Leading global internet conglomerate LeEco reaffirmed the importance the Indian market has to the company amid its recent strategic realignments. “India represents the future and its user value may surpass China in a few years,” said YT Jia, co-founder and chairman of LeEco at the company’s investor meeting in Beijing on November 10.

1. wwww.etailingindiaexpo.com
LeEco Chairman YT Jia Believes India’s User Value Will Surpass China
Leading global internet conglomerate LeEco reaffirmed the importance the Indian market has to
the company amid its recent strategic realignments. “India represents the future and its user value
may surpass China in a few years,” said YT Jia, co-founder and chairman of LeEco at the
company’s investor meeting in Beijing on November 10.
#DigitalErra Thought Corner
“We will focus on China, American and India and achieve breakthroughs in these three valuable
regional markets,” said YT Jia, co-founder and chairman of LeEco.
LeEco embarks on a new phase of journey, from capital-fuelled expansion to building a stronger
hold of existing markets and achieving higher profit. A letter Jia sent to LeEco employees states,
“No matter how hard it is to crack the India market, we will try our best to grasp the opportunity
there,” Jia said.
Founded in November 2004 by Jia Yueting and Liu Hong, LeEco employs more than 10,000
people and is the world’s first video company to go public with a market capitalization of more

2. wwww.etailingindiaexpo.com
than $12 billion USD. It also said it would invest $10 million to build cloud infrastructure for
delivering content in India.
India’s User Value
Companies usually rely upon having a reliable group of engaged users, they do offer at least one
telling metric: the amount of money each user is worth. That’s why venture capitalists evaluating
such businesses in their early stages often examine how much revenue a company is generating
per user. LeEco statement that India would surpass China in its user value is not an underrated
statement.
India has around 684 million mobile users whereas China has about 1.28 billion users. In China,
Nearly 20% of the digital consumers now buy some goods from vendors outside China. Indian
online shoppers spend Rs 54,700 crore buying products from other countries, and that is
expected to rise by more than 75 per cent in 2016. Both India and China has embraced the wave
of e-commerce where e-commerce can create 10 million jobs in India in a decade of time.
While it is true that ‘User Value’ matters to the company, revenue per user isn’t an absolute
measure of a company’s prospects. Google is the world’s most profitable and valuable Internet
Company not only because it has a lot of revenue per user, but also because it has a vast number
of users. Sheer scale is also a reason for the soaring valuation of Facebook, which now boasts
more than 69 million users in India. However, by the time public investors get a chance to buy a
piece of the company, they’ll have to gauge whether its metrics really justify the price, or
whether they foreshadow another bursting bubble.
Every startup needs to generate value but the metric a Value-driven startup should
focus on are relevant volume and Unit Economics: lifetime value contributed by a user,
cost of acquiring users, and margin per transaction. On the other hand, Valuation-
driven startups would focus on vanity volume: traffic, page views, no. of transactions
while ignoring important stats for profitability.