Bringing Entrepreneurship Home

That entrepreneurship in India has been on an overdrive over past few years is fairly evident -be it increasing number of capital providers and investment, increasing number of self-made millionaires or students skipping job placements to start their own companies. What has been more understated is the contribution that the Indian diaspora, especially return migrants, have made in the process.

Firstly, it helps to know the perspective that return migrants bring. They have experienced seeing something come out of nothing, they have seen empty spaces being populated with startups and they have seen why large companies do not always provide the best solutions in emerging markets. This group also brings a conviction, almost religious, that India is headed the same way.

At the same time they also bring in a set of skills that help them become a part of this growth.

There are friends in the venture industry who have helped build companies overseas before - they understand “how it is done” – and are now working closely with several ventures here. At the same time, at Canaan, we have also had the fortune of investing in some entrepreneurs who have returned with a desire to leverage the infinite opportunities in the fast-developing Indian market. With them, one does not have to start off explaining what venture capital is, or why owning 1% of Shell makes more sense than owning 100% of a gas station.

Like their Indian counterparts with few years of experience, these return migrants also bring in a strong work ethic and the ability to hire equally great people. The key edge with them is in their ability to replay concepts. In some spaces, such as mapping devices, the distinction between what exists today and what will exist in a few years time is very obvious when you have lived in two different geographies - in some sense, these return migrants almost encounter a plethora of visible opportunities.

I believe these are great resources that Indian entrepreneurship will benefit from. One word of caution though: India is not US, and it never will be! We need to identify our own blind spots and make sure that those get addressed with the right blend of a global vision and the local insights. The melting pots are getting more interesting!

Alok Mittal, Managing Director

Portfolio News

iYogi recently announced the launch of its exclusive server monitoring tool for SMBs to offer an integrated technology solution to surmount the users’ unique IT support requirements, enabling them to derive and share information/data, enable network performance analysis, and security trends that are critical to plan and manage their set of servers – 24x7. The company has now added to the service, the support for Microsoft Windows 2003 Server, enabling business owners to efficiently maintain their network without maintaining an IT department.

ActiveNetworks recently raised $80 million in its sixth round of funding co-led by Canaan Partners. This brings the firm’s total venture funding to $275 million. Active Network runs a number of Web communities related to sports and active lifestyles, including Active.com and CoolRunning.com and provides software tools that community organizations can use to manage administration such as online registrations, reservations, payments, donations and fundraising, and memberships.

Soasta a leading provider of cloud-based testing solutions, today successfully closed $6.4 million in a Series B funding with participation from Canaan Partners, a previous investor. The new funding will be used to support product enhancements, marketing, and business development efforts to address the growing demand for SOASTA’s web testing solution for Cloud Computing environments.

MODASolutions the parent company of cash-based online payment service eBillme, recently raised $12 million in new venture capital to drive business for an alternative online payment system. The round was led by Canaan Partners. ModaSolutions will use the new financing to reach more online retailers and customers for the eBillme product. It lets customers make online purchases without handing over sensitive credit card information. Maha Ibrahim, general partner at Canaan Partners will join the board of directors.