This article is part of our GCP Newsletter: A bi-weekly newsletter for startup founders written by Arjun Malhotra.

This is 48.

The magic of Indian commerce begins not in gleaming malls or sleek e-commerce apps, but in countless personal interactions built on generations of trust.

In India, trust isn't just a nice-to-have – it's the lubricant that keeps our economic engine running. It's the invisible thread woven into every transaction, from buying vegetables to closing million-dollar deals.

Take the humble kirana store. These neighborhood shops have survived the onslaught of supermarkets and e-commerce giants not just because of convenience, but because of the personal relationships they've cultivated. Your local kirana-wala knows your preferences, extends credit without paperwork, and might even deliver that forgotten packet of milk at 10 PM. That's not just business; that's trust in action.

Or consider the success of Lijjat Papad, a women's cooperative that started with just seven women in 1959. Today, it's a Rs. 1600 crore enterprise, with its products in households across India. Their secret? Leveraging trust networks among women, creating a decentralized production model where quality control is ensured not by complex machinery, but by the pride each woman takes in her work.

This trust-based economy isn't just limited to small businesses. Even in the tech world, the most successful Indian startups are those that have cracked the trust code. Take Meesho, for instance. While e-commerce giants struggle with high customer acquisition costs, Meesho got its headstart by empowering local resellers – homemakers – to sell to their friends and family via WhatsApp, India’s most trusted messaging app. It's e-commerce, but with a trusted face and platform.

Understanding this trust dynamic is crucial for those building businesses beyond India's top 100 million consumers. It's not enough to have a great product or a slick app. You need to ask yourself: How does my business model leverage existing trust networks? How am I bridging the trust deficit?

In India, people don't just buy products; they buy into relationships. We have seen firsthand how trust-enabling businesses outperform their peers. They have lower customer acquisition costs, higher retention rates, and can often reach profitability faster. It's not just supporting SMEs; it's superior economics.

So, the next time you brainstorm your business model or pitch to investors, don't just talk about your TAM, CAC, and LTV. Tell us how you're going to earn and scale trust. Show us how you're not just disrupting an industry, but enhancing the trust networks that have served India for generations.

In a country where even marriages are often arranged through trusted intermediaries, thinking you can simply disintermediate your way to success is naive at best, and disastrous at worst. The future belongs to those who can blend technology with tradition, and efficiency with empathy.

As always, I'd love to hear your thoughts. How are you building trust into your go-to-market? What challenges have you faced in scaling trust? Let's explore how we can build businesses that don't just boost India, but serve its soul.