President Abdul Kalam Urges SBI for a $1 billion Venture Fund; Why(not)?

It is not the lack of money or the dearth of vision that the Venture Capital ecosystem in India is less than vibrant. If it were vibrant already, why should the President bother to bring it to the forefront?

Part of the agenda setting for State Bank of India(SBI) during bicentinal celebration session our esteemed president, Dr A B J Abdul Kalam asked SBI to set up a venture capital fund to the tune of Rs 5000 Cr. Mainly to fund scientists and innovators to bring their innovations to a huge market success. Thereby benefiting the economy, creating jobs, creating global competitiveness for India, making India a global super power etc.

[ Cartoon Courtesy Hugh ]
If there is an avenue of Investment, in a fairly matured market like India, it will exist in some form or other. Here is my take on 5 reasons why VC ecosystem is yet to take off in India.

5 Innovator cluelessness: Scientist, inventors, innovators are clueless on the venture process. They think VC money is easy money. They don’t do the necessary homework to present their case. Their knowledge of money, finance, how venture funding works is next to zero. They dont fully appreciate that venture finance is costliest from of capital and their plan must be that much high-risk/high-return gig.

4 Speed of Business: Till recently, due to several reasons converting a business concept to a profitable reality took several years to complete. Culturally this means that you normally build your business to keep, and perhaps pass on to your next generation to enjoy. Basing your business on VC funding means you must be ready to exit. The slow business cycle means that there are less serial entrpreneurs to fund. Which has dampened the growth of a vibrant VC ecosystem.

3 Organic Growth favoured over Inorganic Growth: Due to cultural reasons and practical operational reasons organic growth is the only stable/proven/working growth model. Franchisee systems are yet to take roots in a major way. Such partners want to do their own optimizations perhaps killing the concept in the process. When you are growing organically, you are much better off going in for cheaper capital than VC money.

2 Capital Is Not The Only Crucial Success Ingredient: Operations wisdom guides one to maintaining a delicate balance between the stakeholders, viz., suppliers, employees, regulators, utilities, etc. The working relationship is to be cultivated over several years and constantly nurtured. This rules out quick success, quick exit modus operandi of typical VCs. This also means that the market is loaded in favour of incumbent. And the incumbent is invariably averse to dramatic changes in the market( which will typically imply reconfiguration of the carefully constructed relationship network)- thus status quo wins.

1 Cost of Talent/Manpower: Until recently, manpower was cheap and for the talent secured job was more lucrative than the vagaries of business advanture. But now a horde of risk hungry entrepreneurs who have tasted VC funding at shores afar are back in India. They are changing the ground. And the job market is vibrant enough and boring enough to keep them at arms length. Now building blocks of business are slowly emerging. VC ecosystem is not powered by the money, it is powered by the motivation and energy of the individuals want to make it big in business. Now, slowly conditions are emerging to enable this.

This is my quick take. The idea is to stimulate a discussion. Comments, flame, questions welcome.

Flutter:Of Snowballs and Pearls

Mordern science is obsessed with naming theories, concepts, mountain peeks units after pioneers. There is more to naming than just a easy handle. Here is my go at the origin of Snowballs( bearing in mind the Indian adage that it is “Futile to trace the origin of a river or of a saint” )

Confused said:

There’s always some stimulus to write a post about something. It may come from something you read, something that comes up in physical conversation, something you see while surfing the web, whatever. And sometimes it’s none of these, it’s your personal muse.

I tend to think of this stimulus, this spark, as the thing that sets the snowball off. And I wish I had a word for it, like pearls have nacre. I don’t want to use nacre because likening blogs to pearls feels a bit presumptuous. Yet stimulus and spark and root and words like that don’t feel right either.

The sense I’m trying to capture is one which shows the opensource and shared and emergent and free and growing and energetic and creative nature of ideas in blogs, something that snowball captures well. What do we call this thing that starts a snowball? Doc, anyone else, any ideas?

How about Flutter?
As in Butterfly Effect and the natural way a butterfly inspires freedom, contemplation.

And the cruel reality of most flutters:

Cartoon courtesy Hugh

PS: I am posting this here as this comment went into a Moderation queue/Blackhole without much feedback. The result of having so many links. A feedback like “awaiting moderation” would have saved me this trouble.

Creating Passionate Users; Q:A-list howto?; A:Natural, Well Balanced

Kathy Sierra is asking why her blog made it to the A-list. This is the wonder of blogging, bloggers and all thing co-creation:The amature getting really good at it thingy. Like you play a game naturally and suddenly you find that you are winning; You speak naturally and you find that there are fans around you saying thay you are witty.

Be it Code like a girl or If Tech Companies Made Sudoku or Conversational writing kicks formal writing’s ass there is an element of well balanced wisdom packaged with humour. And it is just natural.

In my experience, Creating Passionate Users is part of my staple diet bcoz it is well balanced. Good mix of geek stuff+ marketing stuff+ sprinkled with good images. It is like a time tested favourite treats like say a Kulfi or a Rasgulla, the ingredients are well blended so well that you cannot meke them out in the output. These were not designed by food are recipe experts but they evolved naturally with the help of experts ofcourse. Like that, CPU is a well balanced treat where it is a outpouring of passion. While passion is an important ingredient, the output has its own unique taste.

So what is the tip/recipie for making it to the A-list: CPU happens to be an apple pie/Kulfi/Rasagulla( substitute your fav treat). If you get the recipie treat analogy here, then you have made my day!

Here is something funny/practical/natural, etc whatever typical of CPU:

[To those of you who are just dying to add the snarky-but-uncreative "because blog readers are stupid" or "you must have had sex with an A-lister" kind of answer, don't bother. It's my blog, and I'll consider those unhelpful/off-topic. And besides, I'll just have my new Blog Bouncers Leisa Reichelt (design blog), Rick Turoczy (marketing blog), and James Sherrett (all-around good guy) toss you ; )]

And here is the cartoon curtesy Hugh

World Information Society Day: Go Pinko WiFi with micro enterprise and micro finance

Today is World Information Society Day as declared by the 140 year old International Telecom Union.
While it is hijacked by big guys like

telecom players( BSNL releasing a 4 page ad to promote iteslf) or

poster child IT majors( Infosys getting mielage for its Campus Connect recuritment drive masqurade as an effort to serve ICT to underserved!)

Let me share my thought on equity through Pinko WiFi.

This thought was motivated by the Self Help Group supported/youth operated Soup stands that sprang up in Chennai recently. They offer delicious, healthy and steamy soup, and the minimal equipment needed to boot strap the offering were procured through micro finance. And they are an instant hit and pocketing handsome profit.

Why not offer WiFi the same way? Why wait for the big telecom vendor to work out his numbers and roll it out in phases?

The idea is simple: Use the self help group(SHG) fromat, micro finance, micro enterprise model to encourage motivated youths to by WiFi access points and wireless internet connection. Let them setup points of presence at strategic locations and offer WiFi connections for a charge. They can make roaring business by renting wifi enabled access hardware like Palm Tero or Windows Mobile.

Boot Phase: They can boot their operation by getting a clientele base that has time to kill. And disposable cash to spend. Moving train, rail terminal comes to mind immediately. Let us look at the moving train. Say in a train like Brindhavan Express, between Chennai and Bangalore which is used by a lot of computer savvy crowd this can be tried out and expanded to other trains. If you buy a ticket and travel as a passenger I dont think anyone can object to you carrying WiFi equipment in the train( especially if it is compact). Invest in a few WiFi access points. Invest a WireLess connection that works. And spread the wonders of WiFi for one and all: Profit from it.

Summary: Spread the wonders of WiFi and boot a micro finance, micro enterprise based WiFi access business network based on Self Help Group Model. Something like a STD/ISD boot of the last era. Bridge the digital divide and create equity in the process.
As usual cortoon courtesy Hugh

Update: Kribs the charismatic Blogger and a Sport from Chennai has an excellent suggestion for Company in India to earn goodwill and mindshare. Stating how google got excellent coverage from its free WiFi initiative, he is asking companies to take the cue from there. It will be a major hit at places with huge floating population like Tirupathi. In Tirupathi there is a lot of waiting, and people have time to kill. Doing WiFi there makes a lot of business sense. And there is always the grace of Lord Balaji who will return wealth multi-fold for someone doing their bit for his abode.

Joy of Innovation Crossing 3-digit Hits; Thanks to strange Search Engine Results

Today I am happy note that the hit counter has crossed 1K mark. 80% of the traffic is after the BarCampChennai. It has its own interesting set of search engine results: like the spelling mistake contributed, strange juxtaposition of words etc. WordPress tagging has done a good job of directing relevant viewers to the content. The all time one day high of 43 hits on the day I presented at BarCampChennai where it was projected on screen is yet to be breached.
Next step is to move on to focus on evolving the theme of the blog. I plan to evolve it to:Pinko, technology, micro business, micro finance based social inclusion blog.
Not bad for something started as an experimentation part of the Indian Science Congress 2006 Expedition!

PS: The most curious trafic I get is for “Bicycle renting” , “bike rental”, “cycle rental bangalore”

Cartoon courtesy Hugh:

Ideas Market as Innovation Enablers in Enterprise

John Sviokla has an interesting blog post on Market of Ideas

The notion of having an active market for innovative ideas inside a firm is vital because inventions and innovations are incredibly dependent on people who have local knowledge of the customer needs, customer setting, technology, likely implementation issues, and so forth. All of these factors are “impacted” to use the agency theory description of local knowledge. In other words, the expertise that resides with those people close to the problem, and close to the customer is very hard to transfer to others. Most organizations put their innovations into a budgeting system that allows people to “translate” their expectations into proposal that compete for funding.

It is like internal BlogShares of the companies new idea proposals.
It has several advantages like increasing the level of participation and rewarding the winners that are good at spotting the ‘good’ innovations:

The trouble with innovative ideas within traditional budget mechanisms is that those reviewing the proposal are usually inexpert – and in fact they are probably more inexpert in those projects that are innovative, for senior executives usually climb to the top of an organization through previous innovations which means that the very expertise which was the basis of their success is often outdated.

Better, Early Review:

The best solutions come when it is easy to contribute and there is a social process for sorting out the good from the bad, efficiently – as there is in idea markets, and in open source software

Here is the pinko part:

Put another way, the market allows you to show how deep your faith is. Over time, more successful people should be given even more “nominal” money to spend, because they have shown an ability to judge well. In the stock market, Warren Buffet gets a lot more “votes” than I do, because his track record is so good. This should happen inside companies too, when it comes to innovations.

Cartoon courtesy Hugh:

Is there a microformat for mashups?

Mashups are the most interesting driving force in Web2.0; I was wondering if there is a microformat to describe them – hMashup anyone? If Driving Directions deserve a microformat as envisaged by Bill Gates, Mashups also deserve one. Is it too complex to pass through a ’solve a simple problem’ filter of microformats.org?
Pointers, Answers, Comments, Discussion, welcome.

Cartoon courtesy Hugh.
Cheers.

BarCamp covered in The Hindu by Meera Mohanty

Today in The Hindu Metro Plus, Ms Meera Mohanty covered the BarCampChennai, in time for BarCampMumbai and BarCampPune!
It is Titled “Where Geeks Get Together“

Here are some interesting snippets:

These open agenda, open participation hang-outs for techies and geeks (discuss cars or Frisbees if you please), like all ingenious ideas, caught on. And how! A little more than six months after the first event in Palo Alto, California, in August 2005, Delhi hosted the first Asian BarCamp early this March. In early April, Chennai and Hyderabad, followed by Bangalore, hosted their own events. Mumbai’s BarCamp is scheduled for May 13.

…

BarCamp wasn’t just a place to learn about setting up a successful Web product, mobile computing, entrepreneurship, python (not a reptile) or ruby (not a gem). If you attended venture capitalist Karthikeyan S’s talk, it was also about how to get smart ideas funded.

…

A fortnight later:

Having received considerable encouragement, Ganesh of rupya.com has decided to invest more time and money into his stock blog.

…

Kiruba Shankar (http://www.kiruba.com) and K. Shyam (http://shyamk.blogspot.com) have cycled down from Bangalore to Chennai, and in true BarCamp spirit it’s an open adventure and you’re free to join them. “I’ve since become a big believer in collaborative work,” says Kiruba.

…

Aswin who met Shyam at BarCamp, now gets regular tips, advice and encouragement one of the lead developers of YahooPOPs, an open source initiative that mSync depends on.

Here is the salvo:

Abhinav Goyal writes about a new life (http://abhinavgoyal.blogspot.com). “Something somewhere having shifted,” he says, and credits the transformation to the positive “energy of the people at BarCamp Chennai.” And he writes “Secondly, there was the beach…. I think what I gained this weekend was a formula to beat the mindlessness that the daily routine sometimes brings along with it. … and this weekend, I learnt how to just wash it all away with a smile in ankle-deep water.”

Kiruba’s emali alert for people in the mailing list sums up the coverage more crisply:

Meera Mohanty landed at the BarCamp on the second day. She spent a long time at the barcamp and that’s visible at the quality of reporting. Amongst all the BarCamp articles that I’ve read, this one is definitely one of the most informal and interesting article.

Cheers BarCampChennai, RockOn BarCampMumbai and BarCampPune!

How a small thing can change your life

I was reading a Amazon short I bought using my mturk earnings. It is a story of how a whim about a Luggage can transform a persons life:
Amazon Short: A Man and His Luggage: Leather As a Life Imperative
by STUART WOODS

It starts with:

In the autumn of 1960 I was a boy copywriter at BBDO, earning seventy dollars a week. (It is a measure of my value to the agency that my secretary was earning eighty dollars a week.) One morning there appeared in the New York Times a full-page ad for the now-departed Abercrombie & Fitch, introducing its acquisition of a line of Italian luggage called “Whip di Roma.” On my lunch hour I wandered across Madison Avenue and was boggled to find a sea of gorgeous honey-colored leather stretching over half a floor, incorporating everything from a shaving kit to a steamer trunk. Alas, I was unable to afford even the shaving kit. I slunk, humbled by my penury, back to my cubicle and my Remington Noiseless, which was older than I. A lasting impression had been made upon an impressionable youth.

And ends with:

Before my departure I had ordered two more cases in the new color, one of then a copy of the Case of Suits, and had left my old ones for renovation by their creator. Four months hence, all would be shipped to me. The cost was about double what I had paid in Rome sixteen years before, which, with inflation, still seemed like a screaming bargain. The mystery of who made both my old luggage and the new remains unsolved; Gabriella, lovely as she was, wouldn’t tell me.

My relationship with this luggage is now older than my second wife, and I have enough to last me until I am too old to travel. I have thought of being buried in the cases, but this would require dismemberment and shrink wrapping. On reflection, this is clearly the sort of luggage that should be passed on to a son. But I am childless.

We have decided to adopt.

This piece was written some years ago. The adoption failed, and my wife and I were subsequently divorced. We share custody of a Labrador Retriever, who travels light and, thus, does not require luggage. The Smithsonian is next in line.

Good story! Nice humour!

Cartoon courtesy Hugh

Four Pillars: What it means to micro enterprise + Web2.0 ( SHG2.0)

I am following J P Rangaswami’s interesting Four Pillar’s discussion.

On top of this Foundation are Four Pillars. Syndication, which pushes out information, subscribed to and personalised as needed. Search, which pulls in information, collaboratively flitered and preferenced and heuristically-improved as needed. [In both these cases information is acquired on a non-deterministic relevance and ranking basis, with training and learning being the basis of improving accuracy]. Fulfilment, which is the transaction process of discovering inventory and price for an interest, identifying the buyer and seller uniquely, exchanging value and proceeding with the logistics. Fulfilment is fulfilment for a book, a bed, a bond or a body. And Collaboration/Conversation, which is the “markets are conversations” Cluetrain glue that binds all this together.

A quick recap of SHG2.0 – it is a collobrative self organizing network of self help groups( micro enterprises) that are engaged in craft and artisanship. The idea is to leverage the power of web2.0 to empower the craftsmen and artisans to create products and services and compete with big businesses.

Four pillars is about information, how information is produced and consumed in the era where peer production assumes centre stage.

SHG2.0 is about craft and craft enterprises. It is age old and time tested ‘peer production’ equivalent of manufacturing.

With the emmergence of the four pillar/cluetrain age, manufacturing will also be influenzed by it. Craft based manufacturing will increase its share. SHG2.0 will become relevant with that development.

Cartoon Courtesy Hugh