Ecosystem rankings 2012
Marketing

Silicon Valley in India- Possible reality or Marketing pipe dream?

Silicon Valley is perhaps the world’s greatest startup ecosystem which the entire world is trying to emulate. The efforts of the countries are mapped in this fabulous Startup Ecosystem map –

 

Ecosystem rankings 2012

According to the Startup Ecosystem map, Bangalore is listed on the 19th position from among the 20 cities under consideration.

This begs the question to be asked – How is India doing on the front of the Startup ecosystem building? Not very well on any Global metric apparently.

Here are three big reasons why India very badly needs a Startup Ecosystem –

1. Massive educated workforce churned out by Universities – Every year we see such huge numbers among the work force churned out by Indian colleges – not only engineering but science, commerce etc

2. Relatively larger uncertainties for bigger companies – Given the retrenchment going on in many sectors, it won’t be wrong to say that Startups will provide employment to a larger audience than before.

3. Exciting opportunities with potentially larger impact – At a startup, there would be a greater opportunity to create an impact as compared to a smaller company.

Given this, is India missing a huge marketing opportunity by NOT making a city like Bangalore or Pune a Startup Hub?

I certainly think so. Given the huge fillip that IT has given to Bangalore or Pune or Gurgaon or Hyderabad – local Governments should be literally jumping at the opportunity at creating a startup ecosystem. It has the potential to attract the best talent from the globe to that city and more importantly is a better way to collect sustainable and ever growing revenue. Look at the model that the state of California built for itself with the Silicon Valley. While it is true that the state was blessed to have minds like Steve Jobs and Sergey Brin, the fact is the California and US Government also played a small but important part in the Silicon Valley development.

Look at Tel Aviv – In 2009, Israel had more IPOs on the NASDAQ than China , India and Russia combined. Thats a telling statistic. If Israel can do it, so can a focussed approach from a country like India, with the abundance of talented people .

To Quote the article –

Highly advanced ecosystem and bustling with tech companies

– In 2009, 63 Israeli companies were listed on the tech-orientated NASDAQ – more than from Europe, Japan, Korea, India, and China combined

– Almost every major tech company today has some kind of subsidiary in Israel: Intel, Microsoft, Google and Cisco etc.

– 39% of Israeli high-tech employees work in the R&D departments of multinational companies

  • Closing fast on Silicon Valley due to risk-taking nature

Given all of this, it may seem as if India has already fallen behind . What is the best foot forward to build a Silicon Valley in India? Have any opinions? Let us know!

Source for diagrams and quotes: Telefonica digital

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Dropbox-startup
Entrepreneurship, Strategy, Technology, Web

Early Days of Dropbox – Drew Houston talk at Stanford

Drew Houston, the co-founder of cross platform file sharing service Dropbox talked about the Early days of dropbox here. Do check the talk out. Very interesting how Drew totally changed the paradigms of file sharing, the kinds of doubts that persisted in their team’s minds and how they overcame it.

Three key lessons :

1. If your product is good, the virality of the web can take care of advertising!

2. Build something that people can use

3. Persist (this is particularly important for me!! )

For those who cannot spare so much time to see a 58 min video – check out this Slideshare presentation by Drew about Dropbox.

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Business, Entertainment, Entrepreneurship, Technology, Web

Dhunio – Categorization is Everything!

One of the best things about India is Music! Bollywood and its music defines us. One of the most common hobbies for Indian youth is …. watching movies and listening to bollywood music. Movies and its music drives India and is a part of the nation.

Still, such an important service and in no single place has it been categorized completely? Itunes does not yet sells Indian music or categorizes it. Lets not blame them for we Indians don’t have a habit of paying for music and thus we make it impossible to put capital behind it or generate revenue from it.

This is where Dhunio comes in. Dhunio has ambitiously made an attempt in this space and has categorized innumrable Indian music videos! The best part of their strategy is that the videos are sourced from Youtube which makes it cost efficient. Dhunio drives the part where it is best, Categorization.

Now one of the best part of Dhunio. If you are reading this article then please try this … Go to Dhunio, search for Rockstar, it will give you a list of songs from the movie, you can listen to them or click on any of the links … you can click on Imtiaz Ali, Ranbir Kapoor or Mohit Chauhan and each will give you a list of songs in which they are director / actor / singer respectively. Now this is Categorization!

Ofcourse there are many more additions and many other features. That is for you to check out.

 

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Business, Entrepreneurship, Marketing, Strategy, Technology, Web

FlipKart: India’s Amazon

To be honest whatever I write is probably already covered in the video, except that Binny and Sachin Bansal are from IIT Delhi 2005 batch, one year senior to me! Flipkart is an amazing site and its success makes me very proud. Firstly because the founders are my seniors, secondly because it proves that ebusinesses are possible in India, and thirdly because instead of an established player a startup has been able to crack the ecommerce market of books in India. All credit to Sachin and Binny for having the guts to take the risk, leave their jobs, start a website and take it to such a level. Kudos guys and all the best for the way ahead.

Update: Just a day after this post the following came up in VCCircle! “FlipKart raises upto $10mn from Tiger Global”

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Entrepreneurship, Technology

Has outsourcing made us READY for the next technology revolution in India ?

As IT companies declare surprisingly optimistic results over the last quarter of 2009, industry experts claim that the worst in IT outsourcing seems to be behind us and that it is time to look ahead at positive trends throughout 2010.

When it comes to the IT outsourcing market, it seems that we have always been ready. It started with menial data entry jobs and low skill clerical work. While continuing with that, Indian companies upgraded their competency levels and started attracting low to mid skill application maintenance jobs. With the vast pool of engineers and innovative management minds coming into the business, a big wave of BPOS and KPOS swept the country and is still going strong.(Though BPO jobs are lately being lost heavily to Philippines though)Along with these developments, a parallel path of piece meal product development started hitting the Indian shores. Offshore Product Development needed higher levels of skills and companies managed to put together systems to generate those skills and delivered superb results. This is when MNCs started coming and opening offices all over India and the latest trend has become the outsourcing of R&D processes to Indian offices of MNCs like Google, Microsoft, Oracle etc.

Companies are setting up centers here because of the vast untapped pool of engineers and scientist in India and most of the giants like HP, IBM etc generate more than 50% of their revenues from the emerging markets outside US. Moving to India is a part of the strategy to keep the research close to the customer.

What this means that as we have moved up in the value chain, the entire product lifecycle from research to product development to maintenance to voice & non-voice support to menial data entry is happening at the highest level possible – within India! From low skill call center work to high caliber IP generation, we have a talent pool that has stood up every time the outsourcing industry has stretched its hand towards it and we can now start to imagine that we have the experienced resources becoming available in all of these disciplines.

So much so, that for the opponents of outsourcing, ‘losing jobs in the US’ is becoming a secondary stand and the “US Outsourcing away its competitive edge ” seems to have become a more powerful argument. As far as India is concerned, outsourcing has done a fabulous job and continues to be powerful in its place. But it is definitely not an answer to everything. In a BBC radio show debate between Shashi Tharoor – out Current minister of state of external affairs and Niomi Klein – Canadian Writer, even the all optimistic ‘Soft Power’ claim of Shashi Tharoor falls short of being convincing and he does agree that Outsourcing is not a final answer to everything for technology in India. But are we ready or at least on track towards the next step – a “product revolution” to march ahead of the services revolution?

With the vast pool of engineers and now, the experienced pool of professionals catering to every level of the value chain being available within India and with the proximity to most of the fastest growing markets, are we now in a better position than ever to be able to defy the odds and wash off the label of a ‘stagnant innovative and invention technology ecosystem’ that has been applied to us continuously by almost anyone reporting on this topic?

We have had champions within the service industry, master managers who have handled teams of hundreds to dish out world class software for companies throughout the world. What is stopping the champions of our product industry? Is it our culture that discourages risk and looks down upon failures, poor infrastructure, brain drain, or our history of being used to providing ‘services’ to foreigners?

All the MNCs coming to India have shown us that we have the talent and skills that can be leveraged to respond to the highest levels in technology. Are our entrepreneurs, investors, mentors and startups  READY enough to use this same talent, the advantage of availability of experienced talent due to the globalization of R&D processes in technology and put into action the next technology revolution for India ? Or is outsourcing going to be our best answer for the mention of ‘technology’ for years to come?

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Entrepreneurship, Politics

The Start Up Visa

USA-startup-visaIts 2010 and as we step into the next decade, Business and Technology remain the scale of measuring the overall strength of any country. Though jaw-dropping start ups keep coming forward from the dorm rooms and garages of the Silicon Valley, investors in US are worried that the  government is not doing enough to entice entrepreneurs to stay.

So the US congress is now considering what can be called as a ‘start-up Visa’. A visa for foreign born “techies” who have good ideas, so that they can stay ‘in’ US and continue working on them. This is especially valid for foreign students who drop out of school to found their own companies. It is particularly hard for them to get visas and continue in the valley, and US is aware of its losing ground if it doesn’t encourage smart brains from India and China to stay within.

The visa also aims at attracting foreign capital. So if your business plan is good enough to attract $250,000 through Venture Capital or $100,000 as angel funding, or shows prospects of creating 5-10 jobs and around $1Mn in revenue, then you are eligible and up for the visa. Such visas are already in place in Canada, UK and Australia and US knows the importance of funding the founders if it does not want to give away any advantage to one of these.
But the point to ponder upon is, if US, with all that it is, is thinking so seriously and taking steps to attract talent, imagine what steps India is going to have to take to at least retain its talent. The reforms from 1991 have provided the fuel for entrepreneurs to pick themselves up without licensing hassles, but do we have a government that is worried about start ups in India?

According to Dr Venkatraman, Indian born US based 2009-Nobel Prize winner, if India does not invest in the facilities that support long term research now, it is going to find itself 10-20 years behind in harnessing technology for better benefits.

We have one of the most, if not the most, competitive educational systems in the world. But it is also true that most of the smart brains are showing all their competitive spirit in India and Creativity outside it!

There is indeed a lot of activity going on in the start up incubators in India. Loads of VC funding and a build up of an entrepreneurial ecosystem with foundations like NEN, but we seem to miss godfathers like Andy Bechtolsheim and Mike Markkula coming ahead to mentor the Google’s or Apple’s of tomorrow.

With the Indian population all set to hit 1.5 Bn by 2020, the Indian market and economy is essentially going to piggyback on the ability of future job creators. The ecomonic reforms from 1991 have provided the fuel for entrepreneurs to pick themselves up without licensing hassles and red tape , now it is the turn for our educational reforms to pick up soon enough to catapault innovation and R&D. Are outdated rotten courses going to make way for a fast changing and flexible course systems that incorporate iphone and Android apps on the go ?

Image credits 1

PS: Click here if you wish to know more about the visa.

Click here if you think something has to be done about our educational system!

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Entrepreneurship

Facebook-focussed startups

(This is the first article in our Startup September series announced on September 1.) It is indeed amazing how fast applications on the internet evolve. We already know of the speed at which facebook is growing . It has crossed 250 mn UVs , with ever growing penetration in the Indian market. However, there is another direction in which facebook is evolving – as a Platform for app developers.

Till now, the most popular facebook applications have been games like Farmville, Mafia wars etc. The parent company, Zynga, which makes most of its money from these games, has revenue figures in millions of dollars. Taking cue from Zynga and other such firms, a lot of facebook-focussed startups have eveolved and they are getting huge VC support as well. Here are a few startup pitches to the VCs at the fb Fund REV social incubator organised by Facebook themselves.

Facebook quotes examples of successful VC fundings-

Thread.com $1.2M seed round of financing. The seed financing included participation from fbFund and was led by First Round Capital. Thread.com uses Facebook Connect to create a site for social dating via friendly intros. Nutshell Mail raised over $500k in funding. Nutshell Mail uses email to help you manage your social network activity. RentMineOnline raised over $300k in funding have been profitable for the past 4-5 months. They combine the success of resident referral programs with the power of your friends on Facebook.

We, at strat.in, are already using the services of one of these startups – Networked Blogs on our strat.in facebook fan page. The service that they provide in simple terms is to connect a blog with the facebook community. In future, they plan to enter into content disovery area from a blog perspective leveraging the social graph on facebook. Check out their presentation to VCs in the presentation pack above.

While it is interesting how startups are leveraging the power of facebook and social graph of its users, the question of sustaining growth still remains. It would be interesting to follow these startups and how they evolve over the course of time.

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Business

Strat.In initiative: Startup September – Call for articles!

startupIt is said that the toughest business to run  in the world is that of your own. However, the world’s biggest firms were once upon a time Startups too, started by aspiring entrepreneurs in the start of their career. Some of the current startups in India will surely become great successes in their fields. Strat. In plans to present its readers a novel perspective about Startups in September of 2009 with a novel initiative – Startup September! We invite reader articles for the same.

The objective: Writing articles about Startups or concepts about entrepreneurship itself. Articles that speak of your own experiences are also welcome.

Who can write: Anyone! Also, if entrepreneurs want their startups to get featured with us, you can drop a mail to us as well. Email address is mentioned later in the post.

What to write: We have some broad guidelines about what to write: If you are writing about a startup, the article should contain:

  • Description about the business of the startup
  • Thoughts about WHY this idea from the entrepreneur or author
  • Pointers about how the startup is carving a niche for itself
  • Link to the website of the startup

Apart from this, its upto the article writer how he/she wants to fashion the article. It can be a descriptive article, an interview, a video – its totally upto the author.

Excited? Yes, we surely are! Team Strat. In wants to hear about Startups from its readers. Write to us at contribute AT strat.in with Subject line “Startup September” . Kindly mention your name and information about yourself as well.

Deadline: The series would run all through September. But the deadline for articles is September 25, 2009 23:59:59 . However, note that the earlier you submit, the more visibility will the article get on the website!

Finally, why would a Startup like to get featured on strat.in of all places? Strat. In, within a short span of time, has generated considerable buzz among the IIM community and its read by around 40k readers from different fields in the industry. We, at strat.in believe that the ensuing discussion after the article is posted would be invaluable to entrepreneurs themselves from many perspectives. And, most importantly, it would create a buzz about your startup among people whose opinions matter – your future customers!

So, readers and entrpreneurs, lets make this initiative a success! Write about your startups, your experiences and send them to us at contribute AT strat.in

Cheers,

Team Strat.in!

Strat.In

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Entrepreneurship, Public Issues

Billions of Entrepreneurs in India?

China and India have always been compared; being the two most populous nations with diverse cultures and being neighbors on the map, they are expected to be similar, but in reality they are starkly different – be it economically, socially or politically. In this blog, I will share and extend some of the ideas of Prof Tarun Khanna, Harvard Business School, in his book Billions of Entrepreneurs: How China and India Are Reshaping Their Futures and Yours. In the book, Prof Khanna compares the millions of budding entrepreneurs in India and China; and how the economic, social, political situations in India and China affect its growth, culture and entrepreneurship ecosystem.

Well, this blog talks about the setting of our nation – the largest democracy and how an entrepreneur in India differs to its counterpart in America (or for that matter in most developed nations).

  1. In developed countries, most resources are already in or near their highest value use. Any increase in the value of a product/service is due to new and improved technologies. While in India, where technology is much behind compared to the developed nations, a simple import of the technology from the US works best in most cases. Obviously, big business houses compete better in this than a start –up. For example, did Reliance do break through research in mobile technology? Did they spend an equal amount in research as their US counterparts? Or was it economies of scale and import of technology which they exploited! Therefore, one of the important roles that entrepreneurs play in the US, namely, their role in early-stage innovation, has relatively little value in India.
  2. An interesting observation amongst early stage entrepreneurs (within 5 years of startup) in India is that they look forward to diversify rather than to expand. In US, normally early stage entrepreneurs look forward to expand in the customer base and compete with already established market players or sell to players who can use economies of scale or scope for better market positioning.
  3. Another interesting observation is that most early startups in India, have a starting capital of around Rs 5,00,000 which is about 10 times the per capital income in India; while a typical US startup capital is about ½ of US per capita incomes. Naturally, this should mean that Indian entrepreneurs should create greater jobs as compared to the US. This is quite not the case, because a typical US startup has revenues approximately 10 times of an Indian startup and hence they create more job opportunities.

Following from this blog, quite a many of us are deemed to think that Entrepreneurs are lagging a lot behind their US counterparts. This would be wrong to say, because the US markets and Indian markets are two different settings. This blog realizes the differences in the optimal roles that the US and Indian Entrepreneurs can play. The reasons for the differences in the optimum role are open ended and not discussed in the blog.

I myself am the founder of a campus sustainability campaign, Delta Climate. And from what I hear from all corners – academia, industry and investors, it surely is a good time to be an entrepreneur in India.

(Gaurav is an undergraduate student at the IIT Bombay in Computer Science. His interests include entrepreneurship, climate change mitigation, finance and  information technology. He is a member of the winning team at business plan competitions Eureka! 2008 and finalist in the McGinnis Venture Competition 2009. He is currently interning at Microsoft Research India and also blogs with Forbes columnist Sramana Mitra as an intern.)

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Business

Advertising, at its very best!

What is advertising? To put it in the most simple terms, it is the way to put across some information to a set of people so that it can be beneficial to you in some way. And of course, it is a paid form of “marketing”.

The most common form of advertising when we first think of it, is TV advertising. But that has its limits because you can never measure its influence. Online advertising is one step ahead as you can get a better idea of whether the receivers of your information are listening to you. Also, it is one more step ahead in trying to ensure you know you are hitting that section of society which you want to target.

But here’s a truly amazing form of advertising that I came across a few days back, through a friend.

This guy walked into a book store and went to a section which said “Search Engine Marketing”. He then browsed through a few books, before hitting on this one particularly interesting book. Before buying it, he just quickly scanned through the book to ensure good quality. And right at the centre of the book, he saw the visiting card of the CEO of a startup for Search Engine Marketing. He bought the book, and then called the CEO.

On telling the CEO how he had come across the information, the CEO told him that he had put his card in every single bookstore which had that book in Mumbai. He then interviewed this guy, and in 1 week’s time, he had joined that company in his first ever job.

So the startup ensured they advertised in exactly the right places – the CEO knew that he would only want to interview those people who selected this book.

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