After two years of working as software engineer, Hemant Lingala (25) left his job at TCS to start a new venture, Green Mobiles, which sells mobile accessories online. He was joined by his brother Sumanth, who was also working as a software engineer with Cisco.
The Lingala brothers are not the only ones. Krishna Sumanth, a U.K. returned software professional, too, took the online route to become an entrepreneur.
While there is nothing new in techies turning away from 9 to 5 jobs to start their own business, there is a rapid increase in many of them turning to the online space to realise their dream. The growing popularity and flexibility offered by the online platform is encouraging professionals to look at this as a serious career move.
“In the last few years, we have been seeing young people wanting to start their own companies. A new trend that has emerged in the past year or so is that we are seeing a lot of migration of people from the IT sector to the online space, turning sellers/entrepreneurs,” Flipkart Senior Vice-President (Marketplace) Ankit Nagori said.
There were over 2,500 sellers on Flipkart alone, who were working in the IT sector before turning into online entrepreneur.
This new crop of online entrepreneurs is in the age group of 25-35 with work experience of 2-5 years in the IT industry. The major traction for them lies in categories such as apparels, footwear and mobile accessories.
“It is natural for techies to start off in an area where one has a good deal of expertise. Therefore, today, we see more young professionals from the IT industry quitting their job to launch an Internet business. And, the online marketplace today provides the right opportunity and the promise for growth,” Internet & Mobile Association of India Associate Vice-President Nilotpal Chakravarti said. While e-commerce had been around for sometime, there was a sudden pick up in consumer adoption. And, this was now prompting young tech professionals to quit their job and start their own venture, he added.
While some kick-off their own e-commerce ventures, most start by selling via online marketplaces such as Flipkart and Amazon as the e-commerce venture “needs minimal investment and offers the maximum customer reach.” The online space also eliminates inventory carrying risks faced when expanding a physical presence.
“E-commerce has opened up several new business opportunities for people with diverse backgrounds. With consumers in India increasingly turning to the Internet to make purchases, sellers are searching for efficient ways to take advantage of the online channel to offer their selection to a wide customer base,” according to Amit Deshpande, Director, Seller Services, Amazon India.
“Easy procurement, capital availability and supply-chain efficiency in India are encouraging more and more professionals to give online selling a serious thought,” Mr. Nagori added.
The marketplace not only acts as a training ground for those new to the business, but also helps them to create their brand. They also offer professional support to encourage businesses that have no prior experience of selling online.
For example, Flipkart works with partners to offer working capital assistance to sellers. With an average loan value of Rs.5-10 lakh, high value loan value up to Rs.50 lakh is available.
Amazon, too, has launched ‘The Amazon Trained E-commerce Specialist’ programme through which it gives basic training to first-time vendors to help them.
“We started Anytime Retail in 2010. It was a pretty slow start. E-commerce ecosystem had not developed. Once Flipkart started, it gave e-commerce a major boost, particularly with the marketplace model. We started selling through Flipkart marketplace in 2012, and now are the fourth largest seller for mobile accessories on the platform. We expect to reach revenues of $1 million this financial year,” Mr. Krishna Sumanth said.
When selling through a marketplace, the sellers did not have to worry about regulatory hassles or backend and logistics issues, he added. Also, there were less bureaucratic hurdles in starting online.
While Mr. Krishna previously worked with Dell, his partner in the business Vamsi Krishna is an ex-employee of eBay.
The things that really work when selling online are largely those products that connect with the youth. Mobile accessories are the most popular category, followed by lifestyle products such as footwear and apparel, particularly the customised ones.
According to Sumanth Lingala, to succeed it is important that one adapts to the trend. While he believes that now is the right time to become an entrepreneur in the online space, the case may not be the same a few years down the line.
“Dynamics keep changing, and, hence, the timing is very important. Right now .com and app market is booming... but few years down the line if someone wants to get into this space and do something the chances of success are slim,” he said.