This is a response to Sanjay’s post on whether or not Indian startups are thinking big enough. (Because it is a reaction to different points he made, I have traded flow for succinctness.)
First, a story of my own:
A practical joker (read: PJ master) friend of mine once came up to me and asked me to think of a number. I must have said 20. The guy quipped back – hey, you can’t think big! Think of a number like 124,368 (or something like that).
If I were an entrepreneur pitching to a bunch of investors in a biz plan competition, I would keep things simple and practical. I’d tell them about the revenue potential of the product, about the people in my exec team, do a 4-6 year financial forecast, and tell them how I plan to grow my business, and so on. Do you expect to hear the intentions of world dominance in a biz plan competition? Of course not – this is the chance to make an impression to get started and you don’t want to blow it up by stating that you want to be a billion dollar company in 10 years. Your financial forecasting will be torn into shreds.
Even if you aren’t competing in a contest, you’d have you break your grandiose vision into do-able pieces. Scale, global appeal and are things you keep building at along the way.
Did Infosys or YouTube or Google or Alibaba know how they would grow from day 1? No. For instance, we all know that the Infosys IPO was undersubscribed. I know of people who (sadly) tell the story of how they were offered Infosys shares at par during the IPO and refused to take up the offer (these are I-bankers, by the way). Point is, it is extremely hard to tell at the start whether you are going to be the next killer or not.
The VC community however, is supposed to have the experience to ensure that the “innovation” becomes a superstar. Like Sequoia put Steve Chen and Chad Hurley in an office and got them to hack away at YouTube. That’s why they get to judge the biz plan competitions .
I think entrepreneurship is matching capital (and other resource) availability step for step. As more capital investment flows in, there are more enterprises being created.
Look at RouteGuru, Redbus, MineKey & TringMe for example (there are more, but I don’t want to make this a link list). Each of these companies has the potential (product-wise) to change the way we think about currently existing equivalences. They are currently in “innovation” mode. The scale mode will come just around the corner – and scaling innovation is a different ball game altogether. (Following the Skype story?)
Anyone heard of SKS Microfinance? Non tech, it received $11.5 MM in funding from Sequoia earlier this year. The CEO was named one of the 100 most influential people on the planet by TIME magazine in 2006.
I believe the Indian entrepreneur is thinking big.
I don’t mean to launch a personal attack, but pay close attention to the line drawn from the post. “Remember to reach for the stars if you want to reach for the tree-tops (Emphasis mine).” Isn’t that thinking small, Sanjay?
Brilliantly written Sowmya…..I agree every point of it… and with this let me throw some light in what’s happening with Indian product development scenario……
Well i do take a leaf out of Sanjay’s post, but unfortunately India needs mentors at this stage than VC’s and investors……
India has huge potential, and so has diversity options, who in the world have thought India could be next prominent destination for products and not only servicing the major companies…..
who in the world world have thought Indian economy would be heading north and stock market would hit 19k, ironically while writing this post the stock market was 850 points up [biggest in a single day]..India is shining dude……..:)
Well, coming back, Indian startup needs to be guided and mentored by strong individuals , its not true always to keep high the US flagship to run your own business……coming to point, is it essential for a Indian startup to get funded in Dollars or are we so very oriented in making ourself visibly true o dollar options? [ in fact dollar has fallen sharply this year, and talks of recession in US has been making rounds]. but more or so, when u come across a potential product with right people handling it, it would require more of grooming to make it big than to push it to a extinct level in next few months only in allowing a biggie to take over.
There can’t be many Indian companies which i could think of, where in the internet spectrum are potential revenue earners and can sustain to there limits, its rather easy to quote there are way loopholes in these products to earn a revenue, but tell me someone who is taking some initiative in explaining how to make those changes and improving it ?? well in this case i am not supporting every Tom Dick n Harry who brings up with a Business plan, its actually a growing trend these days……..but i firmly believe you got to have a potential medium in order to project and make it work.
Looking at the changes from past 8-10months, when the complete ZOHO development is done by 150 individuals in INDIA and could challenge the likes of Google’s , Yahoo’s, we actually got to think again what India is suppose to give to the world , we do have very innovative products, but his shouldn’t only be a tagline for further developments!!!
kindly please talk about taking this to new level than pushing it downwards!!!!
Soumya,
Both sanjay’s viewpoint and yours are very much valid. In a way, both are very cliched as these debates are there everywhere in Indian IT industry.
So its just a state of mind, and there are umpteen no. of examples in support of both arguments.
we all know the very basic problems that are hindering the growth of the country, but for argument sake, we can conveniently project in a good way (India Shining, IT boom, rising stock market etc) or be pessimistic about growth (bad infrastructure, poverty, outsourcing, BPO,KPO companies etc)
Firstly, sowmya, you have articulated your point extremely well.great job!
But i think you have misunderstood sanjay’s argument.
Entrepreneur thinking big has nothing to do with the guy going gaga to a VC about the billions he will make.Thats an obvious blunder.What thinking big actually means is that given there is a market opportunity, how much money are you willing to throw into your company to go after it? In that context, if you think small, you can forget about the opportunity.
To quote a comment from sanjay’s post:
“success in most businesses comes not as a result of meticulous planning but its response to opportunities.”
If you take that to be true..your RESPONSE to opportunities depend on how BIG you can think.And life always throws opportunities at you all the time.You think big and execute it, you might very well end up as an infosys
So, sanjay has a point – thinking big has a crucial bearing on where you will take your company. It cannot be shown on the finiancial charts and projections. its in the way you see things and go at it
At the risk of oversimplifying things, If I distill out Sanjay’s post, he’s essentially saying two things
1. That companies ought to think big, ought to go after and dominate big markets.
2. That Indian entrepreneurs aren’t thinking big, by imposing constraints on themselves, not having enough imagination, ambition or will power.
The first point is right on the money. No arguments on that one.
My post is essentially arguing the second hypothesis.
@Ravi: Excellent comment. Thinking big is about how much investment are you willing to make as a company, and you really cannot put your Big vision onto a financial statement – or any kind of statement, actually. Its in the way people approach their tasks, the way they talk about their work that gives you a strong “feeling” that this company is going to hit it big.
Add Tachyon to the list. Their transliteration product, Quillpad, beats Google’s product hands down. They seem to be a 5 to 6 people company.
Going back to the topic of discussion, IMHO nobody can predict whether an idea/product will be a huge money spinner. One can only bet on it and throw some money at it. With some luck, sometimes people hit the jackpot. But we all know that risk capital is almost absent in India.
Every entrepreneur believes that he is chasing a huge market opportunity. Show me a market report which says that my product wont sell and i’ll show you few more which says it will. Predicting the market again is based more or less on the gut feelings. Most of the time its just the case of a disagreement.
What I firmly believe is within this current crop of entrepreneurs, someone will make it big. Once the industry goes through that big exit cycle and people become multi-millionaires overnight, just because of someone followed his/her instincts, and somebody else backed them, we’ll start seeing risk capital in India. Till that time we are pretty much on our own!
But the good news is there has been no huge success story from India yet. So if you are “thinking small”, then you might be just thinking the right thing!
@Rajiv
” But we all know that risk capital is almost absent in India” is 100% Agree to that point and its true.
Indian ppl scare to come out of Comfort Zone, Because in indian Failure is not Respected but Same is Respected in Silicon Valley because they believe:”Failure is simply change in direction to set you straight for the next success” the same happen for Apple Inc.
Indian PPL faces lot of diffulties but they adjust to those difficulties instead of innovating the things to make those difficulties easier and make viable business. If ppl try to adjust to those difficulties the how BIG thinking Entrepreneurs will born in india. We need Unreasonablemen because Reasonable men adjust themselves to their environment. Unreasonablemen[Steve Wozniak] attempt to change their environment[Built PC] to suit[for his need] themselves. Therefore all progress[Apple, Google, Youtube, iFood.Tv] is the work of unreasonable men. This quote is by George Bernard Shaw.
Am glad that my article has generated some responses!
Sowmya, I think you have mis-understood the point regarding “thinking big”. It certainly does not mean making empty grandiose financial claims to VCs. It means having the mind-set that wants to dominate a market space. Without belabouring the point, let me simply quote from Steve Ballmer’s June 6th 2002 communication to all Microsoft employees:
QUOTE – Twenty-five years ago, we had a vision of “a PC on every desktop and in every home.” Back then, people thought we had stars in our eyes, but we persisted and no one is laughing today. UNQUOTE
Every great company has this mindset. Google wants to manage ALL the information in the world. Remember claims have to be backed by talent and execution. Else, it remains just an empty claim.
Thanks also for pointing out the terribly drafted last line of my article. It should have properly read “If you reach for the stars you will at least reach the tree-tops. If you aim for the tree-tops, you might not get off the ground.” Juxtapose this with Steve Ballmer’s statement & hopefully you will appreciate the point being made.
Good luck & thanks for reading!
am new to blogging and reading my feeds on a rss reader (bottom to top)
this is a disclaimer before i say
“dear author , you stole my thunder
”
http://www.pluggd.in/2007/10/are-indian-startups-entrepreneurs-thinking-big-enough#comment-15560
Sanjay,
Thank you for clarifying your take on thinking big. I agree that entrepreneurs need to dominate markets (ref my earlier comment). My post is really in reaction to the the points you made around the entrepreneurs imposing constraints on themselves, not having enough imagination, ambition or will power.
We’d love to hear more advice from you on developing the mindset and execution capabilities that you think are lacking in today’s Indian entrepreneur.
Sowmya, imposing constraints is all in the mind.The mind is the one that generates imagination, will-power and ambition. In other words, in a resource starved world, you have to make do with the limited resources you have. But the imagination should not be starved and limited by constraints. Constraint based thinking starts (& stops!) with what you have & plans based only on the resources at hand. It assumes no thing else is possible. On the other hand, constraint-free thinking first sets the goal and then figures out how to achieve it by marshalling the resources required to achieve the goal.
Let me give an example:
In 1930 Jan 26th, the proclamation of Independence / Purna Swaraj from British Rule was made by the Indian National Congress which was the 1st by any political party in India. Did any political party or nationalist know how this was to be achieved? Did they know what it would take? Did they know the outcome? No. But having set the “audacious” objective, they marshalled all resources – political, nationalist, economic etc. They had to mobilise vast numbers of people (i.e. team & shared vision), plan different activities and actions (i.e. the business model), and raise resources along the way (i.e. capital). It took 17 years thereafter but achieve they did.
Remember, a journey of a 100 miles begins with a single step. If people didn’t free their imaginations, nothing would’ve ever been invented because it would’ve been assumed to be impossible & resource hungry.
We can discuss this more off-line if you are interested!
Cheers
very true.. Indian people (entrepreneurs and investors) are thinking big. What one requires is the burning desire of doing something new and different. This desire is the driving force of everyhting. No wonder, there are so many venturs that are coming up or are they are funded by many angel investors or venturs capitalists. Many
ventures such as PITCHINDIA (www.pitchindia.com) also came up.
Entrepreneurship at its peak nowadays..