"As a start-up in an unconventional sector,regulatory & logistical challenges were many"
While the global pandemic has bought economies to a halt and massively disrupted businesses, it has also fuelled start-up dreams and we are seeing several Indian start-ups achieving Unicorn status during the pandemic period. The times have never been better for the budding entrepreneurs to give wings to their start-up dreams.
The Government, too, has come up with various schemes to support its ‘Vocal for Local’ drive. A case in point is the Rs 1,000 crore Start-up India Seed Fund announced by Prime Minister Narendra Modi during the Start-up India International Summit 2021 held earlier this year.
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Adgully is turning the spotlight on the entrepreneurs who fought against all odds to bring their dreams to fruition in our special series – START-UP STARS. We at Adgully wholeheartedly support the ‘Vocal for Local’ movement and over the next few months will be featuring all local/ homegrown businesses, brands and Apps.
Sanya Goel is a fourth-generation entrepreneur hailing from a business family of repute. Humsafar is a consumer brand of Samridhi Highway Solutions Pvt Ltd, and was launched in 2016. The vision to launch Humsafar was to use recent tech solutions and facilitate ‘last mile connectivity’ for fuel delivery to be efficient, convenient and secure. Today, they are providing doorstep diesel refuelling services for vehicles as well as heavy industrial equipment all over India.
Humsafar manufactures advanced technology driven fuel bowsers, which are leakage and pilferage proof, and are managed by using app-driven fuel delivery systems. Humsafar is on a mission to be among the leaders to digitise diesel retail landscape in India, and is fulfilling an unaddressed market need. Traditional distribution of fuel as observed by government agencies, results in significant wastage and pilferage during the process. They were already keen to find tech driven solutions for such challenges and Humsafar crafted an ideal app-based system which is unlike the fixed petrol stations and dynamically responds to market needs.
In conversation with Adgully, Sanya Goel, Founder & Director, Humsafar, speaks at length about being a start-up in an unconventional sector, the regulatory and logistical challenges faced, and much more.
What need gap did you want to fulfil with your start-up? What is the core business proposition?
Since my family is in the fuel business, I had closely observed how customers face multiple challenges in fuel procurement process, especially in storage, spillage, and transportation. The make-shift diesel carriers are not only expensive, but risk prone as well. Considering the evolution of technology in the fuel industry, I decided to create economical, eco-friendly and convenient solution for these challenges, and we have been successfully creating an alternate fuel procurement mechanism for our customers. So, here is the sense of purpose and couple with the tech capabilities for reaching diesel at the doorstep.
How did you identify your TG? Did you carry out any feasibility study prior to starting your business?
I had observed closely how buyers who need and consume diesel in large quantities, such as industrial equipment operators and mining firms, faced procurement challenges. Such firms send their own make-shift oil carriers with large and unsafe barrels to fetch fuel. These vehicles are not only accident prone, but costlier to operate. Further, there is a risk of pilferage and spillage. They were already using Door Delivery in many ways. The need was already established. It had to wait for the right kind of solution. We identified such businesses as our TG.
What were the challenges that you faced in your start-up journey and how did you overcome then?
As a start-up in an unconventional sector, we had to deal with a lot of regulatory and logistical challenges, but we are overcoming them steadily courtesy of approvals and policy changes in fuel retail as well as our own innovations in logistics. Another major challenge that we are trying to overcome is the parking of fuel delivery vehicles. Discussions are going on and we hope to overcome all these challenges and optimise direct fuel delivery system in India.
However, another perspective to challenges was to get started. And, not getting nervous discussing with experts and also to keep learning. Another, challenge is to optimise on costs and be frugal as sustenance is critical. Cash flows are a regular challenge. However, the biggest breakthrough really is to marry digital solutions, which would take its time to pay back, with diversifying into components, which have capability to generate immediate cash flow.
What were the clearances that you required for your venture from various authorities?
Foremost, we needed to be a start-up to participate in the space. Thereafter, Bowsers need to be PESO compliant, approved and licenced. So, bowser licence approval from PESO is required for every Humsafar Bowser supplied in the market.
Funds/ finance is the prime issue of almost all start-ups. What can the industry and the Government do to address this issue and ease the capital requirements of start-ups?
The entrepreneurial ecosystem in India has grown tremendously in the last 10 years, and as a technology driven start-up founder, I am well-versed with the funding challenges. The government needs to take initiatives that don’t just focus on providing legal and statutory support, but also provide seed funding and early-stage finances for the start-ups. Make in India and Aatmanirbhar Bharat are fantastic programs and with institutional funding for promising start-ups, we can make India reap the kind of benefits which the Indian IT industry has ushered in. Easy business loans and seed funding support from banks, increasing budget allocations for governmental schemes is crucial, especially now when a large number of bootstrapped companies are facing the COVID-19 challenge.
Prime Minister Modi announced a Start-up India Seed Fund earlier this year. How do you see start-ups benefiting from it?
The Start-up India Seed Fund is a step in the right direction. Most of the start-ups in India are bootstrapped and fail to survive beyond the first year of operations due to lack of funds for operations during the innovation and early growth stages, when revenues are absent or insignificant. With adequate budgetary allocations and easing of eligibility criteria will allow a larger number of start-ups to benefit from the Start-up India Seed Fund.
How is digital helping you further your business?
We have been leveraging technology to great effect, and it is our path-breaking solution of introducing app-driven geo-fenced fuel bowsers, which has enabled us to answer the most daunting questions faced by the Indian fuel delivery logistics sector. We are constantly innovating and focusing on greater integration of digital technologies in fuel retail sector.
What were your key learnings from 2020? How do you see the start-up ecosystem progressing in 2021?
Fuel supply is an essential service. Our functions were affected by the lockdown to the extent that manufacturing and commercial activities were at a standstill. However, we did make COVID-19 appropriate changes to our work processes to ensure safety for our personnel and customers. We did see demand of diesel supplies from agricultural and essential industries. Door step delivery of fuel has become a better accepted solution now and buyers are keen to rely on our services instead of resuming old and unsafe procurement practices. We spent a lot of time engaging OMCs and Government of India in discussions related to future beyond the pandemic.
Majority of Indian start-ups have exemplified resilience and innovation during these crisis times, and with the worst of the pandemic now hopefully behind us, 2021 surely seems to be primed for economic recovery. The second wave derailed progress for a few more months, but, the second half of the year especially the last quarter is set to witness strong revival of the start-up economy across industries.
What would be your message for the budding entrepreneurs?
The most important thing for any start-up founder or aspiring entrepreneur is to put in the required hard work. No matter what someone says, building a successful business requires working for long hours, making personal sacrifices and constantly striving to build capabilities, developing partnerships for growth. To become gold standard, one needs to go through the rigours.