90% of start-ups are nonsense, have no meaning: Kishore Biyani

Speaking at The Economist India Summit, Biyani said most start-ups' only goal is to sell themselves, need to think bigger

Continuing his skepticism about new-age companies, Future Group Chief Executive Officer Kishore Biyani said on Wednesday that start-ups are too small to create jobs. He was speaking at The Economist India Summit in the capital.

He said that most start-ups miss the bigger picture and work with a ‘smaller canvas’.

“I think 90 per cent of the start-ups have no meaning at all; they are nonsense. I think the canvas of start-up needs to be bigger.”

There are so many people who are doing aggregation, he added. “Let’s take the business of taxi aggregation. The revenues of these companies in four-five years would not be more than Rs 3,500 crore. They are not creating a new economy any which way.”

He said most of the start-ups are coming up with a goal to sell themselves. That is what is happening to many as big businesses are taking over major e-commerce companies, Biyani added. “They are just building start-ups to sell them; there is no long-term goal. This is what needs to change.”

He said start-ups which go on for funding rounds anyway sell almost 80 per cent of the companies to their investors. “I think most of the start-up companies are funded by venture capitalists; once they are all created, the large companies would buy them out.”

Thinking big and long-term should be the goal, Biyani noted. “They are all very bright and talented people; so, they should work on a bigger canvas and big ideas. There is scope for expansion to another level altogether.”

Last month, Biyani had indicated his online retail venture Big Bazaar Direct might be closed down as the business became unviable. Set up in 2013, Big Bazaar Direct is an assisted e-commerce venture of the Future Group with 1,000 franchises. It had plans to enrol 50,000. “I have attempted e-commerce four times in my life. We have opened and shut Future Bazaar. We will close Big Bazaar Direct within a week,” he had said.

However, Biyani on Wednesday said that while the time is not right to run an e-commerce business, they could be disruptors in future. "We have acquired Fab Furnish, we are trying to be a disruptor. One can always do that and we will do it more when the time is right. Today it is not viable to run an e-commerce business," he said.

The company will however go on with its omnichannel approach. It has recently partnered with online mobile wallet player Paytm to sell its products of the digital wallet's marketplace.