It seems like now is the best time to be an entrepreneur in India. It would seem only credible since India appears to be shining for wanna-be entrepreneurs. Capital is available by the double scoop. Yet the refrain from VCs seems to be that there aren’t enough experienced (translation: someone at least in the mid-30s if not more) entrepreneurs. Some commentators opine that VCs should actually encourage and coax experienced corporate executives into becoming entrepreneurs while providing them the supporting environment.
My own view is different. Let me explain.
Indians are extremely conscious not just of power but recognize that it needs to be demonstrated, as Pavan Varma in “Being Indian” so eloquently describes. Power for an Indian flows from caste, class, wealth, favour dispensing, social standing, and as some dual members of the political-mafia club demonstrate from time to time, also from the barrel of a gun. Thus the feudal behaviour that one witnesses all around. From the “sarkari” officials to bureaucrats to politicians. Witness how reverential and deferential the smartly dressed TV interviewer is when talking to someone “higher-up” in the social-wealth-class-power equation. Witness the behaviour of the smartly dressed corporate executive when the security guard refuses him entry into a building on account of not carrying a suitable ID. Witness the grand thrones on which political luminaries are made to sit on during some boring convention or another (while the rest of us have to make do on the plastic chairs!) with colossal garlands around their necks. Witness the mega-cutouts announcing the arrival of politicians and religious leaders into your city. In fact, there are thousands of incidents taking place all around us that such serve to highlight this display of feudal power equations.
Can entrepreneurship really flourish in such a pervasively feudal power environment? One of the key traits of entrepreneurs is confidence. Confidence in their abilities and knowledge, in their business idea and in their convictions. They are not beholden to traditional notions of power based feudal structures. They make their own rules. They are not prisoners of the trappings of corporate success. They are unwilling to be defined by the brand, logo and title displayed on their business cards. They want to carve out their own identity. An entrepreneur is one who undertakes the organization and management of an enterprise involving independence and risk as well as the opportunity for profit. A lot of our entrepreneurs are really businessmen who, notwithstanding their being awarded “Entrepreneur of the Year” awards, in fact passively manage large inherited empires
The experienced executive in today’s corporate India was born sometime in the early late 50s to the late sixties, perhaps even the very early 70s. This was the India that literally flourished on controls, opportunism, patronage, cronyism and corruption. Companies and executives were under no pressure to change or to reinvent themselves. Then in 1991 things changed. The second independence began, this time of the mind and spirit. It was therefore not surprising that the 1st real wave of entrepreneurship took place in the late 90s in India, albeit not very successfully, driven by young, middle class, and educated Indians inspired by the successes like Indiaworld, Infosys and of course from Silicon Valley. The lack of maturity of business models, of investors, of the eco-system all contributed to the less than average run. The second wave has begun now but with a set of differences: there’s a lot more capital available now, India has emerged as a market, there’s a lot more confidence now. Crucially, there are more entrepreneurs now with a lot more experience – 16 years of it - of working and interacting with the world on equal terms. Technology savvy, confident, knowledgeable, well exposed, well traveled, networked, unafraid to make mistakes, are some of the descriptive phrases that are applicable to these entrepreneurs. It is these entrepreneurs that will be the harbingers of true entrepreneurship in India. These entrepreneurs are also the ones that are not awestruck by hierarchical social structures.
In this scenario, VCs will be better off backing these entrepreneurs than coaxing comfortably settled corporate honchos to pursue entrepreneurship. The ability to work with such entrepreneurs and help provide them with adequate supervision will be the true test of VCs. Otherwise, the money raised will be invested not in entrepreneurial efforts that produce the big hits but rather in safer businesses. Certainly not something one needs classic VC funds for.
What do you think?
Sanjay Anandaram is a passionate advocate of entrepreneurship in India; He brings close to two decades of experience as an entrepreneur, corporate executive, venture investor, faculty member, advisor and mentor. He’s involved with Nasscom, TiE, IIM-Bangalore, and INSEAD business school in driving entrepreneurship. He can be reached at firstname.lastname@example.org. The views expressed here are his own.