I promised entrepreneur Sujai Karampuri that I would write a piece on what an Indian Incubator Fund should look like, in response to the discussion in my previous piece, India Needs More Incubator Funds.
To begin, I will tell you a story. When I first arrived at the Laboratory for Computer Science at MIT, my research group under Prof. Anant Agarwal was in the middle of building a parallel computer called Alewife. I joined when the project was already two-thirds of the way there. The big chip was already designed, much of the software written, algorithms researched. Anant asked me to go figure out the performance evaluation and optimization strategy for the system.
I was a first-semester graduate student. I had passion and ambition, but do you really think I could have identified the problem to work on at that point with someone pointing me in a direction?
So let’s define, in the context of entrepreneurship, what I call a “problem”. A “problem” for this forum is one, by solving which, a business can be built. Now, if you put this in the context of venture capital, then you would need to further qualify the term to say, a “large” business can be built. [ Large = $100M, $250M, $1B, depending on the VC in question.]
Such problems are identified in various ways: (a) By actually encountering it in life (b) By observing the sarroundings, identifying opportunities that could leverage a more efficient solution (c) By inventing some technical breakthrough and then finding a problem to apply it on.
For (a) to occur, one needs to be in the face of the problem. This may be easier in consumer domains, harder in domains where the customer is a business. The most important component of this is the customer’s perspective, and the business customer may not be one as easily accessible. For India, the B-B domain will be harder to play in, especially if the customer is global.
For (b) to occur, market knowledge and perspective is essential. This is where, esperienced entrepreneurs from specific domains can actually guide entrepreneurs in India (as discussed in my previous article).
For (c) to occur, engineers inside multinationals would need to “invent” something, and then find a problem to solve with it.
Of the three, (a) in the B-C domain is the easiest for India, and it is already happening. (c) is going to be the hardest for Indians, especially because the cushy, risk-averse mindset of people who spend years in large companies will come on the way.
That leaves us (a) in the B-B domain, and (b). In both cases, I believe, experienced entrepreneurs who have had Silicon Valley experience, can contribute in steering towards the right problems to harness the passion and ambition of the new entrepreneurs in India.
Next time, we’ll discuss the Entrepreneur in the context of an incubator.
This segment is part 1 in the series : Indian Incubator Fund: Specs