Tag Archives: Indian entrepreneurship

Ok, people. Place your bets.

“I’d take all the youngsters to the horse track and make them bet!” exclaimed the well-known entertainment entrepreneur. This was his proposal for acclimating people to entrepreneurship. I was speechless; probably a good thing.

But we hear variations of this theme all the time: entrepreneurs are gamblers. Entrepreneurs are risk-takers. I hear that that one key thing holding people back from becoming entrepreneurs is their unwillingness to take a risk.

I challenge that premise.

Most Indian graduates long for placements in multi-national corporations (MNCs), or large Indian companies. Indeed, an Infosys placement commands a premium in the marriage market.

I contend that these youngsters are the real gamblers. I contend that the young people signing up for jobs in large corporates are assuming more risk than many of their counterparts headed to start-ups, or starting their own ventures.

Consider the placement scenario over the past few months – I know of young people who received offers from highly regarded MNC’s, but then never received their appointment letters.

As in most large companies, the decision to terminate the jobs was taken by people far removed, who were looking at the overall picture of the company. Perhaps the conversation went like this, “We need to trim the bench from 10% to 2%.” “Ok, we’ll cut the new hires in Bangalore.”

And these would-be-new hires couldn’t do a single thing to change their fate. They couldn’t prove their worth by working harder; or improve circumstances by identifying a new opportunity for the company or by changing strategy or pricing. Nothing. It was as if they had placed their chips at the roulette wheel, and then watched the ball land another number.

Contrast that with what might have happened in a start-up, or in their own venture. Everyone faces tough times. But in a start-up, perhaps they could have found another customer. They might have volunteered for extra work to speed up product development. Or negotiated a better deal with suppliers to save some money.

It may not have worked. But the point is that they could have tried something; they had a measure of control.

And in the course of trying, they would have learned something, improved their skills, or met people for the next opportunity. What can you learn, sitting at home, waiting for an appointment letter? Or shoe-horned into a cube, working on a piece of code?

So, who is better off, even in the worst case scenario? Who took more risk?

Everything in life carries some risk. Perhaps it’s about where one wants to place a bet. Do you want to bet on someone you don’t even know? Or do you want to bet on yourself?

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What Indian Entrepreneurs Need. Really.

What do entrepreneurs really need to succeed?

Passion. Drive. A  good idea. A network. Passion. Funding. Passion. Customers. Yeah, yeah, yeah.

But what about power? And I’m not speaking metaphysically here. I’m talking the real thing: electricity running through wires to reach a lab, an office, or a factory, with consistency and predictability. Power.

Journalists occasionally ask me what the government can or should do to improve the conditions for entrepreneurs in India. And every time I answer, I feel that I am somehow disappointing them.  “Changing the laws to encourage angel funding?” some prompt hopefully.  “Sure,” I respond. After all, some entrepreneurs need angel funding.

But generally I focus on the basics: power, roads and water would be a good place for the government to start. All entrepreneurs need power. Not all entrepreneurs need venture capital.

And the cost of building what they should be able to purchase disproportionately affects the new entrepreneur. It doesn’t hurt Infosys too much, these days, to run their own buses, generators, water purifiers and university. In fact, for them it’s an advantage to have these resources, when new entrepreneurs do not.

But it does hurt a new entrepreneur to shell out 2.5 lakhs (~ $5300) on a 25KVA diesel generator. Or 1.16 lakhs for 10 tubular batteries plus a UPS, like we did (~ $2500). Let me put this in context: the cost of backup power equals anywhere from 4 months to 8 months of salary for a junior programmer. That’s a lifetime in a startup. Do you think Silicon Valley startups are trading manpower for lights?

Ok, full disclosure: I’m writing this in the middle of a power shortage. Bangalore is badly crunched right now, though certainly not as badly as some.

To preserve our batteries, we don’t use the printers, and we unplug all the laptops.  There are no AC’s, fridge, or water (when we forget to turn on the pump during the moments with power). The only good thing is that no power means no power point presentations.

And we’re the lucky ones. I was talking to a young entrepreneur from Hubli the other day. His company serves clients in the manufacturing sector of northern Karnataka. His clients suffer power cuts (euphemistically called “load-shedding”) for over 8 hours per day. How do they manage? Some drive their teams to perform 8 hours of work in 4 hours. They have no choice. But is this the way to achieve 6 – 8 % GDP growth?

Building the entrepreneurial ecosystem means investing in the basics, and perhaps the entrepreneurial community should help highlight this priority.

Don’t even get me started on the roads.

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