Startups and the slowdown

By Ganesh Natarajan

Entrepreneurship is always a challenging choice and in a weak economy presents even bigger challenges. In a note to investors Leif Lybecker Eskesen, HSBC’s Chief India Economist has described the state of India as a “gasping elephant”, which may be unflattering but is surely an appropriate description of a country which has always held so much promise, briefly flattered to deceive in the last five years of the previous decade and is now in danger of slipping into an abyss of low growth. The abysmal GDP growth of 5.3 percent in the last quarter, the slowest recorded in the last nine years, could either prove to be a wake-up call or a harbinger of worse growth numbers to come! Vibrancy in the Valley
Should an aspiring entrepreneur suspend his dreams and plans and wait for better times to float his venture? At such times it may be worth taking a leaf out of the book of Silicon Valley, arguably the most vibrant ecosystem for promoting and fostering innovation and entrepreneurship. On a visit earlier this month, I found that while the overall economic mood in the US is wary, there is still vibrancy in the Valley and investments continue in the development of new technology. Cloud computing, mobility, enterprise social media and new technology innovations to help consumers in every sphere are getting traction from customers and investors alike. In spite of the Facebook IPO debacle, there is enough optimism because entrepreneurship is seen as the best way for America to climb back from the abyss of a second slowdown. Address pain points
In our country too, entrepreneurial opportunities abound if one is able to identify discontinuities in existing product or service offerings and build a razor sharp focus in the new business to serve latent customer demand. On a recent visit to Bengaluru, I found some interesting mobile applications and electronic commerce startups have emerged, from hailing a taxi in 15 minutes to enabling small retailers to avail high quality cloud-based services. These thrive in a solutions-hungry city and have been started by talented professionals who have the intelligence to sense a business opportunity, the persistence to overcome initial hurdles and teething troubles and the experience to build a scalable business to address the growing needs of their customer communities. What works for tech entrepreneurs also holds for many other sectors. India has a clear need for entrepreneurial solutions in agriculture where crop productivity remains abysmal, in industry where new manufacturing solutions like additive manufacturing can change the face of the business, in financial services where the troubled microfinance industry is in search of new ideas and many other such areas. What each one of these needs is the hunger to make a difference on a scale that only India can provide and the resilience to build a company that can succeed! smementor@moneycontrol.com