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Podcast with Kanwal Rekhi February 2, 2007

Posted by rajAT in entrepreneur, entrepreneurship, india, tie.

Kiruba Shankar did a podcast with Kanwal Rekhi at the TiE Con Summit.

For naysayyers kanwal is the father of TiE and inspiration to many indian entrepreneurs.

He was a regular visitor to our college ( IIIT-H ) during 1999.

Along with Kanwal Suhas Patil and Chandrashekhar of Exodus Communications also visited our campus.

Talks given by them are still fresh in my mind. 🙂 Those stories I am keeping for another day. At the moment lets listen to the great Kanwal Rekhi :).

[podtech content=http://media.podtech.net/media/2007/01/PID_010097/Podtech_KS_kanwalrekhi.mp3&postURL=http://www.podtech.net&totalTime=961000&breadcrumb=3F34K2L1]


TiE Entrepreneurial Summit December 31, 2006

Posted by rajAT in entrepreneurship, india, tie.
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I attended the TiE Summit in Mumbai. There were lots of problems but finally I was able to make it though only for a day.  It was really a great experience. Highlight of the event was the meeting with Ashish Gupta, Founder of Junglee.com. We chatted for a very long time and it was truly a great experience. He gave me lots of tips and advice. He is truly an awesome guy. Below I have put some pictures of event which my friend Kiruba has taken.

Looking forward for more similar action.

Indian Tech Tour 2006 July 29, 2006

Posted by rajAT in entrepreneur, entrepreneurship, india, tie, tie asia, tie uk, vc, venture capital.
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techtour.PNG The Tech Tour will visit India for the first time and showcase its rich culture of technology and innovation. The Indian Tech Tour is co-organized with TiE UK and TiE Asia. The Indian Tech Tour will highlight this enormous potential and depth during its unique three-day tour across the country.

ETT is a leading non-profit organization of European VCs in the high-technology industry. ETT aims to provide a platform that allows interactions between the entrepreneurial eco-system in Europe with the entrepreneurial eco-system in the visited country eventually leading to facilitating or funding local high technology companies looking to expand internationally.

The delegate profile is top-notch and will comprise of successful entrepreneurs, representatives of national or international research organizations, directors of associations servicing the high-technology industry, partners and senior professionals of leading VC Firms, technology investment managers from development funds, business angels, professional service providers to the technology industry, investment bankers, politicians involved in technology development, global media representatives. Delegates comprising of VCs as well as other business leaders will be evaluating companies not only for investments but also for tie-ups, collaborations, and other strategic business relationships.

Visiting delegates are interested in the following categories.

  • New Materials & Processes
  • Wireless
  • Networking
    • Fixed
    • Management & Services
  • Software Applications
    • Enterprise
    • Consumers
  • Platform & Infrastructure
    • Computer-human interface
    • Search and navigation
    • Content delivery
    • Infrastructure management
    • Middleware
    • OS & Development tools
  • BPO
    • Healthcare
    • Financial Services
    • Content Development
    • Software Development
    • Elearning/Trading
  • Digital Media
  • Consumer Technology and Distribution
  • Energy Related Technologies
  • NANO Technology
  • Retail & Consumer technology
  • Semi-conductor technology/Research/Manufacturing
  • Media & Entertainment
  • Terminals and peripherals

Clayton Christensen @ TiECON EAST 2006 July 27, 2006

Posted by rajAT in Clayton Christensen, entrepreneur, entrepreneurship, tie, tiecon east.

Professor Clayton Christensen of the Harvard Business School belongs to that breed of management intellectuals which counts amongst its ranks the late Peter Drucker, Tom Peters and Michael Porter.

At a special reception at TiECON East 2006, Prof Christensen spoke about his research and on ‘How to tell if a business idea will succeed or fail’.

In the first part of his talk, Prof Christensen talked of a model he developed as a part of his research, which has two elements; one, any business has a trajectory of improvement and second, that every market has a different trajectory of movement. A company can move up its trajectory with simple year to year improvements and still be of tremendous incremental value to customers. That is, small innovations can bring great satisfaction.

He discovered that the innovation did not have to be groundbreaking but it is enough that there is innovation to ensure that the company stays competitive.

He then went on to describe the theory of what he termed ‘Disruptive Innovation’ This too does not refer to any breakthrough innovation, but simply to innovation which disrupts the trajectory of a firm’s offering to the public. This innovation could even have a negative value for the customer. This is when, he says, companies are caught on the wrong foot and the new comers work fast to muscle in on their territory.

Case Study- Steel Industry

To back this up he delivered an absorbing account of the developments in the Steel industry. The Big Fight between integrated steel companies, and new, quick and compact Mini-mills (operating on electric furnaces.) The small mini-mills kept nipping at the heels of the large, slow integrated steel companies when they first appeared on the scene in the 70s. Now the customer offering trajectory for the Steel industry ranges from re-enforced concrete bars (or ‘Rebars’) at the low end to sheet metal used in auto body manufacture at the high end. Mini-mills automatically gravitated toward the low end product because they could make it easily and cheaper than the integrated steel companies.

Soon, the mini-mills had taken the market from the big, old steel mills (the integrated ones) till they forced the last one out of the Re-bar business in 1979. But oddly enough this did not bother the integrated mills, because re-bars were a low margin product for them and they were glad to have it taken off their plate. But once the mini-mills were the only ones servicing this market now, they no longer had a tangible cost advantage. This happened every decade as the mini-mills moved up the steel product value-chain (they went from re-bar to angle-iron to structural beams to now sheet metal even!) Each time they pushed integrated steel mills out of the next higher-margin category but made life tougher for themselves (each time an integrated mill got out of a product category, the stock of mini-mill companies fell because of heightened competition and loss of competitive advantage).

Today almost all steel behemoths, the integrated steel mills, have shut shop. But the mini-mills are not doing too great either. This is a classic case of ‘Assymetry of Motivation’ as Prof Christensen terms this phenomenon. That is, “A situation where an attacker is keen to get into a market the attackee wants to get out of.” He went on to enumerate other industries where this “small guy gobbling up market share of low value-add product offering” phenomenon held true; the automotive sector (the Japanese ate American share, the Koreans are baffling the Japanese, the Chinese trouble the Koreans and soon the Tatas will offer the world the 100,000-rupee car), the airline sector (long haul routes versus, short/local routes), banks and even countries (like Japan).

The lesson he left us with at the end of the case study was “As a newcomer, you don’t always have to have a better product, you just need to create a situation where the current market leader is motivated to flee the battlefield.” His advice for the incumbent biggies his lesson was “Set up an autonomous subsidiary to compete with the newcomers and allow it to cannibalize the parent-leader” because out of the ashes something new and powerful can be reborn.

He also cited the case of Compaq and Flextronics to give us the next lesson on how to ensure a business succeeds. Flextronics started as a supplier and ended up as a competitor to Compaq because of the modular nature of Compaq’s offering. This was an important lesson in when and how much to forward or backward integrate.

He spoke next of Segmentation. He told all present not to segment only on the basis of the product or the customer category. He suggests instead that, as each product or service is employed by a customer to perform a ‘job’ for him/her, the company should segment based on what ‘job’ a particular product does. Therefore the ‘job’ is the fundamental unit of segmentation.

TYE- TiE Young Entrepreneurs July 27, 2006

Posted by rajAT in entrepreneur, entrepreneurship, tie, tye.

Ziggy Tek: It seems definitely like a sound that would appeal to any baby but when the winning team of Shane Lampert, Jay Mayur, Neil Mayur and Aashish Sharma, appeared on stage to receive their  check of $10,000 donated by Microsoft from Ramadorai, CEO, TCS and Chairman of Nasscom, there was tremendous applause from the large audience. The event was held at the TiECON East Banquet dinner at the Copley Marriot Hotel on June 16th 2006. Ziggy Tek, a baby monitoring device that helps alert parents to monitor their child’s fever, was the winning business idea for this year TYE (TiE Young Entrepreneurs), initiative launched in late 2005 from TiE Boston.

The Program geared for young students between the ages of 14 to 18 years is designed for aspiring youngsters who from an early age want to become entrepreneurs. Initially called “How to do a business plan “it soon became  TYE (TiE Young Entrepreneurs), a forum of about 30 students trying to understand the nuances of how to formulate a business plan, research industry segments and use methods to approach and analyze business. Spread over a period of 16 weeks, the students were split into 6 teams of 2 to 5 students who met with a mentor and learned skills that would probably be best learnt at a business school. The final result was presented to a panel of 5 judges consisting of two lawyers, two venture capitalists and a charter member who listened and zeroed in on the winner: in this case the Ziggy Tek team who were  mentored by Moshe Shavit.

Overall the business ideas of the participants were varied and interesting ranging from  maximizing airline trips for travelers, to online tutoring and safer windshields. To all those who were watching especially the younger students it was an inspiring and motivational event to witness and hopefully participate in the future.

Risk Capital in India June 20, 2006

Posted by rajAT in bangalore, entrepreneur, entrepreneurship, hyderabad, IIIT, iit, india, isb, startup, tie, vc, venture capital.

Rafiq Dossani from Stanford and Asawari Desai from TiE has written a report on what is holding the growth of risk capital in India [Via Venturewoods]. Below are some of excerpts from the report and my supporting thoughts on it.

Over 90% of the money invested by VC firms is in late state ventures. And the remaining More than 90% of the money invested in VC firms in India ventures lie in the category of late stage funding. The rest of the funding also goes into the firms who are replicating proven business models. Hence, the risk capital as such is totally absent in India. There are multiple reasons for such a scenario –

1. Domestic Risk capital providers who are skilled at risk assessment and portfolio diversification lack technical skills and market awareness.

This is very true. Most of the HNI (High Networth Individuals) one will find here will be from IT/ ITES industries who will have little or no clue about what is latest in the industry. Some of them who might be able to dish out the names of hottest startups like Riya, Skype (now eBay), Flikr (now Yahoo) etc. but they won't have clear idea as in why they are hot.

2. Early-stage entrepreneurs, though skilled at cost-control and technology, lack market awareness, product development skills, global standards of professional and ethical behavior and team building skills.

a. Some of the entrepreneurs here will simply try to replicate what has been done in US without understanding the whole idea in depth.
b. Early startups will not have discipline which is essential to certain extent.
c. The ideas that they are chasing can get changed very radically because some other quick opportunity will knock their door. Mostly in services side.

3. Inadequate pipeline of angel/university/state funded seed-stage firms.

Univeristy funding or support is happenning at few IITs (Bombay, Chennai) very actively. Now IIIT-H has also started supporting startups. But a wider penetration will take a lot lot more time.
You cannot create a vibrant entrepreneur community in pockets. If Stanford students were crucial in creating Sillicon valley than students from other universities have also played a very important role. All top 100 univs in US have an active Incubation cells. This imbibes a spirit of entrepreneurship in the students right from the beginning.

4. Seed and early-stage entrepreneurs’ professional networks consist primarily of a few strong personal connections and brokers. A wider network of professional associates, incubators and prior-stage financiers, is largely absent.

TiE is the only entrepreneurship network in India. It has chapters all over India, but TiE Bangalore is the most active one. Recently it launched TiE-EAP which is great foot forward. ISB in Hyderabad is also trying to build the same along with TiE Hyderabad and IIIT-H.

At grassroots alot is happenning now days. All Tier 1 IT hubs (Delhi, Hyderabad, Chennai, Bangalore, Mumbai, Pune) have successfully organized Barcamps which were hugely successful. A small step but can go a long way as it gives a platform to the like minded to come and meet.

5. Underdeveloped equity markets for listing early-stage firms.
All big internet companies in India get themselves listed at NASDAQ or NYSE. This shows that Indian investor is not ready for the new age companies.

6. Shortage of complementary capital, such as debt capital.

Organized debt markets in India doesn't exist. One can get debt from improper channels at very high rate of interest. Mr. Finance minister are you listening.

7. The business environment discourages sophisticated standards of – corporate governance.

8.University-Industry partnership was an alien concept 5 years back. Corporate India is still trying to discover how such alliances can affect its topline.  

9.Domestic consumption of IT is not very high. When labor is cheap why bother about IT. This is the mantra at most of the organizations.

10. Bureaucratic, regulatory, legal and tax hurdles affects smallers VC firms and angel investors. Need of the hour is such firms and not big ones. Read my views on it here.

Well this all means we have long way to go. And we will go 🙂 :).