Apr 26, 2020 · 37m · neon-show
Mekin Maheshwari on Impact of COVID-19 on Small & Medium Enterprises and Startups
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In this episode of the 100x Entrepreneur Podcast, host Siddharth Ahluwalia interviews Mekin Maheshwari, former Chief People Officer at Flipkart and co-founder of GAME and Udyam Learning Foundation, exploring mass entrepreneurship, startup resilience, and the economic impacts of COVID-19 on Indian MSMEs.
How this conversation actually went
Every chapter scored 0–10 on four independent dynamics. Hover any point for the reasoning behind the score. How this is scored →
Siddhartha as informed peer 2.1 Guest teaching 2.8 Guest disagreement 0.5 Siddhartha pushing back 0.4
speaking balance: gold is Siddhartha, purple is the guest (3 minute bins)
Sharpest disagreement ▶ 34:44 Guest challenges host's doubt on consumer spending avenues
When the host questions whether consumers will actually spend on new avenues, Mekin directly refutes the skepticism by pointing out unprecedented spending surges in health and hygiene products like sanitizers.
Hardest push from Siddhartha ▶ 34:29 Host pushes back on the viability of startup pivotsThe host actively challenges the guest's suggestion that startups can create new value in a crisis by asking whether consumers and businesses actually have any appetite for new spending.
Biggest teaching moment ▶ 6:26 Mekin breaks down the missing middle problem with global comparisonsMekin delivers a thorough structural breakdown of India's non-farm employment, contrasting India's weak 21% SME employment with China's 85% and Bangladesh's 60%.
Siddhartha holds their own ▶ 11:56 Host cites specific MSME closure projectionsThe host demonstrates deep subject awareness by citing specific industry reports showing that 22% of 75 million MSMEs would shut within 4 weeks of lockdown and 43% within 8 weeks.
the scores for every segment, with the reasoning behind each
| Chapter | Topic | Siddhartha as informed peer | Guest teaching | Guest disagreement | Siddhartha pushing back | Why |
|---|---|---|---|---|---|---|
| Mekin Maheshwari's Career Journey from Flipkart to Founding Udyam | 1 | 1 | 0 | 0 | The host opens with an open-ended question inviting the guest to walk through his career journey. The guest provides a friendly personal narrative covering his early days at Flipkart and the founding of Udyam. | |
| The Mission of Udyam and Genesis of GAME | 1 | 2 | 0 | 0 | The host asks clarifying questions about whether GAME and Udyam operate as non-profits. The guest elaborates on Udyam's entrepreneurial curriculum in public schools and the initial convening of GAME. | |
| Solving the Missing Middle Problem Through Strategic Alliances | 1 | 4 | 0 | 0 | The host inquires about GAME's specific focus and ground-level actions. The guest educates the listener on India's 'missing middle' employment gap compared to China and Bangladesh, detailing GAME's alliance structure. | |
| COVID-19's Immediate Threat to MSMEs and Informal Workers | 4 | 2 | 0 | 0 | The host demonstrates preparation by citing specific statistics regarding MSME survival timelines during the lockdown. The guest builds upon these numbers by explaining vulnerability in the informal sector and MSME contribution to GDP. | |
| Economic Relief Measures, Supply Shocks, and Migrant Displacement | 2 | 3 | 0 | 0 | The host asks about government relief and the scale and reversibility of migrant worker displacement. The guest outlines the dual demand and supply shocks facing small enterprises and discusses the long recovery timeline for labor migration. | |
| Long-Term Behavioral Shifts in Savings and Healthcare | 3 | 3 | 1 | 1 | The host brings up historical parallels with Airbnb's founding in 2008 and Flipkart's growth post-2008. The guest provides nuanced pushback against overestimating long-term behavioral changes while detailing the specific macro tailwinds that aided e-commerce. | |
| The Future of Schooling and Udyam’s Lockdown Initiatives | 2 | 4 | 1 | 0 | The host asks whether physical schooling will be replaced by online schools. The guest reframes the premise by pointing out the essential childcare and social interaction functions of physical schools, along with digital device constraints in low-income families. | |
| Startup Resilience, Stabilization Funds, and Strategic Pivots | 3 | 3 | 2 | 2 | The host questions whether customers are willing to spend on new value propositions during a downturn. The guest counters by pointing out sudden surges in sanitizer and PPE spending while advising caution against superficial sector pivots. |
Statements from this episode (15)
Maheshwari's Udyam reaches 750,000 Delhi students with daily entrepreneurship curriculum
“So in Delhi, we are the curriculum we've helped the government create is the first period every day for grades nine to 12. Students about seven and a half lakh students experience this.”
Maheshwari: India faces social crisis unless small enterprises create more jobs
“And we were both, we were all three very clear that if India does not build an ecosystem where a large number of our people start to create healthy enterprises enterprises that can create jobs for five plus people we will be facing a very large challenge both …”
Maheshwari: SMEs provide only 21% of India's non-farm employment
“Only like only about 21% of it is employed by what you would call small and medium enterprises.
most of the people are running what you would call a single entrepreneurship or what I call solopreneur.
And then there is some employment at the large enterprise …”
Maheshwari: SMEs employ 85% of China's workforce compared to India's 21%
“And when you compare this globally, in China, for example, 85% of the workforce is employed by this middle.
Even in Bangladesh, close to 60% of the workforce is employed by this middle.”
Maheshwari: MSMEs generate ~30% of Indian GDP and employ 100M+ people
“Close to 30% of the GDP comes from the MSME sector. And it employs about over a hundred million people, right?”
Maheshwari: 95% of employed Indian workers are in the unorganized sector
“95% of the workers, people who are employed are in the unorganized sector.”
Maheshwari: 20% to 40% of Indian MSMEs face existential COVID threats
“And these sectors will see the kind of damage that you just talked about, right? Like almost 20 to 40% of them facing very dire situations, right? And surviving itself might be a large issue.”
Maheshwari: India needs much larger COVID relief packages relative to GDP
“When I compare our relief packages compared to rest of the countries globally I think as a percentage of GDP, we need to do a lot more.”
Maheshwari: Restoring supply will be the bottleneck even if demand rebounds
“So even if demand were to come back very sharply after the lockdown, creating supply back is going to be a challenge and The measures that government can take to ease those to enable people to enable transport to work very well, raw material to be available, b…”
Maheshwari: India's COVID migrant displacement is reversible, but will take time
“Is it reversible? I think it is reversible. Will it take time? I do think it might take time.”
Maheshwari: Macroeconomic conditions do not heavily determine early-stage startup success
“The impact of macro factors on very small enterprises and very small new innovative enterprises is reasonably small to start with. Right. We were, so while the economic situation was probably not not very amenable, macro factors like internet penetration in In…”
Maheshwari: 75% of advisors warned me against joining Flipkart in 2009
“The VCs and advisors I had spoken to before joining Flipkart and 75% of them had advised against it believe that Indian consumers would probably not be able to trust online commerce.”
Maheshwari: Complete replacement of physical schools by online learning is far off
“And I think the number of those exceptions will increase for schooling to be replaced is a long, long way off.”
Maheshwari: Startups must treat layoffs as an absolute last resort during COVID
“My advice to people is that this is a time to back people. So let, let retrenchment or finding people will be The absolute last option because this is not a market where anybody is going to be able to go out and find a job. So figure out other ways and other m…”