The Startup Guy

Its been a while since I’ve written here. I am not going to apologize for it. The reason being simple. I once by accident went back a year and on what I “was” thinking, and i realized how fast the space of startups, innovation and clarity was emerging. I am not even seeing the evolution of concepts, ideas, and reality happening. In some cases, it feels like the sky is falling, and out of nowhere things are happening. And thats scary. Its been sometime to pull out of the race, and to look at things to gain perspective. And I only think I understand things a wee bit better. I am sure I’d have to go back to that space once again, and repeatedly from time to time to keep this perspective afresh. Its important.

I once used to have the question in my head as to why cant we create a product and brand like the Mercedez in India. And then we got the Nano. Not at all the same thing, is it?

I cant stop by sit back and think what would be the scenario if we had indeed launched a car that ranks shoulder to shoulder, or even beats the quality of a Mercedez. Why Benz, lets make it beat a Bugatti Veyron, if our fancies need to fly a little. I am not so sure we would have succeeded. Am sure the first question and comparison that would come out, is the price. And India has been so successfully been marketed as a low-cost Utopia that even if we make a Mercedez, we would have to make it cheaper than the Benz.

Now is that technically feasible? Yes it is. And that is our End game in a lot of ways. But where do we start? We start at low-cost.

A lot of people get very upset and turned-off at the notion that we were, and in a lot of ways still the low-cost destination. And so should I – if that is the end game. But it isnt. Let me give you examples.

HCL once used to be nothing more than a pure outsourcing arm for Cisco in the telecom division. Today they have moved up the value chain to establish a joint-venture with Cisco (Setting up HCL-Cisco) that they co-own, and in some cases license patents and IP to Cisco. And trust me, that doesnt happen overnight or by chance. It takes leadership, strategy and direction to make that happen. Which is why I am hoping that entrepreneurs, especially startup entrepreneurs will get to hear this, cause you have to start thinking that way to get there.

So look at the Nano. Tata owns Jaguar, and Tata owns the Nano. Amazing, I must say, and it all makes sense. In order to make the Mercedez, you first have to make the Nano.

Why? Because building a brand takes time, and enroute to that, you have a brand to break – the brand that India is low-cost. And how do you do that? Thats what “Disruptive” technology stands for – by definition. Anything that can Disrupt people’s normal, everyday thoughts in terms of a breakthrough in technology, thats capable of breaking business models as well – thats also more or less the reason why technology entrepreneurship is so glamorous. Because it can bring down prices, do sexy things, grab attention and make people take notice.

So seriously, whats the link from a Nano to a Benz? The Nano is important, because its a crucial step to get to the Benz, and the crucial step and mindset breaks when you get people to say the first Wow. And the Tata Motors Company, has successfully managed to do that. Get the world to say a Wow. And that is the first leap for any of our companies, be it whatever domain to do. The wow could be quality measures, cost, design, Interaction mechanism, or the simple science behind it. But it has to begin with the Wow. Get that in, into your product somehow.

The second bit is the value engineering. How do you mass manufacture something, and still manage price points and quality. If you think this is a mechanical engineer’s curse, think again. Most web companies will bleed and die because of their “cloud” bills. That silly recursive function that takes that extra compute cycle, will come to bite you in the wrong place, if you dont fix it. This is where specialists kick in. This is where experience comes in, and this is where price point remains still. This is definitely India’s second move. And I’m already starting to see plenty of companies do this.

The Third move will be in Feature Engineering. Whatever you did in the first bit, you want to do the reverse of that, with the supervision of the second phase engineers. You want to put stuff in, but not the old stuff, make a leap and bring in the next generation of things that make it easier on the user, the manufacturer and everyone who comes near a ten foot radius of it. And this is where the next generation of Benz, Jaguar, and Bugatti’s are born.

The interesting point will be that, without step one, we would never have step three, because the evolution of talent, processes, and engineering will simply not be there. And If we try to jump directly to step three, what we will end up will be a fake imitation of a luxury product, twice priced, and having to fight the mindset of it being in the wrong place (it should be low-cost instead).

I remember standing on the stage at Proto.in in 2007 asking where are our companies that can make a Merc and Ipods. The Answer – They are coming, and the first generations of them are just born. To be in India, to be in the products space, and to thrive in it, it helps to keep this in mind. It took me a while to get this, but thats also cause I see this trend happening around me – Playing out in real life.

I can imagine the look that you have on your faces reading this. Where is our market then? Isnt the US the most wealthiest market to go tap into? Am sure you have that look on your face, judging me for that. You might want to sit down for this. I think there is a strong misconception. While the western “developed” markets might be the richest, the emerging markets are the biggest – they make for 5/6th the world, and make up in large numbers. It’s almost the long-tail in the truest sense of the word and according to the definition of Pareto distribution (Economic divide on the 20-80 rule). And listen, if it works in India, it will work in most of the emerging markets. And fortunately for us, the high cost of innovation, the inability to grasp emerging markets and the masses, all play against the research labs of the far west.

If anyone can make it happen, and playing with the advantages that we have in terms of the ability to communicate better with the rest of the world, the collaborations we have with abroad, the support that we can garner from the govt (alright alright, we can improve on this bit) and most importantly, our inherent need to innovate, we are probably the best suited for it. And if we are bold enough to take that first step, our journey has finally begun – well hurry up, cause there are already folks getting a headstart on that – Mark my words, the Nano will lead the way to the next generation of Jaguars!