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The aspirational spirit of Bharat is palpable as its young population seeks improved lifestyles and better products. With consumption rates on the rise, the potential for growth in these largely untapped markets is immense. "In every sector there is opportunity, we just need founders. It's a supply side issue. If you have high-quality founders going after these problems then dollars will chase," says Accel's Anand Daniel. 

Bharat, which encompasses middle-income households in Tier 2, Tier 3, and rural areas, presents a staggering opportunity exceeding $500 billion for startups, Daniel said in the inaugural episode of SeedToScale’s ‘Decoding Bharat’. However, the true challenge lies not in the scale of this opportunity but in identifying the right problems and crafting innovative solutions to unlock a potential $200 billion market cap, he added.

This perspective was echoed by Rama Bijapurkar, author of 'Lilliput Land: How Small is Driving India's Mega Consumption Story'. “The consumption train has left the station, the consumer has left the station, supply has lagged behind in this country,” she said. Founders should take a page from established companies by immersing themselves in their target markets — ”Knowing your customer and walking the streets, and understanding what different parts of the country want is what big companies have done all along. Just learn from them and copy their processes," she said.

Experts agree that while Bharat is ready for products and services that enhance quality of life, the key challenge is in the supply side, where entrepreneurs must take the lead. Most of the Bharat is very aspirational, according to Lalit Agarwal, Founder and MD of V-Mart, which is a value retail chain that operates primarily in Tier 2 and Tier 3 locations in India. It is now more on the entrepreneurs themselves to rise up from their seats, explore these markets, and take risk, he said.

As Bharat’s market potential unfolds, a key consideration for investors is determining which companies to support. Accel, India’s top VC firm, which is invested in several Bharat-first companies such as CityMall, underscores the importance of identifying high-potential startups in this expanding market.

According to Daniel, the primary factor in evaluating potential investments is the founder's willingness to take significant risks and immerse themselves fully in solving the problem at hand. He emphasized that successful founders must be deeply committed to addressing the issue long-term and be prepared to adapt as they progress.

Accel sees a potential for several large $1 billion-plus companies to emerge from Bharat's non-urban markets over the coming decade. In the Decoding Bharat episode, Daniel also highlighted two sectors where he sees substantial opportunities in the near term: consumer consumption, and the application of technology, especially AI, in areas such as edtech and healthtech.