India can design the Global issues database.

So every voice is heard and addressed.

I have a design already, when the world is interested. It is designed to support all 6.5 Billion people, and group related issues together.

I guess I should have said they could implement it. I actually have a protype. The genius is in the method it is somewhat autonoumous, unlimited, and extensible.

They could start with their country as the pilot project.

Reality Check.

In India more and more of VC funding is going into IT related products and services because that is where the maximum return on investment is.
This is causing a great imbalance in the economy where other general industries and services are not getting so much traction.The cost of living in places like Bangalore have sky-rocketted which is causing more and more people who aren't making that much money as those in IT industries to move out of big cities.

Increasing more and more students are choosing IT related careers because of the lure of money,lifestyle,desire to go abroad etc. In places like Bangalore,the basic services and infrastructures are lacking like roads,electricity etc.

Even thought there are more students graduating from India than any other place, the quality of education still remains to be decided.The educational institutions are more and more interested in churning out engineers and doctors in large numbers than focussing on the quality.
It is no wonder that some of the best institutions in India like IISc and IITs dont figure in the top 300 universities in the world.

I recently visited Bangalore and I could see the glaring constrast.There are these new malls and places of entertainment all over the city and at the same time the traffic,the roads and the living conditions have grown exponentially bad.Some of my frieds who still work in general non IT industries aren't making that much money and they are contemplating moving out of the city because it has become increasing difficult for them to affort to live in the city.

The fact is that the world sees India as a cheap labor market and more and more of the investments and funding will flow into IT with less and less focus on living conditions and infrastructure.

Prabhakar

Hi Mallika- yeah, i think india is a huge untapped resource that people are just now beginning to utilize. I think it's great your husband is strengthening international ties- it will help both countries. Good for you for supporting him =). Happy Holidays everyone!

I am going to read the interview in the weekend. Just a offtopic note. There is some typo in the article :-)

"With Sumant Mandal, managing director at Clearstone Venture Partners, a venture capital firm with more than $650 committed capital."

Hi Mallika,

Your husband really knows his stuff -- his answers are quite comprehensive and knowledgeable. Someone to boast of, for sure!

Cheers, Heather

interesting-"early stage' investing, giving legs to ideas, to me, qualifies as an area in need of critical synergetic support.

Sumant is dot on about the dearth of angel and early-stage money in India, a situation that should improve as more success stories are created and as younger breed of entrepreneurs emerge from the country. From an entrepreneur’s perspective, there are several reasons for the lack of seed and early-stage funding in India: 1) Lack of truly innovative companies, 2) Exit timeframe of VC community, 3) Absence of equity based compensation culture, 4) Short history in the area of angel and VC investment, 5) Corporate governance issues. I will discuss each issue briefly.

The global giants of Indian IT industry, such as Infosys and Wipro, have not built a business model that is innovative in a pure sense. They have not created a brand built upon innovation, creativity or breakthrough technology. These companies have capitalized on the cost arbitrage at a global level and have reaped financial rewards but they are not Yahoo! and Google. Most of the Indian IT firms earn their bread and butter by working for multinationals and only recently they are trying to move up the value chain and there is nothing wrong with that. However, VCs and angels are on the look out for next Google and Yahoo to claim a home run in 3 -5 years.

It’s well known fact that VCs want to earn 50% ROI and need to see clear exit in 3 – 5 years, either through acquisition or IPO. In India and China, there are opportunities to invest in later stage companies right before IPO or buy-out and earn 30-50% ROI. Everyone knows how much money Warburg Pincus made in Bharti Telecom deal, thus the hunt is on to find similar deals. The bottom line is if you can invest in later-stage companies and earn 30 -50%, why bother looking at high risk start-ups with longer exit windows? Thus, you will see a lot of private equity firms entering India with ever larger fund sizes, but early stage VCs are still testing the water, so to say.

Pramod Haque from National Venture Capital Association recently gave Forbes magazine a first-hand account of his trip to India where he was looking for promising start-ups. One of the biggest challenges, he found, was motivating next rung of employees with equity based compensation. With the red hot job market, where you can double your salary every other year, its hard to get excited about the promise of making millions in 5 – 7 year, a realistic timeframe for start-ups. If you can’t attract top notch talent to work like a maniac on mostly sweat equity, you can’t build a business without a large upfront capital investment. Google still pays below market salary to most of its employees. This is one issue that will haunt Indian start-ups for a long time to come. If a start-up is forced to match market rate for talent, they are in deep trouble, especially if their main focus is domestic market.

India simply never had angel investors or a thriving VC community. Only people who invested in new business (read ‘person’) were family members who loaned you money, so you had to belong to business community to enter business. The concept of equity investment at start-up stage didn’t really exist ten years back. Without angel investment, it’s hard to get VCs interested, kind of catch 22! When I was raising angel money for WahIndia, I only had to look in my local Michigan community and there was support available. I found an angel who is truly excited about our vision and has stood by us in all situations, by providing additional funds and by introducing us to business opportunities. During my MBA studies at Michigan, I focused on private equity and knew that going too early to VC is not good for a start-up. I am building the business the hard way, by bootstrapping, maxing out credit cards and living on my wife’s income (she is my biggest motivator)! I wanted to build the key pieces of business and prove the model before I go to institutional investors for simple fear of losing too much on the equity side. The story only gets better for WahIndia as I was able to attract top notch talents for minimal cash compensation. This summer, we had a Harvard MBA/JD candidate help us with our business strategy in full-time capacity. My Michigan MBA classmate who is working for Big 3 is putting in a lot of hours helping me put together the business plan. My other team members and program hosts have not seen a salary comparable to market rates and don’t expect to see that in next 3 -5 years. But, our shared dream, passion for Indian media and entertainment and an unbelievably audacious goal is the driving force of our team and equity compensation helps. Even my 20 year old web programmer gets the equity concept. I don’t think this is the culture in India. My other classmate, who now lives in Mumbai and is building a BPO business in medical billing area had to raise angel money in the US and finds it hard to get any Indian investor look at his model since he is looking for less than $5 million. The reality is that US is still the best place to raise money for start-ups and early stage companies.

Finally, the issue of corporate governance! If you look at the board rooms of large publicly listed companies across India, you will find mostly family members, relatives, and close confidants occupying director seats. In many cases, the voting majority still lies within the family. Any significant investor would need to see transparency and a voice in the future direction of company, which becomes difficult if family controls the voting stock as well as board of directors. If such is the case with public companies, the smaller companies are lot more difficult to evaluate, thus making VC’s job harder. An entrepreneur needs to be willing to yield control for the greater good of company. Terry Semel has added many billions to the fortunes of Yahoo founders and I am sure investors had a lot to do with bringing outside help when founders could not step up to the next level of challenge. Ah, the pains of growth!

These are my random thoughts. Recently discovered Intentblog after Rohit Batra and Kavita Chhibber mentioned about it. This was one issue I felt like adding my inputs.

Happy Holidays,

Sunil Thakur
Founder & Chief Collaborator
WahIndia, Inc.
www.WahIndia.com

An angel of innocence is a breath of love that shall carry many into the future of peace.

Clearstone's portfolio revolves heavily around IT domain, no wonder being Silicon valley centric, it makes sense.

India presents a whole new persepctive. If Return on Investment(ROI) is the goal of VCs, there are many stories/compaies in India giving an ROI of more than 50% annuallized.

It's time Sumant et al. looked at the non-IT space rather than be disappointed at Indian IT space as most of the software companies in India are service oriented, not product oriented.

Ever wondered why all the best brains at IITs/IIMs work for CEOs who are school drop outs(DELL/Gates/ Ellison)?

Answer: Because Indians have the brains but not the go-getter attitude to solely execute their plans.

These days at Airports, we see 2 types of Coolies:
1) One, unskilled & semi-skilled going to Gulf
2) Two, Cyber Coolies going to US, Europe.

Both with the same goal in mind - better lifestyle, earn more money

thanks for the comments. i really look forward to seeing the ecosystem of starting enterprises thriving in India - IT or non IT.

In India you get get millionaire within 6 months.
All what you need is
1) A PC and know how to write and send e-mails
2) speak a little english language
3) You have to have a goal in front of your eyes. This goal can be crazy, far, far away, unpossible, stupid, but if you believe in this goal and you know you can do it, you will do it. Without this selfconfident you will never do it.
4) Aso yourself: How hard you will work? If you don't want work hard, stay in the sofa and watch TV.
5) Check yourself: What kind of typ are you. You don't care to work also in the night. You don't feel hungryness and thirsty and forget to go to toilet, only becuase you fight for your goal and everything else is unimportant. If you are like this, you can do it. If not, don't worry, I know many people who are like this and also happy. Congratulation, you had the better life.
6) Ask yourself: What price you are willing to pay? To have success menas to work hard, miss many things, and this in very early age. When other go palying football, you wish to cry, becuase you are alone and have no power any more. Are you ready? You know; Everyone want have success, but only very few people are willing to fight and accept the negative things. Success is like a chocolade: Outside sweet, but inside hard work.
6) Don't talk to much about your dreams. That are the loser and stupids in our society, who talk, talk without rest and what they one day want and if you ask them what they do for it, they only start to say...ahh.aaa..aha...ahhh.....Words brings nothing, only acting counts. No talking, do it.
7) Before every success 10.000 times failure, no-success will come, No-success is the rule, on the way to success you will fall thousand times, important is, that you 1001 stand up again
8) Success is like a Hollywood diva and change her mind every day, there is for many people only on-day-fly-success but rela success is lifetime success.
9) Don't let people distroy your ballon of dreams, if they throw you out of the restaurant, use the door behind next day
10) New ideas have all a hard life, becuase to this people you tell your ideas will always think
a) Why I didn't have this idea by myself. You will make him feef frustrated and he will put you stones in your future way
b) What he want from me? People with great ideas are a big danger for people withoutgreat ideas in their empty world. He will not accept you, becuase he don't want relaise that he is a "nobody" against you.
11) Learn from every mistake: Ask yourself: what can I do more better? Don't search your fault in others. Never give up, try again next day.
12) Don' t let other people say that it will not work, and you should forget it. Think about this: Other don't like if you are faster and better then them and win the race. Also your good friends want that you are on the same level like them: And there are also friends, who want you are on level down.
13) Start your knowledge very early. If you want all this, start now, not tomorrow. Don't try to be in all the best, only in one thing, like Tiger Woods in Golf, Steven Spielberg in movie, David Coperfiled in miricle and Deepak Chopra in writing great spiritual books.
14) Work fair and treat people and businesspartern always right. This is the only way.
15) It's lonely on the top. When you will be in the top of success you will feel what real joulosy is. And than you will find on " occupied-sign ": Here is sittig Rafael Kujundzic

Www.immobilineclub.de.vu E-Mail: rafaelkujundzic@eplus-hiptop.de

Mallika,

So true, I have two letters for near future display of some indigenous talent..."AI". ;)