Are Indian startups thinking BIG enough?

October 18, 2007

By sinha

Are Indian entrepreneurs thinking big enough? Here is a great article from Sanjay Anandaram, entrepreneur-turned-VC. A must read for Indian entrepreneurs/startups.

For Indian startups

I remember reading an Akbar and Birbal tale many years ago. In this story, Akbar and Birbal wager on something. Akbar tells Birbal that if he (i.e. Akbar) loses, he could give Birbal as much gold as he wanted since he was the emperor, but what would Birbal give Akbar if he lost?
Birbal said that if he lost, the first person who comes to the royal durbar the day after the loss would be asked to name the highest number he could think of. And Birbal would give Akbar as many gold coins as the number mentioned. Sure enough, Akbar wins and asks Birbal to prepare himself for the following day when he’d have to pay Akbar a huge sum in gold. The next morning, a beggar is the first person to come to the royal durbar and upon being asked to name a big number, says “100”. Birbal with a knowing smile promptly hands over a bag of 100 gold coins to Akbar.

He later mentions to Akbar that for someone like a beggar who has to struggle for survival, the sum of 100 gold coins was an unimaginable amount and was the highest number he could think of. Knowing that the beggar was always the first person everyday in the royal durbar, Birbal was confident of his ability to pay.

This story came back to me recently when some of us were at a national business plan competition organized by a premier management school. Most of the business plans were very innovative and had been prepared with a great deal of thought. However one recurring theme emerged as we sat in on presentation after presentation.
And that was the incredible ability of these bright smart people to think small! How small? Well, how about wanting to be a Rs 100 million (approx. $2.25m) company in 5 years? This from a team of management students from a top school who one would have imagined would have higher and bigger ambitions.

I don’t know if it is part of our DNA or eco-system or both but the innate capability to “think small” appears to be pervasive. And the resultant outcome is that we do things “small”. We’ve encouraged people through the years to think and behave small like the beggar in the story thanks to the largely self-imposed resource constraints.
A look at our industrial policy over the years, especially the reserved list for the small scale sector, is enough to illustrate the point. By operating in a resource starved environment, we have learnt to make do with less. The worst thing that has happened to us is that we have learnt to dream very small dreams, sometimes have no dream, goal or ambition even. We are paralyzed with inaction and self-doubt when there are resources to be deployed.
We employ constraints based reasoning, i.e. we impose constraints before we decide the goals and our ambitions. We also assume that the constraints are somehow unchangeable and try and fit our ambitions and desires within them.

Fortunately, the last decade or so of economic reforms has brought in global brands, global processes, global awareness and global scales to some of our thinking. Capital is no longer a severely scarce resource at least not to the smart team of entrepreneurs. So why do we continue to think small? Why cannot a team of entrepreneurs think of the globe as the market, think of the globe as a sourcing platform, think of becoming a $1 billion company? So if capital is no longer a scarce resource, what is holding us back from thinking big?

The scarcity is in our imagination and will power that we continue to think small. The ability to think big on global scales is what makes a world class entrepreneur. Look at the examples around us – entrepreneurs who could and did think big were the ones who created Reliance, Bharti, Pantaloon, Infosys, and many others not just in India but around the world. These entrepreneurs have focused on their goals and ambitions and worked diligently to remove the constraints that could hold prevent them from achieving their big dreams. Why should our dreams be constrained?

So what does all this mean for an entrepreneur today?

Focus on large market opportunities. Focus on fast growing market opportunities. Focus on dominating that market opportunity.
Ask: what does it take to dominate the market opportunity? Capital availability is the easy part. The hard part is building out the product/service, hiring globally scalable talent, and penetrating global markets. Capital will make this happen in large part. And the ability to think big (obviously backed by a clear focus and execution plan) will make the capital happen!

Remember to reach for the stars if you want to reach for the tree-tops. Those who are happy trying to reach the tree-tops are unlikely to get their feet off the ground.

What do you think?

The article first appeared in Financial Express. Pic credit

indian startups

Tags: sanjay anandaram, VC speak

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Mahesh on October 18, 2007 at 6:02 pm

What a Great Combination of Title and Pic. Both sync.

“Are Indian startups thinking BIG enough?”: Are indian entrepreneurs reading this Blog and other blogs about entrepreneurship. How to ensure that they are smelling the gearing up entrepreneurship in india.

Are Sanjay’s articles and everything else in this blog reaching to the aspiring entrepreneurs ?.

We need to reach them and Inject about entrepreneurship, innovation and creativity.

There is lot of Divide. How to bridge it ?.

Andrew on October 22, 2007 at 12:14 pm

KILLER STARTUP: http://www.giventake.in

Givetake.in is an online bartering site. Just like in the old days, you can barter your old shirts and shiny records for other people’s old shirts and shiny records. Or anything, for that matter. The site has categories for practically every consumer good, whether it be antiques, games, electronics or services. To start bartering you’ll need to register first. Next use the search box to find exactly what you’re looking for (or browse by category). Once you’ve found that perfect something, connect with the person who’s got your product and make an exchange. You’ll have to work out the exact terms of the deal, and figure out whether a boot is warranted or whether you can arrange something fancy where A helps B in return for getting C product X and so on. Get creative, it can save you some cash and perhaps make you a friend or two. There are no fees involved to trade your stuff or for registering.

In their own words

“Giventake.in is the Web’s premier free, full-service bartering site. Unlike other similar bartering destinations, Giventake.in is the only one that provides a comprehensive range of categories that truly allows members to trade anything they have for anything they want, be it a product, a service or even cold, hard cash.

Oh, and did we mention it’s free? That’s right. No processing fees. No hidden charges. No kidding!”

Why it might be a killer

Giventake has come up with a new twist on a classic idea: bartering. It’s been in effect for ages, but there hasn’t really been a heavy push on trading in recent times. With Giventake you can save some cash and get something you really like. Better for the planet than buying new too.

Some questions though

Will they add user ratings? As usual this site really needs some users to start bartering otherwise, it can’t go far. How’s it going to attract barterers?

In defense of the Indian Entrepeneur |Indian startups, India Business on October 23, 2007 at 12:20 pm

[...] is a response to Sanjay’s post on whether or not Indian startups are thinking big [...]

Yash on October 23, 2007 at 5:40 pm

Well, a good article and fantastically written. But I disagree with parameters of big.

Drucker, one of the greatest management gurus was of the opinion that the success in most businesses comes not as a result of meticulous planning (he called that a hygiene factor) but its response to opportunities. I would agree.

While “how big do you intend to be?” would be a very obvious question from a VC and a VC will look at the financial terms of size, an answer of 2.25 billion in 5 years would be met with just as much skepticism if not more than 2.25 million.

I assume when looking for a big new business one should would look at the following,
1. How can this product/service help me do thing differently?
2. How pervasive is it/can be?
3. Look for something in the people that tells you
a) They can grab opportunities
b) They have the ability to create opportunities.
I am sure Bill gates or the guys at Google did not realize their idea would be SO big

Wouldn’t it be unfair to ask to ask inexperienced engineers/geeks about how big they think a business can be? I would love to know what the Google guys thought their business was worth at the start.

Vivek on October 24, 2007 at 11:16 pm

I disagree with the think big too. I believe a startup should be conservative in its projections. I am sure that none of those people mentioned in the article would have imagined that their companies would be a multi billion dollar , global phenomenon.

After all, even Bill Gates once said “640K (roughly 1/2 of a megabyte) ought to be enough for anybody”