Monday, July 26, 2010
India & Entrepreneurship : a Debate
In his own experience as an entrepreneur, Hosanagar found distribution to be the biggest obstacle in India.
-----------------------
Sudhir Syal, a producer of a show on entrepreneurship called "Starting Up" on ET Now, an Indian television channel, recalled his experience at Sulekha.com, an Internet portal for classified advertisements. "In the U.S. to book an ad, you log on and punch in your credit card details -- there is no sales force at all," he said. "In India, there is a sales force that only exists" because customers come personally to offices to buy advertising space. That increases distribution, employee and infrastructure costs "and makes it extremely difficult for an entrepreneur to grow," he added.
----------------------------------------------------------------
India's IT services industry has led the country's growth since the 1990s precisely because it was largely free of government regulation and did not need too much capital, Malik said. "In the businesses that need external capital, you are competing with guys who are very well entrenched, have access to capital, connections. In the industries where you do well, you don't have such a need for capital, or some of that has changed with deregulation."
-------------------------------------------
That may be so, said Goel, but pointed out that he comes up against cultural barriers when he goes campus recruiting. Students in U.S. university campuses say, "It's cool to work at a startup," he said, but not so in India. "In India I have spent hours with many smart kids who say they have to check with their parents," Goel said. "Some of them say, 'My dad says I won't get married if I work at a startup because the bride's family will say he works at a little company. Why can't he work at Infosys or Microsoft?'" Goel described those mindsets as "a real issue... there is little entrepreneurship by choice."
-------------------------------------------------------------------------------------
All the same, cultivating relationships with the government is not unique to India. "Which large corporation in the U.S. does not have contacts with senators or other politicians?" he asked.
----------------------------------------------------
Patil said he sees opportunities in the educational sector for his business of taking classic Indian comics based on folk tales to digital and animation formats. But he wants to stick to services and avoid products or rely purely on online channels. "I'd be skeptical of any Internet-alone opportunities; also, products are inherently harder to sell than services in India," he said. He found services an easier market to enter, especially for startups, "because cash flow problems are fewer, you get your money upfront and you have a direct relationship with the customer."
--------------------------------------
Wharton Link :
http://knowledge.wharton.upenn.edu/india/article.cfm?articleid=4499
-----------------------
Sudhir Syal, a producer of a show on entrepreneurship called "Starting Up" on ET Now, an Indian television channel, recalled his experience at Sulekha.com, an Internet portal for classified advertisements. "In the U.S. to book an ad, you log on and punch in your credit card details -- there is no sales force at all," he said. "In India, there is a sales force that only exists" because customers come personally to offices to buy advertising space. That increases distribution, employee and infrastructure costs "and makes it extremely difficult for an entrepreneur to grow," he added.
----------------------------------------------------------------
India's IT services industry has led the country's growth since the 1990s precisely because it was largely free of government regulation and did not need too much capital, Malik said. "In the businesses that need external capital, you are competing with guys who are very well entrenched, have access to capital, connections. In the industries where you do well, you don't have such a need for capital, or some of that has changed with deregulation."
-------------------------------------------
That may be so, said Goel, but pointed out that he comes up against cultural barriers when he goes campus recruiting. Students in U.S. university campuses say, "It's cool to work at a startup," he said, but not so in India. "In India I have spent hours with many smart kids who say they have to check with their parents," Goel said. "Some of them say, 'My dad says I won't get married if I work at a startup because the bride's family will say he works at a little company. Why can't he work at Infosys or Microsoft?'" Goel described those mindsets as "a real issue... there is little entrepreneurship by choice."
-------------------------------------------------------------------------------------
All the same, cultivating relationships with the government is not unique to India. "Which large corporation in the U.S. does not have contacts with senators or other politicians?" he asked.
----------------------------------------------------
Patil said he sees opportunities in the educational sector for his business of taking classic Indian comics based on folk tales to digital and animation formats. But he wants to stick to services and avoid products or rely purely on online channels. "I'd be skeptical of any Internet-alone opportunities; also, products are inherently harder to sell than services in India," he said. He found services an easier market to enter, especially for startups, "because cash flow problems are fewer, you get your money upfront and you have a direct relationship with the customer."
--------------------------------------
Wharton Link :
http://knowledge.wharton.upenn.edu/india/article.cfm?articleid=4499
Labels: Knowledge at Wharton
