The Approach Must Be To Change The World In a chat on chaat with Ritu Marya, Editor-in-Chief, Entrepreneur India, Anil shares his panorama on future of start-ups in India.
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After receiving a Doctorate from the Harvard Business School, there has been no looking back for Anil K Gupta. Quoted as one of the world's most influential living management thinkers, Anil is widely regarded as a leading expert on strategy, globalisation and entrepreneurship. In a chat on chaat with Ritu Marya, Editor-in-Chief, Entrepreneur India, Anil shares his panorama on future of start-ups in India.
What makes Silicon Valley (SV) so special?
Entrepreneurship and technology are becoming a global phenomenon; it's like a good virus that is spreading throughout the world. But it's interesting when we look at the numbers, that even within the US, Silicon Valley remains not only the hot sun, but it's becoming bigger.
Look at total venture capital investment in the US. By regions, in 2000 -25% of that was in Silicon Valley, 75% was in Boston, New York, New Jersey, Washington D.C., Texas Austin, and other areas. But in 2014-2015, the 25% of VC investment in the US being in Silicon Valley doubled to 50%. So, Boston is losing ground to Silicon Valley, Austin Texas, New York and New Jersey as they are all moving ahead, but Silicon Valley is moving ahead at such a breakneck pace.
Silicon Valley, if you go back to 2000, was really all about IT and related sectors and to some extent about biotech. Today, of course, IT and Biotech remains absolutely hot, but then you look at for example automotive.
The automotive center of the world is not Stuttgart, Detroit, Tokyo, or Nagoya, it's in Silicon Valley. You look at Fintech, look at Edutech and so on; they are gravitating to Silicon Valley. In that sense SV remains at least, so far, unique almost like hotspot in the world.
Is Bangalore at par in connectivity with Silicon Valley?
Bangalore is moving at a breakneck pace. And there, I think, India's innovation and entrepreneurship ecosystem benefits both, from the culture of India and it also benefits essentially from the connectivity Bangalore has to SV.
If you look at the tech venture created at SV formed by Chinese and Indian emigrants from dominant ethnic background and that started in the late 80s and early 90s, many of them have graduated and have become successful and many of them are now VCs in SV. Therefore, there are a whole bunch of tech entrepreneurs and tech VCs in SV whose roots are in India and they provide the connectivity.
That's why we look at, for instance, Vani Kola of Kalaari Capital; she is from SV. Look at some of SV venture capital firms such as Sequoia, they are very big in India. So, I think Bangalore is really like the hot spot for tech ventures in India.
How do you see the talent growth in India?
It benefits if you look at the phenomenal quality of the talent that comes out of the IITs and IIMs. And it is when the IITs are not yet research power houses. Nevertheless, the quality of the talent, the average IIT graduate certainly from the top five that goes back to the 50s and 60s, they are at least as smart as people coming out of MITs and Stanfords. And they don't want to work for a large company. They want to be entrepreneurs. And more and more money is now flowing.
Is Silicon Valley all about Changing the World?
One of the many factors that make SV what it is, for instance, is the strength of the educational institutions, like the Oxford and Cambridge in the UK, Chingua in China and you have the IITs and IIMs in India.
Although IITs are moving quite proactively to become stronger in research, if you look at Google for instance, Google algorithm came out of PHD students doing research and so if you look at whether it is Cisco, or what we are witnessing in terms of autonomous cars, artificial intelligence, that the underlying technology came out of universities. We still don't have that kind of cutting edge research coming out of Indian or Chinese universities.
Cambridge, yes in the UK! but definitely not in India yet. Probably the biggest difference is in the ethos. What I mean by ethos in SV is "change the world'. Of course you want to make money and you can't change the world if you cannot financially sustain yourself. But the basic idea as Steve Jobs said is to make a dent in the universe which is different from the typical Chinese entrepreneur based out of Beijing or Shanghai, is to create a commercially successful venture. The goal is same in India also.
Nothing is wrong with that approach, but there is a difference between Flipkart's approach vs Amazon's approach to tech venturing. Amazon started out as online retailer, but if you look at their cloud computing, they are ahead of Microsoft, IBM, and Google and so on.
Jeff Bezos has said that his goal is to make Amazon the world's most customer-centric company and not the most customer centric online retailer. Therefore, in a sense, Jeff Bezos wants to change the world and not just make a successful enterprise. Same ethos, we still don't see in India or China yet.
Like Deepmind, purchased by Google, created the programme that defeated the World Champion from South Korea in the Chinese game of Go recently. That's kind of the world's leading edge technology. We still don't see that. I think it's great we are moving ahead in that direction in India or China but it's like, you walk before you run.
This article first appeared in the Indian edition of Entrepreneur magazine (May 2016 Issue).