March 21, 2013
NEW DELHI: Starting a new venture anywhere in the world is fraught with challenges, but in India, start-ups face even more daunting hurdles.
There are regulatory burdens and policy uncertainties. In the past decade India's start-up ecosystem has developed phenomenally but remains quite immature relative to the world's famous entrepreneurial hotspots such as Silicon Valley.
March 21, 2013
NEW DELHI: Starting a new venture anywhere in the world is fraught with challenges, but in India, start-ups face even more daunting hurdles.
There are regulatory burdens and policy uncertainties. In the past decade India's start-up ecosystem has developed phenomenally but remains quite immature relative to the world's famous entrepreneurial hotspots such as Silicon Valley.
One bright spot has been the marked increase in activity by large players such as Google, Microsoft, Yahoo, Nokia, SAP and Intel who have established incubators, accelerators and seed funds to kindle startups. But many other large, platform players – LinkedIn and Facebook for example – have yet to engage deeply with the Indian start-up community.
The efficacy of academic powerhouses like Stanford spawning innumerable start-ups in their backyards is a phenomenon still being cultivated in India at the IITs, IIMs and other institutions. There haven't been awe-inspiring buyouts of startups. This paucity of 'liquidity' leaves the ultimate carrot for starting up missing. So Indian entrepreneurs start-up on a wing and a prayer, made doubly difficult by conservative, middle-class parents and spouses who live in mortal fear of monthly EMIs!
Here are a few tips to surmount early challenges.
Start-ups should work hard on getting their Product-Market Fit right. The typical Indian start-up has smart founders who passionately believe in a solution they've developed but then, literally, go searching for a market. Frequent customer and market validation and course correction seems to them to be an expression of doubt or, worse, failure, instead of a maturation toward a market-ready product or service.
In the West, two close friends or former colleagues may startup, but in India we regularly see groups of 4-5 like-minded college-mates joining hands. Camaraderie and loyalty can't trump the need for complementary skills. I have yet to see a young start-up team seeking out a 'grey-haired' co-founder early on. They also falter in seeking capital without a highly defensible plan on exactly how they are going to spend every last rupee with good odds of a 'return' on those monies spent.
(The writer is co-chair & co-founder of Harvard Business School Alumni Angels India)
