Given the economic climate, the first thing every country out there seems to be intend on doing is to plug their capital leakages, and in most cases seems to be shutting down outsourcing, closing borders to immigrants and workers, and the usual shabang. Close the doors, lock it tight and throw away the keys till we figure this thing out seems to be the attitude.

This is all just so wrong.

The US is such a fabulous country for one reason. Because the land gave opportunity for entrepreneurs to succeed. It was a fresh soil, they got rid of all the natives and with no prior baggage in terms of history, it was all open to those who arrived to build the nation. And building almost always came with perks – of becoming rich.

We need to do the same here in India.

Its election time in India, and not sure if anyone is reading blogs and listening to the voices that go on here, but if there is someone listening, they should seriously consider opening the boundaries of this country for any national from anywhere in the world to come here, and setup shop. We should even go as far as providing these startups with space and some financial support to get them on their feet.

We have very little to lose, and so much to gain if we do this. We would;

a) Have more entrepreneurs coming here, looking at everyday problems of ours and trying to fix them effectively, essentially building this country. And Making money.

b) Bringing a fresh and radical outside perspective which doesnt carry the cynical attitude that we carry towards change.

c) Will leapfrog India into an International zone, creating various modes of expression and lifestyle services, that will make us unique and original, rather than imitations of the west.

d) Entrepreneurship is the fastest way to create most jobs.

As I said, if anyone out there is listening, You make this part of your mandate, and You have my vote and support.

Mahesh Radhakrishnan, a friend of mine who is behind MOAD and is one really talented architect and I often meet to discuss about something we can do to solve these issues.

One latest such initiative is to setup something like this in Chennai. We are going to need some hands on this, but if and when it comes out, it will be quite something to boast about. What do you think?

This is an installation done in (Helsinski) Europe. We are planning to build the same at a fraction of the cost.

Youtube Link of the Wall in Action.

Imagine a situation where a technologist is trying to showcase the iPhone. He goes through every step of the features of the phone, the gestures, the various user interface nuances of the device and the audience barely reacts. A little frustrated, the technologist tilts the phone to the side, and the picture aligns itself sideways, and the audience goes wild – almost giving him a standing ovation. We’ve seen this demo before, and we know what all an iPhone can do.

Case in point: Technology alone doesn’t fascinate. How it is packaged, and how it resonates with the audience and customer means a lot more. India lacks in that space, most times.

Read the Entire Transcript at the Proto.in Blog here.

All that said, we understand that most of these benefits are enjoyed by those who live in the major cities, and in most cases in the cities down south. There hasnt been much activities going on in cities such as Hyderabad, Pune, Kolkatta, Ahmedabad or any where in Kerala to bring the community together and to share, ask questions, and receive support from one another.

In an attempt to bridge that, we are hosting an online meet this Saturday at 3pm at http://chat.proto.in. Most of you would know how to login, and the process is quite simple. Visit the URL, enter a nickname and you could join in.

If you would be participating, do post a comment, and feel free to ask any questions if you do have any. You are also more than welcome to invite your friends, should they be interested, and ask them to join.

All that said, we understand that most of these benefits are enjoyed by those who live in the major cities, and in most cases in the cities down south. There hasnt been much activities going on in cities such as Hyderabad, Pune, Kolkatta, Ahmedabad or any where in Kerala to bring the community together and to share, ask questions, and receive support from one another.

In an attempt to bridge that, we are hosting an online meet this Saturday at 3pm at http://chat.proto.in. Most of you would know how to login, and the process is quite simple. Visit the URL, enter a nickname and you could join in.

If you would be participating, do post a comment, and feel free to ask any questions if you do have any. You are also more than welcome to invite your friends, should they be interested, and ask them to join.

This is the first time I am watching a live cricket match in the Chennai stadium and I am no sports reporter. So I hope the readers of this blog will be lenient should this fall short of an actual coverage.

The game was to start at 4pm today, but the ticket said that folks would be expected there a good two hours beforehand. Knowing how our folks have no sense of time these days – or are just enjoying an extra hour or so lazing on a saturday – we decided to play the first mover advantage and head to the stadium early. We reached there at around 2:45. The sun was still out. It was fairly hot, but a couple of folks – Mirchi Suchi, Benny Dayal etc were trying to keep a few people occupied and entertained with their live music.

At around, 3:30, the teams started coming in, and were going about their routine of stretches and excercises, and ten minutes before the game, the coin was tossed and Kolkata won it, preferring to bat.

As I said, I had no interest in this. IPL felt like this lavish noble of Rome buying and selling away gladiators to prove a point. I didn’t even know who all were having whom under their arsenal, except for the news-making Dhoni whose price-tag made headlines. For one, I was pleasantly surprised that there were quite a few new faces on the turf, and the Chennai team looked quite decent with a mix of batters and bowlers. I mean, do you need anyone else for bowling when you have Murali on the team? Sheesh. Nope, Me thinks.

So, skipping through the ball-by-ball acount, the Knight riders scored 147 losing all wickets, and it was upto the Super Kings to chase them. They won the match with Dhoni removing his helmet and blasting the last ball flying to the boundary when all we needed was one run to Win. Our man sure has style when it comes to granting the death knell I must say.

There were a couple of pretty interesting moments in the game. For one, the energy level of the audience was amazing.The audience was extremely engaged with the game. I mean, they managed to go on a few tides of the mexican wave and were absolutely interacting with the players. The game was very well organized that whenever the “noise level” went down, there was always a drum beat by Sivamani or a rajini track which would jolt the spectators to a rupture of support.

Some of the golden moments in the game was when Ponting got out. He walked in, took the batting end and gave a clean catch on the first ball. Walked out even before asking anyone. Gotta love players with a fabulous spirit of sportsmanship. On the other hand, the so-called Run-out of Shukla was quite interesting.

I guess there was a fair bit of expectations from the crowd hoping for Shah Rukh. The entire excitement would have been atleast a few times higher if he was there. It seems he didnt make it. Contrary to popular belief that the locals are totally backing their teams, there was more than a fair share of support for the knight riders and especially for Ganguly. He did walk out with with less than 20 runs and a lot of wasted balls, but I personally know of a few who lost their cheers post that.

I doubt a post on the IPL is barely complete without a comment on the so-called Cheerleaders. Well, I have to say that the Knight riders were pushing it a bit. They did have a wee bit over-excited and scantily dressed women going at it, but knowing Shah rukh, and the glitsy world that he comes from, its almost his signature on it – just as much the kingfisher airhostesses are Mallya’s signature.

The Chennai “Cheerleaders” are definitely on the conservative side, and i doubt that being on home town the crowd needed cheering. All said and done, and for the initial skeptism that I was brooding on, this match was one to remember!

The Only analogy that fits this strategy is what happened in the US when the colonization began. Obviously, everyone was quite familiar with the “yellow Dust” that the native Indians simply didn’t care for. And when the immigrants did arrive, and realize that there was gold just lying there in the river basins, the rush was to essentially get to where no man has even been to – to enjoy the luxuries and wealth that he might find.

I am slightly against the so called first movers advantage, because it essentially means that you are planning to go find a problem – hopefully a real problem – and stake the entire zone for yourself. Hmm. It usually doesn’t work. Here’s why.

The market is global. And News travels fast. By the time you actually create that awareness wave, it will spread much faster than the company can expand operations. It will then turn into the inevitable home turf vs. foreign markets and we all know how that game goes. You start playing defense from day one.

Customer Loyalty is on a lowest low these days. There is no such thing as inherent branding that happens – especially if its in the web world. Sell someone a Sony Bravia, and since its a more tangible product, the branding aspect still sticks. When it comes to services and applications around the web, nope nobody cares. I’d flip in a jiffy if I find a better tool that does what I want to do and expands my productivity.

The First Mover advantage, (a.k.a The Goldrush strategy) works where niche products and brands are in play. For a startup, those are dangerous and long term goals to achieve and there are more pressing needs.

I am lately realizing how many of the hip companies of the internet which was so hot last year, arent anywhere now. I was fighting over everyone to get a subscription about in Scribe and I do like what they do, except that I also have plenty of alternatives. I am not even sure if I remember my username password there. I am sure you can think of many more names that I could. I want to focus on what it takes to build a company that lasts a lifetime or even more. In a day and age, when it seems that most of the hottest companies also seem to be dying off pretty rapidly, that’s a thought that almost makes me smile… and wonder.

The striking similarities that we hear from folks around us in:

1. Thinking that the Silicon valley for some reason offers more opportunities.

2. Europe just like India, in most cases, seems to think that you only get funded if you hit the valley. Atleast we aren’t that bad. We have much more easier access to capital.

3. There are folks like FOWA (Future of Web Apps) who are trying to build a vibrant community of users, developers and startups in Europe, very much like how we are working on the same – with arguments that they have “everything that they require right there”

4. There are also people, most of them, who seem to think that the UK companies should be looking into the valley for users and potential exit strategies.

I’ve been working on a post that shows a snapshot of interaction between startups, venture capitals and the markets from across the globe – the valley, Canada, Australia, Europe and India. You’d be surprised how similar most conversations are. Trust me, things are not so hard because we are in India, neither too easy because we are here. We are just facing the same harsh realities as anywhere else. Perhaps the world is flatterning. Huh! who thought I’d agree to that, so easily!

I’ll leave you with this comment by Phil Bradley in that post, which just gets the message home without any explanations:

“The equity gap between seed and series A that plagues the UK will not be resolved if we can’t demonstrate maturity and ability to build profitable businesses.”

Paul Graham has written a recent article where he is wailing and moaning on the same topic. And I think he lives in the heart of where the action lies.

To Quote Paul from his Article, “I used to think of VCs as piratical: bold but unscrupulous. On closer acquaintance they turn out to be more like bureaucrats. They’re more upstanding than I used to think (the good ones, at least), but less bold. Maybe the VC industry has changed. Maybe they used to be bolder. But I suspect it’s the startup world that has changed, not them. The low cost of starting a startup means the average good bet is a riskier one, but most existing VC firms still operate as if they were investing in hardware startups in 1985.”

That just eerily sounds like the issue we face here.

PS: I haven’t thought through this yet, but I believe this only applies to Internet/Media related startups.

“We examine the impact of business angels on 182 Series A financings and subsequent company outcomes. Our studied rounds have a varied mix of business angel and formal venture capital investors (VCs). We find that when only angels participate in a financing round and VCs are absent, control rights are more entrepreneur-friendly, legal expenses are lower, and investors are more geographically proximate to the company. Such angel-backed companies are less likely to fail and are more likely to have a successful liquidity event. We find that companies financed exclusively by VC investors also perform well, particularly when deals are large. Companies financed by both angels and VCs experience inferior outcomes. Our results suggest that entrepreneurs consider business angels to be preferred investors and VCs investing in small deals face adverse selection. For larger deals, where deeper-pocket VC participation is required, these roles reverse and angels face adverse selection when investing alongside powerful VC syndicates.”

ofcourse this is for a scenario in the valley. I wonder if its any different here in India.

The first downturn that I saw in Canada was right after the dotcom bust. That was when I went to Canada. One day it was all merry making, drinking and having fun, and the next week, all the new construction that was coming up on “March road”, which was known for his cluster of hi-tech companies, simply was uncovered with inactivity. Nortel, which was and still is the royal diadem of pride in the region and for the country used to have close to four or five campuses – maybe more – and each of their offices were huge. Their headquarters in Carling avenue was pretty much a glass dome building, and it still shines quite beautifully during the night – perhaps now with the splendor that once was.

When the first bust did happen, the first thing that most companies did was shut down their research facilities which were on long term evolution strategies – essentially the teams that were working on the next big thing lost their jobs. While most of the others felt sorry for these guys and were empathizing for these fellas, little did they know that in a couple of months following that, thousands would get laid off and no one would flinch even hearing the news – it had become everyday affair.

The interesting thing to note was that almost everyone who got laid off from their research work setup shops, or joined a small firm. Within a month there was barely anyone out of the first wave who was still unemployed. If you asked them what their new company was doing, they would all nod and say its still under thought and planning – exactly what we mean by a “stealth-mode” startup these days. Most of them, we all knew, were working on optic fibre and wireless stuff – because we all knew what the core expertise of these guys were. It was quite obvious that they weren’t going to hire artists to do masonry work.

Fast forward three+ years, and Ottawa is a thriving centre for wireless and telecom activity with a bustle of activity going on there. Mitel, I am told, was one of the first companies that came out of Nortel’s engineering team. The second bust (which i witnessed) spawned lots more of them. Not all of them survive, but most of them are doing pretty fabulous work.

Now what’s the correlation, you might ask.

Well, Let me draw a parallel. Remember the time that a team of amazing folks walked out of Wipro and started a company? You could consider that as the same as Mitel coming out of Nortel. When, and if the economy does slowdown in the US and hit us, even slightly, it will cause a spillover which will turn this place into a haven for startups.

All of a sudden the high quality management staff that only big corporates could hire, talent that never even considered startups as an option, PR firms which were too swamped to cater to the SME market, surviving corporates which need an edge to break free into the void, would all be available to work with a prospective startup or SME and grow it into the next big thing, and soon you have hoards of new high calibre companies popping all over the place. In very cinematic terms, startups essentially become the seabiscuits of the game. All that said, cash will once again rule over the industry to be the final word in every deal, and what Alok Mittal writes about becomes very crucial to become practicality. People who were once used to flying in business class and have tasted the spark of life and luxury, simply can’t stop till they regain that status again. And Ambition, drive and passion are all good traits to bet on.

I’ve always imagined the economy to be this lone tower which keeps growing and growing and everyone around them wants a piece of that growth that they feed it everything, and eventually the tower crumbles a bit because of the weight, and as it crumbles, spawns off new seeds around it. The cycle goes on and on. There are ripples caused all around, waves rise and fall, and the cycle repeats all over again.

If you really think about it there are only two kinds of folks in the economy: The creators and the capitalists. So if you look at it from that perspective, what applies to entrepreneurs also applies to artists. If you apply the scenario to the case of music, there probably once was a genre of music which grew in demand and possibly was “the” in-thing, eventually crumbled into a million other variations and the cycle goes on and on. It’s all part of the progressive path.

If you really want to get spiritual about it, isn’t destruction itself the first stage in creation?

I am also realizing lately that once your company does grow to a point where it is a new peak and much taller than most other companies around you, ensuring that it still does stay tall by expanding its base is probably the toughest part. I can only imagine the stress and pressure that must be on the senior management of companies such as cocacola to keep the momentum going. I can surely understand why their current CEO Neville is quite thrilled to have the company breaking even and profitable again.

But coming back to the topic, So… why am I having a grin when I hear news about the economy? Because it means change is in the air, and its good for the startups. Absolutely!