All the Risk. All the Reward ?

The Anderson School of Business (UCLA) has a T-Shirt that says, “All the Risk, All the Reward”. I sometimes wonder about the truth of that statement. Especially in India. Whilst in the US, entrepreneurs, and especially successful entrepreneurs are hugely rewarded, in India that just does not seem to be the case.

The primary issue in India is the business environment. The complete system that has its basis in the British era, and revolves around making it extremely difficult to conduct business. And so that itself is the first stumbling block. If you want to appoint professionals to do the filings and other compliances, you face the issue of them being pretty expensive. And worse, on most occasions they don’t comply. As and when the issue comes up, they “Settle”.

The next challenge is employees. In India, we do not have a culture of risk taking employees. Most young people just want a safe and secure job with a salary as high as they can manage, with as little work content they can get away with. And so hiring becomes a huge challenge. You do manage to with great difficulty hire a few people. And being a start-up you train them and make them super competent, and you begin to get a feeling that something is finally moving.

And just as you’re about to throw your first party, to celebrate the coming of age of your new trainees, who are now competent, they put in their papers. They are now so well trained and so good, all of the big companies would love to have them. And the name itself is sufficient for them to leave. On many occasions, they aren’t even being paid more. And not to waste the event already planned, it becomes a farewell party. And so you’re now back to square one.

Your dream product is getting delayed. And by now you’re running a little short of money. Your funds are drying up. You’ve taken all the risk. You’ve burnt up your money. And the reward you’ve gotten for all of your pain is to know that the next time you have a great idea, you need to get it done in a place where the environment is more conducive to rewarding new and advanced forms of innovation. Be they services, products or solutions.

Just saying a system SUCKS does not help anyone. But doing something about it does. And one of the things I hope to do, is to try and make the environment more conducive for entrepreneurs, By having a fund that will not only act as a VC, but more important, make the environment conducive to focusing on making the business valuable as opposed to getting caught up in managing unproductive  administrative red tape.