Travel-tech Startup Guiddoo Listed Itself in Singapore Over India. Here's Why
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Guiddoo World Travels, a company that builds in-destination experiences for travellers, chose Singapore over India at the time of listing itself. Why is it that startups from Guiddoo to Flipkart feel the need to list in Singapore? What is the X factor that makes Singapore a great choice to register a company or rather what still makes India an unpopular choice despite the Indian government blowing a trumpet about wanting to ease startups’ distress?
The company was founded by Vineet Budki, Nidhi Varma, Prashant Choudhary and Biswajeet Karmakar in 2014 as a tour guide app. It is now an in-destination platform.
Entrepreneur India caught up with one of the founders of tech-travel startup Guiddoo World Travels to learn more on what makes Singapore ace the race of Indian startups lining up to register.
Vineet Budki CEO and co-founder of Guiddoo World Travels explained when made the company choose Singapore.
“When we were in the initial phase, in a meeting once there was a gentleman who was cutting us a cheque of half a million dollars. When I actually told him that the company is India-based, he was not sure about the investment,” Budki said in an interview.
According to Budki, the investor was not sure about what are the FDI policies were and tourism in India he said that if I put money in an unlisted company he will not be allowed to take out the money for three years and in a listed company its 1 year; so there were a lot of regulatory issues that he was not sure and confident about.
Budki thinks that while funding Singapore based companies, investors feels secured about their rights and they are scared of putting money in India due to strict regulations.
Tax Benefit No Real Reason
Budki explains that companies have to pay taxes in Singapore as well. There is an 18 per cent tax so tax is not the real reason why Singapore lures investors.
He feels Singapore and China are more interesting hotbeds for investors and doesn’t see any regulatory challenge in the region with an investor approval point of view.
“There is no issue with China or Singapore. The reason why we are scaling up in China is there is a big market; there are roughly 25 million Indian customers traveling internationally while 150 million people travel outside China and the Chinese government is taking a greater effort to promote their start-ups,” Budki said.
He thinks China’s progressive approach towards how the country helps its entrepreneurs deal with failure is something that is helping the country. Like a law in in Shanghai that enables a 60 per cent investment refund in case of a startup failure.
Tips for Startupreneurs
For entrepreneur looking to start up in the Asia-Pacific region, Budki’s advice is simple - study the ecosystem and meet a lot of people.
“The first job of an entrepreneur or a CEO is to meet a lot of people. I actually spent 6 months in China meeting everyone; I had marathon meetings from 2 in the afternoon to 12 at night. So you need to go meet people, understand the ecosystem and analyze the model’s workability,” said Budki.
Another one from his valuable experience is thinking about a way to profitability to be top priority.
Budki says profitability ensures survival of the company and the person who loses the fear to die is the most dangerous of all.
A start-up will lose the fear of dying if it has revenue and it has sustainability. no one cares about 100 start-ups, no one cares about the team on the opposite side, no competition can kill it because profitability ensures survival of the company.” He said
The Mumbai-based company builds in-destination experiences for travelers and is seeing quick expansion in South East Asia. With its presence in India, Singapore and China, a new fund raise this March has given wings to Budki.
US-headquartered venture capital firm SOSV and Australia-based VC firm Artesian, via its Chinese fund, have invested in Guiddoo World Travels. The capital is expected to fuel Middle East and Africa expansion. The company last raised $800,000 in a pre-Series A round in December 2018 and $300,000 in 2017.