Saumesh Thimbath By

KOCHI: At a time when Prime Minister Narendra Modi claims that startups ‘have moved beyond IT’, a glance at the list of startups incubated at the state’s two major startup incubators, Startup Village and Kerala Startup Mission, will make it clear that not only have the startups not moved beyond IT, most of them are app-based businesses.

Joseph T Mathew, the IT advisor to former Chief Minister V S Achuthanandan, says the extreme focus on apps is counter-productive as most of them neither create jobs nor revenue, the two aims on which the startup incubators were started in the first place. “I have nothing against these errand apps as they make lives easier for many people, but these shouldn’t be the focus of any startup incubator. The projects that are green-lit do not add any value to our economy,” says Mathew.

A startup observer based in Kochi, who wishes to remain anonymous, says that most of the startups are ‘zombie startups’ and don’t have an IP core of their own. “About 99 per cent of the startups, whose job is mainly creating apps, are just web design shops which hardly make any money,” says the observer.

But Sanjay Vijayakumar, the chairman of Startup Village (SV), even while agreeing that many app-based businesses hog the list of new startups, does not see the businesses as ‘zombies’. At a time when apps are used from booking movie tickets to analysing agricultural data, Sanjay says app development is anything but a lost cause. A few of the product apps developed at SV have gone on to become huge successes. A case in point is Neyya, a Bluetooth-based ring which raised $ 2 million venture capital investment from Kalaari capital and Chillr, a money transferring app. He adds that the boom in app-based business has to do with nature of its model. “Any new business needs capital and infrastructural investment to take off. As for apps, the capital investment needed is comparatively lesser and so is the incubation period. The increased smartphone penetration can also be attributed to the fact that there are more apps,” he says.

Sanjay does not believe there is a need to cut down or curb the startups that develop apps, as that goes against the very grain of the SV idea. “We conceived Startup Village as an incubator that can give a leg up to budding startups. We are not just about the success of the startup initiatives, as even the members of those projects that did not succeed learn a lot here and move forward with great jobs,” he says. Jayashankar Prasad, the CEO of Startup Mission, says there are more apps from startup ventures as they require less capital and have more market accessibility. “I don’t see this as negative in any way and we don’t dissuade anyone who approach us from making an app,” he says. He adds that the success of aggregator apps like Flipkart might be spurring youngsters to go for app-oriented business models. “Information technology has always played a facilitator role when it comes to businesses and apps are doing the same,” he says.

Neyya, success story of a startup

A Bluetooth-based ring which raised $ 2 million venture capital investment from Kalaari capital and Chillr, a money transferring app, it has proved to be a huge success from the state.