It Is Not Worth Applauding The Indian Startup Ecosystem
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Bangalore: If entrepreneurship is thought to be a religion, then Silicon Valley is the holy land. The startup ecosystem in Silicon Valley has evolved some 25 years back and today the ecosystem is much matured with colleges, angel investors, VC investors, entrepreneurs, employees and other all working in harmony. Despite the early big names like Google and Yahoo, the valley is still producing companies like Twitter and Facebook. While in India, it is understandable that the ecosystem is still in its nascent stage as it has just started to develop. There is a lot of visible dynamism in the Silicon Valley which India lacks. Mark Zukerberg, Larry Page, Sergey Brin, Bill Gates and several other entrepreneurs came up with the next big ideas when they were in the college. The next big ideas are probably growing on college campuses around the world, but then why India has not produced any entrepreneur who started the company while in college and took it to IPO within few years. Facebook was launched in 2004 by Mark Zukerberg and within seven years, it is worth $4,270 million and has registered a growth of 114 percent in 2011. When talking about Indian giant like Infosys, it took around eleven years to go public and after 30 years of its establishment, it is worth $6.041 billion. In the Valley, the seed of entrepreneurship is sowed from the childhood. Kids start their own business while in school and their first business being a 'lemonade stall'. While in India, until the kid completes his education, he is not allowed to think of any alternative. Even the colleges in the Valley permit the students to take a break from their curriculum and start their own venture. They also have an option to resume their studies later. India lacks such education system. 'Take Your Kid To Work program' is an educational program in US that allow parents to take their children to work for one day, i.e., fourth Thursday of April every year. The day has been generally scheduled on a day that is a school day, and schools are provided with literature and encouraged for incorporating career exploration into school curricula on the day before or after the event. This helps the young would-be-entrepreneurs to understand the corporate world by observing the management process. While in India, there is not such initiatives taken to breed in the entrepreneurial skill since childhood. Naveen Jain, Founder of Intelius, used to take his son Ankur Jain, who was then a kid, to his meetings just to learn. Later he used to come up to Naveen to suggest him why he was wrong and how to improve on his ideas. This helped Ankur to better understand the opportunities and principals of conducting business. At the tender age of 11, he started his own company. Naveen attributes exposure as the key to his success. While Silicon Valley continues to be a hot bed of innovation in science and technology, Indian startups are more focused on providing services for the rapidly growing consumer class in the country. Instead of inventing new technologies, Indian entrepreneurs are innovating with new business models to meet India's consumer needs ranging from retail to restaurants and microfinance to education. Social environment also has strong influence in shaping the character of an entrepreneur. In India, social and cultural issues hold their importance besides issues related to infrastructure. Any innovation to succeed in the society needs to be accepted by the value systems and cultural issues. In U.S., most of the successful incubators have a champion or group of champions who serve as advocates. There are several government funding programs for incubation centers. Some incubation centers provide the initial round of funding to their incubeetes to pull their business forward. Whereas, in India, twenty eight years later since incubation ecosystem emerged, the business incubation landscape is not seeing enough quality projects to incubate. Even though the Government has opened NSRCELL and several other incubation centers to help startups, but good and innovative ideas are not emerging out of the pockets. To develop a better ecosystem in India, it is important to widen the scope of government funding programs to support incubators, and ensure that incubators follow best practices, standardize outcome measures across the industry. The government should also tailor new incubators to the needs of local communities rather than applied as a bureaucratic solution, and improve local, regional and national support for seed, angel and venture capital funding. MNCs need to play their part of role in bringing these startups into limelight. What one might think trivial help often ends up being a big reason for one's success. It is the time for the giants to nurture the newbie and create a new culture for a successful ecosystem.