Bessemer Venture Partners, a global venture capital and private equity firm, observes a $200 billion window of opportunity in India's B2B online marketplaces by 2030, as part of its recent thesis titled “The Emergence of B2B Marketplaces in India.”
As per the report, a confluence of factors including rising internet penetration, growth of digital infrastructure, favorable regulatory policies and a conducive cross-border environment are together set to drive this exponential growth in India's B2B online marketplaces.
According to the report, the key contributors to the growth will include instant payments through a Unified Payments Interface (UPI), the formalization of businesses through Goods and Services Tax (GST), increased manufacturing activities through Production Linked Incentive (PLI) schemes, and the global de-risking of supply chains with companies adopting a China +1 strategy.
Anant Vidur Puri, Partner at Bessemer Venture Partners, says “We are still in the early days of the B2B opportunity in India. B2B marketplace startups have the opportunity to emulate in the next 5-10 years the same growth trajectory that B2C internet companies saw in the last decade. To fully leverage this opportunity B2B marketplaces must play a larger role than traditional distributors and focus on providing end-to-end management of transactions, with a deep technology and software layer while ensuring strong control over supply, quality, and service levels. ”
“The true cost of working capital must be considered while evaluating a B2B business – the balance sheet cannot be ignored. The best B2B companies will differentiate by demonstrating high ROCEs up to 30% over the long term,” he added.