Over the years, we have been hearing more about investors, entrepreneurs, and even businesses talking about the lucrative business opportunities in Asia, more specifically India and China.
Okay, I know what you are thinking; Indian-American entrepreneur talking about the potential of India? I am indeed Indian, but my business is not.
I am a regular visitor to India due to large pockets of family there. I truly love visiting the country, especially with its developing infrastructure, rich amenities, and deep culture.
My last trip over was last summer. I spent a few weeks in Mumbai, Pune, and Chennai.
India’s main cities for startup activity are Bangalore, Mumbai, and Pune. Unlike our Boston, New York, and Silicon Valley startup ecosystems, Indian startup cities have large Facebook groups that allow entrepreneurs to connect with each other. Think of it like a marketplace for businesses to get things from web design to business strategy done.
Being new to the startup space, I posted a simple post on Facebook: “I’m an entrepreneur from Boston in Pune for a few weeks, and would love to meet up with entrepreneurs.”
Unlike the major startup hubs in the U.S., Pune seemed to lack the support and encouragement that meetups and organizations such as the Cambridge Center for Innovation hope to achieve.
Believe it or not, the meeting I had was one of the first meetups in the Pune area for startups, and I am on a mission to continue that support and encouragement using Office Hours.
During our first meetup, there were about eight people in attendance. But those eight people were some of the most motivated and hungry I have ever met. They were willing to hustle and were looking to work extremely hard to make their startup come to life.
From this interaction, I started looking deeper into India’s startup ecosystem, especially through my interaction during Office Hours. Here are some of the advantages India has to offer:
Startup valuations. In Silicon valley, there are a certain number of venture capitalists fighting for the same startups, which can easily increase the price of a startup, relative to the actually worth.
These valuations are increasing and are a sign that startups in the Valley are outrageously overpriced. For example, entrepreneurs are known for getting much higher valuations in the Valley than in ecosystems such as the Kansas city entrepreneurial community.
Now, let’s take a look at Flipkart and Snapdeal, two of India’s foremost companies in regards to their valuations. These two companies have led the growth curve for many other companies to follow, such as Ola Cabs, FreshDesk, Myntra, Zomato, and others.
Historically, Indian entrepreneurs have graduated from an IIT and have left India for greater opportunity in the U.S. A classical is Vinod Khosla, cofounder of Sun Microsystems.
Unfortunately strict immigration laws have prompted founders such as Kunal Bahl to leave the US and go to India to start world class companies.
Sheer population. The growth rate of India’s population is astounding. In fact, in recent months, India in 2013 saw a growth rate of 1.2 percent, which is almost double the U.S.’s (0.7 percent) and China’s (0.5 percent).
The most fascinating aspect is opportunities for literally anyone to become successful financially. Having worked with many consumer goods companies in the U.S., I took note of a few major fast food companies that are doing incredibly well, just based on the amount of foot traffic that exists in India.
These population numbers mean that your business can do incredibly well as long as your maintain quality control and deliver as expected to your customer.
Such a large population brings opportunities to create niche products for different segments and, more importantly, many different ways to disrupt traditional ways of going about life.
In comparison to China, India has the largest democratic government and the youngest working population in the world.
Growing verticals. Immense population growth equates to growing pains for many citizens. Lucky enough, this means opportunities for businesses and entrepreneurs.
For example, the sharing economy is a concept that is becoming widely popular in the U.S. with companies such as Airbnb and Uber, but it is even more apparent in India, where a large majority of individuals are impoverished.
According to Richard Dobbs, the Director of the McKinsey Global Institute based in London, and Anu Madgvakar, a senior fellow at the McKinsey Global Institute, a staggering 56 percent of Indians lack the means to meet their basic needs.
And the sharing economy is not the only vertical. Areas such as food supply, health care, clean drinking water, and rising housing prices are just some of the major problems that will continue to affect Indians.
Investor migration. There a large majority of investors who see India as a major business opportunity. For example, venture capital firms such as Sequoia Capital, Microsoft Ventures, and 500 Startups are creating India subsidiaries to their U.S.-based offices.
A large majority of these investors see the seeds in India just being planted, which means opportunities for venture capital firms to make key investments in the Facebooks, Googles, and Amazons of India.
India in recent history has experienced immense growth in the venture creation space, and your business can jump on that growth curve.
India is ready for you. The question is, are you ready for India?
Chirag Kulkarni is a serial entrepreneur and advisor. He is currently the CEO of C&M Group, an entrepreneurial strategy consulting firm focused on growth and new product innovation for startups to Fortune 500s. Previously, he cofounded STR, a B2C and B2B racquet-stringing company, and sold it in 2013.