Startups and India

This came up while discussing this with my friends..

"Living in India is lot like working in a startup!"

Interesting point if you come to think of it.

While I was in the US everything was so developed, all the process were very organized. You woke up in the morning and you knew you won't have to worry about hot water... Get into your car and thanks to mapquest you can almost always knew how much time its going to take you in going from one place to another. Even while driving you don't have to think and you can simply assume an Autopilot mode because everyone else will just follow their lanes and won't be of any trouble to you as such.

On the other hand, in India you are still on the defining stage of all these processes. The infrastructure is being setup so a hot water bath cannot be guaranteed unless you wake up a little early and switch on your geysers :) ... Highways (a.k.a Freeways) and metros are being built so it might take you anywhere from 20 minutes to 2 hours to travel between the same places. And never dare to take a AutoPilot because the traffic rules are still under development. Everyone must be wondering why is it still a fun to live in India? Well, its pretty much similar to the fun you get while working in a startup environment.

US according to me is more like a corporate blue chip company where everything is almost exactly the way it should be. Nice infrastructure, well defined best practices, planned processes for everything..things that symbolizes a blue chip also represents America.

Today's India is more like a startup where every process is still under development. Developing processes, not the best of offices to work in, highly spirited team, a vision to change the world, visible growth and changes around you... things characteristic about any good startup represents India.

The phenomenal rate of around 10% at which our GDP is growing will probably make India as one of the richest nations in the world in the coming 30 years. With an economy of some $700 billion today, India is expected to scale to around $40 trillion during this time. Everything is under development, everywhere you go things are changing for good. New bridges are being built, new airlines are making way, new business models are being established. Now who wouldn't want to be a part of such change?

Microfinancing early stage startups

Rajesh Jain has a very interesting idea about a stock exchange for early stage companies.

Being an entrepreneur myself I couldn't agree more with the need for investors willing to invest in early stage companies. Micro financing the startups will not only dramatically reduce the barrier to entry for starting up a company fostering more and more innovation but will also bring self confidence to people making them more capable of taking risks. Some of the things that come to my mind:

- Investors should be aware that startups take a comparatively longer time to bring in return on their investments so patience is the key here. Instead of worrying about the short term quarterly profits they need to stay with the team.

- I hate to say this but the fact is "Startups have higher failure rates", thus, anyone investing should be very well aware that its a high risk --> high gain game.

- I would also propose the need such investors to play as mentors/advisor's for the startups they have invested in.. depending on their expertise in the domain. This will keep them more involved with the companies and probably give them a better handle on their investment, something that is not possible while investing in the blue chips. However, the final decision making should always be in the hands of the startup's management team lest small investors might bring in more trouble than good.

Any other thoughts?

TiE Delhi: Working with your Core Incompetence?

I was at a TiE workshop at India Corporate Center, Delhi on Saturday with Varun: "Being an Effective CEO: How to work with your Core Incompetence?" by Dr. Prasad Kaipa. Prasad did an excellent presentation and brought across with a very valid point that "Your most treasured strength is what becomes your biggest weakness and hinders you from getting to the next level." I was only partially at agreement with him when I had left the conference but as I continued thinking I started getting more and more inclined towards this point of view.

Some of the things that I had thought:

- Family system in India: We in India have strong family ties, something which most of us consider to be our biggest strength that supports and ensures success in our lives but after a point the same thing affects our ability to take risks. I personally have been really lucky on that front and I have always found motivation from my parents whether things have been good or bad at Wirkle. That though is not usually the case and most people even fear the risk of say joining a startup.

My colleague Sunil had written this a few months back in his post "Is joining startup really a Risk?"
Sunil wrote:

I remember once I was talking to this American lady in front of me, standing at the luggage check in queue at the IGI Airport. She was I guess a teacher and a painter by profession. She said you Indians are a lot lucky, you have such a strong family background especially financial stability provided by family networks. There in America, once you are 18 you are independent and you have to think all by yourself. She told me about an Indian guy in America whose mother had come to US and used to prepare all meals, bedding etc. for the guy, while the guy studied hard for his exams. Americans, she said are a lot insecure.

My response was, although Indians have strong family traditions but the same traditions make them less matured and mentally weaker. My personal belief is people in US or Europe are mentally more stronger than Indians and take more risks. On the contrary, the strong family background should have made Indians taking more risks! It might be I am just looking at a small spectrum of people, but that's what I got when talking to engineers in my last 1 year.

- Education: I think education provides us with a cushion and ensures that we will be able to earn well in our lives ahead but the very same thing may bring in a sense of undue security making you less susceptible to take any risks. Why is that most of the Harvard, MIT graduates are happy working for $200-$500K/year while some dropouts like Bill Gates, Steve Jobs, Richard Branson, etc. have been able to rise much higher?

- Flexibility: Lot of companies have a flexible vision and they take a path that allows them to adapt to the market. We at Wirkle do that, Yahoo does that, Microsoft does that..think of any company and most of them fall into this category. If a company is flexible then their vision/goal keeps on changing and you have to do a whole lot of new learning (bigger the learning curve bigger the time to actually perform) to succeed in the new marketplace. But again that doesn't mean you have to inflexible (Had Microsoft learnt that earlier there wouldn't have been a Google today)

In my opinion my core strength is to build strong relationships with people and continue those relationships. I have several people I know and always like to really spend time with them. Yet, this becomes my incompetence because when you know too many people you have only so much time to give to everyone (shrink it a whole lot if you work in a startup ,thus, leaving most of them complaining.

So what is your "Core Competence" and how does at times it becomes your "Core Incompetence?"

Mobile: Potential to revolutionize advertising?

In its very fundamental terms ideal advertising is about giving the person what he wants, when he wants. Google made billions of dollars by make a leap towards this, offering people what they were searching for. Something seemingly as simple as narrowing whom to target upturned the whole online advertising marketplace and allowed Google to something that is producing several billion dollar annually and is growing at an even phenomenal pace. But lets consider for a second, "How big is the online marketplace as compared to the physical marketplace?" Without even thinking twice anyone could come up and say "really small". How is any company supposed to upturn this industry by allowing advertisers to give physical shoppers what they want, when they want? The only answer I can think of is some set of services accessible via a mobile phone.

Mobile is the only device that allows a person to always stay connected with the networked world all the time, everywhere. In other words, it is the only device with a potential to connect the physical world to the smart virtual world full of tons of information, relevant advertisements and what not. Being a doorway to access information also makes it the doorway for advertisers to offer relevant adverts to potential customers in a purely physical setting. For instance, my friend Lisa sitting in her car and looking for a "Gas station", can simply search for that using her mobile phone and can be pushed relevant advertisements such as from shell offering her a discount of 5%, if she takes the effort to drive an extra mile to get his/her tank refilled from their Gas station on Broadway. She reaches the station snaps enters her discount code and gets the promised discount, additionally, she also gets 100 points for the purchase and is now a part of the Shells customer loyalty program. Lets consider another example: I enter best buy planning to buy a TV, my phone can start pushing me a comparative specifications for each TV set as I pass them and offer special adverts making me wanna buy one particular TV set vs. the other. Furthermore if I want to do compare amongst the 5 sets of TV I like, I can simply give a print command and can visit the customer service counter to collect a table showing the feature set comparison of those (very similar to what I can do on Amazon today). Extending this example slightly further, consider the possibility of my phone being like a wearable internet which offers me the relevant services wherever I go, for instance in this case an application can automatically start showing me the details of deals available in the store when I enter and stops showing that as soon as I leave the store.

There are hundreds of possibilities for entrepreneurs to take this challenge and make something that is several times more stronger than what Google did to the online advertising world. The biggest challenge in my opinion is to make such compelling applications usable on this small device such that it doesn't look like a spam but a service. Any takers?

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