What VC’s think of Web2.0

By priya • June 25, 2007

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After understanding web2.0 through an entrepreneurs and marketers eye at the IAMAI conference, the VC’s stepped on to the stage. The Panel included:

    Suvir Sujan, Nexus India Capital Advisors Pvt Ltd
    Rishi Navani, Managing Director, Matrix Partners
    Kanwaljit Singh, Managing Director, Helion VC
    Sandeep Murthy, Sherpalo Ventures
    Manik Arora, IDG Ventures

When the panelists were asked to give their views on what kind of company’s in the web2.0 arena would get funded. “I am not convinced that any me-too of orkut in India will work” stated Manik Arora who believes that a good business model and a good team that has the power to lockin users will be a good investment.
Rishi Navani, believes “Web2.0 is a misquote. There are web1.0 portals that have web2.0 type features. One needs to make sure that their web2.0 feature helps attain high level of usability.”

Kanwaljit Singh questioned why would an Indian web2.0 company succeed. He believes that is one big question to answer. According to him there is Market opportunity and business models that are based around advertising will succeed. The team should have technical skills and the will to ride with the phenomena.

“The funding would depend on what is the consumer’s needs and is the business able to fulfill that need” believes Kanwaljit Singh who also stated that education is one sector that is unexplored.
Interestingly Suvir Sujan, bluntly pointed out “why would a user shift from an already existing platform to yours? What would be the unique differentiating factor of your platform and how would you engage your users to build the platform.”

Suvir’s point brings up the point that yes there are me-too clones in the market, so would VC’s be interested in funding clones?

Manik Arora believes that “If a model has worked in USA and China markets, then one should compare and see if it will work in India. While Mr Rishi Navani adds that his company has funded 4 startups, similar models of which have worked in China and USA.

The general consensus from the panelist was that the business should ultimately be solving a need. While even if a business is a me-too of a business in the west, it should embrace localization. If a business brings about engagement, it also brings with it ways to monetize.

Though a common problem that the VC’s found was that most websites are not good looking websites. Cleartrip was unanimously voted the best looking website. The discussion also brought about the fact that Travel was being over spent on.

To read further: Heres an exclusive article on what the eminent Venture Capitalist of the country think of the Internet, The web2.0 sphere, its anticipate bubble burst or not.