[Editorial notes: A lot of startup pundits tend to tell Indian entrepreneurs that Indian ventures cannot go global, as we do not understand the business/behavior of other economies. Logically, that’s true. But entrepreneurship has to defy such logic and the below guest post by Prashant Singh pretty much nails it. Read on.]
A little more than half a decade ago was a sales person in a IT service firm . It was pre iPhone world (ancient history for some ); I was a poor guy fresh out of college and it was my first time in a big city. During the course of my work one day, I found myself in a textile firm in Gurgaon. I was trying to sell them my stuff but I keep getting distracted by all the Branded cloths over there. There was Adidas , Nike ,GAP, Lee, Wrangler, Pepe,Levi,Mango, Tommy Hilfigher ,you name it . It was kinda shocking to me that these garments were made in india. I shared my surprise with purchase manager.
“They are not made here – they are manufactured. there is a difference”, he responded.
” And what is that ?” I asked.
” Well there are elements of Branding, Design , Quality standard and anticipating need we don’t understand ” .
“So you don’t have Designers here ? ” I asked
“We have some .. but they mostly work directly with US guys and mostly oversee that design standard are met. they don’t get to design their own thing” He replied.
“any plans to do that .. ”
“No one in India pays for that . We are a nation of wholesale market”
“That’s sad ..”
“No. That’s just how its done. I was in south before this and many of the component of Big branded cars are made by my previous employer . we can’t sell that in India because no one will pay for it “
Fast forward to the present day. Two Indian automobile manufacturers have acquired two global heavy weights. After years (may be decade) of being a supplier, a leading manufacturer of denim is making some serious stride in branding its stuff. My friends in BIG textile firm in Gurgaon told me that they receive a significant number of applications for internships from US based folks. Expat management trainee are a familiar sight at all the Big Call centers.
Few months back I got to know few folks from MIT Solan who were doing internship here to understand mobile advertisement and they told me that understanding of India and China is most sought after thing by companies back home.
In between whole mobile revolution happened thanks to iPhone, Android and other platforms, apps became hot and not surprisingly a lot of these Apps were “manufactured” in India . The same story repeated again. India is not the market and you can’t serve the global market from India and stuff. The industry wisdom is
“Apps are conceptualized in US, designed in Europe ,developed in India and Consumed all over the world ”
Now that sound a lot like the East India Company to me! While pundits were busy theorizing, some enterprising folks figured out that they can reverse the trend so now I see some Nordic /European designers sign up for jobs in India . Dextera and Sourcebits , two of my fav app companies are having designers from outside of India . Mig33 started focusing on India big time because that’s where the action was , followed by Nimbuzz shifting its HQ to India.
InMobi, one of the biggest independent mobile ad network in world is an Indian company that made a couple of smart acquisitions in international market. Zoho command a respect of global users , Visual website optimizer , a bootstrapped venture in Delhi is a category leader with industry heavy weight as paying customers, GrexIT is solving a global problem and having paying customer for their service . Back home, Flipkart is going great guns. a veteran of Twitter has joined them in their mission (this is a BIG deal IMHO) . so In short I see that needle is moving ..and its only a matter of time before pendulum will swing .
In between Instagram got acquired and pundits got busy rationalizing why Facebook bought them and why or why not it can be replicated here . I saw many such commentaries . Latest was the one by Mukund. It got me thinking and i decided to write a response . Ashish was kind enough to provide me the platform to publish it . So here it goes
So What’s my point ?
To put it simply, I believe that it’s possible to make global companies from India. Its not easy and might not be the most optimal way of doing it but It can be done . In all the commentaries I read, no one talks about the challenges involved. Everyone gives gyaan and in most cases the reason offered are far from reality .
Lets examine them one by one
Having Technical Chops : Read above . No one doubt Indians to have capability to engineer a great product. In fact we are doing it already . As you read this some great product is being developed in outsource dev center in Pune or Bangalore . Look at the history of Google , Facebook , Foursquare you will find more than one Indian playing a critical role there.
Understanding of User Need: This is often cited reason and with a tone of righteousness which border delusion.
The truth is that this statement is funny . One should know the pulse of its user demographics but is hanging out in the streets of Palo alto is only way of doing it ? I don’t think so . As far as identifying the need is concerned, the internet is a great level playing field for smart people . One can test market the product from anywhere in world . There is enough evidence of people doing that and making it big in US/Global stage
- Chatroulette was done from Russia.
- Skype was from Luxemberg .
- Slideshare ,GrexIT, Zoho, Scrabble on FB,Wingify,interview street, iRead(FB app) are from India.
- Spotify,Shazam,Rovio is a european thing
Funny part is that when you look at the fundamentally new use case of Internet the US market itself is not a source of all innovations .At least not always . a littlementioned ( watch the clip at 6:30) but well known fact is that traditionally Japan is proxy market for product in US . From Walkman to Farmville this has happened . Now if the use case has to emerge from Japan why can’t we pull this off ? Why we have to be in US ? I am at my wits end on this. The example I mentioned above are of the Indian products which made it big but there are enough example of indian products which might be less than successful but their failure was not of lack of identifying the need.
- KOMRAD : Open Mobile Reference Architecture was done by Rajiv in Bangalore, Long before Android.
- Lifeblob introduced concept of social time line long before Facebook . they had good traction too.
- Core value proposition of 160by2 Free Texting app was very similar to WhatsApp .
- Voiee was voicemail on steroid long before Pinger.
- mscriber,buzzworks and few other were contemporary to Tell Me Networks.
In short, one can make a strong case that there is no statistical proof that being in India make you incapable of understanding what global audience want . World is flat and smart people everywhere can see the next turn in road.
This one is tricky . Popular belief is that even if you can identify the niche , develop a product , it will be hard for you to get any traction in media & users. Getting organic traction and word of mouth is impossible for Indian products . My experience is that if you have substantially differentiated product and reach out to Media proactively and do it in a persistent way, eventually media will take notice . Again its tough but not an insurmountable problem.
A real problem which rarely got discussed is what to do when you get traction – How to sustain it? One might get an initial spike in usage for a variety of reason but sustaining it is a skill which require very thoughtful execution. Since there is very little precedence of global in India, it’s unlikely to get proper mentoring and guidance for the same. A case in point is Game Your Video App by Global Delight. It can be roughly explained as Instagram for video (it’s highly popular).
Its an case study in organic traction based on pure word of mouth. They have won various award and been featured in App Store multiple times and have hundreds of thousands of paying customers. No small accomplishment in hyper competitive world of iOS apps . They are executing beautifully so far and I am confident that they will be able to figure out ways to sustain the momentum on their own. This will set the precedent. They are not alone – Noida based Spice Labs got 52 Million plus downloads of their apps [ Disclaimer : I was associated with SpiceLabs ]. Sourcebit made it big with NightStand app. callgraph is another such service getting good traction . I can quote some more example but you get the point I guess. Fundamental problem of traction is not difficulty of initiating but of hardship of sustaining it . That’s why it’s critical for startups to do an orbital shift to US at right time to sustain the momentum but one can initiate it here .
On a related note a painful side effect of lack of precedents and expert handholding in managing the initial traction is that in most cases cash-strapped startup diversify in services they showcase their app to establish their capability and get outsource development assignments. There is always a set of people who tell them this is the “wise” thing to do. The right course for “Indian ” venture .
Avoid such folks.