Archive for February 2012
Is the Indian e-commerce market feeding frenzy a greater fools phenomenon?
It has been a long time since I have blogged and I felt the urge to write about the e-commerce frenzy in the startup world as I am starting to see irrational behavior set in to the market. I have been watching in awe as the next baby products or handicrafts startup in India is raising huge amounts of venture investment at crazy valuations Are these valuations really justified or is this some sort of greater fools phenomenon?
I have thought a lot about this space and while I believe that in the real long-term e-commerce will be a very large category, I do not believe that given the current state of the market the feeding frenzy that has started may be justified. It sure feels like a hype cycle has started with the startup focused media focusing >70% of their energy on this category. Let us look at the fundamentals and realities of this market closely:
