With the rest of the world beating a path to India to cash in on the rapid economic growth here and tap the low-cost services model, countless business opportunities have opened up in the country for the young blood in the country. MNCs grab these young minds even before they graduate showing them dreams of big money and fancy designations. But there is a select group of students who are not fancying the big recruiter names on campus. With more and more talented young people opting out of the placement system to start their own ventures, the trend of taking this less traveled road is growing stronger by the day in the country.
There are many factors driving these young entrepreneurs: a larger appetite for risk, the thrill of controlling their own destiny and the promise of a successful future that comes through mentoring incubation, advising and financing from entrepreneurship-oriented bodies as well as venture capitalists and of course the opportunity to make pot loads of money.
Indians are by nature very entrepreneurial. The number of small fragmented businesses is an indication of this. Until recently there was a dearth of capital and an absence of an entrepreneurial ecosystem which influenced the mindset of the entrepreneur. Therefore the Indian entrepreneur has generally been more profit centric than growth centric. The arrival of global as well as home grown venture and PE funds, the returning of the global Indians to their homeland, the beginnings of successful VC/PE exits in India, and the emergence of entrepreneurship mentoring organizations have begun to change this mindset.
Organizations like the TiE network (The Indus Entrepreneurs) or Wadhwani Foundation are promoting entrepreneurship in India by organizing workshops and seminars nationally. Entrepreneurship education-related projects like the National Entrepreneurship Network (NEN) bring together prestigious Indian higher education institutions and entrepreneurs providing young entrepreneurs a chance of mentoring from seasoned businessmen as well as VCs.
Though the entrepreneurial environment in India is buzzing with activity there are areas that need improvement and can take us to the next level in developing successful entrepreneurial ventures: There are not many people in their 30’s and 40’s taking a serious look at entrepreneurship since they are generally “well settled” and carry the notion that entrepreneurship is “excessively risky”, requires you to work at “30% of your salary” etc. It no doubt is riskier and generally requires you to take a pay cut but the risk-reward ratio is very favourable in India where the opportunity to create something big is abundant. Today the typical entrepreneur is in his mid twenties with a lot of passion and ability to take risk. The entry of more experienced people large network of contacts, teaming up with the passionate twenty year olds can lead to higher probability of success. Secondly, the VC industry in India is rather young, but many funds that started with an early stage focus have begun to migrate into the mid to late stage game. In India today there is a critical need for seed and early stage VCs who have patience to build great companies. Thirdly as mentioned above the entrepreneurial mindset needs to begin to value growth and the value the VCs and PEs can bring to the table. A lot of young companies shy away from venture investments because of a loss of equity, control or because it may cause them to move at a pace beyond their comfort zone. We are beginning to see a favourable trend in this regard and as the industry matures, I have no doubt that all this will fall into place.
On the whole in my first 6 months as a VC I have been delighted at the level of excitement around entrepreneurship today and by the number of people who are taking the plunge. I am sure this trend is only going to get stronger day by day
Harish Gandi, Executive Director
Israeli firm - PrimeSense which develops innovative technology that provides digital devices with three dimensional vision, enabling users to interact, in real time and at low cost, with consumer devices in a simple, intuitive way has secured $20.4 million in its second round of funding. The round was led by Canaan Partners amongst others. The device created by Prime Sense has a tiny optical sensor, which it uses to see the person using it (in the context of his/her surroundings) and also possesses a digital component which acts as its “brain”, which can learn from, as well as understand, the various actions of those using it.
Consim Info (earlier known as BharatMatrimony) has tied up with Metropolis Heath Services India Pvt. Ltd for encouraging the premarital check up for couples to avoid any post marriage health related disaster. Such premarital health check ups will help in preventing instances of contracting infectious or sexually transmitted diseases, and HIV AIDS.
iYogi is planning to take up the leadership role in green computing by planning to launch its iYogi Global Green initiative shortly. This initiative will help reduce carbon dioxide emissions by guiding computer users to optimize their power settings of a computer, using native functionalities built into the operating system. The utility is designed to engage personal computer users in a community drive to save energy and in turn cut down on their respective energy bills.
Deepak Kamra General Partner at Canaan Partners has been elected as a board member for a four year term at the National Venture Capital Association, USA. Deepak was also recently named as one of the top 100 technology deal-makers with ‘Midas-touch’ prepared by the renowned business magazine Forbes. At Canaan, Deepak is focused on investments in digital media. Deepak led Canaan’s early investment in DoubleClick, the Internet’s first and leading online advertising solution; Match.com, the most popular dating site worldwide; and BharatMatrimony, the world’s number-one online matrimony site.
Web Innovation 2008, conference and expo was held in Mumbai on May 8, 2008. The conference addressed Web 2.0 workplace technologies and their business implications and focused on the next generation of web technologies, methodologies, vendors, and culture. Discussions during the conference also delved into social networking, blogs, wikis and open APIs and their place in the enterprise, popular technologies and those shaping the future direction of the web. Alok Mittal, MD Canaan Partners participated at the event as a speaker. In his note, Alok elaborated on ‘Early stage financing in context of technology based businesses’.
4th BarCamp Delhi (BCD4) was held on May 17, 2008 at the Amity Innovation Incubator in Noida. Close to 220 campers turned up for the day-long event. Through the 25 sessions at the event, discussions ranged from the IT scenario in India to best practices for start-ups, blogging and social networking sessions such as Open Socials and Facebook APIs (application programming interface, on which Web applications are built). Mukul Singhal from Canaan Partners also participated at the BCD4.
Canaan Partners invests in entrepreneurs and works alongside them to turn visionary ideas into valuable companies. Since 1987, the firm has catalyzed the growth of disruptive technology startups and healthcare companies revolutionizing the practice of medicine. With $3.4 billion under management and more than 95 acquisitions and 55 IPOs to date, Canaan has funded companies such as Acme Packet, Associated Content (acquired by Yahoo), CommerceOne, DoubleClick (acquired by Google), ID Analytics (acquired by LifeLock), Match.com (acquired by IAC), SandForce (acquired by LSI), SuccessFactors (acquired by SAP) and Virsto Software (acquired by VMware), as well as notable healthcare companies such as Advanced BioHealing (acquired by Shire), BiPar Sciences (acquired by Sanofi), Chimerix (NASDAQ: CMRX) and Elevation Pharmaceuticals (acquired by Sunovion). Current technology investments include Blurb, Kabam, Lending Club, Performance Marketing Brands, SOASTA, Tremor Video (TRMR), and Zoosk in the U.S.; BharatMatrimony, Loylty Rewardz and UnitedLex in India; and PrimeSense and LiveU in Israel. The Canaan healthcare portfolio includes emerging leaders such as Liquidia Technologies, Civitas Therapeutics and DICOM Grid. Canaan maintains a presence in the global innovation hubs of Silicon Valley, New York City, India and Israel. For more information visit www.canaan.com or www.facebook.com/canaanpartners. Follow us on Twitter @canaanpartners.
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