Twitter’s acquisition of ZipDial: Good times are ahead for Indian startups

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How cool is it to take the indigenous idea of a small, humble, cost effective and convenient missed call, turn it into a business and make a hefty profit out of it. And then get snapped up by one of the biggest social networking sites around.

This is exactly what ZipDial achieved. Coming into prominence with its implementation of missed calls for user verification, alerts and other uses, Bangalore-based mobile and analytics company ZipDial has engaged nearly 60 million users with hundreds of marketer clients. Enough for Twitter to sit up and take notice and seal a deal pegged at $30 to $40 million.

What does a microblogging site do with a missed call?

“Well, Twitter plans to use ZipDial’s user base to take its service to the audience that either does not a smartphone (and hence have no internet capabilities) and more importantly those that have patchy mobile internet on their smartphones,” explains Sanchit Vir Gogia, Chief Analyst & CEO, Greyhound Research.

Gogia feels this acquisition is a clear sign from Twitter to treat India as a strategic market and invest more locally to capture audience mind share.

Mirroring this sentiment, Gogia says, “This acquisition will surely act as an emotional booster for the increasingly large base of start-ups (and their investors) in India that are increasingly looking at the likes of Twitter for acquisition. This acquisition and some of recent other investments in India-based start-ups is a good proof point of the future of tech-based start-ups in India.” But putting in a word of caution, he says that it is critical for start-ups in India to offer solutions with a unique positioning and not be a me-too in its space.

The Indian start-up scene does seem to be picking up and will continue to do so over 2015 too, but it’s just not time for them to kick back and relax. Offering a piece of advice to budding startups, Gogia says, “Such deals can be expected but it can be well argued that they can be pre-mature and well ahead of its times. Start-ups require sufficient time and capital to ensure they can reach a significant peak in terms of the visibility and business and selling ahead of this peak can mean smaller valuation and return for investors. While India is home to some highly innovative start-ups, but when compared to its global peers, valuations still remain smallish. More needs to be done to make India based start-ups global in visibility and scale of business.”

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