Elevation sees $50 billion of public market capital to be contributed by new-age brands in discretionary categories by 2030.
Elevation Capital, a venture capital firm, announced the launch of its report, “What If... We Win? Unlocking the India Consumer Tech Opportunity”. Addressed to founders who are building or looking to build in the consumer tech space, the report identifies vast untapped opportunities backed by in-depth data-led analysis.
As per a company statement, the report aims to dispel the growing chorus of skepticism surrounding the consumer tech start-up space in India. The optimism is fuelled by India’s rising online consumer spending, estimated to more than double from $140 billion to $300 billion by 2030, according to Elevation.
In a joint statement, Mukul Arora, co-managing partner, and Mayank Khanduja, partner, who leads Elevation’s consumer tech investments, said, “Of late, India’s start-up ecosystem has started questioning the viability of delivering new high-quality businesses in the consumer tech space. With all our conviction, we say yes, these businesses can be built. This is not just because we have partnered with multiple category winners in the past consumer tech waves, but because all markers today strengthen our conviction..
Here are some of the key highlights of the report:
Indian media platforms will monetise users directly at scale. Historically, giants like Google Meta have dominated the digital ad market, accounting for over 50 per cent. It is worth $8 billion and grows by 16–18 per cent annually. Emerging marketplaces and e-commerce platforms contribute 15 per cent of this pie, with 10–15 per cent of their revenue from ads. Some believe Indian consumers don't spend much, leading to the misconception that consumer apps can't profit there. However, platforms are proving otherwise by exploring diverse monetization methods beyond ads.
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India’s top 2% are a $100 billion opportunity. The top 5 million households, constituting approximately 2 per cent of the population, allocate approximately $40 billion annually towards discretionary expenditures. Over the next decade, this spending pool will expand to $100 billion as their incomes grow. For founders building in this space, a fail-fast, one-size-fits-all mantra will not work; instead, they should focus on consumers’ unique needs and premium quality, all built on trust. The report shows emerging opportunities like pets ($7 billion opportunity), premium leisure travel ($20 billion opportunity), real estate ($8 billion opportunity), and premium healthcare ($10 billion opportunity).
New-Age Consumer Brands Will Create $50 Bn of Listed M-Cap.
Deepening e-commerce penetration, lowering cost barriers, and internet access before discretionary income are enablers that are now converging to make brand-building both lucrative and exciting for entrepreneurs. As a result, Elevation sees $50 billion of public market capital to be contributed by new-age brands in discretionary categories by 2030.
Offline-Dominant Models Will Unlock Deep Customer Value Across Education, Healthcare, and Consumer Brands. Despite predictions of doom for offline businesses during the pandemic, they've made a strong comeback afterwards. In 2023, hotel occupancy in India surpassed pre-pandemic levels, reaching 70 per cent. Despite the growth of OTT platforms, multiplexes have seen weekend occupancy rates rise to 65 per cent from 35–40 per cent post-Covid.
Elevation Capital is an early-stage venture capital firm that has supported more than 150 companies in India, including start-ups like Swiggy, Paytm, and Meesho. Elevation Capital has also invested $500 million in fintech firms, such as Paytm, Karur Vysya, and Edelweiss.