DOI: 10.59571/mpi.v3si1.1
The global fintech business is a hive of innovation and expansion, despite declining funding and revenue multiples and some depressing years.1 The success rate of fintech startups is low , with India experiencing a downward trend as well.2,3 India has immense potential -projected to be a US$2.1 trillion market by 2030 -but the rate of new fintech startup incorporations is declining.4 This raises the question: Is fear of failure discouraging new entrants? Fintech is a broad industry encompassing various financial verticals, each operating within unique business environments and consumer markets. A key determin ant of success or failure is how entrepreneurs perceive and act upon opportunities. In their research article, Ramoglou and McMullen explain how entrepreneurs can create dynamic possibilities through innovative actions and strategic alignment instead of waiting for opportunities that exist 'out there'.5 They propose a framework for effectuating opportunities, emphasising that entrepreneurial success stems from active engagement rather than passive discovery. Given India's vast potential and the need to expand access to financial services to even the most unreached segments of society, understanding and applying this framework could redefine how fintech startups approach innovation and success.
5 The article 'What Is an Opportunity?: From Theoretical Mystification to Everyday Understanding' by Stratos Ramoglou and Jeffery S. McMullen, featured in Volume 49, Issue 2 of Academy of Management Review, argues that 'opportunities' in entrepreneurship are not fixed things we discover, but ideas we believe can lead to a better future
Published by SPJIMR in 2025. This is an open access article under the CC BY license Management Practice Insights Vol 3
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reached this goal six months earlier, granting them financial freedom. McKinsey reports that Paytm achieved this goal through disciplined cost management, revenue growth across businesses, and a
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business model with strong operating leverage. The entrepreneurial actions can be strategic, such as decisions on pricing systems like freemium, pay per use, dynamic pricing, or tactical, such as short-term price promotions or product trials.
C (Enabling Conditions): The fintech sector relies heavily on a supportive regulatory environment and robust technological infrastructure. For instance, when launching a digital lending platform, it is crucial to have regulations that permit such services to operate legally and a digital infrastructure that allows customers to access the platform effortlessly. Peer-to-Peer (P2P) lending tech platforms often face issues with fraud. The Reserve Bank of India continuously refines regulations and imposes stricter licensing and compliance standards for P2P lenders operating under a non-banking financial company (NBFC) framework, promoting ethical business practices.
Entrepreneurs must monitor and sometimes even influence conditions to ensure the right support structures are in place for their actions to succeed. Entrepreneurs must adapt their strategy or focus on influencing policymakers to create more favourable conditions if these conditions are unfavourable.
Figure 1: ABC Model of Opportunity Actualisation in Fin tech
Source: Developed by authors based on research by Ramoglou and McMullen
Here are some fintech companies that have leveraged the ABC model.
Ÿ A: Used the opportunity by creating a global platform for secure digital payments.
Ÿ B: Developed technology that enabled secure online payments and targeted the growing e-commerce market.
Ÿ C: Rise of online shopping, increased consumer trust in digital payments, and the regulatory environment for digital transactions enabled PayPal to thrive. 14
Ÿ A: First created the opportunity for digital payments and digital banking by launching an extensive telecom network (Jio) and an e-commerce app (JioMart) that complemented a fintech offering.
Ÿ B: Building on these foundations, Reliance's digital businesses were consolidated into a super app (My Jio) and a subsidiary (Jio Platforms). 15 These early actions were followed by a series of fintech offerings, including JioFinance, which includes UPI payments, digital savings, insurance, and a credit business that now includes home loans.
Ÿ C: The conditions that enabled this success were high smartphone penetration in India, government policies supporting digital inclusion, and a relatively underdeveloped telecom market with high-cost data services, which Jio capitalised on by offering more affordable alternatives.
Jio's success wasn't about 'discovering' an existing opportunity but creating one by aligning its actions with favourable market conditions.
Ÿ A: Enabling seamless, real-time digital payments across the country.
Ÿ B: National Payments Corporation of India (NPCI) developed the user-friendly UPI interface, collaborating with banks and financial institutions and ensured interoperability.16
Ÿ C: India's growing mobile phone penetration, a regulatory push for digital financial inclusion, and collaboration between banks, fintech companies.
UPI has since transformed India's digital payment landscape, showing how fintech innovations can thrive when the right conditions exist.
Even well-intended entrepreneurial actions can fail if the enabling conditions (C) are not aligned or deteriorate over time. The demise of Powa Technologies in the UK is one such example.17 Powa aimed to
Artificial Intelligence (AI) and predictive analytics can enhance the ABC model by providing real-time insights into market sentiment, regulatory trends, and customer behaviour. This agility is particularly vital in fintech, where change is constant and rapid.
revolutionise mobile commerce by developing PowaTag, a platform that allowed customers to make instant purchases by scanning QR codes. The company sought to position itself as an industry leader in mobile payments.
To achieve this, Powa made substantial investments in developing the PowaTag technology, established partnerships with thousands of retailers, and launched aggressive marketing campaigns to promote adoption of the platform. However, there were significant challenges: consumers were not widely embracing QR code-based payments, retailers were hesitant to adopt new systems without clear evidence of demand, and the competitive landscape included new mobile payment solutions, such as Apple Pay, that offered more practical options.
This disconnect between Powa's efforts and market realities ultimately led to poor adoption rates and financial difficulties for the company.
The ABC model serves as a decision-making compass. It encourages entrepreneurs to:
Define Clear Goals (A): These must align with real-world problems or market gaps.
Take Targeted Actions (B): Actions should be iterative and informed by data and feedback.
Align with Conditions (C): Entrepreneurs must adapt to, or actively influence, regulatory and technological environments.
Artificial Intelligence (AI) and predictive analytics can enhance this model by providing real-time insights into market sentiment, regulatory trends, and customer behaviour. This agility is particularly vital in fintech, where change is constant and rapid. The ABC model is applicable across sectors. Healthcare, retail, logistics, and education operate within complex ecosystems where opportunities must be carefully shaped and timed.
While there is an explosion in the fintech industry, it is challenging for most of these businesses to break even and survive.18 New entrepreneurs should constantly assess the opportunities they seek, allowing them to drop the less promising ones and stick with those still appealing.19
Vineeta Dwivedi is Associate Professor in the Organisation Janakiraman Moorthy is Professor in the Marketing and Leadership Studies department at SPJIMR. You can reach department and Dean, Academics, and Research at SPJIMR. out to her at vineeta.dwivedi@spjimr.org. You can reach out to him at
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1 Deepak Goyal, 'Global Fintech 2024: Prudence, Profits and Growth', BCG Global, 25 June 2024, https://www.bcg.com/publications/2024/global-fintechprudence-profits-and-growth.
2 Lisa Barz, Sarasimone Lindeque, and Jonas Hedman, 'Critical Success Factors in the FinTech World: A Stage Model', Electronic Commerce Research and Applications 60 (1 July 2023): 101280, https://doi.org/10.1016/j.elerap.2023.101280.
3 Alka Jain, 'Indian Fintech Funding Slumps Nearly Two-Third in 2023', Mint, 5 January 2024, https://www.livemint.com/companies/news/indian-fintechfunding-slumps-nearly-two-third-in-2023-will-india-emerge-asglobal-fintech-powerhouse-11704444297387.html.
4 PwC and ASSOCHAM, 'FinTech – Powering India's USD 5 Trillion Economy by Fostering Innovations, Enabling Inclusion and Building a Sustainable Future', 2024, https://www.pwc.in/assets/pdfs/industries/powering-indiasusd-5-trillion-economy-by-fostering-innovations.pdf.
5 Stratos Ramoglou and Jeffery S. McMullen, 'What Is an Opportunity?”: From Theoretical Mystification to Everyday Understanding', Academy of Management Review 49, no. 2 (April 2024): 273–98, https://doi.org/10.5465/amr.2020.0335 .
6 Tom Eisenmann, 'Why Start-Ups Fail', Harvard Business Review, June 2021, https://hbr.org/2021/05/why-start-ups-fail.
7 Mike Yon, '40+ Startup Failure Statistics For 2025', 17 January 2024, https://growthlist.co/startup-failure-statistics/.
8 Sergei Vardomatski, 'Why IT Startups Fail: Reasons, Trends And Solutions', Forbes, 2 May 2023, https://www.forbes.com/councils/forbestechcouncil/2023/05/ 02/why-it-startups-fail-reasons-trends-and-solutions/.
9 Counsel India, '"The Percentage of Startups Failing in India', n.d., https://www.counselindia.com/blog-detail/the-percentage-ofstartups-failing-in-india-.
10 Niketan Sharma, 'Why Fintech Startups Fail: Insights from Notable Startup Collapses', Nimbleappgenie (blog), 23 May 2025, https://www.nimbleappgenie.com/blogs/why-fintech-startupsfail/.
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Raghav Aggarwal, '72% Fewer Indian Fintech Startups Incorporated in 2023 than in 2021: Report', Business Standard, 20 February 2024, https://www.businessstandard.com/companies/start-ups/72-fewer-indian-fintechstartups-incorporated-in-2023-than-in-2021-report124022000376_1.html.
12 'How Does PolicyBazaar Work?', Canvas Business Model, 2 October 2024, https://canvasbusinessmodel.com/blogs/how-itworks/policybazaar-how-it-works.
13 'Fintechs: A New Paradigm of Growth', Mckinsey Insights (McKinsey & Company, 24 October 2023), https://www.mckinsey.com/industries/financial-services/ourinsights/fintechs-a-new-paradigm-of-growth.
14 Ayush Singh Rawat, 'The Success Story of PayPal', 16 February 2021, https://www.analyticssteps.com/blogs/success-storypaypal.
15 Moulishree Srivastava, 'A Brief History of Reliance's Digital Venture, Jio Platforms', KrASIA, 25 August 2020, https://krasia.com/a-brief-history-of-reliances-digital-venture-jioplatforms.
16 Prateek Singh, 'The Resounding Success of UPI in India: A Revolution in Digital Payments', Medium, Digital Diplomacy (blog), 4 November 2023, https://medium.com/digital-diplomacy/theresounding-success-of-upi-in-india-a-revolution-in-digitalpayments-79c31a78fb8d.
17 Rory Cellan-Jones, 'Powa: The Start-up That Fell to Earth', BBC News, 21 March 2016, sec. Technology, https://www.bbc.com/news/technology-35860814.
18 Santiago Carbó-Valverde, Pedro J. Cuadros-Solas, and Francisco Rodríguez-Fernández, 'Entrepreneurial, Institutional and Financial Strategies for FinTech Profitability', Financial Innovation 8, no. 1 (10 February 2022): 15, https://doi.org/10.1186/s40854-02100325-2.
19 Dimo Dimov, 'Nascent Entrepreneurs and Venture Emergence: Opportunity Confidence, Human Capital, and Early Planning', Journal of Management Studies 47, no. 6 (2010): 1123–53, https://doi.org/10.1111/j.1467-6486.2009.00874.x.
Date article submitted: Sep 9, 2024 Date article accepted: May 23, 2025 Date article published: Jun 30, 2025
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