An Afternoon With Don Norman In Bengaluru

Are you building products for the everyday user? Is it becoming harder and harder to manage complexity while maintaining usability? How do you design a sustainable system for a complex multi-stakeholder environment? How do you teach a user to use your product with good design? How do you reinvent an established business model in light of rapidly evolving markets and technological possibilities? How do you design a product to be truly human-centric?

If any of these questions sound relevant to you, here’s an opportunity to seek answers on 22nd February in Bengaluru! 

About Don Norman

Dr Don Norman is a living legend of the design world having operated in the field for over 40 years. He has been Vice President of Apple in charge of the Advanced Technology Group and an executive at both Hewlett Packard and UNext (a distance education company). Business Week has listed him as one of the world’s 27 most influential designers. Dr Norman brings a unique mix of the social sciences and engineering to bear on everyday products. At the heart of his approach is human and activity-centred design, combining knowledge of cognitive science, engineering, and business with design.

Presently, he is Director of the recently established Design Lab at the University of California, San Diego where he is also professor emeritus of both psychology and cognitive science and a member of the Department of Electrical and Computer Engineering. He is also the co-founder of the Nielsen Norman Group, an executive consulting firm that helps companies produce human-centred products and services.


Don will share valuable insights about his interactions with Indian people, products and experiences.

Fireside Chat

An informal discussion with Don about his learnings and experiences spanning his long and illustrious career.

How to participate?

We’re inviting engineers, product managers, designers and everyone else who is building for large scale impact.

If you would like to further your understanding of human-centric design and hear straight from the horse’s mouth, please register here by 18th February. (An invite will be sent out to selected participants by 21st February)

iSPIRT Presents Poster Session & Product Discussion With Don Norman

Don Norman, the pioneer of design in the 21st century, is visiting India. Presenting you with an opportunity to engage with the living legend in a closed-door interaction where you can discuss your solution/product and get unbiased feedback on 20th February 2019 in Bengaluru. 

We’re looking for solutions in the social space that are building for the next 500 million in India.

About Don Norman

Don Norman is Director of the recently established Design Lab at the University of California, San Diego where he is also professor emeritus of both psychology and cognitive science and a member of the Department of Electrical and Computer Engineering. He is the co-founder of the Nielsen Norman Group, an executive consulting firm that helps companies produce human-centered products and services. He is an honorary professor of Tongji University’s College of Design and Innovation (Shanghai). He serves as an advisor and board member of numerous companies and organizations. Norman has been Vice President of Apple in charge of the Advanced Technology Group and an executive at both Hewlett Packard and UNext (a distance education company).


Poster session  – Show us what you’re working on and how your solution is better in a poster format.

Product Teardown – Engage with Don over your product and discuss what you’re doing well and what can be done better.

If you are interested or know someone who would be interested in growing through this experience, please do register or help them register here by 15th February 2019. Since this is a curated event and there are limited seats we would request you to kindly apply at the earliest. (An invite confirmation will be sent shortly after registration)

For further query, you can write to us at [email protected]

Building for Bharat – A Bharat Inclusion Initiative

Bharat Inclusion Initiative seeks to equip entrepreneurs with the right knowledge, skills and tools they need to solve some of the toughest problems of India in a scalable manner using technology. While Bharat Inclusion Research Fellows are working on some of the most interesting studies, another important source of knowledge is thought leaders and domain experts who have been there and done that. In this three-part video series, we have Dr Pramod Varma, the Chief Architect of Aadhaar, providing his perspective on how entrepreneurs can go about building solutions for Bharat.

Part 1: The Key Construct

What are Bharat’s unique attributes? Its needs and aspirations? With data becoming one of Bharat’s key assets, how can entrepreneurs leverage it to provide solutions that matter? Watch the video to know some answers to these questions and much more.

Part 2: The Journey So Far

How to leverage the opportunity made available through Data empowerment? Know how Aadhaar, India’s biometric ID, has fundamentally changed the economics of reaching the poor. Understand how the Aadhaar platform has aided in building further platforms of IndiaStack such as eSign and Digilocker which have further reduced cost and increased trust at scale. The video rounds off with another uniquely Indian platform — Unified Payment Interface (UPI).

Part 3: Exciting Times Ahead

Reimagine solutions. With the newer domain, specific stacks being built, learn how even seemingly unrelated domains can use these platforms to offer innovative solutions. With GST and BBPS already in place, and more being built around transport (ETC), National Health Stack, Diksha and Drone Stack it has been never this good for entrepreneurs crafting solutions for Bharat. Watch the video to understand how.


What is Bharat Inclusion Initiative?

Bharat Inclusion Initiative (BII) is an incubator platform at CIIE that provides entrepreneurs with the domain knowledge, training, financial support, mentorship, and market access they need to bring inclusive, for-profit-business to life. BII’s core design is to promote technology-driven entrepreneurship towards the delivery of affordable services to the Bharat Segment- the poorest 200 million households in India who survive on less than $5 per person a day through programs, fellowships, and funding where possible.

The program focuses on solutions leveraging technology, especially the India Stack. It integrates financial inclusion research with entrepreneurship and training to transform these solutions into scalable, viable and high impact businesses.  Keen on partnering with entrepreneurs who are driven by building next-generation digital services for India. Reach out to us at [email protected] or ask your questions in the comments section below.

Please note: The above information was first published by Bharat Inclusion Fellows here:

A New Tryst with Destiny

On Aug 15th 1947 at the dawn of India’s political Independence, Jawaharlal Nehru delivered his “Tryst with Destiny” midnight speech. In 1991, India gained economic freedom from a clutch of socialist era shackles. In 2017, it is time for India to redeem its “pledge in full measure” towards freedom of the individual and enterprise to achieve its destiny.

Today, as India completes its 70th year, we need to, as is customary, take stock. India is a $2.2trillion consumption-led economy today, growing at about 6.5 percent, with a 250m in the middle-class out of 1.3billion, and at an average of 29years old, the youngest population in the world among major economies. Life expectancy is at about 68 years while literacy is at 79%.  About 31% of India resides in urban areas. India’s forex reserves were at $386billion in June 2017 up from $5.83billion (~3.5months of imports) in 1991. We now have about 799 Universities and 50,994 colleges with about 34million students in higher education.

While very impressive strides have been made in many areas, it is important that we keep in mind the fact that 15% of the world lives in India and over 68%  ie about 700million of our people live on less than US$2 a day. Over 17 million people are born (equivalent to the population of The Netherlands), an estimated 40million are unemployed, 47million youth drop out of school by 10th standard, healthcare related expenses push over 60million people into poverty each year,  500,000 students graduate each year from various colleges and over 12 million join the workforce each year. The investment required to educate, feed, train, and employ these large numbers into gainful jobs is in the lakhs of crores. Where will this money come from if not from economic activity and from creation of millions of jobs?  Where will the water and sanitation, education, travel, housing, electricity, entertainment, banking and financial services that need to be provided to these huge numbers come from?

For far too long, we have been plagued by poverty – of ideas, of ideology and of course economically. Misplaced socialistic policies in the early years of India ensured that poverty was distributed while cronyism ensured that a few made unconscionable amounts of money and enjoyed the trappings of power.

Jobs and solutions are created by entrepreneurs and those who are entrepreneurial in their thinking. Governments are facilitators and regulators to make sure that everyone’s playing fairly and by the rules. Wealth is then created by entrepreneurial actions. Only when wealth is created, can there be investments in creating the support infrastructure and services necessary for India to seriously consider redeeming its pledge in its tryst with destiny.  And a crucial pre-requisite for this is the need for an entrepreneurial mindset among different stakeholders. A mindset that challenges status-quo, propels growth, engenders innovative problem solving, embraces ideas, technology and models, and delivers benefits to people.

Fortunately, India has no shortage of entrepreneurs, of all kinds! There are born entrepreneurs, some become entrepreneurs and others have entrepreneurial thinking thrust on them thanks to circumstances! In 2017, as the landmark $2.5b Softbank-Flipkart deal shows, Indian entrepreneurs have come of age.  The Indian startup entrepreneur is educated, aware, unafraid, confident, assertive and, are unabashedly Indian.  Today, the Indian startup ecosystem is the 3rd largest in the world with over 26,000 startups and with over $90billion in value being created. 

This century will be driven by knowledge based capital with software as engine. India is recognised, regarded and respected for its software prowess built on the success of Indian IT services which deliver over $170billion in revenue and employ over 4million people today. Indian talent runs software giants like Google and Microsoft and powers thousands around the world from Silicon Valley to Singapore, Boston to Bangalore. India’s ability to leverage this talent, create and deploy knowledge based capital will be key.  New technologies, models,  affordability, policies are all helping India rapidly emerge as a key player in the 21st century knowledge economy.

Regulators and governments are waking up to the transformative power of innovation via startups. Policies are being re-worked, technology platforms are being deployed and programmes being launched to encourage innovation and entrepreneurship.  Digital India, Startup India, India Stack and other programmes are being co-opted to drive financial inclusion, education, healthcare, and governance.  Startup hubs, incubators and accelerators, entrepreneurship groups, are sprouting across cities and towns in India. Costs of doing business, ease of doing business have to come down dramatically and there’re initiatives underway to make those happen.

In 1929 in Lahore, a call for “Purna Swaraj” a declaration of India’s Independence was given and Gandhiji hoisted the Indian flag.  No one knew how or when this would happen but it was an audacious goal, a call to action that drove the people to achieve their goal in 18 years.  Is it possible, similarly, for us today to set a goal that will galvanise us to action to achieve what seems audacious? Is it possible for startups to enable India to leapfrog and transform itself? Could we have a 10year goal calling for 100,000 startups, benefitting 10million people, impacting 40million people, uplifting 30million MSMEs, creating $500billion in value? Is it possible for us to imagine that each of us, in our lifetimes, creates – either directly or indirectly – a 100 jobs? Can these 100,000 startups – with educated, experienced, entrepreneurial and energetic founders– each  take up this challenge? Ten million jobs can be created by this group, indirectly benefiting 40 million?

If it is possible, it is do-able!

The Brihadaranyaka Upanishada has this to say:

“You are what your deep, driving desire is. As your desire, so is your will. As your will is, so is your deed. As your deed is, so is your destiny.”

Do we desire this strongly enough?

6 traits that define successful entrepreneurs

The contribution of entrepreneurs to boosting the global economy is undeniable. Right from the Graham Bell to modern day Steve Jobs, their journey of innovation has greatly benefitted their countries and the world in general.

For sure, entrepreneurs are cut from a different cloth, though one cannot really pin down a particular type that defines them. They are driven, creative individuals with a great capacity to overcome hurdles and adverse conditions in order to realise their ‘big dream’. It’s commendable how they manage to fulfil a gap in the market or create a new demand altogether with their disruptive ideas.

Here are some of the most consistent six qualities that define a successful entrepreneur and make them tick in a highly competitive environment:

  1. Risk Taking

They have to have nerves of steel to branch out on their own, do something new, with a dream in their head and little in their pocket. “To win big, you sometimes have to take big risks” in the words of Bill Gates, aptly defines their attitude. It also indicates an acceptance of failure as apart of that risk. Successful entrepreneurs usually chalk out all the aspects of failure and keep resources, plans and bandwidth for dealing with them as a standby before taking the plunge. It is the challenge of making a winner out of nothing which gives them the adrenaline push to make them take the plunge.

  1. Ability to influence others

Entrepreneurs are no less than a firebrand idealist, politician, military strategist and actor rolled into one. They have to be able to sell their dream to their employees, customers, investors, shareholders and other stakeholders. Entrepreneurs possess a very high social intelligence and an ability to build relationships that help in their company’s growth. As a result they are able to get the help of mentors for valuable advice, garner support from fellow entrepreneurs for networking and build a loyal and capable team for the firm as well a loyal customer base. It is this emotional instinct and empathy with others which helps them strike the right cord with others and get things moving in the right direction.

  1. Foresight

Foresight is perhaps what sets the best entrepreneurs apart from the rest. After all, entrepreneurship is all about identifying the right opportunities and seizing them at the right time in order to stay ahead of competitors and conquer a larger share of the pie. The key is to be able to spot the opportunities long before others do. For instance, Steve Jobs was always known to be steps ahead of competitors when it came to technology, and hence was able to launch one iconic product after another while he was at the helm at Apple.

  1. An eye on the ‘Big Picture’

Entrepreneurs are visionaries and always have an eye on the big picture when taking any decision. They understand the implication that the smallest of decisions can have on the organization, and hence, know exactly whether or not it is in its the best interest to implement it. The entrepreneur’s true value is in creating the path to the vision and guiding the company towards it, making sure they never lose focus. In fact, it is very easy to stray as the daily struggles and challenges tend become the biggest distractions. It is during such times that they not to hold fort and lead the way for others to follow, inching closer to the goal with every step. It is best to leave the details and day to day workings to the staff and managers.

  1. Resilience

There are very few guarantees on the path of a start up and an entrepreneur is well aware of that. A few rough knocks and road blocks are treated like learning grounds for the future. Instead of agonising over the wrongs, they analyse what went wrong, and take corrective and preventive steps to correct themselves. Above all, they don’t shame failure, but celebrate it, because with every failure you learn something new that you can use to propel yourself and the startup into ‘something bigger’. Mr. Sunil Mittal, is a great example of this quality. Even after two failed entrepreneurship attempts at a cycle parts business and a capsule making business, he didn’t give up. He started again with a new enterprise of manufacturing push button telephones, and ever since then, there’s been no looking back!

  1. Attitude

More than anything, it is the attitude that sets an entrepreneur apart from others. Real entrepreneurs are never afraid of failure. They are driven by the desire to accomplish their mission, no matter what and have a ‘never say die’ spirit that keeps that going even under the toughest of circumstances. No amount of pressure can make them crumble. Rather, they see every problem as an opportunity to come up with new and unique solutions that’ll work.


It takes a lot more than a great idea to become a successful entrepreneur. Aspiring entrepreneurs can take a cue from these points and imbibe some of the aforementioned qualities, if they plan to prove their mettle and are here to stay and make a difference.





Vikram Upadhyaya

Chief Mentor & Accelerator Evangelist at GHV Accelerator

Christening of a Tribe and Launch of Home Tour Videos

iSPIRT is not a tradebody. It is a think tank focussed on transforming India into a Product Nation. To describe the set of things we do to make this happen, we have created four Home Tour videos. They will give you a good idea of what iSPIRT is doing today through the voices of some of our anchor volunteers.

There was a trigger to create these these Home Tour videos. Recently the tribe of product entrepreneurs touched by one of iSPIRT’s programs swelled to over 1000 people! Many of them told us that they know that there is a lot going on in iSPIRT but don’t have the full picture.

As many of you know, we are believers in deep impact. We would rather touch fewer participants (entrepreneurs, policy makers, buyers) and make a big difference to their lives than go after shallow engagement with many. In light of this, having an iSPIRT tribe of 1000 software product entrepreneurs is a big moment for us. To mark this occasion, we christened this tribe as the Product Nation Founders Tribe(PNFT)! More power to them. They will make India proud.

The single most frequent mistake #entrepreneurs make during the #customer #development process

There are many assumptions we make about the product or the customer problem, which makes us develop solutions that may be really more complicated than required.

A friend and fellow entrepreneur I met on Friday was showing me a prototype (HML mock up with transitions, with some simple functions implemented) of this SaaS application. He had used a developer on hire at UpWork to develop the initial version. After speaking to and confirming the mockup (wireframes) with 10 different users he was off to develop and deliver the MVP. Overall he had spent about $8000 in design and development and had taken about 13 weeks to develop the MVP. Most of the time was spent back and forth with the design team for the HTML / CSS and the development team for confirming features and transitions.

Of the 13 weeks, his development team spent 2 weeks just implementing a sign up process, a user cancellation process, a payment process, a refund process, a login process, a password retrieval process, etc. Which he did not realize was the tax of developing a SaaS solution. Instead he took the 5 step approach to building a SaaS application and followed it religiously.

The critical mistake during customer development that most entrepreneurs make is to lead with the solution or product instead of spending time learning about the current solutions.

When he was showing it to potential customers, he found that most of them liked the product and said they’d use it and pay for it, if they could find value in 2-3 weeks. He was pretty happy given that most users were ready to pay for the product, which he did believe would solve a critical problem for them.

After developing the MVP and letting his users know about the product, he followed up by asking them to start to use the application. The first two days were great, with lots of feedback and improvements that they gave him about the product.

Then for the next 3 days there was radio silence. Even after his prodding and cajoling, most users were not using the application.

Instead of talking to users face to face, he instead decided to spend time with them (3 hours each user), shadowing them to understand why they were not using the application.

Turns out most of the users needed his product, but either A) did not remember it existed or B) were used to using their workaround – largely using a combination of email and cut and paste into Slack.

The biggest barrier to his adoption and usage was their existing process (although inefficient) was something they were used to and so were able to “optimize” it to make it quick and “fast” for their own usage. So much that they felt that using his product (which I can assure you would be vastly superior) would slow them down.

He then pivoted his product (not idea) to implement the one feature they all wanted as a Chrome plugin. Which worked like a charm.

He then had to remove the top 3 features and undo all the user login and management, infrastructure code and other remaining features, just to support the user behavior for their existing process.

The big takeaway for him was that when you have a hammer, everything seems like a nail.

The biggest takeaway for his wife (who is his cofounder) was not over engineer the solution.

The big takeaway for me was the failed customer development process. With all our biases (which all of us have) – we always tend to lead with the solution (“let me show you a demo”), instead of understanding the problem better to focus on delivering the one feature that matters, without all the bells and whistles.

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Indian Product Industry: How Far We’ve Come And How Much More To Go

These are exciting times for us in the Indian software products industry. The air is pregnant with cautious, yet very strong optimism that some truly great product companies will emerge out of India in the coming years. There is a significant shift in the mindset of Indian entrepreneurs, with a focus now on building great products and not just good enough products. A talent pool of  highly qualified and experienced professionals who have worked with MNCs across various functions and roles is now available. The support system has also gotten stronger with more angel investors, accelerators and incubators, focused events and meetups with founders, entrepreneurs and experienced professionals coming together, sharing their knowledge and helping each other. Entrepreneurs now have more exposure to the Valley and other innovation hotbeds and international markets by virtue of their interaction and participation with accelerators, investors and entrepreneurs outside of India. More importantly, we already have examples of successful Indian product companies that have built products for the world and are now well-established names in their businesses.

I’ve stated this earlier as well, that it is my firm belief that the software product industry will lift India out of its poverty. While I strongly believe we’re firmly on track to make the prediction come true, I would also like to strike a note of caution. Having been in the industry for close to 25 years new wearing multiple hats and seen it evolve, there are some observations I would like to share with the readers.

Rome wasn’t built in a day. It’s probably the most cliched phrase, but I think it makes sense repeating the cliche once more in the current context. As entrepreneurs and investors, it is indeed important that we celebrate key wins and milestones like funding, new hires, entry into new markets etc. However, we also need look at the larger, long time picture and focus on what is needed to build a meaningfully successful company, a company that creates value for all the stakeholders – founders, employees, investors and most importantly the customers. And it is that part, of envisaging the larger picture and actually painting it, which is a true test of one’s faith in their core beliefs, their endurance and perseverance.

It is said that dramatic changes happen in a dog’s lifetime. Dogs usually live between 10-15 years on an average, and if they were to follow technology they’d be witnesses to some incredible and eventful happenings. Ten years maybe doesn’t seem like too long a time for us humans, but I were to borrow from the tagline of a very popular coffee chain, a lot can happen in ten years! Rewind ten years to this day, and this is what we would be looking at. Facebook, Groupon, Zynga did not exist. Google’s AdSense & LinkedIn were just about to be launched. On the mobile side, Nokia was the largest vendor of mobile phones and Samsung hadn’t introduced mobiles phones in India yet. Seeds of iOS and Android had probably just been sown in the minds of their creators. In the fast-paced world we live in, it’s very easy to miss how much can happen in what now seems like a short period of ten years. But if you take a step back and notice each of the happenings, you’ll realise how impactful and significant these changes are.

The observations and insights from the points mentioned above hold a lot of meaning for us in the Indian software product industry. While it’s very natural and fair to expect things to move quicker, people to be smarter, government and regulators be more friendly, investors be less risk-averse and so on, but it is also important to remember that magic doesn’t happen overnight. However, small wins and milestones added up over time will see your product and your company achieve something significant over time. Moreover, as an entrepreneur, you’ll need to believe in non-linear growth and that there’ll always be a point from where your growth will take off and go the hockey stick way. Remember, that Angry Birds was Rovio’s 52nd game and they were almost bankrupt at the time they released Angry Birds. What if they had given up after their 50th game? Of course I believe in overnight success, and the only overnight success is getting a good night’s sleep! For all other kinds of overnight success, there are miles to go before one sleeps!

I’m reminded of a tagline that Timex watches had for a long time. (A Timex watch)…takes a licking, but keeps on ticking. That’s some inspiration for us entrepreneurs there! I’ll leave you with some vintage Timex commercials. Hope you enjoy them.

YouTube Video –

Happy Building,

The Business of Accelerators

Accelerators are in the business of creating Startups – or atleast taking the first bet. Its a startup of startups; Which means, everything they talk about as risk, in venture capital nicely gets bundled up and will get put on the head of what is the accelerator.

Going back to the basics, Now depending on which accelerator you are involved with, there might be two or three key milestones that they would provide as value:

  • Spit Polish your Pitch in a matter of weeks and put you in front of a lot of Investors and hope one of you becomes a hit (Usually this model also involves accelerating a lot of companies in one go)
  • Have an Alumni or a Brand that can give you early traction, and mentors who can give you an overview (working with a startup to dig deep will take a few weeks usually)
  • The hands-on accelerators that will work with a handful of startups, but will dig deep, have a few dedicate personnel whose job would be to help you eliminate market risk (have a product, but there is no market) and also help with Go-To-Market strategy, setting up a board, advisory etc. Thats really a deep dive model and most accelerators wont touch that route with a ten foot pole – we at the Startup Centre, however love doing that kind of stuff.


Depending on what level of support you are getting, the duration of the programme will vary, but you get an idea. All of them, in someway will put some money in, quite honestly that would be the easiest (valuation of the company is the lowest and shares are cheaper comparatively – it makes sense to do it).

Thats the Pledge, if you can call it.

The Accelerator Model, no matter how sexy it may sound is a very very complicated and fragile model. It throws the firm in the side of the entrepreneur than the VC. The VC gets rather hefty (or sizeable) management fees of the funds they manage (usually 1-2% of what they manage divided over 7-10years) and the managed fund sizes are usually in the three digit millions, so that usually covers for operations. Accelerators on the other hand, even if they have a fund, owing to the nature of making small bets, the fund size would be small and the management fee, so to speak, usually covers the legality in managing the fund. Nothing more – Yes there is hefty legal fees involved in auditors, lawyers and stuff when you manage a fund.

And the accelerator has the cost of infrastructure (if its provided), the man power, operational costs, and travel where they go around meeting companies. All of this comes from a very very thin shoe string budget in most cases.

That’d be the turn.

Now, are they making a sacrifice and killing themselves over a cause. Not at all. But however, the upswing for an accelerator is in that small amounts of equity that they are taking in. If you are a banker by any chance and can do a little bit of excel sheet math, you will realize that the Approx 10%  that is taken (out of which usually 70 – 80% belongs to whoever brought in the capital also called LPs), is very small and if the venture goes through two rounds of funding or so, will quickly become a 1-2% play (which is the “carry” that the accelerator makes – sameway a VC fund makes money)

Which means, in order for the accelerator to say make a million in a company (and it usually takes about 3-4 years to think about any reasonable exit, in most cases way more) the company has to be valued, literally, at a billion. The chances of building a billion dollar company? Well, the US has 20 companies that are listed and 40 companies that are privately held, who are billion dollar companies in the last 20 years. close to 30,000 companies get funded in the US per year, so you can see the odds.

What you get is a fantastic community. You work shoulder to shoulder with entrepreneurs and pushing them to be their utmost best, because quite literally you make money only when they do. Some accelerators – if they are short termed, will go the mass model way (put 30 – 40 companies in a batch), raise the valuation by 1x or 2x and want to dump it on someone else and go to the next batch. They make less money, but over volume, they make more.

Not sure, if that is a model that is exciting for us, personally. I’d rather be associated with one or two companies that stand out, and perhaps stand the test of time – solving real problems.

Honestly though, if anyone were to ask me if starting an accelerator was a good Idea, its not. Its hard work, but if you love working with entrepreneurs, this is the best place to be. Its a lot of community building, lot of hard work, with not much money to hire talent – a lot of lonely hours, but along the way you also have the possibility of building a few amazing companies.

That’s the Prestige.

PS: Most wont make it.

The Indian startup ecosystem should look at Israel as a role model

I love Israel. Having been there 7-8 times over 5 years when I worked for a company (Mercury Interactive, acquired by HP) that had its development center there, I believe they have some of the best developers, product thinkers and execution oriented folks.

They are also amazing at marketing. They have successfully convinced the world that they are the “startup nation“.

Never mind that they have 1/3 as many product startups as India produces annually and never mind that Indian companies acquire or get acquired twice as much as Israeli companies.Indians also make up 52% of Silicon valley startup founders, whereas Israelis make up less than 8%.

Take a look at those 3 data points and tell me they are not facts. The PWC report is for 2012, so its relatively recent. The # of companies we track in India versus Israel startups in our database is three times as well. The # of companies on Angel list or Crunchbase reveals a similar statistic.

Still its Tel Aviv that creeps up on Silicon Valley as the top startup center. If you read the startup genome report, you’ll be convinced of the same based on their methodology.

What are the arguments I have heard against India being the startup nation?

1. Quantity not quality:  We produce numbers, but not quality. Many of our startups are clones of Silicon Valley companies featured on Tech Crunch 3 months post launch. I looked at the 3 top Israel incubators and found that over 60% of the companies they were helping were clones as well.

2. Exits: We dont have a significant number of $billion or hundreds of million $ exits. I have found that while we do not have those exits, the number of companies listed on the stock market in the US for both Israel and India are comparable.

3. Market access: Israel has excellent knowledge, insights and know-how about US markets. Since Israel itself is a fairly small market, most Israeli entrepreneurs focus on US markets solely, even though they are geographically closer to Europe. Technically the # of people with market knowledge of the US in India far exceeds that of Israel, but they are not in product startups but at large companies.

4. Services mindset & positioning: Thanks to the ginormous success of Indian services companies who helped position India as the “world’s backend” (comparable to China being positioned as the world’s manufacturer) we have been already positioned as low value, low margin, consulting providers.

5. Late start: Even though Israel is 60 years old and India as a nation is a little older, we had a late (2001 or so) start to technology startups. Compared to Israel which had some interesting companies (need references here, what I have heard is mostly anecdotal) in the late 90′s as well.

Why do I still say Indian startups should look at Israel as a role model?

1. They champion their startups very well. They are very well vested in their startups success. They are constantly talking about how good their startups are, how they are possibly better than the valley and why they have the best talent in the world focused on startups.

2. They take significant risky bets. The # of investors in Israel (seed, angel and institutional) is comparable to those in India even though the number of startups is a third.

3. They look out for each other. The community is so well connected with each other that they genuinely look out and help each other. I dont know of any other place that supports their own as much as Israel does.

If you have been to Israel or have lived / worked with Israeli’s please tell me in the comments if there are a few data points I missed.

If you have any good data (not anecdotes, I have enough of those) to counter any of my arguments, feel free to call those out as well.

Who are the “early adopter” Venture Capitalists in India

Like you, I assumed that all VC’s are risk takers. I mean as an asset class if you have to provide the highest returns over the long term, I would suspect you have to take big risks to get big returns. The average Indian bank has been giving around 8% annual returns on FD (source), real estate returns about 13%, and gold loan providers will give you close to 15% I am told. So, VC as an investment class should offer higher returns given how ill-liquid they are and how risky they tend to be.

So, how do you really measure if a VC is an early adopter versus a late adopter? (lets keep it simple and only put them into 2 categories).

My thinking is the only way you can do that is to look at their investments (portfolio companies) and find out the categories of companies they invested in. Then find out if any other VC’s invested in another company in that category after the “first” VC did. There are other ways to do that, like ask entrepreneurs who responded the fastest when they were looking for funds, but those dont evaluate who puts their money where their mouth is.

Why is this question useful to answer?

For entrepreneurs who are innovating in a new area, this list of early adopters will help you determine who you should go to first versus who should you expect will fund a possible competitor.

Lets define our methodology and assumptions:

1. We will look at all their websites and make a list of the Indian VC portfolio. Fortunately we have that list of over 50 VC’s in India.

Flaw: Many dont update their website as frequently so there may be a 20% (or higher) error, but I have tried to be comprehensive.

2. We will then categorize their investment into 5 buckets – Media and content, eCommerce, Business to Business, Mobile and other (Education, Healthcare, etc). This is important so we know not only which VC’s are early adopters but we can also try to find that out by sector.

3. Then we will look at the announcement dates of their funded companies from press releases, Unpluggd, YourStory, ET and VCCircle. We will give them 2 points for every investment done in a sector before any other VC did.

Flaw: Most (I suspect over 50%) of companies report their funding 3-6 months after they have raised the money, so this will be a large flaw, but lets do the analysis anyway.

4. Finally look at stage of investment. If a VC puts money in the series A, I would give them two points in the early adopter bucket. If, however they participated in series B or later, they get one point in the late adopter bucket.

First let me give you the results (not in any order other than early adopters vs. late adopters).

Early adopters VC’s.

  • Accel (eCommerce, B2B) – 78 points
  • Indo US Venture Partners (B2B) – 56 points
  • Saif partners (Mobile, eCommerce), but they are late adopters in B2B – 49 points
  • Venture East (B2B) – 45 points
  • Sequoia (Media) – 46 points
  • Seedfund (Scored enough, but dont have a clear winning category) 42 points

In the middle

  • Blume ventures – 40 points
  • Nexus Venture partners – 36 points
  • Helion – 36 points
  • Ojas ventures – 34 points

Later adopter VC’s – all scored less than 30

  • Bessemer Venture Partners
  • DFJ
  • Cannan partners
  • India Innovation fund
  • Inventus Capital
  • Footprint ventures
  • IDG ventures
  • India Internet Fund
  • Lightspeed partners (but have done well in Education)
  • Norwest
  • Sherpalo

What I hope this list will do?

1. Make Indian VC’s think about being innovation catalysts rather than ambulance chasers. I understand you have a responsibility to provide returns, but you also have a responsibility to grow the Indian startup ecosystem. Might I suggest a 5-10% of your portfolio towards risky, “first time this is going to happen” investments?

2. Make Indian company founders announce their funding. Unlike the US, here entrepreneurs are loathe to do so. I can understand the competitive pressures, but not doing any announcement is just lame.

3. Educate Indian entrepreneurs on their target VC list. Depending on the opportunity you are trying to pursue, please target the right VC firm. The only thing you have (and dont have) on your side is time. Use it judiciously.

P.S. I have confidence in the methodology but I would be the first to admit its neither comprehensive nor scientific. If you are an eager MBA / Engineer / analyst and would like to help make this methodology and analysis more robust, I’d love your help. You can take all the credit. In fact, I can convince many publications to give you credit for the work if you desire and if you keep it updated every 3-6 months.

P.P.S. If you are a VC and not in the early adopter list, or you are not happy with the analysis I’d also welcome your associate’s help in making this analysis robust.