In The Times Of Coronavirus: India And The World
Fake News & The Panic At a time when people around the globe are engulfed in fear emanating from news on the spread of the deadly disease, this has widened the scope for panicked consumption of information - whether official statements issued by government agencies or mere rumours doing rounds in the digital media. Phones are flooded with misinformation and rumours around the COVID-19 outbreak. For countries such as India, it is all the more difficult to cope up with such a situation due to a slew of factors, such as the size of crowds and the absence of enough health institutions. The spread of fake news can be restricted by way of WhatsApp encryption. Tech
companies are taking all measures possible to limit the dissemination of fake information.
However, there is a platform which is still underperforming in the time of coronavirus. Due to encryption, misinformation is often spread in leaps and bounds through WhatsApp. Authorities are making efforts to encourage
the public to rely on credible sources such as the WHO tfor information, and check the source of any received information thoroughly before sharing it with others.
18
For instance, Pinterest has limited its search results for coronavirus and related terms to internationally-recognised health organisations, and Youtube added a link to the WHO’s COVID-19 page to the top of its search results page, and is even taking steps to remove misleading or fake videos from its platform.
Business In The Times Of Coronavirus: India And The World
Impact On Sectors
Automobile: The United States General Motors & Tesla Stock Prices Take A Dip Amid COVID-19 Fear China acts as a major destination for automotive parts export for the US domestic market
General Motors Stock Price (In USD)
40
24.69 USD Mon, 9 Mar 35
30
25
20 21 Feb
2 Mar
10 Mar
Date
Source: Google Finance, DataLabs Analysis
20
Business In The Times Of Coronavirus: India And The World
1,000
608.00 USD Mon, 9 Mar Tesla Stock Price (In USD)
900
800
700
600 2 Mar
21 Feb
10 Mar
Date
21
Business In The Times Of Coronavirus: India And The World
Automobile: India S&P BSE Auto Index Plunges As COVID-19 Pandemic Intensifies In Asia Coronavirus spread is expected shrink India’s auto production by 8.3% in 2020 18,000
14962.65 Mon, 9 Mar
Index Points
17,000
16,000
China accounts for 27% of India’s imports of auto components. Additionally, the prolonged panic and fear in the fallout from the coronavirus outbreak in India will impact the overall sales of automobiles in the country, in which test drives play a major role in attracting potential buyers.
15,000
14,000 18 Feb
24 Feb
3 Mar
27 Feb
6 Mar
Date
22
Stock
10-Feb-2020
16-Mar-2020
Closing Price% (10 Feb to 16 March) 2020
Tata Motors
168.9
83.0
-51%
Mahindra
528
392
-25.9%
Maruti
6892.9
5480.25
-20.5% Business In The Times Of Coronavirus: India And The World
Technology: The United States NYSE Tech Index Showing Signs Of A Slowdown Over The Past Month As of March 9, the closing price of the index was 17% lower compared to that of on 10 Feb. 2020 26,000
1976.46 Mon, 9 Mar
Index Points
24,000
22,000
20,000
18,000 19 Feb
27 Feb
6 Mar
Date
23
Stock
10-Feb-2020
16-Mar-2020
Closing Price% (10 Feb to 16 March) 2020
Microsoft
$189
$135
-20%
$1,509
$1,073
-19%
Apple
$322
$242
-17% Business In The Times Of Coronavirus: India And The World
Technology: India BSE Teck Index Takes A Deep Dive As Well As of March 9, the index was down 10% compared to February 10, 2020 8,500
7264.43 Mon, 9 Mar
Index Points
8,000
7,500
7,000 14 Feb
Source: Google Finance, DataLabs Analysis
24
19 Feb
25 Feb
28 Feb
4 Mar
9 Mar
Date
Business In The Times Of Coronavirus: India And The World
Stock
10-Feb-2020
16-Mar-2020
Closing Price% (10 Feb to 16 March) 2020
WIPRO
240.9
179.8
-25%
Infosys
773
583
-24.6%
TCS
2,162
1,696
-21.5%
Impact on the technology sector Facebook cancelled its F8 Developer Conference which is the company’s biggest tech event this year Apple temporarily shutdowns it’s all 42 retail stores in mainland China
Microsoft warned investors that revenue in the business segment that includes its windows operating system and surface devices would likely miss earlier forecasts The cancellation of around 12 high profile tech conference incurred economic loss worth $1 Bn
Google temporarily closes all its offices in mainland China, Hong Kong and Taiwan
25
Name
Organiser
Location
Status
Mobile World Congress
GSMA
Barcelona
Cancelled
F8 Developer Conference
Facebook Inc.
San Jose
Online
Adobe Summit
Adobe Inc.
Las Vegas
Online
Google I/O
Alphabet Inc.
Mountain View
Cancelled
GPU Technology Conference
NVIDIA
San Jose
Online
Snap Partner Summit
Snap Inc.
Los Angeles
Online
Business In The Times Of Coronavirus: India And The World
Edtech To shield their economies from the fast-spreading pandemic, policymakers around the globe have mandated temporary or indefinite lockdowns of schools or universities in a bid to ensure public safety. According to UNESCO, 49 countries across Africa, Asia, Europe, the Middle East, North America and South America have announced or implemented closures of schools and universities as of March 12.
The nationwide shutdown of schools in 29 countries has impacted almost 391.5 Mn students and another 20 countries have implemented provincial school closures, according to UNESCO, which has also released a guide for distance learning solutions in an attempt to mitigate the loss.
Global monitoring of learners affected by school closures caused by COVID-19
Country-wide school closure Localized school closures
26
Business In The Times Of Coronavirus: India And The World
Education tech (edtech) comes to the rescue as the coronavirus crisis limits access to physical classrooms.The segment is making learning accessible through means of technology. When students are forced to remain captive indoors, the burgeoning demand for different ways of remote learning has picked up like never before; edtech companies are working to help the students in every way they can.
adoption in the long term is obvious and there is a huge potential for edtech startups to explore the Indian market. In FY2018, the gross merchandise value of edtech startups stood above $120 Mn, a surge of 48 per cent compared to the previous year. At this juncture, the role of online learning has expanded with Indian edtech startups offering free access to study material for students.
With the spread of the coronavirus outbreak, the rise in technology
Free access to school students from classes 1 to 12 till April Free mathematics and English lessons access to school students from classes 1 to 3 and mathematical and scientific concepts for classes 4 to 12
Free access to school students from classes 5 to 12
Free access to live classes Offering learning live and online by joining hands with schools in Bengaluru, New Delhi, Kerala, and Hyderabad Option for schools to opt for end-to-end online tutorials through the startup’s content or use school’s own content
27
Business In The Times Of Coronavirus: India And The World
Extended the free trial period for its online courses to 14 days
Free access to Internshala Trainings, e-learning platform, for the students of Kerala, Jammu and Kashmir, and Ladakh till March 31.
Free access to lessons to students appearing for UPSC, banking and railway exams Pooling in educators to offer 20,000 free live classes
Free access to lessons Putting efforts in doubling the number of free videos
Free access to app till April
Free access to online classes on competitive exams
Deeper internet penetration along with the rampant use of smartphones and other connected devices has exponentially increased the capitalisation opportunity in the Indian edtech segment. This trend is attracting investors, resulting in huge funds for Indian startups. In FY2018, the gross merchandise value of edtech startups was above $120 Mn, marking a surge of 48 per cent compared to the previous year. 28
With technology coming to the rescue amid the coronavirus pandemic, edtech platforms have already begun to witness a surge in users. According to a Quartz India report, Gradeup’s daily enrolments have risen 25 per cent, which underlines the huge potential for online learning— a trend expected to prevail in the years to come.
Business In The Times Of Coronavirus: India And The World
Online Work Management Tool Despite Hard Times In The Market Zoom Stock Surges The Zoom stock soared 29% between February 12 and March 9 130
113.75 USD Mon, 9 Mar
Zoom Stock Price (In USD)
120
110
100
90
80 19 Feb
24 Feb
27 Feb
3 Mar
6 Mar
11 Mar
Date
Source: Google Finance, DataLabs Analysis
29
Business In The Times Of Coronavirus: India And The World
(% change) daily closing price
10.00%
5.00%
0.00%
-5.00%
-10.00% 16-Feb-2020
23-Feb-2020
1-Mar-2020
8-Mar-2020
Date
Zoom has added 3.5 times more monthly active users since February 24 compared to 2019. Businesses are widely adopting video/audio conferencing solutions to conduct meetings and to enable remote work operations for their workforce. This has resulted to a surge in downloads and the number of active users of online work management tools. This is reflected in Zoom shares which are drawing more and more buying interest with the rising popularity of remote working solutions in the backdrop of the coronavirus pandemic.
30
Business In The Times Of Coronavirus: India And The World
Work From Home In India Businesses around the world have already started experimenting with work-from-home protocols. Many companies including Bounce, Snapdeal, Uber, Ola, Swiggy, Zerodha, Flipkart, Paytm, Unacademy, Meesho and Instamojo - are encouraging their employees to start working from home. Companies have to deal with a distributed workforce thanks to the coronavirus, and efficient communication is the backbone of this newly warranted mode of operation.
Adoption of video conferencing technologies in the time of coronavirus has led to multifold growth in their usage; companies such as Webex are witnessing a boom in traffic. There are many free collaboration tools available in the market today that can be utilised by companies for better collaboration:
Remote Collaboration Tools For Small To Mid Size Companies
31
Team Chat
Meetings
Task Management
Document Collaboration
Code Collaboration & Management
Design Collaboration
Video
Team Monitoring
Business In The Times Of Coronavirus: India And The World
Tools such as Google’s Docs and Sheets are always there for better collaboration. Tech companies such as Google, Microsoft, Zoom and Zoho are doing their part by providing free access to some of their paid services, thus making the remote collaboration much more effective and easier.
32
Business In The Times Of Coronavirus: India And The World
Companies are reportedly experiencing multifold growth in their app downloads. Here are some highlights: Global downloads of apps such as Tencent Conference, WeChat Work, Zoom, Microsoft Teams and Slack have surged nearly five fold so far this year. From 1.4 Mn new users in the first week of January, the figure jumped to a record 6.7 Mn in the first week of March across the App Store and Google Play platforms, according to app analytics firm Sensor Tower. Zoom Video Communications’ daily active user base has grown 67% since early January, according to data from Apptopia. By January-end, the company’s run rate stood at a hundred Bn annual meeting minutes. The company also removed the time limit from video chats using Zoom’s free service for affected regions. The boom was recently highlighted in Zoom’s financial results for the October-December period, as the company’s total revenue came in at $188.3 Mn, marking an year-over-year increase of 78%. Microsoft’s Teams platform witnessed a six-fold increase in meetings, calls and conferences in China since January-end. Mobile app usage grew three-fold. Slack’s revenue rose to $181.9 Mn in the December quarter—a gain of 49% compared to the corresponding period a year ago. On an average, free sign-ups of Cisco’s Webex in affected countries are up seven times compared to the pre-outbreak period, according to the company.
33
Business In The Times Of Coronavirus: India And The World
The Work From Home Boost Since the initial spread of coronavirus in January, new downloads of Zoom have exploded in affected regions. The U.S. is just starting to catch up 350000
Number of downloads
300000
250000
200000
150000
100000
50000
0 03/12/19
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Jan
Feb
03/11/20
Date Zoom Cloud Meetings (App) Worldwide
Zoom Cloud Meetings (App) U.S.
Source: Apptopia, DataLabs Analysis
34
Business In The Times Of Coronavirus: India And The World
No businesses are left unattended by the companies. Companies such as cloud communication service provider Ozonetel have started offering
its clients the option to switch their call centres into work-from-home models in a seamless way.
No Drop In Productivity Companies are using tools to track the progress of work being done by their employees from home to make this mandatory transition smooth and effective. Some of the highly adopted tools for tracking the progress of staff working from home are Time Doctor, Toggl, RescueTime and Timely.
35
With the rising number of companies sending their employees home to work, and collaborate digitally, there is a clear surge in the adoption of tools enabling such operations. Collaborative work solutions are also expected to clock multifold growth in near future.
Business In The Times Of Coronavirus: India And The World
FMCG & Retail: The United States
NYSE U.S. Market Consumer Goods Sector Index Takes A Double Dip The index had plunged 12% between 11 February to 9 March 2020 2,500
2,117 Mon, 9 Mar
Index points
2,400
2,300
2,200
2,100 21 Feb
2 Mar
10 Mar
Date
Top Retail Stock Trends Goes Red In The US
36
Stock
10-Feb-2020
16-Mar-2020
Closing Price% (10 Feb to 16 March) 2020
Home Depot
240.61
164.9
-31%
Target Corp.
116.98
93.79
-20%
Walmart
115.25
106.76
-7% Business In The Times Of Coronavirus: India And The World
FMCG & Retail: India
BSE Fast Moving Consumer Goods Index Slide As Consumer Hysteria IntensiďŹ es Between 11 Feb to 9 March the index plunged by 10% 12,000
10467.14 Mon, 9 Mar
Index points
11,500
11,000
10,500
Supermarkets and retail outlets are bracing for a drop in footfalls with the growing number of mall and shopping complex shutdowns. India’s overall retail sector will also be highly affected. On the contrary, hyperlocal services and e-commerce websites are expected to gain traction, highlighting the impact the coronavirus outbreak will have on traditional retail sales.
10,000 24 Feb
18 Feb
Source: Google Finance, DataLabs Analysis
37
27 Feb
3 Mar
6 Mar
Date
Stock
10-Feb-2020
16-Mar-2020
Closing Price% (10 Feb to 16 March) 2020
Future Group
341
153.1
-55%
ITC
210.55
147.25
-30%
HUL
2159.3
1941.9
-10%
Business In The Times Of Coronavirus: India And The World
The Game Of Masks & Sanitisers
Google Searches Related To Hand Sanitisers Surged Exponentially In India And The USA Over The Past Month Popularity higher in USA as compared to India
Popularity Score (0 to 100
100
75
50
25
0 16-Feb-2020
23-Feb-2020
1-Mar-2020
8-Mar-2020
Date India
USA
Source: Google Trends, DataLabs Analysis
38
Business In The Times Of Coronavirus: India And The World
Online Popularity Of Facial Mask In India Surpasses The United States In India popularity of facial mask reached its peak on 4th March 2020
Popularity Score (0 to 100)
100
75
50
25
0 16-Feb-2020
23-Feb-2020
1-Mar-2020
8-Mar-2020
Date India
USA
Source: Google Trends, DataLabs Analysis With the growing demand and limited supply for hand sanitisers and facial masks amid the panic, the prices of such products have spiked to record levels. The price of a basic surgical mask has surged four times
39
(from INR 10 to 40), while that of an N95 mask has jumped 3.3 times (from INR 150 to 500).
Business In The Times Of Coronavirus: India And The World
Healthcare: The United States
NYSE Health Care Sector Index On A Downward Trend As Well As of 9 March 2020, the closing price of the index was 11.8% lower compared to 11 Feb 2020 28,000
24206.95 Mon, 9 Mar
Index points
27,000
26,000
Since China accounts for a large portion of the supply of drug ingredients, the COVID-19 outbreak will have a major impact on the supply chain for the pharmaceuticals industry.
25,000
24,000 2 Mar
21 Feb
10 Mar
Date
40
Stock
10-Feb-2020
16-Mar-2020
Closing Price% (10 Feb to 16 March) 2020
McKesson
162.14
121.3
-25%
UHG
287
225
-21.6%
Pfizer
38
30.2
-20.2% Business In The Times Of Coronavirus: India And The World
Healthcare: India
S&P BSE Healthcare Index Dips 829 Points On March 9 Compared To 11th February The index had plunged 6% in the same period 14,500
13505.03 Mon, 9 Mar
Index points
14,000
13,500
13,000 2 Mar
20 Feb
10 Mar
Date
41
Stock
10-Feb-2020
16-Mar-2020
Closing Price% (10 Feb to 16 March) 2020
Sun pharma
420
369
-12.3%
Cipla
445
396.4
-10.9%
Alkem
2585.2
2,426.9
-6% Business In The Times Of Coronavirus: India And The World
Aviation And Travel: Global
Steep Decline In NYSE Arca Global Airline Index Over The Past Month As of 9 March 2020, the index had plunged a whopping 37% compared to 11 February 120
NYSE’s Arca Airline Index - a 69.91 Mon, 9 Mar
index designed to measure
100
Index points
modified equal dollar weighted the performance of highly capitalised and liquid international airline stocks - is an adequate way to quantify the impact of the
80
coronavirus outbreak on the US airline industry. 60 18 Feb
21 Feb
26 Feb
2 Mar
5 Mar
10 Mar
Date
42
Stock
10-Feb-2020
16-Mar-2020
Closing Price% (10 Feb to 16 March) 2020
UAL
79.47
35.5
-55%
Delta Airlines
58
35.8
-38%
Southwest Airlines
57.42
37.52
-35% Business In The Times Of Coronavirus: India And The World
Aviation & Travel: India
Stock Prices Of Both Indigo And Spicejet Have Plunged Drastically Over The Past Month From 11 Feb. to 9 March, Indigo plunged by 16% whereas Spicjet witnessed 28% decline 1500 1213.20 INR Mon, 9 Mar
Indigo Stock (In INR)
1400
1300
1200
1100
1000 18 Feb
24 Feb
27 Feb
3 Mar
6 Mar
12 Mar
Date
Source: Google Finance, DataLabs Analysis
43
Business In The Times Of Coronavirus: India And The World
100
Spicejet Stock (In INR)
63.70 INR Mon, 9 Mar
80
60
40 18 Feb
24 Feb
27 Feb
3 Mar
6 Mar
12 Mar
Date
The rising number of flight cancellations and a slump in air travel demand is expected to take a troll on the working capital of airlines. Refunds against cancellations and the cost of daily operations are likely to pile up, hampering the overall performance of the carriers in the coming quarters.
44
Business In The Times Of Coronavirus: India And The World
Shares Of Indian-Origin Travel Tech Companies Take A Hit The stocks of MakeMyTrip and Yatra sank 35 per cent and 32 per cent respectively between February 11 and March 9 30
MMYT Stock (In INR)
19.01 USD Mon, 9 Mar
25
20
15 21 Feb
2 Mar
10 Mar
Date
Source: Google Finance, DataLabs Analysis
45
Business In The Times Of Coronavirus: India And The World
4.0 2.50 USD Mon, 9 Mar
YTRA Stock (In INR)
3.5
3.0
2.5
2.0 21 Feb
2 Mar
10 Mar
Date
In a bid to halt the spread of the coronavirus outbreak, India has suspended the grant of visas for a month with few exceptions. The travel industry has taken a big blow due to the coronavirus outbreak, as March and April are believed to be the peak season for Indians traveling both within the country and abroad. Indian tour operators are staring at losses of up to $500 Mn thanks to booking cancellations from China and other countries due to the coronavirus crisis; those losses can multiply four-fold if the situation lasts for the entire year.
46
Business In The Times Of Coronavirus: India And The World
Real Estate, Coworking & Shared Office Spaces: The United States
Realogy Holdings Stock Price Declines Amid Market Panic As of 9 March the stock plunged 46% compared to 2th February
Realogy Holdings Stock (In USD)
12 6.67 USD Mon, 9 Mar 10
8
6
4 24 Feb
3 Mar
11 Mar
Date
47
Business In The Times Of Coronavirus: India And The World
(% Change) Daily Closing Price
10.00%
0.00%
-10.00%
-20.00% 16-Feb-2020
23-Feb-2020
1-Mar-2020
8-Mar-2020
Date
Source: Google Finance, DataLabs Analysis
48
Business In The Times Of Coronavirus: India And The World
Real Estate, Coworking & Shared Office Spaces: India
S&P BSE Realty Index Takes A Hit The index tumbled 18 per cent between February 12 and March 9 2,400
1,972.96 Mon, 9 Mar
Index Points
2,200
2,200
1,800
1,600 18 Feb
24 Feb
27 Feb
3 Mar
6 Mar
11 Mar
Date
49
Business In The Times Of Coronavirus: India And The World
(% Change) Daily Closing Price
2.50%
0.00%
-2.50%
-5.00%
-7.50%
-10.00% 16-Feb-2020
23-Feb-2020
1-Mar-2020
8-Mar-2020
Date
In addition to the country’s traditional realty market, new age markets such as coworking/living as well as shared office spaces are also expected to bear the brunt of the coronavirus pandemic, especially the pay-as-you-go model-based products.
50
Business In The Times Of Coronavirus: India And The World
Financial Sector: The United States
JP Morgan Chase And Bank of America Stock Tanks As Panic IntensiďŹ es On 9th March Both JP Morgan and Bank of America stock plunged 13% and 14.7% respectively, highest in the past month
(% Change) Daily Closing Price
10.00%
5.00%
0.00%
-5.00%
-10.00%
-15.00% 16-Feb-2020
23-Feb-2020
1-Mar-2020
8-Mar-2020
Date JP Morgan Chase
Bank of America
Besides the traditional finance sector, new age fintech instruments are expected to suffer due to decreasing business activity and narrowing consumer expenditure. 51
Business In The Times Of Coronavirus: India And The World
Financial Sector: India
BSE Bankex Index Bleeds The index dipped 9.4 per cent between February 13 and March 12
36,000 30,384.17 Mon, 9 Mar
Index points
34,000
32,000
30.000
28.000
26.000 19 Feb
25 Feb
28 Feb
4 Mar
9 Mar
Date
Source: Google Finance, DataLabs Analysis
52
Business In The Times Of Coronavirus: India And The World
Stock Price Of Two Top Banks In India Plunges Overtime On March 12 both HDFC and ICICI bank tanked more than 8% as COVID-19 cases rise in India
(% Change) Daily Closing Price
2.50%
0.00%
-2.50%
-5.00%
-7.50%
-10.00% 16-Feb-2020
23-Feb-2020
1-Mar-2020
8-Mar-2020
Date HDFC
ICICI
With self-isolation and contactless communication becoming the need of the hour, the demand for home delivery and digital payments is poised to grow. This will give an impetus to digital transactions - in terms of both
53
volumes and value - and in turn enhance the utility of fintech products such as payment gateways, mobile wallets and prepaid payment instruments (PPIs).
Business In The Times Of Coronavirus: India And The World
About DataLabs by Inc42
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Impact On Funding Activity In India
Frequency Of Funding Deals Decreasing With Growing Fear Of Coronavirus In India The total deal count in February was 12% lower than that of January 20
Funding Deals
15
10
5
0 12-Jan-2020
26-Jan-2020
9-Feb-2020
23-Feb-2020
Date
Deal Count
SMA(5 Day)
Source: DataLabs The volume of funding deals in the first two months of 2020 fared better compared to the corresponding period a year ago. In January-February 2020, the total number of deals stood at 154, up 29 per cent compared to
56
119 in the year-ago period. Despite having a good start so far in 2020, the hysteria surrounding the COVID-19 pathogen has affected the frequency of deals in the ecosystem.
Business In The Times Of Coronavirus: India And The World
Startup funding stats between (2 Jan.to 9 March) 173 total number of funding deals
81 startups funded at seed stage
Edtech sector with highest
Capital Inflow In Indian Startup Ecosystem Slowing Down As Investor Meetings Get Hampered Although the total capital inflow ($3.1Bn) was higher than the previous years—$1.8 Bn raised the previous year, but a slowdown is evident in the trendline
Funding Amount ($ Mn)
800
600
400
200
0 12-Jan-2020
26-Jan-2020
9-Feb-2020
23-Feb-2020
Date (2 Jan. to 6 March)
Funding amount ($Mn)
SMA(5)
Source: DataLabs 57
Business In The Times Of Coronavirus: India And The World
Out of the four primary stages of startup funding - seed, growth, late and bridge, the most impacted are the growth (Series A and B) and late(Series C and above) stages. Given that high-value deals mandate physical
meetings, which are losing popularity among startups dramatically due to the coronavirus crisis, startups have fallen prey to increasing precautionary measures adopted by the government and the public alike.
Startup funding stats between (2 Jan.to 9 March) $3.1 Bn worth of total funding
58
9 Mega funding rounds ($100 Mn and above)
Enterprisetech sector with the highest capital inflow
Business In The Times Of Coronavirus: India And The World
Public Tech Companies In India Market Hysteria Reected In Tech Stocks The Stock Prices Of Both IndiaMart and Just Dial Is On A Downward Streak Over The Past Month
%change (Daily Closing Price)
10.0%
0.0%
-10.0%
-20.0% 16-Feb-2020
23-Feb-2020
1-Mar-2020
8-Mar-2020
Date
IndiaMart
Just Dial
Source: DataLabs 59
Business In The Times Of Coronavirus: India And The World
Nakuri and Matrimony Stock Prices Slide As Well In Accordance With An Overall Downfall In The Market
(% Change) Daily Closing Price
7.50% 5.00% 2.50% 0.00% -2.50% -5.00% -7.50% 16-Feb-2020
23-Feb-2020
1-Mar-2020
8-Mar-2020
Date
Nakuri
Matrimony
Source: Google Finance, DataLabs Analysis
60
Business In The Times Of Coronavirus: India And The World
Tejas Network Takes A Double Dip Whereas Infibeam Continues To Plunge Further
(% Change) Daily Closing Price
10.00%
5.00%
0.00%
-5.00%
-10.00%
-15.00% 16-Feb-2020
23-Feb-2020
1-Mar-2020
8-Mar-2020
Date
Infibeam
Tejas
Source: Google Finance, DataLabs Analysis
61
Business In The Times Of Coronavirus: India And The World
Fundraising In The Times Of Coronavirus
Startups thrive on virality – pitch decks, marketing collateral and KPIs scream the term in bright colours as investors look for this essential element before committing to a company. But to paraphrase “Star Wars: A New Hope” – “this is not the virality you were looking for”.
Siddarth Pai Founding partner & CFO, 3one4 Capital
COVID-19 or Corona Virus Disease 2019 has permeated all aspects of life for mankind, especially for startups and investors. Many have grappled with the issue of Work from Home (WFH) and are creating and open-sourcing playbooks of best practises and tools to tackle the issue.
Social distancing has become ingrained in our vocabulary as people strive to stem the dissemination of the virus and fight this the best way they can. But as the dust settles and people adjust to the WFH imposition, founders and investors have one word in mind, in addition, to cover (safety) and continuity: capital. To understand the interplay of the COVID-19 on startups and investors, it’s important to look at the macro effects of the virus and its implications on the two players: startups and investors.
Meetings and conferences have been cancelled or postponed; stand-ups have moved online and long commutes have given way to LAN bandwidth management.
Macro The most visible sign of the virus’ impact on capital is the sheet hollowing out of the capital markets worldwide. The precipitous fall is in danger of reversing close to 6 years of gains for stock market investors globally as investors rush to cash out and sit on liquidity. The slide is in no danger of ending as the US markets have hit the lower circuit breaker thrice in the past week itself. Marquee stocks such as Berkshire Hathway are trading at book value and in India, during Holi, the only colour that investors saw was red. Those in the private markets (VCs and startups) have been insulated from this fall. After all, the private markets lack the price discovery and liquidity 63
of the listed space – making all rises and falls in fund value and startup stock slower, but stickier. Funds normally value their portfolios based on the most recent funding round (known in the industry as the Price of Recent Investment methodology) as it offers the closest analogue to a stock-ticker for the underlying portfolio. Commonly, only in cases of a force majeure event, erosion of the substratum of the business or the lack of a funding round amongst others do the VCs mark down their investments.
Business In The Times Of Coronavirus: India And The World
In the world of capital raising in the private markets – the source of funds for VCs and by consequence, startups, all come from LPs. In the typical VC structure, the fund managers are known as General Partners or GPs and the investors in said funds are known as Limited Partners or LPs. The money from the LPs flows into the funds floated by the GPs and ultimately, to startups. The source of funds for the LPs has always been the listed markets – be it in debt instruments like bonds or equities like stocks, hedge and mutual funds or other such investments. Very seldom do LPs sit on cash, i.e, keep funds parked in fixed deposits or their current accounts.
investment figure that they must achieve via diversification into various asset classes (gold, debt, bonds, real estate, stocks, etc). But if you look into the investments of any LPs – be they large endowments, family offices, etc – their primary investments are always in the listed space with venture being part of their allocation strategy. And therein, as the Bard says, lies the rub. For a fall in the public markets have a bleeding effect onto the startup world as well.
Their asset allocation strategies always keep a minimum return on
Impact Of Corona On VC Fundraising The common consensus amongst VCs is that they all fall into two categories: Those who are fundraising Those who just finished fundraising VCs, like startups, too need to raise funds. They have decks, undergo due diligence and make quarterly reports to their LPs, similar to the cycle that startups endure. Their cycles are typically longer than startups -with funds taking around 6-18 months to close out depending on the GP, sector, experience, etc. For the more established GPs with a strong LP base – the fundraises can be as simple as an email and a call announcing the new strategy, prior
64
performance, thesis and an ask in terms of a capital commitment. They aren’t as adversely affected as the newer breed of GPs coming out. For the new GPs – VC fundraising is still an old school as it places greater importance on a face-to-face meeting initially to get a good read of the GP. For those who are fund-raising and who are new GPs, their processes have
Business In The Times Of Coronavirus: India And The World
gotten harder as the three largest pools of capital for Indian VCs – USA, Singapore and China – are under various stages of travel restrictions. The
Indian LP pool is also reeling from a sliding stock market, tepid real estate market and a liquidity crunch that India is emerging from
Compounded by tax policies that make gains from startups suffer a tax rate that’s 2.54x the one for listed gains, a holding period that’s twice that of listed entities and the lack of liquidity, fundraising in India for VCs just got harder. The silver lining is that the rout in the stock market and the relative stability of the private markets is making VC and startups a more attractive asset class for LPs the world over. India needs to capitalise on this and create more conducive policies that don’t discriminate against startups as opposed to listed companies so that greater value creation can happen here and rupee capital is less discriminated against than foreign capital. For context, gains from startup share sales for Indian investors suffer from the “superrich surcharge” announced in July 2019 whereas it was rolled
back for foreign investors and gains from the listed space. Those who completed their fundraises are more secure, but they also face another issue – capital calls in the time of the Corona Virus. VCs who have raised funds are grappling with capital calls being postponed due to LP requests as exiting the market and going back six years is a prospect few can stomach. While many LPs have exited their positions, the ramifications are still being felt.
Impact Of Corona On Startup Fundraising As go the VCs, so go the startups. Startups rely primarily on two broad sources of funds: Angel investors Institutional investors
65
Business In The Times Of Coronavirus: India And The World
Angel investors usually consist of CXOs, ex-entrepreneurs, friends and family who are looking to support somebody they know, back a passionate idea or give back to the ecosystem. For them, their sources of funds are prior gains from exits, salaries, savings or gains from the markets. Many are looking at conserving capital at this point as the world seems to collapse around them, in terms of capital markets. Some, due to issues like the angel-tax, have also moved their startup investments into Angel Funds and VCs. Angel investing has been on the decline for a few years and the sector formalises and others have moved onto different products such as funds. But the capital market hit has affected them as well. For the institutional investors, VCs have already been covered, as have their LP base. But one source of funds that’s strongly coming into vogue is Corporate Venture Capitalists or CVCs. These are the captive venture arms of large corporates who look to diversify their business or identify cutting edge technology to invest in, learn from and even acquire.
Corporations across the world are sitting on large amounts of cash and due to changes in regulations and taxation, cash distributions to shareholders via dividends and buybacks have become more expensive. They’re also more cognizant of the role that startups and entrepreneurs play in disruption and they’re more than willing to participate in the startup ecosystem to stop themselves from becoming obsolete. Indians corporates have started investing in and acquiring startups from India. But the most curious absentee in the Indian startup story has been India’s homegrown tech giants – who are more comfortable acquiring foreign startups rather than Indian ones. Though the reasons for this are yet to be articulated, one hopes that the companies with the largest cash balances and the strongest alignment with India’s startup tech scene will also become its largest customer and patron – similar to how the US’s Silicon Valley and China have become the largest funders and acquirers in their countries.
Sectors And The Way Forward Startups in sectors like travel, co-working or other areas which rely on the convergence of crowds will face a tough time raising funds. But those in the attention economy – media, content, etc and those in software and productivity tools are seeing their metrics rise and will be well placed to come out of this rut stronger than ever. The consensus amongst the community is that capital will become tighter across the board. Many startups are looking to cut their burn and firm up operations to wait out this Capital Winter that has descended upon
66
us. Hirings have been put on hold and the luxury of larger offices will fall to the wayside. A lasting effect of the Coronavirus will be how offices are going to evolve – we’ll see WFH playing a more prominent role. This will also see rent – amongst the largest cost centres along with salaries and marketing come down as startups evolve to more geographically diversified and remote teams.
Business In The Times Of Coronavirus: India And The World
The markets, its often remarked, operate on two primary emotions: fear and greed. Fear leads to the markets haemorrhaging and greed sees them rising back. This is personified as the Bulls and the Bears, the animal spirits symbolising the rise (Bulls) and fall (Bears). We’re currently in a bear phase as capital will become scarce.
67
Startups are also going to rely on existing investors to stay funded and M&A via stock deals will come into play as cash starts drying up. These will be testing times for the ecosystem and one thing will be common to startups and mankind in general during these times of the Coronavirus:
Business In The Times Of Coronavirus: India And The World
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Business In The Times Of Coronavirus: India And The World
China: An Analysis
2020 marks the last year of the country’s 13th Five-Year Plan, and the efforts to meet the targets are on the rise. China has taken a number of measures to meet a range of key aspects laid out in its economic policy, including the moves by its central bank the People’s Bank of China - to ease the reserve requirement ratio and to lower the loan prime rate. The deadly coronavirus outbreak has also provided China with few positives along the way: the application of new technologies has accelerated, and the scope increased for development of new businesses in areas such as health, logistics, automation, online
70
office, entertainment, retail and education. On the flipside, industries such as tourism and aviation industries have taken a major blow, with 400,000 group travelers from China expected to cancel their trips to Japan before March, according to the Japan Association of Travel Agents. The supply chain of the manufacturing sector is also expected to be hurt badly. Since the epicentre of the coronavirus outbreak, Wuhan, China, is an automobile manufacturing base, the tremors of this are likely to be felt in the global automobile business.
Business In The Times Of Coronavirus: India And The World
China Coronavirus: Death Toll Rises As The Pandemic Spreads 80,796 total cases and 3,169 deaths were estimated in China till March 10, 2020
Total Coronavirous Cases
100K
80K
60K
40K
20K
30 b Fe 1 b 3 Fe b 5 Fe b 7 Fe b 9 Fe b 11 Fe b 13 Fe b 15 Fe b 17 Fe b 19 Fe b 2 Fe 1 b 23 Fe b 25 Fe b 27 Fe b 29 M ar 2 M ar 4 M ar 6 M ar 8 M ar 10 Fe
28
Ja n
26
Ja n
24
Ja n
Ja n
Ja n
22
0K
Date
The world today shares a common value chain, and any disruption in its second largest economy is bound to result in a significant turbulence for all. As the Chinese economy experiences a major hit due to the coronavirus outbreak, China’s GDP growth is estimated to decline to 4.9 per cent in 2020, according to the Organisation for Economic Co-operation and Development (OECD)
71
Business In The Times Of Coronavirus: India And The World
Hit On Economy By The Outbreak China’s GDP growth is expected to slow down to 4.9% for 2020
Stock Price (In USD)
8 6.1
6.4
6
5.6
5.1 4.9
4.9
4 2.9
3.3
2.4
2
0 2019
2020
2021
Year
World
India
China
Source: DataLabs Analysis, OECD China’s share in the global economic activity increased drastically from 2002 to 2019. This is why the adversities faced by China are bound to spill over to the world economy. Despite China’s speedy recovery from the coronavirus, a substantial drag is likely on global growth.
72
Business In The Times Of Coronavirus: India And The World
China’s Rising Share Of Global Activity China is more integrated in the global economy 24
20
% Share
16
12
8
4
0 Global Industry
Global GDP
Global Trade
2002
73
Global Tourists
Global FDI
2019
Business In The Times Of Coronavirus: India And The World
China accounts for a large share of global commodities demand 60
50
% Share
40
30
20
10
0 Aluminium
Copper
Nickel
Zinc
Lead
Natural Rubber
Cruid Oil
Date 2000
2018
Note: Share of industry, GDP and trade in constant US dollars. Share of global FDI in current US dollars. Data for the tourist share refer to 2002 and 2017, and data for FDI refer to 2005 and 2018. Industry data are on a value-added basis and include the construction sector. Source: OECD Economic Outlook database; OECD FDI in Figures, October 2019; and World Bank.
74
Business In The Times Of Coronavirus: India And The World
The extent to which China, the world’s largest goods trader, can end up imposing on the rest of the world cannot be underestimated and is rather self-explanatory, given that the country contributes more than 30% to the world economy
Base-case Scenario: Potential Economic Impact Of The Coronavirus Outbreak China’s contribution to the decline in global GDP is the highest Q1
Q2
Q3
Q4
0.0
% Difference From Baseline
-0.1 -0.2 -0.3 -0.4 -0.5 -0.6 -0.7 -0.8
Date Demand
75
Equity + Commodity prices
Uncertainty
Total
Business In The Times Of Coronavirus: India And The World
Contributions to change in world GDP in 2020 % pts
Q1
Q2
Q3
Q4
0.0 -0.1
Contribution in %
-0.2 -0.3 -0.4 -0.5 -0.6 -0.7 -0.8
Date China
Other Asia-PaciďŹ c
Europe
N America
Commodity exporters
Note: The first panel shows the contributions to the decline in the level of GDP from the different element of the shock. The second panel shows the contributions of differents regions and countries to the decline in
Other
World
global GDP. Commodity exporters are Argentina, Brazil, Chile, Russia, South Africa and other non-OECD oil-producing economies. See text for details of the shocks applied.
Source: OECD calculations using the NiGEM global macroecomics model.
76
Business In The Times Of Coronavirus: India And The World
Trends Observed
Online Conferences/Meetings/Events And Development In Remote Workplace Operations On The Rise With the spread of the coronavirus outbreak, companies are encouraging their employees to switch to virtual meetings using solutions such as video conferencing and teleworking. In order to continue meetings without disruptions, several companies are exploring technologies such as BYOM, or Bring Your Own Meeting. Tech giants such as Google, Microsoft and Zoom Communications are providing support in this area, by either allowing access to their premium services for free or removing the related time limits. In the age of digitalisation, it is paramount to collaborate remotely from anywhere at any time in the world. This change will lead to a bigger impact and the adoption of such solutions in the long term.
Increased Adoption Of Enterprisetech In India With self isolation on the rise and diminishing physical contact in meetings, the adoption of enterprise tech products is likely to increase, and give a phillip to Indian enterprise tech startups. These companies relied heavily on forgein clients until now, given the popularity of the traditional style of running businesses - which involved regular physical meetings - in the country . Tools such as task management, video conferencing and digital contract management are likely to witness the highest traction.
Adoption Of Mandatory Sick Leave Policy On an optimistic note, even if the situation gets back to normal soon. Corporates as well as startups will adopt mandatory sick leave policies covering even minute and common health problems such as u and fever, which are highly ignored in India especially in the small and midsize business (SMB) segment. Overall adoption of such measures will result in a healthy and clean work environment throughout businesses across the country.
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Business In The Times Of Coronavirus: India And The World
Behavioural Changes Observed & The Long Term Impact
Currently, everybody is in a state of panic. The panic has set in to an extent that human existence is in jeopardy, triggering excessive demand for household items such as hand sanitizers.
here’s a surge in sales of staples as well as products of daily necessities and personal hygiene in the backdrop of the fast-spreading coronavirus outbreak. Sales growth numbers range from 15 per cent to 45 per cent across categories. The World Health Organization has stressed upon the adoption of everyday practices such as frequent handwashing to fight the deadly pandemic. Consumers have become more aware of the available supply chains and how they works. China, being India’s second largest trading partner for long, accounted for 13.7 per cent of India’s imports in 2018-19. Awareness about relevant supply chains and alternatives will be pivotal in shielding local businesses from the coronavirus-induces global crisis. There is clearly the need for Indian startups to act responsibly and equip themselves with realistic contingency plans in the time of Covid-19. There is a need for startups - big or small - to expedite the adoption of processes in a timely and logical manner to ensure public safety. Many startups have sensed a lack of communication between their management and employees in adhering to government policies in containing the spread of the pathogen. On the contrary, many startups have already taken bold and strict steps to fight the outbreak; while Paytm and Flipkart have shifted their employees to work-from-home protocols, Ola has placed hand sanitizers in its walk-in stores across the country.
In order to make robust contingency plans, the responsibility of startups only begins at maintaining hygiene in office space and offer workfrom-home alternatives to their employees. They have to think of sustainable solutions that can ensure operability even under coronavirus circumstances. Investors such as Sequoia Capital have taken initiatives such as the issuance of letters to startup founders outlining practices that can protect businesses in best possible ways should things go south.
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Business In The Times Of Coronavirus: India And The World
Are Indian Startups Acting Responsibly? There is clearly a need for Indian startups to be well equipped with contingency plans during these times. With big players acting slow on taking the necessary steps like Swiggy sending a safety advisory to delivery partners in Delhi on March 3, no release of information to Zomato delivery agents about proper food handling to avoid infection by the company, there is high time for Indian startups to sense the urgency for taking necessary action. As claimed by multiple startups in terms
of closely monitoring the situation and following relevant government recommendations, there is clearly a lack of communication from some startups to their employees. On the other hand, there are many Indian startups who are taking strict measures to avoid any loss such as Paytm and Flipkart providing its employees work from home, Ola has kept sanitizers in its walk-in stores across the country.
Contingency Plans For Startups The responsibility is not limited to maintaining a hygienic workplace and providing work from options for companies. But, the responsibility stretches beyond this and towards keeping startups running even in coronavirus outbreak circumstances. This reminds us of our responsibility to have contingency plans in place during these tough times.
Internet speed fluctuations, power outages and employees attrition but with such outbreaks taking place, there is high time for Indian startups to brace themselves up and manage when there is major loss experienced. Startups need to have strong plans in terms of leadership succession planning and clear planning of workflow and team structure.
Investors like Sequoia Capital are initiating such efforts by issuing letters to founders about how to manage business better and plan for contingencies in case things go further south.
For instance, a recent note from Easy Home Finance accessed by Inc42 has documented the plan of action for the business if the office building or an employee or a senior employee is quarantined. It laid out the team structure in such a scenario, which makes the process clear to all stakeholders.
Till now, startups have been prepared for the short term contingencies like
81
Business In The Times Of Coronavirus: India And The World
Methodology & Glossary The reported cases used in the report is till 20 March 2020, the primary data source for COVID-19 related cases is from the tracker established by John Hopkins University. The analysis done on stock prices and indexes is on the adjusted closing price, the base date is 10 February 2020 unless
mentioned otherwise. The mortality rate is calculated on the basis of the number of deaths recorded divided by the number of confirmed cases. The stock prices of companies listed on Indian market is in INR.
Glossary COVID-19
Growth Stage
Coronavirus
Series A and B
MICE
Late Stage
Meetings, Incentives, Conferencing and Exhibitions
Series C and above
$X Bn
VC
Billion in USD
Venture Capital
$X Mn
Angels
Million in USD
Angel Investors
Seed Stage <Pre sereis A
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Business In The Times Of Coronavirus: India And The World
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Business In The Times Of Coronavirus: India And The World
Inc42 is a leading Indian media and information platform, known for its end-to-end coverage of the Indian startup ecosystem. We work with the mission to empower, connect & grow the Indian Startup Ecosystem by providing a deep understanding of the startup economy through data-backed news and analysis. Inc42 is the authoritative voice of the Indian Startup Ecosystem and it has brought to light the amazing stories of thousands of startups, entrepreneurs, technological innovations, businesses and many other constituents of the startup ecosystem. Starting 5 years ago, Inc42 has now become the gateway to the Indian startup ecosystem, having published more than 20,000 stories and touching the lives of more than 20 Million people in India every month.
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The research wing of Inc42 Media, DataLabs specialises in producing comprehensive datadriven and insightful reports about the ballooning Indian startup economy. Since its launch, DataLabs has produced over 35+ reports â&#x20AC;&#x201D; covering diverse sectors such as Blockchain, Agritech, Foodtech along with regular coverage of investments and the overall health of the Indian startup ecosystem. DataLabs reports are aimed at bridging the information & data gap about the Indian startup economy. In the last few years, DataLabs has produced comprehensive & insightful reports to help readers make more informed decisions at work, in investments, and more. It is responsible for producing detailed reports covering the diverse industries of the Indian startup ecosystem spread across 29 states and 7 Union Territories of India.
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Business In The Times Of Coronavirus: India And The World