Economy

How gig economy start-ups and social enterprises are facing the lockdown

N Ramakrishnan Chennai | Updated on April 08, 2020 Published on April 08, 2020

Founders of start-ups looking for new biz opportunities amid Covid-19 crisis

The gig economy is probably the worst hit by the nation-wide lockdown because of Covid-19. Visuals of thousands of migrant workers walking huge distances to somehow reach their villages are still fresh in people’s minds. And, ventures that employ a large number of blue collar workers have seen their plans go for a toss. Cab aggregators such as Ola and Uber, food delivery companies such as Swiggy and Zomato, online grocery ventures BigBasket and Grofers are among those who employ a large number of these blue collar workers. Some of them have re-started business, albeit on a limited scale.

Along with the gig economy, start-ups catering to that segment as also social enterprises found their businesses disrupted. Their investors have been backing them and advising them to conserve cash for as long as possible. Besides thinking of ways to keep the venture alive, the founders continued looking for new opportunities.

Drivers on demand

Take the case of DriveU, a Bengaluru-based venture that offers drivers on demand. It works with about 25,000 drivers across the country, offering drivers on hire to individuals and businesses. Ramprasad Shastry, co-founder and CEO, DriveU, says they pay their drivers daily and since the lockdown was announced from March 24 midnight, there has not been any income for the drivers.

However, Shastry believes that it is not all gloom and doom, even in the time of such a crisis. One, the online grocery ventures have started working, as also food delivery platforms, although with restrictions. “We are entering that market as quickly as possible. We are going to get our drivers to do things that make sense,” says Shastry. Almost all their drivers have a two-wheeler, which they can use to deliver essentials to homes.

Blue collar workers

Another venture that caters to the gig economy is Betterplace, based in Bengaluru, which is a digital platform for blue collar employee management. It hires blue collar workers for its customers that includes large companies. According to Pravin Agarwala, co-founder and CEO, Betterplace, the blue collar industry has been impacted badly. There are a few sectors such as facilities management that have been impacted to a greater extent and others such as providing security in apartment buildings not so much. “Overall,” he says, “the industry has gone down by 60-70 per cent, may be also because most of the workers have rushed to their home towns.” There is hiring happening in some areas, particularly the online grocery companies and food delivery ventures.

Betterplace used to bring on board a few thousand blue collar workers every day before the lockdown; now, it is down to a few hundred. The company, Agarwala said, continued to think about growth and new opportunities. It had signed fresh contracts in the last two-three weeks, he added, without disclosing details. Customers who would have signed up a few months later were coming forward to sign up now itself, stating digital was the way forward. An app for a doctor-on-call was gaining adoption, while Betterplace had also started digital on-boarding for health insurance products for their customers.

Milaap, a crowd funding platform, has seen a spike in the number of people raising funds for health-related issues. With work from home being the norm in Bengaluru even before the lockdown came into effect, Milaap’s co-founder and CEO Mayukh Choudhury says the nature of the platform’s business allowed a lot of work to be done online. People have raised money for various medical emergencies. Milaap verifies the authenticity of the purpose and has a network of 8,000 hospitals across the country, so that the money raised on the platform is directly deposited into the hospital’s account.

During Covid-19, Choudhury says, people have been raising funds for various purposes related to Covid-19, including helping daily wage earners and transgenders with food and stay facilities. The platform has facilitated raising nearly ₹29 crore so far for the pandemic, since the lockdown began.

Diagnostics services

5C Network, a start-up that provides radio-diagnostics services at remote locations, has seen a significant drop in business. Kalyan Sivasailam, CEO, says his first aim during the lockdown is to ensure that the morale of his team is kept upbeat. He has worked out a communication strategy with the team and company levels, come up with a plan to ensure that there is money available. 5C Network used to provide diagnostic services for nearly 3,000 cases a day till the lockdown began, which has dropped nearly 70 per cent. It now only relies on x-rays from nursing homes and hospitals and promises them reports much quicker than before. 5C Network works with 500 customers in various parts of the country and has 280 radiologists on its platform. Sivasailam says of the reports they get for diagnosis every day, at least 10 are for suspected Covid-19 cases.

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Published on April 08, 2020
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