Vol 2 / Issue 01 / Oct 08
a
publication
/Rs 30
20
things that improve your chances for loan or equity funding
Couples as entrepreneurs - secrets for success 3G and WiMax opportunities Kids’ furniture & furnishings New fundraising options for NGOs Breeding exotic pets Drama for education Vehicle bulletproofing
entrepreneur of the month/
Schauna, Alisha & Nadia Chauhan, Parle Agro investor of the month/ Mohit Bhatnagar, Sequoia Capital columns/ Opinionated Brands Uncle Sam’s Long Shadow Grandeurship
Gujarat: Naga Sathi Agencies - 9601259838
Vol 2 / Issue 01 / OCT 08
BOARD OF ADVISORS C K Prahalad
University of Michigan
N R Narayanamurthy
Chief Mentor, Infosys
Kanwal Rekhi
Chairman, TiE
Romesh Wadhwani Chairman & President, Wadhwani Foundation Gururaj ‘Desh’ Deshpande
Chairman, Sycamore Networks
Saurabh Srivastava Chairman, Indian Venture Capital Association Kiran Mazumdar Shaw R Gopalakrishnan
Chairman & MD, Biocon Executive Director, Tata Sons
Philip Anderson
Professor of Entrepreneurship, INSEAD
Shyam Malhotra Editor-in-Chief Krishna Kumar Group Editor ANALYSTS Aswathi Muralidharan Binesh Kutty Mohita Nagpal Shilpi Kumar Sreejiraj Eluvangal Vimarsh Bajpai OPERATIONS Ajay Dhoundiyal Product Manager VIjay Rana Design Anil John Photography SALES & MA Jaideep Mario Gabriel Imran Ali Dayanath Levaj Jagadeesh Kingshuk Sircar
MARKETING Associate VP West West South South South-East Asia
PRINT & CIRCULATION SERVICES NC George Associate VP T Srirengan GM, Print Services Sudhir Arora Circulation Services Manager Pooja Bharadwaj Assistant Manager, Subscriptions Sarita Shridhar Assistant Manager, Reader Service
/cover story
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43 things that improve your chances for loan or equity funding
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66 New fundraising options for NGOs and social entrepreneurs
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From basic donations like food and clothes to more innovative ones like sponsoring medications, schooling and granting wishes— the focus is now shifting from cash donations to the more transparent in-kind donations
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/contents
32
opportunity/ 3G and WiMax opportunities..................... 16 Hair-raising business ideas ..................... 40 The business of coffee table books .......... 48 Software opportunities from SaaS ............ 56
entrepreneur of the month
Schauna, Alisha and Nadia Chauhan, Parle Agro From the daughters of Prakash Chauhan to the ones handling Parle Agro, how was the transition planned out?
Breeding exotic pets ................................. 60
Rupin Jayal ............. 20 Anurag Batra ........... 63
Europe’s largest economy offers Indian entrepreneurs a strong base to expand in diverse sectors
strategy/ Couples as entrepreneurs......................... 80 sector/ Vehicle bulletproofing ............................... 26
education/ Edu-drama ............................................... 76
DARE catches up with Sequoia Capital India’s operating partner, former entrepreneur and telecom industry veteran. Bhatnagar has worked with Bharti Airtel and Ericsson, before his stint at Sequoia.
business cabs chauffeurs come companies
company cost crore customer customers delhi entrepreneurs fleet house india industry
just like make manufacturing market print
publishing radio resort says search
second services share start time traffic tree used value want world year years
52
investor of the month/ Mohit Bhatnagar
books brand
number passion people
Doing business in Germany
Business from waste paper ...................... 64
Paranjoy Guha Thakurta ... 90
good goods hand
22
Event lighting & equipment ..................... 72
blogs/columns
audio book
global opportunities/
28
opportunity/ Kids’ furniture & furnishings
others /
With households forming 65% of the $7,922 million Indian furniture market, how are entrepreneurs leveraging the potential in this niche segment of business?
Feedback ............................................... 13
Exchange ............................................... 08
from the website / Blogs ..................................................... 94
NEN / Creative organizations ............................... 74 Off to a hot start ...................................... 84 OCTOBER 2008 5
www.dare.co.in
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blogs/edit
Expect more bad news to trickle in, but a relatively faster recovery. Why? Because governments cannot afford huge and unexpected financial blowouts.
Lehman Brothers, Merril Lynch and the rest: How will you be affected?
L
eading investment banks are collapsing like there is no tomorrow. Bear Stearns, Merril Lynch and Lehman Brothers are now history. Goldman Sachs has taken a big hit on profits. Big insurers are in deep trouble. In Europe, travel agencies are falling like nine pins. Seguro Holidays and XL Leisure are down and many more are expected to be in trouble. AIG is scrambling to stay afloat. Should you be trembling in your shoes? How does this affect the entrepreneur in you? Anybody who is in business or wants to get into business would be foolish not to be concerned. Here are a few first cut pointers to what is in store for the rest of us. 1. Interest rates on everything have already gone up; expect them to go up further. This means cost of working capital and operating expenses are going further northwards. 2. If you are in the market for PE funding, take a deep breath and look again. PE funding is a big part of what investment bankers do. And three out of the top five have just sunk. You will be lucky to get a deal immediately; forget valuations. 3. Put your IPO in cold storage for as long as you can. 4. VC valuations have already come down. Expect the southward squeeze to continue. Funding may not die out, but will definitely be slower and funds will be choosier. Expect due diligence to take longer. 5. Now might be a good time to rework your sales predictions if you are selling to the US markets. 6. Expect more bad news to trickle in, but a relatively faster recovery. Why? Because governments cannot afford huge and unexpected financial blowouts. Look at what happened to AIG. They could not predict the impact of AIG going into liquidation and so could not afford to let it happen!
PS: This was originally a blog posting made at dare.co.in/ blogs
/Krishna Kumar
OCTOBER 2008 7
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Published: July 2008
I am working with the
Arvind Tolye of Delta Group invited entrepreneurs to grab a business opportunity on the launch of his men’s apparel brand.
Dainik Bhaskar group
dia setting up a unique me and am interested in e a combination of onlin company, which will be in g a magazine (1st time and offline by launchin g nture Capital, marketin world). I need some Ve and space selling expe
rt for my venture. Via SMS
Response: September 2008 I read an article in your July issue on “CONFIDO,” an exclusive brand in the men’s wear category, and am interested in the opportunity. Can I get the contact details of Mr Arvind? Arun Kumar, Andhra Pradesh
I am a subscriber of DA
RE, and am happy to
nit has given me treme note that over the year, a area of business. I am dous knowledge in the neur, involved in the ne first generation entrepre last cafes. However, in the glected field of cyber all re has grown from a sm eight years, my ventu ne of six cyber cafes in Pu cyber cafe to a chain the .30 lac per annum. In with a turnover of Rs some unique systems
and
this business highly pr
ofit-
process, I have created I am interested in setting up a micro industry for extraction of sodium silicate from rice husk as it is abundantly available in our locality. I would be grateful if you could provide information as to who can provide the technology and who can setup this unit on a turnkey basis. Ajay Kumar
8
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a strong team to make
able. I have got a uniqu business out of Pune in 2, tier 3 cities, which is
e idea for expanding thi semi urban areas and
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der
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I am a third year B.E (bachelor of engineering) Computer Engineering student. My aim is
I want to setup a tiny/m
icro chemical unit
to set up a software company during my gradu-
hs. It will be useful if and can invest Rs15 lak
ation period for which my college is incubating
n ormation as to who ca you could provide inf
me. But the main problem in achieving my goal
oduct and will give the help me choose the pr
is the lack of work/clients/customers.
technology, or if it is be
We are a group of people having expertise
tie-up for an ancillary
tter to have a marketin
g
unit.
in C++, C, Java, Oracle and I need some work
Sennakesavaraj Tirunelveli, Tamil Nadu
as well as customers to flag my company. I am requesting you to please help me and guide me so that I can turn my dream into reality. Sudipt Kumar
I want to start a plant the ter. I wanted to know I want to create a socia
l networking web-
site, and need a mento r to guide me on how to run a company, ho w to get people for my website, how to create
a market for my website ,
etc.—there are many do am new to this field. I
ubts regarding this as
would be very grateful
I
rose water, the type of
producing rose wa-
process of extracting
rose required for extra
ing rose water and the who will purchase my
ct-
addresses of the buyers rose water for sure. Als
o
sent cost price of the I want to know the pre entire project, the prod
uction cost of rose wa
ter per kg and the price
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if please guide me?
you could help me.
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I am from a village in the Tirunelveli
to approach for legal and other
from the library of my college. It is re-
district of Tamil Nadu. I accidentally
advises. I am also interested in part-
ally a very good magazine with lots
saw a copy of DARE magazine Sep'08
nering with service providers across
of information relevant to my area
at a bookshop in Chennai. I bought it
various domains.
of research.
and have gone through it. Must say, it
Prashant Thakkar
really impressed me. I have subscribed it now, though I missed 12 issues of this magazine. Sennakesavaraj I am an entrepreneur from Mumbai offering ITES services. I am interested in promoting medical tourism.
theme of entrepreneurship in India. I am In the September 2008 issue I read
also surveying angel investing in India
an article by Binesh Kutty regarding
through a questionnaire. I am currently
Dr. Jain, who offers cow therapy for
pursuing a study on the preferences
cancer. I would like to contact the doc-
of new age entrepreneurs towards
tor. Can I have his contact details like
financing their ventures in India.
e-mail or cell number? Lakshmanan, Chennai.
Keeping in mind the Commonwealth I would really appreciate if you can
medical tourism portal wherein I want
help me on the valuation front. We
to provide information about medical
have a chemical manufacturing com-
treatment, tourism, affordable hotels,
pany in Gujarat. Do let me know what
resorts, service apartments and home-
details you will need from my end.
Kindly provide me more informa-
I would request you to share the information related to entrepreneurs and venture capitalists in India, (par-
Games in 2010, I am planning to have a
stay services and other services.
I have written research papers on the
Raj Lokhandwala Altret Performance Chemicals
ticularly entrepreneurs from Gujarat) and help me in pursuing my research, Bindiya Pathak
I read an article in your issue regarding alternative therapy products based on cow urine. As my son has a
tion for home-stay services, medical information and other services. If
I am a lecturer at K S School of
tumour in the kidney called clear cell
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Business Management, Ahmedabad.
sarcoma, I want to know weather I can
this domain, what would I need and
I am doing PhD in the area of venture
go for this medicine. I request you to
what other factors do I have to keep
capital financing in India with special
provide the phone number or the con-
in mind before moving in this direc-
reference to Gujarat. I have just read
tact address.
tion. I would also like to know whom
the previous issue of DARE magazine
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The Fourth Screen 3G and WiMax will bring tens of millions of new devices to the Internet marketplace, are you ready? /Sreejiraj Eluvangal
T
he prospect of Indian operators launching 3G and WiMax services has 36-year-old Yusuf Motiwala excited. A veteran of premier technology companies like Lucent Technologies and Texas Instruments, Motiwala bid adieu to his high-flying corporate career to start his own mobile application firm a year and half ago. “Carriers have made it into a walled garden, but things are going to change now,” he says. Motiwala is talking about the Rs 7,000 crore Indian mobile value-added services (MVAS) market. Motiwala, whose TringMe platform tries to use Internet data to provide seamless voice connectivity, gets most of his business from outside India now. Though TringMe offers a mobile phone application that uses the subscriber’s data connection to enable free voice calls to other phones and computers, the takeup in India has been limited so far. 16
OCTOBER 2008
“Only a small part of our four million users are from India currently. The data connectivity here is very poor,” he says, “In addition, there are many regulatory hurdles. We cannot interconnect our traffic with normal phones in India; we can’t give them a phone number. So, we have to give our users a US phone number.” The problem that services such as TringMe face in India is at a fundamental level, that of the availability of basic infrastructure. Most applications such as voice-over-Internet, streaming music and video, video calling and a decent web-surfing experience require moderate to high speed access to the Internet. Because the mobile Internet experience is less than compelling at the current speeds, only about 5% of the 300 million Indian mobile users have subscribed to any kind of data plan, even though more than half of the handsets
sold in India in the last two years have data capability. Even though there are no high-speed wireless data services yet, most phones that cost upwards of Rs 8,000 come with 3G built-in. The prices too are declining every quarter. “As of now,” says Pankaj Mahindroo, president of the Indian Cellular Association which tracks mobile phone sales, “about 15% of the phones sold in India are 3G-enabled. But, technically, 3G handsets can be sold for as less as $100 also, given the decline in prices.” However, the fact that most mobile users in India do not subscribe to any data plan means that mobile VAS providers have to come up with ingenious solutions to reach out to their customers. “We have tried to get around by introducing an SMS-based alternative, in which we will patch you with voice call if you send us an SMS with the phone number you wish to speak to,” says Motiwala.
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opportunity/telecom However, most companies choose the easy way out and either provide only voice and SMS based service, or tie-up with the operators to deliver data services even to those subscribers who do not have data plans. Caller ring back tunes and SMS news alerts are an example of the earlier strategy, while music and video downloads are usually delivered in partnership with the operator. The result has been that mobile VAS businesses in which the operator does not charge commission and the vendor reaches across to the consumer directly are almost unheard of in India. It is in this scenario that 3G and WiMax are likely to play a very disruptive role by making millions of consumers directly accessible to the mobile VAS service providers. The faster connectivity is likely to lure high-end consumers to subscribe to data plans that allow them to connect directly to the Internet. Once exposed to the Internet, VAS providers can directly reach the customers without having to depend on operators to deliver content such as video, music and messages.
NOT JUST INTERNET ON PHONE While exciting, unleashing the full power of high-speed Internet on the phone may not lead to the most obvious results, according to some. “Most of the VAS services right now are built around voice, because voice works on low bandwidth networks also. That is all you can expect from the current 2G networks too,” says Prasanna Gokhale, manager for wireless and telecom at Tata Elxsi, the Bangalore-based technology arm of the Tata group.
“However, 3G and WiMax networks have fat pipes in which voice will be one kind of service. These services will allow you to design and launch applications that could not be even thought of earlier. It’s certainly not going to be just Web pages on your phone, but video-on-demand, news modules, voice-over-Internet,” he adds. Indeed most developers see an opening for new players— new Googles and Yahoos—on the fourth screen. “A new entrant will have to leverage the uniqueness of the mobile phone. They have to realize that it is not like the PC. It’s always with you, and it’s more personal,” says Chaitanya Nallan, who founded mGinger, a targeted ad service for mobile phones, with two of his friends a year ago. “The services offered can be more personal and more location-based than on a PC,” he points out. Vishwanath Alluri, founder and chairman of Hyderabadbased managed service provider for Telco’s IMImobile, strongly believes that the market opened up by mobile Internet will have very different dynamics. “The needs and circumstances of someone using a mobile and a desktop or laptop would be very different. A desktop user is probably sitting in office or home while a mobile user is more likely to be out. Therefore, what people do with Internet on a PC may not be what they do with Internet on a mobile,” he says.
The strengths and limitations of the mobile device itself will mould the kind of services that will be successful on it. — Vishwanath Alluri CEO and Chairman, IMImobile Besides the difference in the ‘situation’ of the user, Alluri points out that the strengths and limitations of the mobile device itself will mould the kind of services that will be successful on it. “It has got a small screen. There is a shorter span of attention and some content that may not be appropriate on one screen may be so on the other and vice versa,” he points out. As an example, he points to the ‘world in a minute’ video-news cap-
OCTOBER 2008 17
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opportunity/telecom
A new entrant will have to leverage the uniqueness of the mobile phone. — Chaitanya Nallan CEO, mGinger
sules that IMImobile sends out in partnership with AP for subscribers in Singapore. “Just like Microsoft Windows is not the main operating system on mobile phones, so too, mobile Internet will see its own set of new players. For example, in Germany, there is a company called Jamba. They are a brand in themselves. Even for payments, one can launch one’s own scratch cards instead of depending on the operator.”
CHALLENGES As in any new venture, the world of high-speed wireless services in India also faces many hurdles. The biggest one is, of course, that of handset availability. Though, as Mahindroo of ICA says, a 3G phone can be manufactured and sold for as little as Rs 4,500; for taking advantage of the full potential
of high-speed data, it would also need to have high-end features such as a big display, camera and perhaps even a touchscreen. “The Indian consumer wants the maximum benefit at the cheapest price,” says Chaitanya of mGinger. “We love to get things for free. So, it’s not of much use if you offer a lot of services and don’t keep the price factor in mind. Just because something works abroad doesn’t mean it will here. Look at the iPhone, it has only sold a few thousand units in a country of a billion people,” he points out. However, Roger Dorf, Vice President & General Manager of CISCO’s broadband wireless business unit prompts us to look beyond the mobile phone. Indeed, with Intel scheduled to make WiMax a default feature on its laptop chips later this year, PCs may just
Only a small part of our four million users are from India currently. The data connectivity here is very poor. — Yusuf Motiwala CEO, TringMe 18
OCTOBER 2008
shrink well enough to fit in consumers’ pocket. HCL Infosystems, for example, has announced that it is working on bringing out a 5-inch pocket PC over the next few months. Dorf says as long as the networks are there, the end-devices will not be a problem. “If people see there is a broadband infrastructure that reaches millions and millions of people, then manufacturers will think of how to scale down the products to make them affordable to everyone,” he says, talking about scaled down PCs with builtin WiMax. “Finally, it doesn’t matter whether you call it a PC, an internet tablet or even if it’s a set-top box that connects to your TV. But once the networks are there, devices will come in all shapes, sizes and prices,” he points out. The second question mark hanging over mobile Internet is the absence of a clear, operator-independent business model. The PC-Internet saw its own evolution, starting with early attempts to charge users for content and settling with the ad-based model pushed largely by Google. However, the smaller screen size may make the display-based advertising strategy unsuitable for the mobile screen. However, the smaller screen may also be the savior for advertising companies on the mobile. Alluri says IMImobile already has a few aces up its sleeve. “We are developing a system called Ad-Ring through which we can provide ads on anything—SMS, MMS, video, voice - on the fly,” he says. Ad-Ring adopts the online concept of behavioral targeting with on-the-fly capability to deal with a variety of consumption models. “For example, if you are someone who provides free phone calls using voice-over-Internet [VoIP], we can deliver a voice ad before the call is patched through. Also, the ads are selected based on the profile of the listener,” he points out. “Ultimately,” says Chaitanya of mGinger, “VAS providers will have to evolve an ad-supported business model like on the Internet. The services have to be affordable to the masses DAR E and that is a challenge.”
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/blog
Opinionated brands It must make people think and respect their freewill to disagree
“T
hese graphic, billboardsized ads included depictions of a variety of ‘shocking’ subjects such as a deathbed scene of a man (AIDS activist David Kirby) dying from AIDS, a bloodied, unwashed newborn baby with umbilical cord still attached, two horses mating, close-up pictures of tattoos reading “HIV Positive” on the bodies of men and women, a collage consisting of genitals of persons of various races, a priest and nun about to engage in a romantic kiss, and pictures of inmates on death row. The company’s logo served as the only text accompanying the images in most of these advertisements.” Briatore explained how they raised the company’s profile, “We decided to do something very controversial that people would pick up on—50% of people thought it was great and 50% thought it was awful, but in the meantime everyone was talking about Benetton.” (Wikipedia) There was a time when in India you actually used to have Coke versus 20
OCTOBER 2008
Pepsi arguments at parties. Today the two brands are increasingly blurred. Pepsi popularised “hinglish” when most considered it to be infra dig. For a time, Pepsi was the spokesperson for a generation being liberated from the inhibition of socialist idealism. The brand had an opinion and wasn’t wary of expressing it bluntly. “Nothing official about it” expressed an attitude towards authority and not just a clever hijack of an event. “Mera number kab ayega?” vividly expressed the hope and fear of a youthful population with ambition but without pathways—it wasn’t just a clever brand promotion. Pepsi truly was a “youth soulmate” and not just a carbonated soft drink. Some people think Harley Davidson is the ultimate expression of liberation while others see owners as wannabe posers. Swatch was very vocal in espousing causes, created global communities of like-minded people long before the term “social networking” was coined and revelled in being the Swiss “un-watch”. Again, everyone had an opinion about the brand. Many fashion brands thrive on being polarising thus generating opinions and convictions. “The trouble with our times is that the future is not what it used to be.” Paul Valery (1871- 1945) Today, more than ever before, we know more about just about everything but less and less about the future. We have become expert microsoothsayers and have succeeded in collapsing our entire world view into a quarter by quarter shoebox. And having done this, we keep casting about for some anchors to hold us while a deluge of uncertainties buffet us with increasing ferocity. As audiences fragment and the “mass market” goes from reality to myth and evanescence becomes the norm rather than the exception, how
/Rupin Jayal can a brand survive for the long term? Some of the most robust and profitable brands today polarise people in fundamental ways. They go beyond “benefits” and “positioning”. They go beyond “category” and into the realm of culture. Apple was in many ways one of the pioneer brands that addressed culture rather than category with their iconic “1984” advertisement and a product whose core philosophy was liberation. Today, taking simplicity, creativity and imagination forward, Apple has gone from being an iconic computer brand to celebrating the power of personal music. Apple is the No.1 distributer of music (in any format) in the US; iTunes has 65 million customer accounts and offers 8.5 million songs, 30,000 episodes of TV shows and 2,600 Hollywood movies. (Steve Jobs, September 2008). From computers to music—replacing the previously iconic Sony Walkman, a computer company usurps the space of one of the most successful and respected entertainment electronics companies in the world! Why? Because Apple has always had a clear point of view. Apple has always had those who passionately believe in it and those who are antagonistic about it. Please note that the words being used are not “loyalty” and “preference”. And now the same point of view has created a storm in mobile phones. Should Nokia worry? Maybe they should see what happened to Sony! To quote Steve Jobs... “Here’s to the crazy ones, the misfits, the rebels, the troublemakers, the round pegs in the square holes... the ones who see things differently—they’re not fond of rules... You can quote them, disagree with them, glorify or vilify them, but the only thing you can’t do is ignore them because they change things... they push
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/blog the human race forward, and while some may see them as the crazy ones, we see genius, because the ones who are crazy enough to think that they can change the world, are the ones who do.” Virgin is another example of a brand with a clear and vivid point of view. Again the brand polarises people. In the UK, the generation gap can be defined by the attitude towards the Virgin brand. The brand is not about “service” or “innovation” it is about a much deeper value of giving people a better deal than brands that live by category, 4Ps, profitability, etc, do. That is why category becomes irrelevant for Virgin because the brand plays on the far larger stage of human culture. This is what Porsche says about itself—the Porsche Principle: “The Porsche Principle is about a company that knows size isn’t everything. It’s also about a company that consistently goes its own way. On the stock market, for instance, because we don’t think too highly of quarterly reports and accordingly, don’t publish them. In public life, because we not only decline subsidies, we even challenge them out of principle. In the automotive industry because the little Porsche Company dares to acquire a substantial share of the giant Volkswagen Group, in order to secure its autonomy over time. In society as a whole because, despite our exclusive products, social acceptance is paramount for us. On the labour market, because to secure our long-term success we don’t eliminate jobs, we secure and create them. On the business base issue, because we are committed to Germany and are a constant reminder to others that one can succeed here too.” (Porsche Website) Porsche builds cars that are centred on performance. Even the Cayenne is an SUV where “S” actually means “sport” rather than “sluggish” which is what many so-called Sports Utility Vehicles have been. Porsche is the most profitable automobile company in the world. It is also possibly one of the most opinionated.
In India, given the recency of economic liberalisation, market driven forces, the evolution of people as consumers and the advent of Indian brands, few Indian brands have actually espoused a clear cut point of view. Exceptions are idea who today is talking more about the power of communication to transform rather than just connect. It will be interesting to see whether this is just an advertising campaign idea or a philosophy that will permeate the very soul of the brand. How will this initiative be experienced by Idea users, their employees, their associates and how will their shareholders intensify the conviction to take it forward even at the possible cost of profitability.
“
Few Indian brands have actually espoused a clear cut point of view. Exceptions are Idea who today is talking more about the power of communication to transform rather than just connect. It will be interesting to see whether this is just an advertising campaign idea or a philosophy that will permeate the very soul of the brand
”
The Tatas have always had a point of view—about doing things honestly and with honour. It’s now recognised worldwide and in an environment where members of the c-suite of many companies have enriched themselves while laying off employees, brands with a long heritage have been found to have foundations that are corroded, this value will only gain in importance. Nike too has always espoused a philosophy and point of view that transcends their category. They have always celebrated the power of the human spirit and doing rather than dreaming. Not surprisingly Nike continues to remain the leader while oth-
er brands die, merge or diminish. The power of a point of view backed by conviction and unwavering faith. Do all opinionated brands need a messianic founder or leader? To orient the entire company around a belief that transcends category and commerce, definitely requires it. But this also means that the brand has the potential of becoming a choice based on conviction rather than convenience or mere preference. It is very difficult to battle an opinionated brand. Copy it and you automatically become a follower. Oppose it and you strengthen the conviction of those that believe in it. This is a lesson that the so called IBM-based PCs have had to learn to their cost. They struggle as semi-commodities while ranks of the “Apple faithful,” swell. Given the myriad challenges that people face today and the increasing vacuum of leadership in other spheres of life, brands have a unique opportunity to appeal to people at a far deeper level. This goes way beyond Corporate Social Responsibility. It is not always about “doing good”. It is about human beliefs such as freedom, individuality, respect, honour, rebellion, etc. The only thing that is indispensible is that it must polarise. It must make people think and respect their freewill to disagree. But must never fear disagreement or disapproval as long as what it believes in, does not cause widespread harm. Many of the brands such as Harley Davidson, Porsche and Apple went through a period of doubt – at the time when brands with mass appeal were able to attract a mass market. But with the advent of Internet and the post mass market world, these brands have found renewed relevance and today are able to move between category and market effortlessly so long as they keep their core convictions intact. The day of the opinionated, iconic Indian brand is not far off. Will one of you be the creators of this brand or be a spectator to its creation? The choice DAR E is yours. The Author is Director-Strategic Planning at M&C Saatchi. OCTOBER 2008 21
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/global opportunities
Doing business in Germany Europe’s largest economy offers Indian entrepreneurs a strong base to expand in diverse sectors /Vimarsh Bajpai
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hen business conglomerate Kalyani Group acquired Germany’s RSBconsult last year, the move was aimed at further strengthening its position in the wind turbine sector. The acquisition helped the Indian company improve its product technology while harping on its own global supply chain capabilities drawn from its successful auto components business. The German company offered superb design capabilities from components to wind turbine systems, and had projects across the globe. Kalyani Group is among a host of Indian companies to have made such strategic moves in Germany, and renewable energy is not the only sector of
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interest for Indian firms. DARE country facts Much action has been Area 357,114 km² (137,883 sq mi) seen in the pharmaceuPopulation 82,369,548 tical space, primarily beGross Domestic Product 2,423.8 billion euro (2007) cause Germany happens to be one of the biggest Exports 969 billion euro (2007) generic drug markets in Imports 772.5 billion euro (2007) Europe. It was in 2006 Labor Force 43.51 million (2007 est.) that Dr Reddy’s LaboraWhile acquisition of German firms tories snapped up fourth-largest German generic drug maker Betapharm seems to be the preferred route for Arzneimittel for approximately Rs some Indian companies who plan to 2,550 crore. This was, at that time, the grow quick, others such as IT major biggest overseas acquisition by an In- TCS have set up their development dian pharmaceutical company. Prior centers in the country to cater better to to that, Torrent Pharmaceuticals had their European clients. With its Central acquired Heumann Pharma, the Ger- European head office in Frankfurt, TCS man generic drug distributor of Pfizer. has other regional offices in Munich,
/global opportunities
DARE.CO.IN
Michael Pfeiffer
Managing Director, Invest in Germany
What makes Germany an attractive destination for Indian businesses? The advantages to foreign investors in Germany are the same regardless of the prospective investor’s nationality. Germany offers advantages in the industries in which many Indian investors are very active. Indian investors are wise to place emphasis on ICT in Germany as it is Europe’s largest market in ICT, having brought in euro 146 billion in revenues in 2007. Indian investors are taking a keen interest in developments in renewable energies, and this is also an area where, thanks to a favorable investment landscape, infrastructure, and a highly qualified workforce, Germany excels. Lastly, pharmaceutical is an especially important industry for Indian investors in Germany. Germany is Europe’s number one market, not only because of its consumers, scientists, and hospitals, but also because of the quality of German researchers. More patents are registered at the European Patent Office from Germany than from the United Kingdom and France combined. When it comes to the European market, most entrepreneurs say they find it difficult because of the language and culture. Your comments. In Germany, an Indian investor will find that the overwhelming majority of the people whom he will interact with are tolerant, helpful, and multilingual. This means an Indian investor should have no concern about coming to Germany and speaking English with business partners, and even employees. Still it helps to have a German consultant or a lawyer at your side to help work out situations that might be unclear and confusing without someone with local knowledge. Lastly, there is a considerable Indian population in Germany’s major cities. Some regions even have cricket clubs or other organizations that could be particularly appealing to Indian citizens living in Germany. There are also non-stop flights to India from Germany’s Frankfurt airport. All German cities have at least one international (i.e. English speaking) school. What are the key sectors that are attractive for Indian investors? There are many industries that are attractive for Indian investors at the moment. ICT is the one that has seen the most greenfield investment projects over the last five years. However, industries such as pharmaceuticals, automotive and machinery manufacturing, and renewable energies have also seen a significant interest from Indian investors. Indian investors come to Germany because they find a strong R&D infrastructure, knowledge of the industry among potential employees, professional support from authorities, investment promotion agencies, and business partners during the investment process. How is the tax system and labor law in Germany favorable for foreign companies? Germany’s tax system is very competitive. Beginning in 2008, Germany reduced its corporate tax burden to an average of just under 30%, making it lower than in locations such as France, Belgium, the Canadian province of Ontario, and Japan. This reform bolsters Germany’s credentials as a country that is friendly and welcoming to investors. Labor laws in Germany are also more flexible than often perceived. Especially in the early stages of an investment, there are possibilities to ensure flexibility within employment relations. For example, investors can hire staff through a temporary employment agency providing flexibility in both the duration and potential termination of employment. Another possibility is to hire employees with fixed-term contracts, with no obligation to extend the employment. Regularly, fixed-term employment contracts can be signed for a maximum duration of two years. How easy or difficult is it to start a business in Germany? Anyone can start a business in Germany, and it is very easy to do so. It is recommended that entrepreneurs interested in starting operations in Germany study the different types of company formations to decide which one is the most appropriate for their business needs. For most established companies, the appropriate form will probably be the GmbH (the German equivalent to the British Limited). Administratively forming a GmbH requires having a company’s articles of association certified by a German notary, company details entered into the commercial registry, and a further registration at the trade office. The whole process takes no more than two to three weeks, and sometimes even just a few days when the investor has all of his documents in order. In a short time, the German government is also expected to approve a reform to the law pertaining to the GmbH (the GmbH Act). These reforms will further streamline the process of founding a GmbH. How does your agency help foreign companies in entering Germany? Invest in Germany is a full service “one-stop shop” for the investor. This means that when the investor comes to us with an idea that we guide him on all of the steps necessary to realize the investment. We assist him in finding partners such as banks, lawyers, tax advisors, and also help him figure out various incentive programs that the investment project might qualify for. Our industry experts also will accompany the investor on fact-finding trips to various potential investment sites across Germany to help determine the best location for the investment project. In India we are excellently represented through the Indo-German Chamber of Commerce in Mumbai, New Dehli, Pune, Bangalore, Chennai, and Kolkata giving Indian investors the chance in many different locations to learn about the advantages of Germany as an investment location.
OCTOBER 2008 23
DARE.CO.IN
/global opportunities INDO-GERMAN TRADE
Note: All figures in US$ Million Source: Ministry of Commerce, Government of India
Hamburg, Dusseldorf, Waldorf and Stuttgart. “Information and communications technology (ICT) is perhaps the most important industry for Indian investors in Germany. Over the last five years, nearly half of all Indian FDI projects in Germany were in this sector,” says Michael Pfeiffer, MD, Invest in Germany, the agency that helps foreign companies set up shop in the country. India’s bilateral trade with Germany has been growing consistently. It grew over 40% in 2005-06. However, in 2006-07, it grew only 19%. Some of the major items of export from India to Germany were textiles, leather, food items, chemicals, electrotechnical products, pharmaceuticals and machinery. India’s imports from Germany include machinery, elec-
DARE/lucrative sectors • Information and Communication Technology • Renewable Energy • Pharmaceutical • Automotive • Machinery • Nanotechnology • Food and Beverage • Aerospace
trotechnology, metal products, plastics and plastic products, chemicals, pharmaceuticals, automobile products and components.
Doing Business 2009 Why Germany? It is Europe’s largest economy and the second most populous nation. The country has a large domestic market
DARE/doing business Ease of…. Doing Business Starting a Business Dealing in Construction Permits Employing Workers Registering Property Getting Credit Protecting Investors Paying Taxes Trading Across Borders Enforcing Contracts Closing a Business Source: World Bank Doing Business 2009 Report
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and also provides access to the neighboring countries such as Denmark, Poland, Czech Republic, Austria, Switzerland, France, Luxembourg, Belgium, and the Netherlands. Germany’s superb infrastructure and transportation network gives an edge to companies based out of that country. There is no dearth of well-educated work force as 84% of the German population has been trained to university entrance level or possesses a recognized vocational qualification—above the OECD average of 67%. In a company’s first four years of existence, the investor maintains the right to hire an employee with fixed-term contracts, with unrestricted possibilities of extensions within this period, for duration of up to four years. Aerospace is one of Germany’s most innovative industries, having posted over 20 billion euros in turnover in 2007. The industry employs over 88,000 people. The automobile industry has given the country a place of its own. It saw over 100 billion euros in investment during the last ten years. Other sectors such as renewable energy, pharmaceuticals, nanotechnology and foods and beverages are also lucrative. It is a leader in renewable energy, which constituted 4% of its total industrial turnover in 2005.
2009 Rank 25 102 15 142 52 12 88 80 11 9 33
2008 Rank 20 75 16 141 49 5 84 71 9 11 31
Change in Rank -5 -27 1 -1 -3 -7 -4 -9 -2 2 -2
According to the recent Doing Business 2009 Report by the World Bank, Germany has slipped five ranks to 25, from 20 in 2008. Among all the parameters of doing business, it is starting a business parameter that has been a real dampener. On this, the country fell 27 points. The report says that it now takes nine procedures and 18 days to start a business in the country, as compared to the 5.8 procedures and 13.4 days in the OECD region. On other parameters where the country has slipped are paying taxes, getting credit, registering property, trading across borders, protecting investors, closing a business, and employing workers. However, it has bettered on dealing in construction permits and DAR E enforcing contracts.
DARE.CO.IN
/sector
Photo courtesy: Laggar Industries
From politicians and celebrities to statussymbol-hungry youth, this industry has spread quite a bit over the years and is now gaining momentum.
VEHICLE BULLETPROOFING
T
he business of vehicle bulletproofing or vehicle armoring has been around for decades now. The obvious clients range from film stars, businessmen, and politicians to builders, property giants, liquor magnates, hoteliers, and more. With the ever-increasing levels of threat across the country, business seems to be gaining momentum in this industry. “From the demand that was there about five years back, we have seen an increase of about 30%, and as a result we are rolling out about ten cars a month now,” says the director (name withheld as requested) of Laggar Industries of Sobti Group, who we spoke to understand the nuances of this industry.
How did this business start? Laggar Industries ventured into this business back in 1989, when Punjab was burning in its time of extremism. The Sobti Group, which has always been a steel manufacturing company, is also into various defense and government supplies, such as water-fencing, furniture, etc. Needless to say, the 26
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group has always been well-connected in the government, political and highprofile socialites’ circles. “KPS Gill, who was called in to handle the separatist revolt and terrorism in the state, suggested us to do something to save the lives of the policemen,” reminisces the director of Laggar, “With his mind and our company’s technologies and manufacturing capabilities, we started developing bulletproof steel.” Over the years, this company is said to have become one of the biggest private sector vehicle armoring players in the country. It is the nature of the industry that the Sobtis are in, that allows them to have a one-stop shop for vehicle armoring. “For instance, while one company manufactures only bulletproof steel, there is another who produces bulletproof glass, and yet another specializes in fabrication (bulletproofing vehicles),” says the director of Laggar, “We, on the other hand, have our own steel plant, fabrication plant, physical and chemical labs, and finishing plant—in an area that spreads 75,000 square meters in Jalandhar, Punjab.”
/Binesh Kutty
What goes behind bulletproofing a vehicle? When an interested client calls in, Laggar consults them as to what level of protection they require; this also impacts cost. Typically, a new vehicle is stripped down to a level where only the engine remains untouched. Then the whole fencing-wielding process is done, which is to widen the frame, sandwich the bulletproof steel, fit bulletproof glasses, adjust the suspension to maintain the new weight-ratio, etc. All of this is done in a manner such that the exterior look is retained. All in all, the body of the vehicle, its glasses, and even the flooring (polycarbonate sheets for protection from sharpeners of blasts like from a small mine or a small grenade) is done up in the armoring process. Optionally, one could also go for runflat tyres, which is an advanced type of tubeless tyres, which can buy some time in case the tyres get damaged in an event. Finally, electronics is placed back where it belongs, a complete uphol-
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/sector OVERVIEW OF THE BUSINESS Market demand: Increased 30% over the past 5 years Timeline to get armoring done: 1 to 1.5 months – Ambassador 2 to 3 months – Pajero, Safari, Montero, BMW, etc Pricing range: Between 5 lacs to 85 lacs Typical pricing: Pajero – 12 lacs Montero – 18 lacs Land Cruiser – 25 lacs Recommended vehicles: Likes of Safari & Pajero for rough terrains Likes of Audis & BMW for city roads Profit margin per vehicle: At least 15% Some of the players: Secure Mobile India, Laggar Industries, Parikh Armoring Company, Anjani Technoplast, etc DISCLAIMER: This data and analysis are indicative and Cybermedia makes no warranties about its accuracy. You are advised to do your own analysis if you are evaluating a similar venture.
stery process, and repainting the entire vehicle is done. So will this ensure a bullet won’t be able to penetrate inside? What is the guarantee that it won’t? These are the obvious questions one might ask, or rather one should ask—after all, the entire objective here is to protect the customer’s life. “We test our material at the Ministry of Defense Laboratories, Chandigarh. It is this material that goes inside the vehicle,” says the director of Laggar. Bulletproofing at the Laggar's is done strictly following the ballastic standards such as that of US National Institute of Justice Standard, besides others. A typical timeline for doing up a vehicle would be around a month to three months. A vehicle like a Pajero, Montero, or a BMW takes around 23 months. For a car like Ambassador, it takes around 1-1.5 months. Justifying the time taken, he says “What we do is pretty much what an automobile company does; after all we are giving birth to a new vehicle inside the same vehicle.”
Any legal issues or paperwork involved? There is no law governing this industry—as to who can or cannot make, who can or cannot retain. After all, it is not an offensive but a defensive thing to do. “However, to safeguard our and our customers’ interests, we have a declaration form. This form has complete details, ie, his/her personal information, as well the vehicle’s information,” says the director of Laggar. The declaration form includes details of the vehicle, such as the chassis number, engine details, registration number, etc from the company he is buying the vehicle from. Additionally, details such as what business is the client into, why does he need bulletproof protection, et al is also mentioned in the form. There is also a disclaimer that says that tomorrow if the vehicle is misused for something illegal, the armoring company won’t be held responsible. “We also get the customer to sign for the condition that his details will be shared with the Intelligence Bureau. Then, we submit all these declaration forms to the Intelligence Bureau here in Jalandhar for verification and main-
taining a record,” says the director, “An acknowledgement of the same is retained with us, and a copy is handed over to the client.” Apparently, even if a Chief Minister who gets his vehicle done up at the Sobti’s, needs to fill out the declaration. Since this is a sensitive business, such a practice is always good for the business in the long run. It is believed that various small players in this field have not got the ethics right—always misguiding the customers as to getting permissions from local police commissioners, even going to the extent of getting forged permissions from babus in the office, etc. How is the business doing? Laggar has done up vehicles of all kinds that are available in the country. Be it an Ambassador or Gypsy to Montero, Pajero, Scorpio, Ikons, Bolero, etc. “In fact, we have been the first one to do up an Endeavor, Safari, among all others,” claims the director of the company. The company has around 50 people with about 20 years of experience working in private sector armoring. As for the defense sector, they have specialized manpower that runs in 500s as well as contracted laborers. Even though Laggar services ten countries, there are no branches of its company in India. All the paperwork and actual armoring is done at the head office in Jalandhar. Most of the business that is pouring in is from states like Uttar Pradesh, Delhi, Punjab, Jammu & Kashmir, and the northeastern states. All the clients, after fulfilling the paperwork, send their vehicle to Jalandhar to bulletproof them. What about competition? “There are a lot of fabricators in the industry, but no one has an industrial scale as we do. Many of these get their supply of steel from us, and we have no problems with them doing that,” says the director of Laggar. Speaking of challenges, he mentioned them to be very general in nature, “There is no challenge as such, but there is this constant aim to deliver the best quality of armoring, bringing in latest technologies, to save lives.” D A R E OCTOBER 2008 27
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opportunity/furniture
With households forming 65% of the $7,922 million Indian furniture market, how are entrepreneurs leveraging the potential in this niche segment of business? /Shilpi Kumar
G
one are the days when kids’ rooms consisted only of teddy bears and hues of pink and blue. From cozy little baby cribs, playful beds and bean bag furniture to room accessories like colorful drapes, thematic wallpapers and bed
linen—there are special furnishings available for every toddler’s taste. The rising number of single-child-double-income families deeply inclined to spend on lifestyle products, coupled with an exposure to international standards, is luring many urban and middle class parents to invest in high quality furniture and furnishings for their kids’ rooms. Says Veena Deepak, CEO of Vividha, a kids’ chain that sells children’s furnishings and theme-based décor, “It is an innate tendency for every living being to mark their territory and aspire to have their personal space. Like adults, children also require a dedi-
cated area where they can play, learn and grow. Parents are now realizing this need for their little ones to explore their creative selves.” Children are also becoming demanding and are major catalysts in their parents’ decision to deck up their rooms. But is this demand being met? According to a report by India Brand Equity Foundation (IBEF), the Indian Furniture market is worth US $7,922 million, with about 15% in the organized sector catering to households, offices and the hospitality sector. A whopping 65%, households form the biggest consumer segment. Most of the furniture, however, is for adults
Photo courtesy: Vividha
& furnishings
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opportunity/furniture and doesn’t cater adequately to the requirements of the kids, especially in terms of size and design. When it comes to creating a space for children, there is still a gap, with many furniture companies either being international or having a limited range of children’s items. Only a few players are catering exclusively to children’s furniture and room décor, making it an opportunity waiting to be grabbed by aspiring entrepreneurs.
Glimpse at existing players Interestingly, many women entrepreneurs got the idea of starting this venture when they were expecting their babies and had very limited options available in the country for their baby’s room. Says Garima Agarwal, owner of Peek-A-Boo Patterns, a store that offers customized home furnishings for children, “When I was expecting my daughter, I searched all over India to find accessories for her room. Keeping the scarcity of such products, as well as my fashion designing background in mind, I decided to tap this market.” Although Garima considers window dressing her forte, the store has a host of other things to offer including curtains, cushions, bed linen, knobs and handles, white boards and even storage boxes. Along with the ready merchandize, products can also be customized to suit the tastes of the customer. Similarly, Rani Advani had been an interior designer for 18 years before she finally decided to launch Bumblebee, a one-stop-kiddies’ shop, as she likes to call it, which offers infant and kids’ bedding and accessories. “I had to rely on my trips abroad for my baby’s bedding and coordinated accessories, since there was no place to source it locally. That is when I conceptualized Bumblebee,” says Rani. She imports children’s beds, bedding, strollers, baby shower gift sets and nursery furnishings from the UK and US and soon also plans to venture into baby bathroom sets, clothing, as well as accessories for feeding. Being an interior designer, Rani also provides consultancy and takes up turnkey projects like designing nurseries with custom made furni-
About the Customers Target Group: Parents of 0-22 year olds Where are they from: Mainly metros – Delhi, Bangalore, Mumbai, Calcutta, etc Who are they: Upwardly mobile parents, expecting mothers, teenagers, interior designers and architects, schools and hospitals, grandparents, family or friends looking for gifts for children. What are they buying: Households: Cushions, birthday parties and baby shower gifts Architects: Furnishings (fabrics, accessories), door/window knobs and upholstery Schools and Hospitals: Play tents, wall décor, study tables, accessories (swings, toy bags, whiteboards, etc) Average footfalls: Just furnishing store: 100 footfalls Furniture and furnishing: 500 footfalls Conversion rate can go as high as 80% (Assumptions based upon the stores we talked to) Average spend Rs 1000–1500 is what a typical new customer spends. That too on small items such as toy bags, photo holders, etc Rs 10,000 and upwards is the spending potential of returning and loyal customers.
coordinated accessories can cost up to Rs 7 lacs for 200 square feet. However, if the customer just wants to furnish the room with lamps, rugs, wallpapers, etc it costs less than Rs 20,000,” says Rani. Veena of Vividha was earlier exporting soft furnishings for kids under the company name of Vividha Home Fashions. She diversified into domestic retail in early 2006, re-branding the company as Vividha. “I decided to enter this niche market because I realized that Indian parents tend to lose out on the romance of having a child. As soon as the child is born he becomes part of the parents’ room, sleeps on their bed and is constantly surrounded by adult things. There is nothing created for the kid per se. When I was having my second child, I had to travel to the US to look for options for room décor, and had to ask local carpenters in India to recreate it for me,” she says. Vividha’s product range includes theme-based beds, drapes, bed linen, activity tents, wall décor, lampshades, baby bean bags, sleeping bags and laundry baskets. They also design children’s rooms according to clients’ requirements. “The price of these products starts from Rs 75 (photo holders) till Rs 28,000 (bunk beds). The minimum cost for designing and customizing room interiors is Rs 1 lac,” says Vee-
ture and furnishings. What is the price tag attached with these products and services? “The cost of the readymade products ranges from Rs 800 (drawer and door knobs) to Rs 8500 (double bed sets). Designing entire nurseries with flooring, cupboards and furniture and
When parents are shelling as much as Rs 3500 for a baby quilt, they want it to be special and not available in every lifestyle store. Exclusivity is a basic requirement for them. At Bumblebee we experiment with dragonflies, butterflies, farm animals, sea animals and even nautical themes for older children — Rani Advani, Owner, Bumblebee OCTOBER 2008 29
DARE.CO.IN na. Vividha’s gifting range is also quite popular, where they have products like a tooth fairy box and cushion, meant for a child to put their broken tooth in.
Design beyond stereotypes Mickey Mouse, Barbie and Winnie the Pooh are themes that most retailers sell and what most parents expect to find. The trick is to give clients something beyond the usual Disney themes. According to Rani, “When parents are shelling as much as Rs 3500 for a baby quilt, they want it to be special and not available in every lifestyle store. Exclusivity is a basic requirement for them.” For Bumblebee, Rani experiments with dragonflies, butterflies, farm animals, sea animals and even nautical themes for older children. Peek-A-Boo Patterns focuses on themes that are closer to nature and topics that have a learning attached with them. “We design world peace symbols on door knobs and even signs that say “Let’s grow trees”. Instead of designing a silly monkey on furnishings, we prefer going for Gandhi’s three monkeys, so the child can incorporate such values within themselves,” says Garima. Vividha believes in blending modern colors, quality and trends with Indian mythological heroes, as well as motifs such as autos, taxis and busses. “Why should kids only relate to international cartoon characters when our own country is full of child-friendly myths and legends? We plan to introduce characters from Panchtantra, Jataka and Mahabharata in our themebased décor for children,” says Veena. Vividha is also tying up with publishing houses such as Tulika from Chennai to have furnishings inspired from the characters in their folktales. Also, they plan to design products especially for Indian festivals. “We plan to develop curtains, cushions and table sets in the shape of diyas for Diwali and for Baisakhi we plan to follow the kite theme,” claims Veena.
Dealing with Logistics According to Rani, if you are importing your products, the major chunk of 30
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opportunity/furniture your investment goes into inventory and stock keeping. “It takes around three and a half months for the order to reach and get cleared by customs. So, even before it reaches here, I have to start planning for the next order,” says Rani. “It takes around 2-3 years to break even, after which you can expect a turnover of around Rs 70 lacs in a year,” says Rani. Garima, who is solely into furnishings, has tied up with her husband who is into exporting garments, for manufacturing her products. She also sources fabrics from exporters and has tied up with Sunshine, Kolkata for paper craft items, Lola’s World in Delhi for wall paints, and Jelly Beans in Mumbai for bean bags. “Fabric is one of the most significant raw materials in this business and
Most of my clients are from outside Chennai and I keep in touch with each of them through the phone or e-mail. I ask them every minute detail, from the sex and age group of the child to how much time and money they can put into maintaining the room. If required, I even ask them to send me images of the room — Garima Agarwal Owner, Peek-A-Boo Patterns
can be sourced from various parts of the country. Apart from this, you need to set up a manufacturing unit for furnishings, as well as a wood workshop to build furniture,” says Veena, who has one factory each in Mumbai and Andhra Pradesh for this purpose. Vividha also imports ready-for-sale furniture from Malaysia, Brazil, China and Sri Lanka. Over the next three years, Vividha has allocated around Rs 35 to 50 crore for store expansion in other parts of country. Currently, they collectively have five stores in Mumbai, Delhi and Bangalore. Referring to her largest store in Kemp’s Corner in Bombay (3500 sq.ft), Veena tells us, “Without any advertising, we have made sales worth of Rs 20,000 in the starting month. After the break-even period, we are expecting around Rs 7500 to Rs 10,000 per square feet per annum.” Veena advises interested entrepreneurs to ensure that they do not go for the sale and discount model. “These are evergreen products and are not fashion-driven. So if you follow this model, parents will just wait around for the next sale to happen to purchase,” she believes. Another aspect to keep in mind is that while manufacturing and designing furniture for children, ensure that it adheres to high standards of quality and safety. Use non- toxic paints and avoid the use of heavy metals. Instead, go for waterproof ply boards, pinewood, Sal wood, teak and fiberglass. Make sure that the tops, bottoms, sides and edges are smooth. Go for washable and natural fabrics, preferably 100% cotton for cushions and bed linen. If you are doing up the interiors for a child’s room, remember to use good quality lighting and design for plenty of sunlight to enter the room.
Issue of scaling up This business depends extensively on the expertise and involvement of the entrepreneur with everything from conceptualizing designs, to manufacturing products and then finally positioning and coordinating it inside the child’s room. The entrepreneur has to be actively involved in every project.
opportunity/furniture
“
When the concept has already been tried and tested, one only has to sell the uniqueness of their product, in comparison to their competitors. Unfortunately, this isn’t the case with this sector. Those getting into this business have to remember that at this stage they will not only have to sell their products, but also the concept of children’s décor
”
— VEENA DEEPAK, CEO, Vividha end support. This will give them the platform to showcase their work,” says Veena. Under this alliance, the designer’s design will be exclusively retailed in the store, under the brand name of Vividha (for e.g. Vividha by Shilpi Kumar). “The designer will have to run
Photo courtesy: Peek-A-Boo Patterns
So, how do they manage this when they want to scale up and are thinking of opening stores in multiple locations? Well, you can always follow a franchise or partnership model. However, Garima deals with this a little differently. While her business is scaling up, she still believes in looking into every aspect of the business and giving her personal touch to everything. “Most of my clients are from outside Chennai and I keep in touch with each of them through the phone or e-mail. I ask them every minute detail, from the sex and age group of the child to how much time and money they can put into maintaining the room,” says Garima. Sometimes, she even asks her clients to send her images of the room. Vividha has tied up with designers and individual freelancers in all the cities they have a presence in. These designers visit the houses and take measurements and then send the details over to Veena, who then takes over product development and design. In the future they are also planning to tie-up with young designers to create designer kiosks around India. “So many designers across the country are talented and have great ideas with regards to this segment, but lack back-
DARE.CO.IN
Products and Services PRODUCTS • Basket tote • Bean Bags • Bed Linen • Blankets • Curtain holders • Curtains and blinds • Cushions and throws • Drapes • Easels • Gift items-towels, bathrobes, strollers, diaper bags • Knobs/handles • Mouse/desk pad • Play tents • Sheets and quilts • Sofas • Soft/whiteboards • Stools • Storage boxes • Wall hangings • Wallpapers SERVICES • Baby shower gift registry • Customized themes for baby showers and birthday parties • Interior consultancy and customization
the store, including the space costs and interiors, while we will take away the pleasure of production, advertising and running other backend operations,” says Veena.
Looking at Challenges Since the business of children’s furniture and furnishing is still relatively new in India, it is extremely difficult to get funded. “When the concept has already been tried and tested, one only has to sell the uniqueness of their product, in comparison to their competitors. Unfortunately, this isn’t the case with this sector. Those getting into this business have to remember that at this stage they will not only have to sell their products, but also the concept of children’s décor,” says Veena. Another major challenge is the mindset of parents. Even if parents can afford it, they shy away from spending too much on children’s rooms. We talked to a few parents to understand the reason behind this and found out that they do so because they know that it won’t last that long and will eventually have to be passed on to another kid. According to IBEF’s 2007 report on the furniture market and its opportunities, even the wealthy do not change furniture very frequently and the average life of a piece of furniture is about 20 years. Children’s décor, on the other hand, will only last a few years and sometimes only a few months, before the children outgrow it or think it is too childish. Therefore, it doesn’t make sense to spend many thousands on it. To overcome this challenge, you can design in such a way that it is well-suited to all age groups. Butterflies, flowery designs, etc are liked by both small and teenage girls. Barbie dolls on the other hand are only preferred by small girls. Children’s age and personality can be well reflected on things such as bed linen, cushion covers, rugs and curtains, because they are affordable and more frequently bought by parents. With regards to expensive furniture like beds, table sets and dressing tables, etc, pay great attention to the size, colors and designs being used, so that it can be DAR E used for a longer period. OCTOBER 2008 31
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/bio
SCHAUNA CHAUHAN
ALISHA CHAUHAN
CEO, PARLE AGRO
DIRECTOR, PARLE AGRO
She is the eldest of the Chauhan siblings. Schauna, who in many ways was groomed for the top post, returned from business school, and joined the company in 1999. By 2002, she was running Parle Agro, even as her father, Prakash Chauhan still remains the chairman. …
& FOUNDER, V3 FITNESS COMMUNE
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SEPTEMBER OCTOBER 2008 2008
She has made passion a business by opening a chain of health and fitness centers branded V3. She has diversified Parle Agro’s business by entering the fitness segment.
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arle Agro is one of the most trusted names in the Indian beverage, packaged drinking water, and confectionery industry. It has leading brands like Frooti, Appy, Appy Fizz and Bailley. As a pioneer, Parle Agro is the first to introduce fruit drink in a Tetra Pak, apple nectar and PET bottles in India. The second generation entrepreneurs, the daughters of the man behind this company, Prakash Chauhan, spoke to DARE about their transition, challenges, and more.
P
From the daughters of Prakash Chauhan to the ones handling Parle Agro, how was the transition planned out? SCHUANA - Fresh out of school, I had a lot of ideas that I immediately wanted to implement. My father advised me to take one step at a time. That’s how the whole phase started. When I joined the company in 1999, it was a learning phase for me. I started interacting with a lot of departments, understanding the fundamentals of the organization—how we work, what is the culture, etc. It took few years to do this.
entrepreneur of the month When I joined, the company itself was going through a transition. We had just sold our soft-drink brand to CocaCola. My father and his brother were separating in their business. Because of all this, I could bring in a lot of changes and it was easier since there was an entirely new team coming in. I spent a lot of time recruiting a good team.
NADIA CHAUHAN DIRECTOR, PARLE AGRO
When normal 11 year olds were dealing with the drudgery of school and homework, she attended marketing meetings. In 2002, Nadia, joined Parle Agro officially. She oversees product development, marketing, sales and distribution for all the brands and also leads new business ventures.…
ALISHA - Things were different with me. I finished my education and then did a course in fitness and right after that I came back to Mumbai and immediately started setting up V3 fitness commune. Since I was very passionate about starting a fitness center, a business of my own, my father was extremely supportive, and helped me on all fronts. NADIA - For me, it was a very unique situation as my father had me involved in the business from a very young age. From the age of 11, I attended lot of meetings along with him. The questions that I had in my mind, I used to discuss with him later. This involvement made the transition a lot smoother when I formally joined the business because of the familiarity with the operations, the vision that my father had for the business, and most importantly the culture of the business. OCTOBER 2008 33
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MANTRA/
EVERY GOAL THAT YOU BELIEVE IN, PUT YOUR MIND AND HEART INTO, AND ENJOY DOING, IS POSSIBLE. YOU SHOULD NOT LET ANYONE PUT YOU DOWN. From the beginning itself, my father focused me into marketing, sales and product development meetings—from dreaming of the product to making sure that it is established. That is really what I have taken up as my role in the business today. So there wasn’t a phase of transition, it was just that we were involved a lot from such a young age that we just came in and took over. When I joined the company, it was very important for me to earn myself respect, and create an identity of my own. Therefore, I worked at different levels—ground level to the top. More than just the fact that it brings in more humility, it also allows you to understand the ground realities before you start dreaming of things that are completely impossible that might not be good or lucrative for the business. For more than one year, I did spend time in studying the absolute micro level things, and not just looking into it from the point of view of providing direction or leadership.
What were the challenges that you faced when entering the business? SCHUANA - I think the biggest challenge was changing the mindset of the people and building a good team. Because of the restructuring that was going on, there were lots of departments with huge vacuums in it. We had to get a lot of new people on board, put in a totally new culture, and figure out a new strategy.
NADIA - I cannot call it a transition phase as such because from the time I remember I have been in the business. But when I joined, the country was changing very rapidly. In fact in the last five to six years, the country has changed more than what it has in the last 10-15 years. Every industry has hence boomed massively in the past five years. So, one of the challenges was to work at such a pace. There is no time to make mistakes or waste because of the competition. The challenge was to keep up with the pace of the industry considering that the industry was at its peak during that time. To blend in with everyone at that time was not exactly a challenge but it was important for me that they take something forward not because I am Prakash Chauhan’s daughter, but because they believe in it. Were there any differences of opinion related to strategy, operational, etc between you and your father? How were those dealt with? SCHUANA - We share great communication with our father, who is an excellent listener and a very patient man. He is always willing to hear you out. A lot of times it may happen that we both are trying to achieve the same goal, but thinking of doing it differently. However, because of the free hand and trust given, I tend to listen more and that makes a huge difference. We talk it out, and then I go by what he says.
ALISHA - The major challenge was to figure out the right modules for the fitness center to suit the market over here. This is something that would develop out of experience and being in touch with the market directly. One other challenge was getting the space usage in the fitness center right.
MANTRA/
ALISHA - There were no major differences between me and my father as such. Occasional differences in opinion are sorted out through discussions. As I had a free hand in running my business, whenever I required help I would
SUCCESS WILL FOLLOW IN WHATEVER YOU DO IN YOUR LIFE, IF YOU BELIEVE IN IT COMPLETELY, AND GO AFTER WITH PASSION AND PERSISTENCE. 34
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/bio speak to my father for advice and opinions. But at the end of the day, I always have to make my own decisions and pave my own path.
NADIA - My father is a man who believes in just pure common sense and logic. So if there was a difference and we were able to provide him with logic to what we were proposing or stating, then there would never be an issue. There is this very simple thing that he does with us which is very interesting. For example, if I go up to him and propose something, then before saying anything he will ask me the question “Why?” five times. This is because for every answer you give there is another question. This just helps to present the clarity of thought in front of him and then give a conviction about what we have in our mind. There weren’t any personal differences with him as such because we have been on one wavelength. He groomed me and inducted me into this business. So I have been aligned to his way of thinking. If ever there was a difference of opinion, there was logic to back up what he was saying or what I was saying. So logic would win over anything.
NADIA - The way we function within us is that while Schuana handles the operations and Alisha handles the fitness centre V3, I handle the product development, sales and marketing, and new businesses. Our company is structured in such a way and our roles are so welldefined that there is little room for differences to arise. We respect each other’s role and decisions. All three of us and my father meet for lunch everyday and if we feel there are any issues, we discuss it during lunch or we set up a specific time for it. But basically we do not wait for a meeting to discuss a matter—it is about picking up the phone or walking down to each other’s cabin. How do you make time for your personal interests? SCHUANA - I don’t have much of personal interests. I used to play a lot of sports, but I don’t see myself doing that now. So, usually I just make sure that I have got some time to exercise in the evening and Alisha has opened a V3 center at work, so the exercising part is also done in
MANTRA/
I BRING PASSION AMONG MY PEOPLE TOWARDS THE THINGS THAT WE DO, SO THAT IT IS NOT A MERE JOB FOR THEM AND THEY HAVE AN OWNERSHIP VALUE. How often do you sisters meet and discuss business matters? How are differences between the sisters, if any, dealt with? SCHUANA - All three of us have no ego issues, no competition between each other, as we are allocated different areas, equal responsibilities and equal authority in the organization. We have a great level of transparency between us. If there is a difference of opinion, it’s much easier to talk it out. Usually, we all sit down together with our father and whatever he says is the final word (laughs). ALISHA - We all work in the same office building. Whenever we do require to discuss a business matter, we go to each other and talk. Mostly it is during lunch hours that we all sit with our father and do the discussions. Since we all operate in different areas altogether, I don’t think we have ever had a major difference.
office. In the evening I go to the gym or catch up a movie or maybe meet a friend.
ALISHA - I have interests such as horse riding, swimming, traveling and reading. However, to be honest, there is simply no time. Whenever I do get time, sometimes on weekends, I do these activities. I think it’s all about very good time management—slot everything right and religiously follow the schedule. NADIA - I travel a lot across the country because of my work, so it does become very difficult to be able to take time out for my interests such as being a Sunday artist and playing my acoustic guitar. Since the past few months, I have started consciously taking out time every evening to go to the gym. Besides keeping me fit, it helps to relieve stress. During the weekends, my husband and I go out and watch movies. Also, we like to travel a lot, so we take two holidays every year to Europe or to any other country. DAR E OCTOBER 2008 35
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Jute Diversified Products: A Golden Opportunity Jute is haute! It is no longer the coarse brown fabric used just for packaging! /Aswathi Muralidharan
W
hen George Auckland set up the first jute spinning mill in West Bengal in1855, little did he know that he had opened the doors to a gigantic Indian industry. Today, India is one of the largest producers of jute products in the world and commands a fortune out of it. And if you thought that jute products just entail packaging, then you are absolutely wrong! Take a closer look into the market and you will find a range of manifestations of the golden fiber—shopping bags, rugs, wall coverings, apparels, the list is long! Jute products are gaining immense popularity around the globe due to the fiber’s properties. Jute is high on tensile strength, is bio-degradable, inexpensive, and does not emit poisonous gasses when burnt. Moreover, advanced manufacturing techniques have also transformed jute into an attractive and versatile fiber, with a high degree of user appeal. A dash of colours, a master’s hand at work, and you have the perfect fabric that can be transformed into almost anything. India is one of the major jute producing countries, accounting for nearly twothirds of jute and allied fib36
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opportunity/manufacturing ers production. According to UN Food and Agriculture Organisation, India produced 2,041 metric tonnes of jute and jute-like fibers in 2006. Within India, the major jute producing areas are West Bengal, Bihar, Assam, Orissa, Andhra Pradesh and Tripura. Earlier, jute was used mostly for the purpose of packaging, but the advent of synthetic fibers lead to a drop in the demand of the fiber. This dip, lead to intense research and development resulting in diversified jute products. The versatility of jute has enabled it to be used in a number of industries ranging from fashion to automobile, hence opening new opportunities. For the purpose of this article, we have studied five opportunities around jute.
Jute Bags Shopping bags, beach bags, Christmas bags, wine bags, designer bags—these are just a few of the options. The popularity of jute bags has been increasing tremendously both in the international and domestic markets because it is available in the trendiest of design, while being highly utilitarian and eco-friendly. According to A Kumar, Marketing Head of MNR Exports, compared to products such as slippers, rugs, etc, the demand for shopping bags is very high internationally. He explains that since plastic bags have already been banned or are being fast phased out abroad, jute bags fit in this space perfectly due to its high tensile strength and durability. Moreover, with shopping marts such as Wal-Mart and Tesco switching to jute bags and others following suite, the demand for these products is not anymore seasonal. Another advantage is that these bags can be manufactured in several colours, designs, shapes, and sizes, according to the consumer’s choice. The bags produced in India find market mostly in Europe, and the profit margin ranges from as low as 20% to as high as 100% while catering to niche markets, according to A Kumar. On the other hand, the domestic market for jute bags is also fast catching up. This is evident from the
mushrooming of several retail outlets catering exclusively to jute products. According to Rajalakshmi of Chennaibased Jute Emporium, in India, these bags are also being increasingly asked for by corporate houses and big businesses, who are becoming environment conscious. She says that besides being inexpensive, another advantage of using these bags is that it can be customised. Festive season also determine the sales of such products in India. For example, for Rajalskshmi, Navratri and Durga Puja season proves to be profitable. An unit manufacturing jute bags is highly labour-intensive, and a skilled artisan can make up to 50-80 bags in a single day. According to A Kumar, for setting up a medium-sized unit, a jute entrepreneur would require 10,00012,000 sq feet of land, and equipments such as sewing machines, screens for printing, and cutting equipments. The operating cost of such a unit would be near about 2-2.5 lacs. The government is also supportive and provides several concessions for exporting such products. Given the nature of investment, demand for such products, and profit margins, this area is worth venturing into.
Jute Handicrafts and Novelties Indian handicrafts have always been in vogue, especially abroad, and the advantage of jute, in this context, has been its versatility. Handicrafts made from jute include a large variety of items ranging from wall paintings, jewellery, table lamps, toys to innumerable gift items. The bio-degradability, durability and sophistication of jute products have made them a favourite product among consumers in India and abroad. Currently, even though a large number of units exist, they are mostly tiny and situated in the rural areas. These small production units run on small capital investments, and depend on local raw materials, inherited artistic skills and indigenous technology. They generally earn a profit margin of approximately 20%-30%, catering to the domestic market. However, the biggest
FACT SHEET • A natural fiber with golden and silky shine • 100% bio-degradable and recyclable • Second most important vegetable fiber after cotton, in terms of consumption and production Advantages • High tensile strength • Durable • Good insulating property • Ensures better breathability • Versatile Disadvantages • Coarse • Loses shine when washed disadvantage is that even though they know how to make the products, they are generally unaware of advanced marketing techniques. Therefore, it is a good idea to enter this market and organise the sector as the export potential for such products is high. Sensing this opportunity as well as moved by the plight of jute artisans, Ruma Dutt established Indexpo Corporation in 2004. Ruma Dutt tied up with several artisans and created a website, juteslippers.com, to market the products. She says, though jute handicraft items have been little known in the past due to poor marketing, the demand for such products is on the rise and is expected to grow in future.
Jute Apparels Jute is now slowly moving up the social circles and creating an interest among fashion designers as well. A wide variety of clothing ranging from sarees to suits is being made out of jute. On one hand while, the natural golden shine of jute makes it an attractive textile to experiment with, on the other, the coarseness of the fabric is the biggest deterrent. OCTOBER 2008 37
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To overcome this, jute is being blended with various other textiles. For example, with cotton to form Juco. These blended textiles are used to make clothing, accessories and home furnishing items. Besides cotton, jute is being blended with fibers like wool, nylon, rayon, acrylic or polypropylene. Very fine threads of jute are also being used to make false silk outfits. The advantage of using jute is that it is inexpensive, can resist rough use, and is durable. Despite its benefits, jute textiles have not been able to take off because jute fabrics cannot be washed and hence need high maintenance. However, given their advantages and disadvantages, manufacturing winter clothes out of jute might be a possibility.
Jute Geotextiles (JGT) Geotextiles are permeable mesh like fabrics that generally find use in civil and costal engineering applications due to their ability to separate, filter, reinforce, protect, or drain effectively. Jute as a geotextile is being used for soil erosion control, vegetation consolidation, agro-mulching, reinforcement, protection of riverbanks and embankments, and in road pavement construction. Research is also ongoing on its role in sound proofing rooms and constructing shock proof buildings in earthquake prone Japan. The popularity of JGT is increasing around the world due to a number of
• Handicrafts
and applications of the product. According to Chatterji, it is a good idea for existing jute mills to diversify into this area as the demand for the product is likely to grow in future.
• Wall covering
Jute Composites
OPPORTUNITIES AROUND JUTE • Packaging
• Floor covering • Yarn • Geo-textile • Jute composites • Jute reinforced rubber reasons. Besides the abundant availability and bio-degradable nature of jute, other properties that make it a good geotextile are higher moisture retention capacity, ease of installation, and superior drapability. It is also cost competitive compared to synthetic geotextiles. According to reports, JGT enables a cost reduction of almost 30-40% when used for reinforcing road construction. Currently, natural geo-textiles such as jute hold just 1% of the market despite the technical advantages and cost benefits. According to P Chatterji, Joint President, Jute Division of Birla Corporation, lack of awareness, and absence of standards and specifications are the factors that have been deterrent the growth of JGTs. However, this scenario is bound to change with the ongoing R&D activities finding more benefits
In 1941, Henry Ford popularized the use of natural fibers by testing the strength of a car trunk made of soyprotein plastic reinforced fiber. This experiment revolutionized the automobile industry as natural fiber proved to be lighter, stronger and hence fuel efficient. The previously used glass fiber was not only heavy but also emitted poisonous gases when burnt, which was the major cause of death during car accidents. This experiment led to further research and development, and jute came up as a potential composite material. Today, jute composites are gaining popularity because it is bio-degradable, versatile, non-abrasive, light in weight, high strength-to-weight ratio, low on energy consumption and good insulation properties. Moreover, jute composites are cost effective, hence fast replacing conventional materials such as metals and woods in several industries. With jute finding application in a number of industries and the popularity of the fiber increasing around the world, the time might just be right in investing in this “Fiber of the Future!” DAR E
SMS “DARE <your comments, questions or suggestions>” to
56677 or
Email us at dare@cybermedia.co.in 38
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Hair-raising business ideas! India is one of the leading exporters of human hair. But, look beyond exports and you will find many opportunities waiting to be explored. /Mohita Nagpal
F
Fun Facts An auction house in Dallas by the name of The Heritage Auction House sold some strands of hair collected from Ernesto “Che” Guevara, the slain Argentine socialist revolutionary, for $100,000 in October 2007. The average person has up to 150,000 hairs on her or his head 40
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or starters, here are some facts. According to the United Nations trade statistics, China and India exported more than $154 million worth of human hair last year. That is precisely because Asian hair grows the fastest and has the greatest elasticity. Moreover, Indian hair is considered to be fine, lustrous and free from chemical treatments, making it suitable for manufacturing wigs. India has thousands of hair exporters. But sources are few. The biggest one is Tirumala Tirupati Devasthanam in Andhra Pradesh. The hair collected from the tonsuring is reportedly separated into five different varieties. The 600 barbers employed by the temple shave the pilgrims’ heads 24 hours a day. Last year, it auctioned around 80 tonne of hair worth Rs 60 crore. The hair exported from India is either raw or processed/polished. The profit margins are around 15% and 50% respectively. Not a bad deal considering there is a huge demand for Indian hair in France, UK, US, Canada, and a few other European countries. But, why stop at exports? There’s more to human hair than exports. There are some entrepreneurs who have realized the true potential of hair and are making millions by the same. All we need to do is replicate the model. Find an entrepreneur who dares to think beyond the obvious and discover the oblivion. Here are a few businesses opportunities waiting in the wings.
Used in Oil Spills Somewhere in Alabama, 20 years back, a hairstylist was watching television coverage of the massive oil spill in Alaska. He noticed oil-covered otters swimming to shore and how their fur soaked up the oil. This was his cue to something big. The million-dollar question harassing his mind was “could human hair trap and hold spilled oil?” After conducting a home experiment using five pounds of human hair he had found his answer. Human hair has a quality of adsorbing, rather than absorbing oil. That is, oil does not bond with the hair; instead it accumulates in layers on the hair’s surface. This helps in easy recovery and reuse of the oil by simply squeezing it from the collected bundles. Moreover, oil-saturated bundles of hair can be burned as fuel. So, Phil McCrory, the hairdresser became a researcher. The efficiency of human hair as an oil adsorbent has been tested and validated by NASA. It is proven by NASA that human hair adsorbs up to five times its weight in oil while not retaining water. So the idea converted into oil-capturing hair mats, marketed by SmartGrow, a Florida- based company as Ottimats. Ottimats uses recycled human hair that removes oil from water. Ninety-eight percent of the oil extracted by the Ottimats can be recovered. Ottimats has a tensile strength of approximately 38 lbs. and can be used in large-scale petroleum recovery.
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opportunity/manufacturing So, the point is, why can’t a similar model be applied in India. Why can’t we have our own oil capturing mats? Considering that two major oil choke points of the world, the Strait of Hormuz and the Strait of Malacca, are on the west and east coasts of India. With the routes being accident-prone, a product that adsorbs oil does have a market. It is estimated that 25,000 pounds of hair in nylon collection bags might be sufficient to adsorb 170,000 gallons of spilled oil. Tests showed that a gallon of oil could be adsorbed in less than two minutes with McCrory’s method. It is also considered a potential cost-saving method. Conventional oil cleanup methods cost approximately $10 to recover a gallon of oil in the US. McCrory’s system costs as little as $2 per gallon and offers the benefit of recovering oil for fuel. Moreover, the risk of a major oil spill occurring along the west coast of India is considerably higher now, as there has been a significant increase in all types of maritime trade. A major oil spill could cause widespread ecological damage, and cripple or destroy marine commercial operations. Therefore, continued discharge of oil into the sea can pose a potential risk of severe pollution to the sensitive coastal ecosystem.
Horticulture Benefits A step further from oil spills, SmartGrow manufactures mats that are effective in keeping out weeds and have other horticultural benefits. According to University of Florida scientists, they also increase yield in crops like tomatoes. Blair Blacker, CEO, SmartGrow imports hair from India and China on a regular basis. The hair is loaded into a needle-punch machine. Then, a hopper blows air through the hair to loose it, and the hair strands are then knit into a loose mat. These are then pressed into mats and lastly shipped to farmers and nursery growers. According to the SmartGrow website, over two million hair mats are in use in the state of Florida. Moreover, Wal-Mart began selling the mats in about 60 stores in central Florida. Dol-
Other Uses Amino Acid-I-Cysteine used in baked products Human hair is a raw material source for l-cysteine, an amino acid frequently used in baked goods such as pizza dough and bagels Hairs of Dolls/Soft Toys Low quality hair is used for making doll hairs and soft toys Testing When cosmetic chemists make hair products, they need to test them on the real thing lar General signed on to sell the smaller-size sheets in 1,000 of its stores. Hair mats save money on pesticides and labor. A single mat of 6.25” is priced at $3.94. Now considering India, where the share of agriculture in GDP is around 21 percent, it does make a lot of sense to manufacture a product like SmartGrow. Moreover, with a number of corporate players entering into agreements with farmers for major investment plans in agriculture, we have all the reasons to feel positive about a product like this.
Manufacturing Wigs and Hair Extensions Tales of rags to riches always have a warm feel to them. Amit Malhotra, hair exporter and wigs manufacturer in Delhi shares the same kind of hairytouchy tale. From being the owner of a ladies’ boutique, he has come a long way in the last 15 years. Call it an unusual interest or curiosity, but his “experiments with hair” have paid off. No angel investors or VCs, rather he had a guiding angel in the form of a customer who handed him Rs three lakh on sheer faith for his startup. Today, he exports raw and processed hair in countries across the globe, owns three factories and manufactures customized wigs. His clientele includes a few celebrities as well, whose name he obviously refuses to disclose. He employs 100 workers and even teaches wig making to 40 odd students at Rs 1 lakh each!
Around 75% of his business comes from exports. He manufactures wigs only on order. But he accepts the fact that major money is in wigs and hair extensions as the demand for them is increasing in India. So the point is, why not manufacture wigs and hair extensions in a big way. The price of a hair extension is Rs 20,000 and that of a wig is Rs 30,000 at the minimum.. And if customization is your USP, the price can go up to lacs! Profit margins are skyrocketing by 100%. Moreover, with more people falling for hair fashion and genuine falling of hair becoming a common problem, there’s reason to be hopeful. So if you have taken the plunge. Here’s the way ahead.
SOURCE As mentioned in the beginning, the major source of human hair in India is Tirumala Tirupati Devasthanam. Auctions are conducted every three months. If you are buying through a middleman chances are you’ll get a price of Rs 10,000 per kg (30% fluctuations). Apart from that, there are a few other temples, but none comparable to Tirumala, where long hairs are easily available, which are required for manufacturing wigs. Apart from that you could also tie-up with some local parlour.
PROCESSING Let’s take a sample quantity—500 kg of hair. A factory would be required OCTOBER 2008 41
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I used to work at the boutique in the daytime and experiment with hair at nights. I have experimented with all kinds of chemicals, even with soaps like Rin and Lux. — Amit Malhotra Owner-Savvy Wigs and Hair International to carry the operations. About 100odd workers would be sufficient. The task includes sorting hair according to size, checking for inconsistencies and rejecting bad hair. The hairs are then washed with chemicals. A few chemicals imported from Hong Kong, cost around Rs 2,000 per litre. These
are washed in big drums each costing Rs 2 lakh. Next comes drying the hair that can be done in natural sunlight or through blowers. The hairs are then put through the process of combing where they are detangled and each strand stands apart. You need thousands of iron combs for this. Lastly,
Wigs and hair extensions Users Cancer patients, fashion victims, cross dressers, theater actors, aged people Clients Wig shops, saloons, hair clinics, direct customers Features Capital intensive, knowledge-based, eye for detail/quality 42
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the hair goes through intense conditioning and chemical coating to attain natural shine. Now, you can export or sell the hair at 50% profit margins or if you aim a bit higher, manufacture wigs and hair extensions.
MANUFACTURING On an average, 50 grams of hair is needed for one extension. The market demand is more for hair extensions. As Amit says, “Of the total manufacturing we do, 75% are hair extensions and 25% are wigs.” He produces wigs, gluebased hair extensions and normal hair extensions. He has 25 machines costing Rs 80 lakh in total. Eighteen of them are for knotting of hair, seven for fixing glue to hair tips. There are 40 workers in the factory. He has also got a hairdresser to design 60-70 DAR E odd wig designs.
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Funding decisions are not just based on getting the numbers right. A lot more goes into deciding whether your project can be funded and by how much. This is a startupsâ&#x20AC;&#x2122; guide to loan as well as equity funding
things that improve your chances for loan or equity funding
/Krishna Kumar OCTOBER 2008 43
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INVESTOR
BANKER
1. The business plan The business plan is the basis on which funding is done, whether it is a loan or a venture investment. The business plan is where your funding pitch starts. Enough and more has been written about how to create the best business plan. Fact is no two organizations look for the same things in a business plan. Some banks, for example, have standard formats. Further fact is that a business plan is just not enough. Read on 44
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LOW
HIGH
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INVESTOR
2. Your existing brands 4. Your own house Well-established and easily recognized and property brands are a big plus in pushing your
HIGH
HIGH
BANKER
INVESTOR
3. Infrastructure (land and buildings the company owns) Bankers place a very high premium on owned infrastructure when deciding the extent to which to fund you. Investors on the other hand do not place too high a value on this, unless you are in the business of infrastructure or real estate (in which case your land bank is your asset), in which case, you need to
We are talking of property in your personal name as against property in the name of the company. In the case of equity investments, this is a very insignificant factor and may come in for discussion only as a casual point about your background. On the other hand, property in your name is a significant input into a loan decision by a bank. If there is property of significant value in your name, it can have a significant impact on the amount of loan you are sanctioned. Such loans will be against your personal guarantee and the property becomes collateral guarantee for the loan.
HIGH
case for funds. In case of loans, you can actually get your brands valued and can provide them as collateral. Otherwise, your brands per se are not that important in the case of loans. In the case of investments, particularly late stage funding like private equity, the value of the brands go a long way in enhancing the valuation of the business.
THE RATINGS We rate each item for high or low importance to the banker or the investor. High means a score of three or more on a scale of five, low obviously means two or less. Investors here include seed investors, angel investors, venture funds and private equity funds.
approach only those who specialize in funding such businesses.
HIGH
to find out what else can swing the deal for you.
HIGH
W
hether you are a fresh startup or a multi-million dollar conglomerate, you always need outside funding. You need funding for starting up, for new projects and business lines, for building your brands and for working capital amongst other things. Depending on the risks involved and the timeline for repayment, you might approach a bank, a peer organization (for shortterm inter-corporate loans) or an investor like a private equity fund, a VC or an angel investor. Each of them will follow their own process to determine whether to fund your request and how much to fund. While there is a lot of number work that goes into this decision, there are a number of other factors that play a significant and often more important role in deciding both, whether you are funded and how much you are funded by. In this piece, we will take you through 20 such elements that could be the make-or-break factor in your being funded.
strategy/funding
BANKER
INVESTOR
5. Intellectual property (patents and copyrights) you own Intellectual property, along with execution finesse (read as capability
DARE.CO.IN
strategy/funding
INVESTOR
8. Your bio-data This one is a bit like your board exam marks. On every occasion, you see a need to put it down in a form popping up. And everywhere from college to management school entrance to the civil services, there is a minimum cutoff for board exam marks. Your biodata becomes particularly critical if you are starting up. Investors particu-
BANKER
HIGH INVESTOR
10. Confirmed order in hand A banker giving you a loan, particularly a working capital loan, is looking at a definite and short-term horizon. So, confirmed orders in hand are rated highly there. An investor on the other hand is looking at longer time periods. So, a single or a set of small orders will not have a significant impact unless two things happen. One, you are an absolute startup and you already have a big order based on an
BANKER
INVESTOR
BANKER
LOW
INVESTOR
The rating is the same as your team’s bio-data. The point to be noted here is that in the case of investments, if the team brings in complimentary skills, then that becomes a bonus point.
LOW
BANKER
9. Your team’s bio-data
HIGH
BANKER
LOW
HIGH
The balance sheet is the Holy Grail for the banker and a healthy balance sheet probably gets more importance in their books than a good business plan (cash flow plan). For running companies, bankers are known to give the past balance sheets the maximum weightage in loan decisions. Investors on the other hand do not place too much focus on the balance sheet in the case of startups or new businesses. In many cases, your reason for seeking investments may be the very lack of a healthy balance sheet! Only in late stage PE funding does a healthy balance sheet have a significant role.
HIGH
6. Your balance sheet
larly have nothing much to go by in making an investment decision. Even when you are past the startup phase, your bio-data still adds (hopefully) to your case for funding.
HIGH
INVESTOR
This is the ultimate form of name dropping in this business, and believe me, it works; with both bankers as well as investors. Nothing proves your value to them as having the confidence (business) of an established, big name. So, if you are in the Internet research business, having Google and Yahoo as clients adds punch to your quest for funds. On the other hand, having only one client, even if it is a big name, may not be as good, unless you are an ancillary. And then, your funding request is obviously going to be limited or enhanced by the financial wellbeing of the principal
HIGH
HIGH
BANKER
7. Big ticket clients
HIGH
HIGH
of the team), may be what sets you apart from a very similar competitor. Obviously, both investors and banks rate these very highly. Investors will perhaps give them a little more importance than bankers, say a 5/5 as compared to a 4/5. Now you know why it is important to recognize and protect any intellectual property that you create.
INVESTOR OCTOBER 2008 45
DARE.CO.IN
strategy/funding
BANKER 46
OCTOBER 2008
HIGH
LOW
If anything excites an investor more than a great new idea, it is the prototype of a great new idea. In fact, many investors admit that you are better off approaching them with a working prototype rather than just an idea. The response of the banker remains the same
INVESTOR
BANKER
HIGH
HIGH
HIGH
BANKER
INVESTOR
INVESTOR
14. Credit rating A good credit rating is a big plus point when it comes to getting a loan. Actually, it helps you not only in getting a loan, but also in getting a better interest rate. On the investment side, a credit rating has little impact, unless again, you are seeking PE investment where it might add some brownie points.
BANKER
We are on to the soft factors. And now the navigation becomes a wee bit tougher. No one may openly admit that the way you dress will have an impact on your funding application. At the same time, I am sure that you would not be willing to risk it by dressing shabbily! Based on information we have, I would venture to guess that the way you present yourselves would be more critical in the case of equity investments than in the case of loan funding. Also, remember that your stakes are higher in the case of equity investments; so be doubly careful..
INVESTOR
16. A recommendation Let me let you in on a secret. There is almost no decision in the world that a relevant recommendation cannot influence. And financing decisions are no different. A VC firm gets a hundred or more pitches a week. How are they supposed to objectively investigate each one of them? A relevant recommendation can short-circuit the process and give you a quick hearing, if not
HIGH
12. Prototype of a great new idea
A banker’s response to your first client is going to be only marginally better than the response to the idea itself or a working prototype, unless of course the client is bringing in a tremendous volume of business. An investor will look at your first client as a validation of your idea and will look at whether the business model is scalable.
15. The way you dress
HIGH
INVESTOR
13. First client for a great new idea
LOW
BANKER
HIGH
LOW
Nothing epitomizes the difference between a banker and an investor than their reactions when asked to fund a great new idea. A banker would in all probability yawn and move on to the next request. That is how his business model works; there is no point complaining. An investor on the other hand will get excited and could end up funding you to the tune of a few billions!
LOW
11. Great new idea
as it was at the idea. A banker deals with business activities in the current horizon; an investor invests into the future potential of current ideas.
HIGH
idea or a prototype. Two, you have a really huge—in terms of quantity or time—order.
BANKER
INVESTOR
DARE.CO.IN
strategy/funding
19. Big name on your board
BANKER
HIGH
HIGH
BANKER
INVESTOR
18. Your CA/advisor/ investment banker This one is like the recommendation from an industry expert. Only, in this case, we are talking of financial industry experts! A good financial advisor who knows how a particular investor or bank works, what sort of projects they are interested in and what documentation they need, can make a huge difference to your case. How do you
A banker may not be very concerned whether or how scalable your business will be in the future. An investor on the other hand is acutely concerned whether and by how much the business is scalable, since future valuations are at stake. Most investors will reject projects that are not scalable.
INVESTOR
BANKER
HIGH
INVESTOR
20. Is your business scalable?
LOW
HIGH
BANKER
Having a famous name on your board is a huge plus, particularly if you are up for equity investments. And if the famous name can make that recommendation for you, nothing like it. The impact on a case for loans is much lesser, but is significant enough not to be ignored.
HIGH
Let’s assume for the moment that you are a startup entrepreneur who is making a pitch to an investor. Where are they going to find information about you? A search engine is an obvious stop. So what does the search engine show up? Do you even show up? Is there anything negative that comes up? What about your Website? Does it give enough information about you, your team and your business? The same applies if you are pitching your case to a new bank or a new banker in the same bank Recommended reading: my blog post at http://www.dare.co.in/blogs/ if-you-are-not-on-google-search-youdont-exist.htm
HIGH
17. You on the Web and your Website
find the right one? Ask around those who have been there and done that before.
LOW
funding itself. The case with a banker is similar. The operative word, of course, is the “relevant” recommendation. A known industry (your industry) expert or someone close to the investor is a good choice.
INVESTOR
THE RATINGS Business plan Your brands Infrastructure and land/buildings the company owns Your own house and property Patents and copyrights you own Your balance sheet Big ticket clients Your bio-data Your team's bio-data Confirmed order in hand Great new idea Prototype of a great new idea First client for a great new idea Credit rating The way you dress Recommendation You on the Web + your Website Your CA/advisor/investment banker Big name on your board Business is scalable
BANKER High High High High High Highest High High Low High Low Low Low High High High High High Low Low
INVESTOR High High Low Low High Low High High High Low High High High Low High High High High High High D A R E OCTOBER 2008 47
DARE.CO.IN
opportunity/publishing
The Business of Coffee Table Books High price, fewer volumes, pleasing visuals, the result: bonanza in publishing coffee table books!
/Mohita Nagpal
What are coffee table books? Picturesque images topped up with small amounts of text, meant for a quick light read, high quality glossy or matte paper, hardcover, visually oriented, impeccable finishing, large size 48
OCTOBER 2008
and priced right through the roof— these are some of the common characteristics of a coffee table book. There are two broad types of coffee table books—the ones that cater to niche or localized audiences and
tastes, with small print-runs, or those on eclectic topics like Playboy centrespreads, or India, or the Kamasutra, which plays out to global audiences. There is a third kind of coffee table book, one that has been commissioned for a specific need, and is usually a brand promotion vehicle for the commissioning organization. Royal Enfield — The Legend Rides On was one such book, commissioned by the Royal Enfield India to celebrate fifty years in India. Coffee table books are also referred to as Illustrative or Pictorial books. As Kapil Kapoor, Director, Roli books points out, “We don’t refer to our books as coffee table books as that is demeaning to the quality of books we publish. We publish illustrated books that are for reading, reference, and information.” Due to the dominance of visuals, the work involved in its publishing is vastly different. It is often collaborative; working with two equally important people, the writer and the photographer. These two people have a crucial role in the making of the book An average coffee table book is priced at around Rs 2,000. That leads us to the million-rupee question— is there an opportunity in making good money out of publishing coffee table books?
Where’s the money? Out of the three types mentioned above, the most profitable, from an entrepreneur’s view, is obviously the third, where typically you are paid for the project on an expenses-plus model or on a total project cost model and you don’t have to bother about sales, as the sponsor picks up all the copies. While some copies may be sold in the market, most copies in such commissions go for brand promotion. Even when you don’t have a sponsor, you will usually try to find a bulk buyer for your coffee table book, so that most of the cost, if not a part of the profits, are recovered early on. A coffee table book has a long shelf life, unless the subject is extremely time-sensitive, like a book made for
DARE.CO.IN
opportunity/publishing a specific event. So, the publisher has a long window of opportunity to recover the costs. All this seems to indicate that coffee table books are sureshot successes. But that is not always the case. There are lots of risks involved in this business. A good insight into what will sell and in which market, is a must to succeed in this venture. For example, a very costly book on a football icon, in an otherwise cricket-crazy country may not be the most successful of coffee table books. Market sources point out that Pele by Gloria books, which is priced at a lakh and forty thousand, is not doing all that well in the Indian markets. According to VK Karthika, Publisher and Editor in Chief, Harper Collins India, “The idea is not just to give beautiful books, but give books with additional edge of information or particular kind of product that you don’t find anywhere else” However, President’s Award winning architect-turned-publisher Gerard da Cunha of Architecture Autonomous, believes it is all about passion. His first publication Houses of Goa happened eight years back purely because of his love for architecture. Priced at Rs 1,900, around 7,000 copies of the book have been sold till date. “When my first book was launched, everyone said that no one would buy it. They said print only 500 copies, I went ahead with 8,000. Everyone said I was mad. The fact that it sold 7000 copies reaffirms my faith that everything done with passion is successful.” In Indian markets, Indian culture, including religion and religious practices, is the safest bet. There are titles by numerous authors, each exploring India through different lenses. So there’s Exciting India, 100 Wonders of India, Hidden Faces of India, India of Dreams and Fantasy, and many more with an India somewhere in the title. India Then And Now, 270 pages and priced around Rs 3,000, seems to be the hot seller in this category. The book is divided into two halves. In the first half, India Then, historian Rudrangshu Mukherjee revisits ancient India. The
The audience is very smart. Firstly, they will go for a book only if the subject interests them and even then, they will read only if it is by the master of the subject — Bikash D. Niyogi MD, Niyogi Books second half by Vir Sanghvi, India Now showcases contemporary India. People and brands—obviously their own—are hot favorites amongst books commissioned by corporates. Film stars have become a hot topic recently.
The cost heads The major cost elements in publishing a coffee table are photos, paper, print-
Sector Overview Hot Genres India – culture, art and photography, Architecture and interiors, Kamasutra Features High risk-high return, subject-oriented market, longer gestation period, getting the price right Major Players Roli, Mapin, Penguin
ing, designing, marketing and free copies. Yes, free copies is a significant cost factor, given that you print a limited number of copies and that each copy comes at a substantial direct cost. The royalty to be paid to the photographer is usually set at 15 % of the selling price of the book. Many coffee table publishers are themselves photographers of acclaim. Raghu Rai, for example is the co-author and photographer of a number of coffee table books. Books like Calcutta and Mother Teresa: A Life of Dedication are attributed solely to him. In other words, if you are an excellent photographer then you are already half way there to become a coffee table book author or publisher. The factor of immense importance is the quality of the book. The images have to be sharp, the layout has to look professional, and the paper of better (and thicker) quality, often laminated. Printing costs entirely depend upon the volume to be printed. For a hundred pages (fifty sheets counted both sides) along with hardbound cover, the cost could be anywhere from six hundred rupees upwards per copy for a 500 copy run. According to Gerard, one must go to the best printing press in order to do justice to a coffee table book. Thomson Press in Delhi and Pragati Offset in Hyderabad are considered the best in India. However, the concept of printing abroad is fast catching with countries like Singapore and Malaysia offering good rates. The designer fees are also a major cost consideration as Karthika puts it; “Designer fees could go very high, ranging from 50,000 to lacs depending on projects.”
How to market Once your publication is ready, prepare for the marketing and public relations costs. A formal launch function has become almost a rule. Typically, you set aside a percentage of your total costs towards this head. Distribution is another big cost, with distributors demanding as much as 50% or more as their margin. Increasingly publishers (and particularly authors) OCTOBER 2008 49
DARE.CO.IN
opportunity/publishing
We are getting into the segment in a biggish way. We are launching an imprint called Collins India, which is the brand that will look at illustrative books. — V.K Karthika, Publisher and Editor-in-chief, Harper Collins India
are taking the Web route to sales. Opting for search engine marketing is another way to cut at least a part of this cost. A smart marketing move helped Gerard who sold 3,000 copies of his second coffee table book, featuring cartoons by Mario Miranda. Even before the formal launch, he did an exhibition in Goa, where he displayed dummies of the book, offered a prepublication discount to the public and took orders in advance. The advance collected in the process was used at the time of publishing. Moreover, the exhibition also acted as a testing ground to gauge response. According to Karthika, one shall work hard at marketing, “Coffee table books need a very specific kind of targeting. We are working on a project called Khoj, an arts initiative. It features the work of 90 Indian artists. The readers would be people who already know about Khoj, artist community, art buyers and collectors, people who write about art. We are going with some direct mailers, fliers and posters at bookshops. There’s no point in sending review copies to everyone, because every place won’t review it well. Otherwise we end up wasting money by distributing free copies. The whole marketing formula has to be reworked.” 50
OCTOBER 2008
What are the challenges? High risk The huge cost involved in printing quality coffee table books makes it a high-risk business. According to Kapil, “The initial investment involved is much higher and therefore the risk is higher. However if the book sells well then the returns are equally high. So it’s basically high risk, high return.” Right price As Karthika states, “Coffee table book is an expensive product. Costing has to work internally. To get the price right is the big thing, we have to make the formula work, and the investment we put in has to come back quickly. A price has to be determined that is high enough to recover the cost, but not so high to intimidate the reader.” Longer gestation period The gestation period is longer for these books.
“
The future for illustrated books is great. More and more people want to buy these books to read, as reference, as gifts. We have seen huge increase in sales year on year
”
— Kapil Kapoor Director, Roli Books
The pace at which they sell is not the same as regular books, but the shelf life is much longer. So it sells for many more years than a non-illustrated book According to Bikash D Niyogi, MD, Niyogi Books, “The biggest challenge is the slow moving pace of these books because of the price. You really don’t know if the title will sell. Sometimes, it starts moving after a year.”
Who are the buyers? According to Karthika, it’s a “subjectoriented market.” The readers are those who are really interested in the subject and want to collect books on them. Traditionally, coffee table books have been used for gifting purposes. Corporate organizations buy these books in bulk. Incidentally in this segment, an order for 50 copies is considered a bulk order. Usually, titles catering to Indian culture are popular for corporate gifting. And the festive season as well as the New Year are times when publishers or their agents make the round of corporate houses to book their orders. Foreigners are another big market for these books. Books illustrating Indian culture are something they like to take back as mementos. Another book that is pretty hot amongst them is the Kamasutra. Then there are the collectors who buy these books for their collections. D A R E
DARE.CO.IN
funding/strategy
Mohit Bhatnagar
Operating Partner, Sequoia Capital India
52
OCTOBER 2008
It is a VC firm whose name has come to symbolize technology investing. Name the most successful technology companies of the world and it would be difficult to pick out the ones Sequoia Capital failed to spot and invest in, before the rush. Apple, Google, YouTube, Yahoo, Flextronics, Oracle, Cisco, Paypal, etc—Sequoia’s investments are a virtual roll-call of who has been successful in the technology sphere globally. The firm had dedicated about $1.8 billion out of its total $10 billion to India, but has invested across the spectrum. Among the most prominent of its 55 investments in India are Cafe Coffee Day, Idea Cellular, Bharti Telesoft, Edelweiss Capital, GVK Biosciences and SKS Microfinance. DARE catches up with their India operating partner, former entrepreneur and telecom industry veteran Mohit Bhatnagar. Bhatnagar has worked with Bharti Airtel and Ericsson, before his stint at Sequoia.
DARE.CO.IN
funding/strategy
T
he recent market uncertainty has seen a lot of
ments. We make early stage investments, early in the sense
sources for funds dry up for companies. Are you
of being in the sector and early in the company.
still actively investing?
We basically look for four things when we invest. The
We are indeed. In fact, out of the $1.8 billion (Rs 8,000 cr),
first is growth. It is very important for us that the company
$725 million is in a new growth fund that we have hardly
has exhibited a strong growth or has the potential for strong
started investing out of. Considering that we have been
growth in the triple digits in the early stages of its life. To us,
making investments of anywhere from $2 million to $5 mil-
that is the best indicator that we have been able to take the
lion for early stage companies and $50 to $80 million for
lead in the market.
growth stage, we are looking at quite a few more investments to come in the future.
The second is a fantastic team, third is a large market and the fourth is a well-differentiated product. If you have all this, it almost doesn’t matter which sector you are in.
Globally Sequoia Capital is known for its successful bets on the technology industry. Yet in India, you seem to be
What do you mean by ‘large market’?
everywhere.
What we have found is that if you are a young company,
In India we have invested in many companies, both
it is very hard for you to spend enough money to create a
technology and non-technology. We have invested in com-
market. There are, of course, good exceptions like Google,
panies ranging from SKS Microfinance, which is into the
but in general, it’s tough. But if there’s a booming market,
Grameen model of micro-credit and also into Cafe Coffee
say like telecom in India; it’s much easier to ride the wave.
Day, which is into consumer retail. We love to take contrar-
For example, if you are a supplier to the operators, the sheer
ian bets, in both these; we were the first institutional in-
force of telecom as it explodes will also pull the company.
investor of the month vestors. Today, both are the leaders in their sectors. It will
So, by ‘large market’, we mean markets that are not at the
be wrong to say that we make investments into one, two or
height of their saturation, are under-penetrated, there are
three sectors; there is a wide variety of sectors we invest in,
other strong players in the market and the general eco-sys-
in India.
tem is strong. And then, if there’s a company with a great team that can solve a problem in that marketplace, they
So, what has been your investment strategy in India?
grow very fast.
These investments were not done through open market;
To take an analogy, look at a boat at sea. We need a fan-
they were done through relationships, through people and
tastic team to point the boat in the right direction, but you
entrepreneurs we know. In both cases, we knew the entre-
also need a high tide to carry the boat out to sea, which is
preneurs for many years before we made the investment.
like the momentum in the market that I spoke of. In ad-
You will not find us making standard commodity invest-
dition to these, you also need a very good boat, which
OCTOBER 2008 53
DARE.CO.IN
funding/strategy
is different from everyone else. That will be your prod-
What is your biggest learning as an investor, something
uct. Of course, finally, you need the ocean itself, which is
that you picked up after joining Sequoia and doing full
the market.
time investing? The biggest learning has been about the importance of peo-
Is there something, perhaps something technical, that you
ple. Markets are important, but I have realized that investing
look for prior to investing?
is a people business. Another reason to be extremely careful
We are not rigid on what we look for, in terms of
about the quality of initial team is that good people always
technicalities. We just need a fantastic team and a good
tend to attract good people and vice versa. What I have figured
business model. If there’s a little bit of pilot and growth, so
out is that if you invest behind the right team, they will figure
much the better because we don’t invest in ideas, we invest
out a way to make the business work—give me an ‘A’ team and
in businesses.
a ‘B’ market any day over a ‘B’ team in an ‘A’ market.
If someone says, ‘Hey, I just thought about this, what do you think?’, it doesn’t make sense for us. If, on the
What are the areas that the entrepreneurs you have evalu-
other hand, someone says, ‘I have thought about this, I
ated so far seem to always fall short in? What is the biggest
have spoken to these 15 customers, here’s a company that
turn-off for you when assessing a prospective investee?
has got done like this in China, here is someone who is
The most common mistakes by entrepreneurs that I have
saying good things about me..’, I am interested. So we are
seen are two. First is that they try to do too many things at the
looking at all the other things, beyond an idea, which make
same time. Instead of doing a hundred things, it’s better to
a business.
pick one business idea and put all your resources behind it. The second mistake that we have seen a lot of entrepreneurs
How do you decide how much to invest?
make is to hire family members to do critical functions, to
It’s very hard to answer that generically. For example,
‘control’, the company. It is important to have an open atti-
if it’s a technology company, you would not need a huge
tude towards hiring the best professional talent you can into
amount of capital. If you are a consumer finance compa-
your company if you want to make it as an entrepreneur.
ny, then you need larger amounts. Typically, the company raises only as much money as they would need over the
How do you see the opportunities in the telecom/commu-
next 18 to 24 months. If a company needs funds for five
nication sector evolving in the future? Do you expect more
or six years, there’s no point in raising all the money
Bhartis to come out, if so, in which sub-segment?
on day one, because the valuations will not be that favo-
In this segment, we believe that mobile advertising has the
rable... less than 18 months also does not make sense
potential to revolutionize the telecom industry. Of course,
since the company needs to focus on its business and not
we are constantly looking for those companies that can get
on raising capital.
traction in this sub-sector.
SMS “DARE <your comments, questions or suggestions>” to
56677 or
Email us at dare@cybermedia.co.in 54
OCTOBER 2008
DAR E
ARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DAR ARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DAR ARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DAR ARE D DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DAREE DAR ARE D DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DAREE DAR DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DAREE DAR ARE D ARE D DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DAREE DAR ARE D DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DAREE DAR ARE D DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DAREE DAR ARE D DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DAREE DAR DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DAREE DAR ARE D ARE D DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DAREE DAR ARE D DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DAREE DAR ARE D DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DAREE DAR ARE D DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DAREE DAR DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DAREE DAR ARE D ARE D DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DAREE DAR ARE D DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DAREE DAR ARE D DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DAREE DAR ARE D DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DAREE DAR ARE D DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DAREE DAR ARE D DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DAREE DAR ARE D DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DAREE DAR ARE D DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DAREE DAR ARE D DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DAREE DAR ARE D DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DAREE DAR ARE D DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DAREE DAR ARE D DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DAREE DAR ARE D DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DAREE DAR ARE D DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE 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ARE D DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DAREE DAR ARE D DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DAREE DAR ARE D DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DAREE DAR ARE D DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DAREE DAR DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DAREE DAR ARE D ARE D DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DAREE DAR ARE D DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DAREE DAR ARE D DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DAREE DAR ARE D DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DAREE DAR DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DAREE DAR ARE D ARE D DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DAREE DAR ARE D DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DAREE DAR ARE D DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DAREE DAR ARE D DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DAREE DAR ARE D DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DAREE DAR ARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DAR ARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DARE DAR
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opportunity/IT/ITeS
Software opportunities from SaaS Web-based application platforms open up a new world for the software entrepreneur to conquer
/Sreejiraj Eluvangal
D
ment to find out what was happening. Each department would then send their information separately. Every time I wanted an update, this had to be repeated.” Pathak, therefore, looked for a software to help him manage recruitment at the 700-student institute. “Quite a few companies made presentations. But most wanted us to buy a whole package that contained a lot of things we did not need. However, we found one vendor who offered to give us only what we wanted. As a result, the price they offered was also very competitive compared to the others,” Pathak says. a2zApplications, the company that Pathak chose, is a good example of how a new generation of software companies is rewriting the rules of the software industry. a2z, like a few others in the business offers software on rent. So, instead of buying the products at one go, you pay a fixed ‘rent’ for using it. Besides, you don’t have to take the entire product on rent, only the parts you need. In Pathak’s case, for example, companies were offering to sell him an entire enterprise resource planning or ERP software whereas he just wanted something to keep track of the admissions process.“Our basic ERP offering starts from Rs 25,000 per month, for three users. If you were to buy and install it on your premises, you would have to shell out Rs 10 to 15 lacs immediately. Beyou would also need to hire — Srikant Rao sides, an ERP professional to manage President and CEO, the application,” points out SriAffordable Business Solutions kant Rao, President and CEO of Bangalore-based Affordable Busi-
irector of Academics, Devendra Pathak had a problem. Every year, hundreds of students would apply at his college, the Delhi Business School and he had to struggle to keep up with the recruitment process. “We get applications from all corners of the country,” says he, “I had to call up the heads of each depart-
We are mainly targeting the Rs 10 or 50 crore companies.
56
OCTOBER 2008
ness Solutions (ABS). Interestingly, Srikant competes directly with Microsoft’s business of selling such software by renting out the same software ‘in bits and pieces’. The Microsoft ERP software that Srikant ‘rents out’ is the same product that its maker sells for the full price. It is still early days in the business. From a vendor perspective, Indian companies are yet to make themselves heard, examples like a2z notwithstanding. Indian SaaS companies are few and far between. Even global biggies like the customer relationship management service vendor salesforce.com first looked at India out of necessity rather than choice. “We first looked at India because a lot of our customers from the US also had offices in India,” says Aaron Katz, VP with salesforce.com, which has 47,000 companies worldwide as its customers. “Now, we are processing about 1000 leads a month in the country.” Hard numbers are difficult to come by in this nascent industry. According to market research firm Springboard Research, the SaaS market in India is growing at an average rate of 77% and will reach $ 165 million (Rs 700 crore) by 2010. By that time, the Asian market will have expanded to around $ 1.16 billion (Rs 5,000 crore), comprising 15% of the total enterprise software market. Those in the business see an even more significant impact. “Right now, people talk of the SaaS wave,” says Srikant of ABS, “but by the end of three years, 60 to 70 percent of all enterprise software sold would be as service, not as a product.” Kiran Datar, MD of WebEx, which provides on demand, web based videoconferencing services says. “Earlier, we
DARE.CO.IN
opportunity/IT/ITeS used to look at IT as a cost. The CIO’s department was a cost centre. Today, he has become more important. He has become a business enabler, a revenue enabler. From being just a necessity, he is now a key player in ensuring the organization’s competitiveness,” he points out.
Bottom fishing The early adopters of the technology so far have been the small businesses, typically those who have not already invested in buying software. And it’s very early days yet. “Most of our customers are still struggling with Excel and Word,” says Kantanu Kundu, CEO of a2zApplications, who has a distinctly SMB focus to his offering. “A large number of SMEs, even those with Rs 100 crore turnover in a year don’t know what an ERP (enterprise resource planning) software is. I have seen companies with Rs 50 crore turnover doing all their accounting on complicated Excel sheets,” he adds. He further adds, “We don’t try to educate them about ERP or ask them to install it. If it’s a college that wants to monitor its students’ progress, we provide a service that does that. We do not try to sell them something they don’t want. We charge for very specific benefits that we offer.” a2zApplication have clients from publishing houses to hospitals to educational institutes. Srikant of ABS, the company that is both a competitor and a partner to Microsoft, says the service-based approach is very much focused on the ‘S’ part of the SME pie. “Of course, Microsoft itself is trying to sell those software as a product, so in a way, we are competing with them. But what I point out to them is that we are mainly targeting the Rs 10 or 50 crore companies. These are companies that would normally not deploy ERP software, such as the ones Microsoft, SAP and Oracle sell. At the same time, by making their products available to these companies through the service model, we are enlarging the pie for everyone.”
The need to partner The early success of SaaS companies has depended on their ability to provide more or less standardized offerings for managing employees, customers, suppliers, channels, production and inventory, etc. This approach, however, may also be its Achilles’ heel. As a company grows and becomes more complicated, many of the till-now disparate activities, such as selling, may need to be integrated in real time with their other activities, such as manufacturing. In the traditional onpremise software model, the integration was achieved by patching the different pieces of software that were used to manage each of these activities. Sometimes, enterprises deployed companywide software that had modules for each of these activities and the data was shared among all the divisions. So, for example, a sale at the retail outlet can automatically result in an order being placed with the suppliers, with hardly any human intervention. The game changes, however, when one moves from software installed on-premise to services delivered through the Net. If, for example, a customer uses a sales management service from one vendor and an inventory management service from another SaaS vendor, there is a very high chance that the two cannot be made together to talk to each other easily. The problem is all the more acute as unlike on-premise software, individual SaaS vendors still provide just a part of the services that a medium-sized enterprise needs. The various offerings are not ‘integrated’ with each other. This ‘integration challenge’ has two components—integration between two SaaS providers and integration between a software service and a software product, where the latter is installed on the computers of the customer. The second one has been easier to deal with, as the local or on-premise
The challenge for us platform developers is to maintain this balance between ease of development and power. — Kantanu Kundu CEO, a2zApplications software is owned by the customer and can, therefore, be modified to facilitate data exchange with the Internet-based service. Indeed, most SaaS providers supply ready-made ‘bridges’ to most commonly found on-premise software, such as the ERP systems. The bigger challenge and the one that is the scene of a lot of activity now is the integration between two SaaS providers. “We are in talks with a company that provides an HR management service on Internet to integrate our offerings,” says TE Gautham, CEO of Appscale Technologies, which provides an InOCTOBER 2008 57
DARE.CO.IN
opportunity/IT/ITeS salesforce.com. With the click of a button, a company which has both a salesforce.com customer management account and a WebEx videoconferencing account can integrate the two services. “After a few clicks, you will see a WebEx videoconferencing button within your salesforce.com profile of your customer. Click on it and you can schedule a videoconferencing with the customer through our service,” says Kiran of WebEx.
Platforms offer new opportunities
The evolution of the application platform is an unprecedented opportunity for Indian entrepreneurs trying to launch their own software product. — Kiran Datar MD, WebEx ternet-based service for managing payrolls. “It would be easier for our clients if they did not have to feed details of number of leaves, incentives, etc. manually into our service. But we have realized that it will be a six man-month effort to tie up the two offerings at the back-end and offer a single integrated service to the customer. We may not do it unless we get a ready customer who will pay for the integration,” he adds. An example of integration already in the bag is the case of WebEx and 58
OCTOBER 2008
The WebEx and salesforce.com example is an exception. Most SaaS services do not provide their users the option of integration with their other SaaS accounts. However, there is a third opportunity out there that arises from this challenge – that of extending a SaaS application. This is when the SaaS application becomes the application platform. “Ultimately, this will be like the iPhone AppStore or Facebook applications for business,” says Kiran of WebEx, “All you have to do is write a good application, etc. And you have the whole world as your marketplace. The evolution of the application platform is an unprecedented opportunity for Indian entrepreneurs trying to launch their own software product.” There are quite a few such platforms already, including salesforce.com’s force.com, launched a year ago and similar products by Google and Amazon.com. WebEx has also just launched an application development and delivery platform for third-party developers. These companies provide a Webbased platform for developers to create and sell their applications that extend the base platform. In many cases, the platform providers also take care of the billing to the customer as well. In return, the ‘platforms’ charge a fixed fee for every user of an application, either from the developer or from the customer directly.
“There are already 68,000 developers who have registered with us on the platform. Nearly $ 425 million has been invested by VCs in company setups to create applications on our platform,” says Katz of salesforce.com. Besides the obvious attraction of getting ‘hosting fees’ from the application developers or customers, the platform business also addresses the problem of integrating SaaS services. All the applications developed on a particular platform share a basic sub-structure, making it easy to integrate such services. “If you are a customer of salesforce. com’s customer management service and go to the application exchange, you will find 800 other services that are integrated in ours, including human resources management, enterprise resource management, manufacturing, etc. For example, Coda, the second biggest ERP vendor in Europe is on our platform,” adds Katz. Besides opening up virtual marketplaces for small application developers, the platforms are also reducing the complexity of the application development. In an effort to keep the interoperability intact, the platforms do not provide the developer the freedom to go deep and change the underlying code. Instead, they provide ready-made tools, such as workflow diagrams, logic boxes, etc. with which developers have to construct their applications. “However, the more you abstract the development interface, the higher the risk that the platform will restrict the power and flexibility of the applications developed on it. The challenge for us platform developers is to maintain this balance between ease of development and power,” Kantanu says. “Ultimately, designing applications should be as simple as drag and drop,” he adds, “In our case, if you know how to edit HTML and JavaScript, you can construct an application for a school, for a hospital or a real-estate company. Once you do that, you can ‘sell’ the service to anyone and take a one-time fee from them for your marketing and DAR E coding efforts.”
exotic pets
DARE.CO.IN
opportunity/agri
breeding
If you love animals, here is an opportunity to make it your full-time business
/Mohita Nagpal
SHOW
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BUDG
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GOOR
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A GERM
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MAZO
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Sector Overview Exotic pets industry
ROR
EMPE
L ANGE
Pets in demand Birds, dogs, cats, rabbits, ďŹ sh Challenges High risk-perishable, no governing authority, restrictions on imports, highly unorgainsed Advertising Word of mouth, gazettes, internet, newspaper, pets shows
60
OCTOBER 2008
DARE.CO.IN
opportunity/agri
T
he word exotic has a mystical charm. Exotic means “anything of foreign origin or character”. In a nation where everything with a phoren tag sells like hot cakes, the business of breeding exotic pets can be lucrative. But the biggest problem is that breeding exotic pets is not recognised as a business in India. World-over there’s a huge market for exotic pets, and services supporting it. According to Business Week, Americans spend a whopping $41 billion a year on their pets! Ashok Pratap Rai, bird and dog breeder, says, “Importing and exporting pets is done worldwide. In India, certain NGOs headed by some powerful people have made an issue out of animal right activism.” Despite this, some animal loverscum-entrepreneurs are successfully making a fortune out of this business. However, before venturing into this business, one should evaluate one’s genuine passion for animals. A research on the demand and the market for exotic pets in India would come handy. There are a lot of breeds that have just arrived in India and the market is growing. Apart from cats and dogs, there are birds and fishes that have a lot of potential. So, once you have identified your love for a particular animal, here’s a guide on how to get started.
How to get started? Before starting any venture, there are bound to be some investments. For breeding pets, a thorough research should be done about the nature and likings of the pet, so that appropriate environment can be provided. Dogs: A sizeable chunk of startup capital goes into land. An ideal setup would be a farm of around 1000 yards with high boundary and a large lawn of short trimmed grass and a 100-yard kennel to give them privacy. Apart from that, understanding the temperament of dogs is very important. They just can’t bear humid weather, so having coolers and air conditioners is a must. As far as livestock is concerned, dog breeding can be started by just buying one adult female dog who
Popular pets for breeding Dogs Pugs, Labradors, German Sheppards, Mastiffs Birds African Love Birds, Cockatiels, Finches, Budgerigar, Java Sparrow Cats
Persian Cats, Chinese Cats
Fish
Flowerhorn, Arowanas, Mollies
has had prior litters or who belongs to a good line of blood or both. The next part is to find a male dog that is a proven stud. Birds: Most of the popular exotic birds like African lovebirds, finches, macaws are happy living in dense forests with a lot of fruits and greenery around. So, creating shacks makes for a good alternative. You have to create an environment for breeding birds and to keep them happy. So plants and a garden make for good ambience. Then of course there is the investment on cages. When it comes to livestock, again prior knowledge comes handy. Starting off with three pairs of pure breed birds is the usual way. Fish: Area is not a consideration for breeding fish. However, constructing aquariums and aquarium racks consumes the major portion of capital. A fresh water aquarium can cost anywhere between Rs 5,000-15,000. Then there are accessories to go with it. Pumps, filters, heaters, gravels, pebbles, plants and other decorative accessories could be used. Again, having electricity backup is essential.
Other Requirements Labor: Once the business gains momentum and the livestock increases,
employing helpers becomes necessary. It’s important that they should have prior knowledge of handling pets or else should be trained. Reliable Source: Having a source for exotic pets is obvious. But a lot of consideration should be taken before deciding upon the source. Goodwill and reputation speaks volumes in this industry. Of course you don’t want to be conned into buying cheap livestock in the name of pure breed. Knowledge/Education: There’s just no point starting this business without breeding knowledge. According to Himesh, a breeder should possess an in-depth knowledge about diseases, cures, mating season, and most importantly about the breeding styles of pets. He explains with an example, “There are a few fish that lay eggs below the pebbles of the aquarium, then there are breeds that lay only on plant leaves. Now, suppose you don’t have plants in your aquarium and you are thinking of breeding. Your business is over”. Financial Backing: Dealing in livestock is always risky as they are perishable items. A disease may take away all your livestock at one go. So, one should have financial backing to meet these unforeseen damages. Veterinary Clinic: Avoiding a disease is next to impossible, but having a sincere vet is all that you need to cure that disease and save your livestock. Abdul Gulab Wahab, bird and fish breeder of Bangalore has a vet-on-call who charges Rs 300 per visit. Food and Supplements: Identifying and stocking the right food for pets is a must for healthy breeding. For dogs, Royal Kanin is considered the best
Earlier, the business was restricted to normal birds. Now, people are experimenting and market is opening up for more exotic birds. Breeding has also become simpler with DNA testing of birds. — Gulab Abdul Wahab Fish-breeder and owner of petshop, Wetpets OCTOBER 2008 61
DARE.CO.IN brand. According to Gulab, its sale is roughly five tonnes a month in Bangalore alone. He also insists on his pets getting multivitamin capsules and mild antibiotics on timely basis. Then pregnancy capsules, calcium and iron supplements are given to female dogs in the mating season. Register with KCI: If you are breeding dogs you can register with Kennel Club of India or any other such body. The idea is to create a data bank or pedigree of a dog about its bloodline of three generations. This way the authenticity increases and if you are planning to buy a dog, you can check up on its history from KCI. Moreover, they place a microchip on the dogs for identification. Uninterrupted Power Supply: The best precaution that you can take for livestock, especially dogs and fishes, is to have a 100% power backup. Installing generators or invertors is a rule rather than an exception. Legal Papers: Whenever you buy a pet, never forget to get the transfer of ownership certificate from the seller. Having legal papers gives authenticity.
opportunity/agri The Business
Challenges
The money is of course in selling pups or kittens or bunnies. It starts pouring in once you are an established name in the industry and have a healthy livestock. You can price the same puppy at Rs 15,000 that your neighbor is selling for just Rs 5,000. But, this is possible only if your dogs are of pure breed. Take the example of Himesh who owns 17 dogs (seven mastiffs and ten St. Bernards). Around fifteen of them are females. Mating is done usually once a year. On an average, it gives birth to 12 pups at a time. In a litter, a pup can be priced at Rs 10,000 and another one at Rs 30,000. For this distinction to be made, one should have an eye for detail. Himesh annually sells around 200 pups (few are bought and sold), for an average price of Rs 20,000. Then comes the business of mating. His pet show winner, a St. Bernard, is currently priced at Rs 5 lakh (weighing 100 kg). The price for mating with that dog is Rs 35,000. He annually accepts 60 mating offers.
Every business has its share of pitfalls. Here are a few problems associated with this business. Unorganized: The business of exotic pets has not been given industry status as yet. It is not recognized as a business in India. Due to this, there are numerous small breeders scattered all over the country. They don’t have the desired knowledge and expertise to breed pets in a healthy manner. Then there is no legal paper work, which leads to fraud deals sometimes. Legal Issues: There’s no law saying that breeding of exotic pets is illegal in India, but breeders do get into trouble with NGO’s and animal rights activists someway or the other. According to Rai, “There should be proper guidelines and laws for procurement of license for breeding exotic pets. It is done world over. Moreover, animal right activism is taken at par with terrorism laws in the UK.” A similar sentiment is echoed by Gulab, “All the countries import pets with official papers. Unfortunately that is not the case in India.” High-risk: The most important element of the business is that “livestock” is a perishable item and that poses a big challenge. Maintaining, breeding and looking after the pets call for a lot of hardwork. Taking necessary precautions to avoid any disease from spreading is a herculean task.
How to Advertise? After all the inputs are at place, its time to market the pets effectively. The clients are usually traders, pet stores or direct customers. Pet Shows: If quality is the USP of your pets, and ideally it should be, then participating in pet shows can work wonders for your business. These pet shows, again organized by KCI, are the most sought after events by the breeders, nationwide. The market value of a dog show winner rises phenomenally after the title. Word of Mouth: Goodwill and name sells in this industry. As Himesh points out, “If you are confident about the quality of your pets, then sooner or later you will get your dues.” It takes some time to build a reputation. But once you have proved your credentials, word of mouth and referrals spread fast in the industry. Gazette: KCI has an official gazette that is circulated across the country. Advertising in it can be a smart move. 62
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The Future
Breeding dogs require a lot of hardwork and patience. Feeding a litter is equal to feeding five adult dogs. Every breeder doesn’t have the heart to feed them because ultimately they have to be sold out. — Himesh Shroff Co-owner, Authentic Kennel & Dog Home
Despite all the challenges, there are ample number of reasons to look forward to the business. According to Rai, “Very soon there is going to be an order passed wherein you have to register with Animal Welfare Board for starting this business. I welcome this order, as a lot of frauds in the industry would be weeded out by this.” He further adds, “Once the laws come in, the future is going to be very bright. We can genuinely escalate. Even fishery department is encouraging people to take up ornamental fish farming. The fisheries in West Bengal is also asking for industry status. All DAR E these talks are progressive.”
DARE.CO.IN
blogs/opinion
Grandeurship Small is no longer beautiful. An entrepreneur must dream big /Anurag Batra don’t know whether such a term
I
derstanding who we fundamentally
exists in the Oxford dictionary.
are as people. Then, equipped with
They say that entrepreneurs are
this essential knowledge, we can go
visionaries, and create concepts that
out into the world to do what we have
were not coined or envisioned by any-
been wired to do, and create the good-
one, and make a business out of them.
ness that we have been placed here to
The gist of what I am saying, and in
create. Remember, you have a duty to
it my dilemma, is the same dilemma
shine, and this world will be less of a
faced by Elizabeth Taylor’s seventh
place if you chose to play small with
husband who, on the night of the hon-
your life.
eymoon, told her “Darling, I know what
This is the philosophy that the en-
I am supposed to do, but I don’t know
trepreneur must strive to live by. On
how to make it interesting!” I thought
another note, grandeurship in today’s
that I would make it “interesting” by
world can also be achieved through
The perception of scale across
using a PowerPoint presentation to
collaborative initiatives. It is not al-
make my point, only to realize that
ways necessary to do it yourself (es-
the globe, as well as in India, has
PowerPoint presentations are made
pecially if it has to be grand); since it
by people who are either powerful or
is the end result that counts, a group
changed. If your dream is not big
have a point of view—and I consider
with a similar outlook can join togeth-
myself as belonging to neither catego-
er and create something grand.
(or ridiculously big) or GRAND,
ry. Having said that, here is my simple
“
or of a scale that has not been
”
dreamt earlier, then it won’t work in today’s day and age.
proposition in today’s scenario: Small is no longer beautiful. An entrepreneur must dream big.
In the quest for grandeurship, and in the larger sense entrepreneurship, you truly cannot afford the luxury of even one negative thought. A worry-
They say in cricket, and by exten-
ing thought is like an embryo; it starts
sion in life, big things come in small
off small but grows and grows. Soon it
packages (referring to Sachin Ten-
takes on a life of its own. Stop feeding
dulkar, Sunil Gavaskar and Brian
what doesn’t serve you.
Lara). This no longer holds true. In to-
So why postpone your greatness?
day’s world, BIG is beautiful (just take
There will never be a perfect time
a look at Michael (Mike) Hussey, Mat-
to live your dreams and step into
thew Hayden and Kevin Pietersen).
the poetic possibilities that your life
The perception of scale across the
was meant to be. Why not take the
globe, as well as in India, has changed.
leap today?
DAR E
If your dream is not big (or ridiculously big) or GRAND, or of a scale that has not been dreamt earlier, then it won’t work in today’s day and age. The way to an extraordinary life lies in exploring ourselves, learning of our greatest capabilities, and un-
Anurag Batra is real life, first generation entrepreneur who is Much Below Average (MBA) from the prestigious Management Development Institute, MDI. When he is not busy writing such columns, he can be reached at anuragbatrayo@gmail.com. Anurag is the co founder and editor-in-chief of exchange4media group which includes exchange4media.com. OCTOBER 2008 63
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Business from Waste Paper Waste paper reuse and recycling not only saves the environment, but also reduces costs Paper Recycling
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ndia generates approximately 0.1 million tonnes of municipal solid waste everyday, or about 36.5 million tonnes annually! Of this waste, 40% is just paper. In other words, we produce 14.6 million tonnes of waste paper every year! Waste paper is not just thrown away or used only for wrapping your purchases at the local kirana shop. Globally, recycling of paper is a huge business. There are global exchanges that deal in waste paper and many countries mandate the recycling of paper. Currently, the recovery of waste paper in India is low at 26% compared to say Germany at 80%, Thailand at 45% and China at 38%, according to the Indian Agro & Recycled Paper Mills Association (IARPMA) estimates. Here, it is pertinent to note that recovery means collecting back for reuse, while recycling means producing paper out of recovered waste paper. This means that out of our consumption of 8.3 million tonnes of paper, only about 2 million tonnes is recovered for reuse. Obviously, there are significant opportunities hidden in paper. Here, we cover three such businesses—recycling, waste paper collection or recovery, and waste paper based handicrafts.
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IARPMA projects the demand for paper in India to reach 15 million tonnes by 2015. If we were to reach China’s current level of recovery, then we should be recovering 5.7 million tonnes of waste paper for reuse by then. While the production of recycled paper has increased approximately three folds from just 13% in 1985 to nearly 40% in India, the potential is much larger. Paper produced by recycling is generally of four kinds—writing/printing paper, newsprint paper, duplex boards, and craft paper. Recycled paper is often made into the same grade of paper that it was originally. For example, old newspapers are recycled to produce newsprint, and corrugated cardboard boxes are recycled to produce paper for packaging. Paper production is a highly capitaland labour-intensive activity. According to PG Mukundan, Secretary General, IARPMA, “Depending on the produc-
MACHINES NEEDED FOR MAKING RECYCLED PAPER Pulping Machine Multi-stage Washer Headbox Felt Paper Machine Dryer
/Aswathi Muralidharan tion capacity of the mill and quality of the output, the initial investment will not be less than 50-100 crores.” Major investments would be on machinery, which includes the pulping machine, multi-stage washer, head box, felt, paper machine, and dryer. Besides these, one would require pollution control equipment, and water treatment plants. Other areas of investment would be into land and buildings—yard for stocking, storage area for keeping and segregating waste paper, and the cutting division. These requirements remain the same for producing different kinds of paper but some processes may vary. For example, for producing craft or brown paper, everything is the same minus bleaching. Compared to the cost of producing virgin paper, the production cost of recycled paper is much less. According to Jogarao Bhamidipati, Vice President at the ITC Paper boards and Speciality Papers Division (PSPD), “Production cost comes down because for producing virgin pulp, you have to first cut the trees, make it into small chips, cook it, bleach it and make it into pulp. These processes can be avoided by making pulp from waste paper.” He says production costs can be down by about 40% with recycled paper. Cutting down these processes also helps to reduce the levels of pollution caused by paper mills.
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opportunity/waste WHAT YOU NEED TO COLLECT WASTE PAPER Warehouse—to store and sort Vehicles—to collect and transport Shredders—to shred important papers Bailing Machine—to pack efficiently
The quality of recycled paper would be inferior to that produced from virgin pulp, but there is a way out. According to Bhamidipati, “Manufacturers blend waste paper and virgin pulp to manufacture mixed quality paper. For example, they mix 60% recycled pulp with 40% virgin pulp to attain average quality.” According to Bhamidipati, “One of the reasons why the demand of waste paper is high is because not all paper mills are in a position to put up a pulp facility.” While there has been a significant increase in recycled paper production, collection of paper for recycling has lagged.
Collecting Waste Paper At present, the collection of waste paper is the domain of rag pickers, and scrap dealers. Once collected, it passes through several hands before reaching the paper mills, if it does. And if it does, the price at which it is sold to the paper mills almost doubles! In India, there are several companies, large and small, who are into
JOGARAO BHAMIDIPATI Vice President, ITC
Recycled paper reduces manufacturing cost of paper by almost 40%.
this business. One way of trading the waste paper thus collected is through paper exchanges that facilitate buying and selling of waste paper on an international level. Another way is collecting the paper, segregating it and selling it to paper mills. An interesting business model in this respect is that of JDC Recycling, a part of the JDC Group. JDC Recycling collects paper waste from offices and sells it to paper mills for recycling. The company offers collection services and confidential document shredding services to insurance companies, banks, etc. According to Sumeet Chopra the founder, “we have a team of people and collection vans to collect waste paper directly from offices.” The difference in their model comes next. Payment is made either in cash or with stationary made of recycled paper. A major challenge that the company faces is the lack of awareness among people. Explains Chopra, waste paper is of two types, pre-consumer and post-consumer. Pre-consumer is the waste produced by printers, packaging houses, etc, which does not reach the end consumer. A system already exists for collecting this waste. However, the problem is with the post- consumer waste because of the low awareness level. When households and offices dispose wastepaper in the dustbin, it is thrown together with other wastes such as food and the paper becomes so soiled that it cannot be used for recycling. To tackle this, JDC provides educational materials such as posters and special corrugated boxes for collecting paper waste. ITC is working on a similar program to cater to its needs as part of its Corporate Social Responsibility initiatives. It has launched a program called Wealth out of Waste (WOW), which entails buying domestic waste, separating waste paper and sending it to the company’s paper mills for recycling. ITC provides households with two paper bags—one for wet waste and the other for dry waste. According to market sources, it is collecting 400
PG MUKUNDAN Secretary General, IARPMA
Depending on the production capacity of the mill and quality of the output, the initial investment will not be less than Rs 50-100 crores for paper recycling. tonnes of dry waste per month and is expected to hit 2,000 tonnes a month in the next six months.
Handicrafts Papier mache is a craft made out of waste paper. Producing papier mache items does not involve expensive inputs. Paper and paste are the basic materials. According to Kamal Jyoti Das of Papier Mache Craft, they create a variety of products, ranging from beautiful intricately painted masks to pen stands painted with vivid colours. The product costs range from Rs 100 to Rs 1,500 depending on the intricacy of the design. According to Das, marketing these products is a challenge, and he has created a website to reach a wider audience. On the other hand, Ranjay Kumar Jha, a small papier mache products manufacturer, displays his products at the capital’s Dilli Haat. He claims to sell nearly 20-25 pieces per day, in the price range of Rs 75 to Rs 1,000. And his profit margin? 20-30%. Though papier mache products are made by many states, large scale sale of these products has not been attempted yet. So the next time you crumple up and throw away a piece of paper, just keep in mind that you are throwing DAR E away a business opportunity! OCTOBER 2008 65
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/sector
New fundraising options for NGOs and social entrepreneurs From basic donations like food and clothes to more innovative ones like sponsoring medications, schooling and granting wishes—the focus is now shifting from cash donations to the more transparent in-kind donations
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special limited edition of the Kingfisher Swimsuit Special 2008 calendar was auctioned earlier this year. It attracted 60 bidders, 74 bids, and the top bid of Rs 150,000. The accumulated proceeds went to charitable organizations such as the Akanksha Foundation, Dignity Foundation, Jana Kalyan Welfare Society and Sense International (India). More recently, The Hair India People, an association of hair dressers, organized a cut-a-thon to raise money for Voice, an NGO that works with street children. They charged Rs 600 per haircut and throughout the day, celebrities lent their support by getting a haircut. At the end of the day, all
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the money was handed over to Voice by the crew of Rock On. Organized forms of charity have been around for a long time and play a large role in helping money reach the needy. The legendary Mother Teresa and the Missionaries of Charity, founded in 1950, received an estimated US $50 million in donations every year from New York alone. Now, in 2008 we have over a million NGOs and with the evolving times, the techniques with which funds are being raised have also changed. Innovative ideas are being used to increase transparency and to assure people that their donations are being utilized for the right cause. Industry veterans tell us the latest trends.
“
/Shilpi Kumar
Media activism has been a strong factor in portraying a positive outlook towards philanthropy. There is awareness about social issues and charitable giving. Indians were always philanthropic but now it extends beyond just religion and emergency-giving, to even rightsbased organization and activities.
”
— Alice Andrew Director- Fundraising, ActionAid India
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/sector Bringing in transparency “Donation in cash brings in skepticism amongst the donors. People feel more connected with the campaign when they give in kind. The tangibility factor leaves the donors much more convinced,” said Hina Goyal, trustee and project coordinator of the Ek Mutthi Anaaj campaign led by the MCKS Food for Hungry Foundation (covered in DARE Feb 08 issue). Implemented in July last year, the campaign seeks contributions from donors in the form of food grain. For HelpAge India, a not-for-profit organization that provides relief and protects the rights of India’s elderly, most donations come in the form of cash. “But whenever a need has been identified for clothes, blankets or furniture for old-age homes, we have always gotten a good response,” says Harvinder Singh Bakshi, National Director- Advocacy. People are becoming extremely receptive to donating in kind and organizations are putting a greater emphasis on this form of fundraising. The Naz Foundation (India) Trust, for example, that provides support and care to those living with HIV and AIDS, clearly states on their website that building material such as cement, bricks, hardware, wiring and fittings are the most needed, after food. Says Anuradha Mukherjee, Programs Manager, “The only reason we have been able to sustain our carehome and in fact even planning to expand it is because we are getting a lot of support from people in the form of bulk ration and other supplies such as mixer, grinder and cooking utensils.” Many people have also been donating clothes for the 35 children currently in their care home. The Naz Foundation also encourages donors to interact directly with the 1500 families living with HIV in Delhi. “Money can be raised from anywhere, but these families and children need to be interacted with,” says Anuradha. Have they been successful in doing so? Well, according to her, their donors from abroad write letters to the children and even send them birthday
NGO Funding Overview Fund raising activities Corporate Fundraising Direct Mail Fundraising Events- dances, concerts, etc SMS Appeals School/College fundraising programs Selling merchandize Various forms of donations Adopt a Wish Adopting/Sponsoring a person Cash Grants In-kind: Food, Clothes, utensils, etc Including cash/kinds in wills Payroll Giving Sponsoring a meal/outing/healthcare Support a campaign/movement Supporting an mobile medicare unit Know of more fundraising activities and forms of donations? Please write into us at dare@cybermedia.co.in greeting cards. “Many families spend their birthdays and anniversaries by sponsoring meals and spending time with the children at our care home,” she says. Make-A-Wish Foundation that grants wishes of children with lifethreatening illnesses regularly update their “current pending wish list” on their website so that donors know some of the childrens' wishes that need to be fufilled. “We encourage donors to interact with the children, tell them stories, etc to divert their attention from the illness. If the donor doesn’t have time to do so, Make-A-Wish sends them photographs capturing the wish fulfillment,” says Dakhina Mitra, Divisional Coordinator- Programs.
“
Donors from abroad write letters to the children and even send them greeting cards. Indian families contribute by sponsoring meals and celebrating their birthdays and anniversaries with the children
”
— Anuradha Mukherjee Programs Manager, The Naz Foundation (India) Trust
A lot of interest has also been generated for sponsoring trips and outdoor activities. Says Anuradha, “This is an extremely welcoming gesture as outdoor activities are extremely important for children’s holistic growth.” Naz Foundation has had sponsored trips to the Delhi Zoo, Appu Ghar, Children’s Park, Water Park etc in the past. Similarly Make-A-Wish gets a lot of “I wish to visit...” wishes from children for donors to fulfill.
Sponsoring the needy Last year, around 18,000 older people were sponsored under HelpAge India’s Sponsor-A-Grandparent program and the organization’s statistics show a trend towards larger and meaningful contributions. Says Harvinder, “The donor usually gives around Rs 600 a month to provide for the person’s basic necessities including food, clothing, medical, etc.” Regular reports on how the money is being spent are usually sent to the donors. However, Harvinder tells us that programs like these can get a bit taxing on the organizations. “If the donor wishes to stop donating after the one year period, it can get difficult to find another one,” he says.
Medical assistance Pharmaceutical companies, doctors and hospitals that provide free medical assistance are the backbone of many charitable organizations. For Make-AWish, medicos have even been open to interaction between the volunteers and the patients. Dakhina shares an experience with us, “One of the children’s wish was to be a doctor and the hospital arranged a special chamber for him to practice and even got him nurses, medical supplies and pretendpatients. He was also given candies to hand out to the pretend-patients as medicines.” Naz India receives medicines from doctors, some of which are even shipped in from abroad and Cipla is HelpAge India's regular donor According to HelpAge India, around 50,000 cataract operations are sponsored in a year by their project partners and support is also given for their OCTOBER 2008 67
DARE.CO.IN mobile medicare units, in the form of medicines, supplies, equipment, medical assistants, etc. Even the general public get an opportunity to assist medically by sponsoring medications, hospital visits and tests for a child.
School and college participation Educational institutions are also giving a lot of weightage to social work. HelpAge India is involved in school education cum fundraising programs where they sensitize the children towards the issues that the elderly face. “We conduct essay writing and painting competition, as well as host cultural programs with the theme being old age. Children are handed out sponsorship sheets and the money collected is sent to us,” says Harvinder. All the children who contribute are given certificates and the highest contributor is given a prize. “In the past we have given out cricket bats with all the Indian cricketers’ signatures on it,” says Harvinder. For Make-A-Wish, college students put up donation boxes in various places and also set up stalls that sell their merchandize. “Last year, the volunteers in Lady Shri Ram College (LSR), New Delhi set up a wishing well. Students could purchase a paper star for Rs 5, drop it into a make-believe well and make a wish. After all the stars were sold, they had a lucky draw
/sector where three winners were given free merchandize," says Dakhina. The American Embassy School has actively supported The Naz Foundation and the children frequent visits during the weekends and even engage in various fundraising activities to buy lunchboxes, water bottles, school bags etc for the children. “Recently, we even had a workshop on hygiene by medical students, who later handed out toothbrushes to everyone,” says Anuradha.
Collaborating with corporations With the concept of corporate social responsibility gaining momentum, many organizations are tying up with charitable organizations. They help by donating in cash, in-kind or by sponsoring fundraising events such as con-
“
One of the children’s wish was to be a doctor and the hospital arranged a special chamber for him to practice and even got him nurses, medical supplies and pretend-patients. He was also given candies to hand out to the pretend-patients as medicines
”
— Dakhina Mitra Divisional Coordinator - Programs, Make-A-Wish
certs, marathons, auctions, balls, etc. Make-A-Wish has a tie-up with Mattel Toys that sponsors children’s Barbie wishes. They also have collaboration with Hyatt Hotels and Resorts and Walt Disney Company. Says Dakhina, “Every month we send out pending wish lists to corporate organizations and a lot of times they end up adopting the entire list. They also host parties for the children where they arrange for activities like magic shows, movies, etc and give standardized gifts to all the children.” HelpAge India has a tie-up with Archies Greetings and Gifts and they reportedly generated revenues worth Rs 1.9 million in the year 2004-2005 through the sale of greeting cards. Archies Greetings and Gifts is also the sole distributor for Child Rights and You (CRY) greeting cards and paper products. Even social networking sites are entering the picture like UNICEF partnering up with Facebook to launch a charity gift feature in one of its applications called Causes, last year.
Shopping for a cause Each charitable organization has merchandize that is usually sold online or during events and is an excellent source of revenue. Organizations like HelpAge India and The Naz Foundation encourage the needy to make candles, envelopes, home accessories, clothing, etc and help them in selling these products. This is also a source of direct income for the needy and motivates them to fend for themselves.
Reaching out to donors
Last year students of Lady Shri Ram College (LSR), New Delhi purchased paper stars of Rs 5 each and dropped it in this make-believe Make-a-Wish well 68
OCTOBER 2008
According to Alice Andrew, Director-Fundraising of ActionAid India, an anti-poverty agency, “Direct mails, SMS appeal, face-to-face appeal are some of the ways through which you can reach out to potential donors. We are exploring telephone prospecting now with a BPO, which could be an aided tool for refining charity lists. Some banks also help to convert prospects to donations over telephone.” Alice also mentioned that you have to be careful about using the right
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Whenever a need has been identified for clothes, blankets or furniture for oldage homes, HelpAge India has always gotten a good response. mode of fundraising with the right target audience. “The aged group still responds best with direct mailing methods, but with youngsters one should go for either online or SMS appeal. The middle aged group usually prefers face-to-face interaction,” she says.
Scope for much more Commenting on the future, Harvinder says, “Although donations in-kind are becoming extremely popular, cash donations are here to stay. We still stress on donations by cash because in time of emergency we can allocate the money according to the essential items that are required.” Make-A-Wish agrees, “Certain wishes are not picked up or sponsored by any donors, in which case, we need the cash to grant those wishes." The stress on payroll giving in many companies also generates cash for NGOs. Most of these donations are exempted under 80G of Income Tax 70
OCTOBER 2008
Although donations in-kind are becoming extremely popular, cash donations are here to stay. We still stress on donations by cash because in time of emergency we can allocate the money according to the essential items that are required — Harvinder Singh Bakshi National Director- Advocacy, HelpAge India
Act and gives employees all the more reason to donate. Another big way through which people donate by cash is through their will or legacy. HelpAge India has a legal cell that can help an individual to draft out their will. Despite all the buzz, there is still a lot left to be achieved. According to The South Asian Fund Raising Group (SAFRG), there are over a million NGOs in India that collectively raise around $500 million annually. But our potential is assessed at $10 billion. So, what’s stopping us? According to SAFRG, “There is no dearth of donors but there is an extreme dearth of professional fundraisers.” SAFRG has made this their prime objective and are now conducting annual workshops, where they share best practices, case studies, innovations and new trends in fundraising. SAFRG believes that “such capacity building needs to be further boosted.” Well, are DAR E entrepreneurs listening?
A B-plan contest for working professionals and Start-ups Rs. 50.0 million* funding from Seed Fund Advisors Pvt. Ltd. for the winning teams And a chance to present to their core team
Registrations Close on 22 October, 2008 www.sibm.edu/endeavour08 Contact Details : Sorabh Goel : +91- 90110 20967 Subodh Garg : +91- 90110 20968
Supported by
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PUNE Mentoring by
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/sector
Scope of event lighting & equipment
Industry: Entertainment / services Business: Lighting and lighting equipment rental Scope: Fashion events, television shows, music concerts, business conferences, trade shows, weddings, etc Where’s the money? Distribution of cheap and efficient fixtures in volumes 72
OCTOBER 2008
Photo courtesy: Genesis Burson Martseller, Lakme Fashion Week (Spring/Summer 2008) - Nandita Thirani's Collection
/Binesh Kutty
Can you begin by giving us a basic understanding of lighting as a service? There are two main categories in lighting— entertainment and architectural lighting. Architectural lighting at the simplest level is the bulb on your ceiling all the way up to lighting on streets, bridges, etc. The former, however, is vast in its scope as it covers lighting in small discotheques, weddings, as well as highly sophisticated television shows. While being sort of similar, each type has a very different approach for business. For architectural lighting the bulbs burn for many hours at one go and the focus is more on energy efficiency and illumination levels. In entertainment, by its very nature, lighting plays a supporting role to many other things, and therefore it is relatively one of the low cost ingredients. For this the focus is more on the atmosphere created by the positioning of the lighting, type of fixtures used and the intensity of the lighting. Typically, entertainment lighting and equipment has to be delivered on a particular day, on a huge scale, along with backup and more. For better understanding, if two bulbs in a lighting setup of 40 bulbs on a bridge burn out and are not replaced for weeks together, it won’t really make a difference. However, the same situation for a television shot matters a lot. As a service in the entertainment industry, what is the scenario for lighting in India? The entertainment industry is booming in India. The scope of business is vast. As for providers, there are not many people in the field who know much about lighting. These providers might have seen couple of videos and DVDs to get their basic knowledge of lighting. However, their actual level of exposure, as compared to people in Europe and other western countries, is minimal and hence lack the discipline that is required in this field. There is a tendency in India to replicate everything possible. And the problem is taken to an advanced level when even the usage of certain fixtures are questioned saying the same result can be got using a much cheaper set of light bulbs. And even when it comes to clients, the ideal level of sophistication is not existent. The role of a light designer is to study a project and decide what kind of fixtures and equipment is needed. It is somebody else’s job to obtain and install that. However, this
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I do not believe there is huge demand for light engineering. If you really want to make money, you have to be in the business of distributing cheap and efficient fixtures, as widely as possible. business also works out on a turnkey basis, where it is sensible for the client to get everything from one single provider. Clients prefer going for a provider who, along with light designing, arranges for the hire and setup of the equipment and fixtures. This is because not many clients pay too much attention to lighting. In the western countries, however, since there are clients who are more sophisticated, these functions are clearly divided. The trend in India will surely head to the same direction some day. As of now though, people use bargaining chips such as offering free lighting for a particular contract, and so on. For instance, if one looks at what happens in these television serials and sitcoms, the common perception is to focus the lights on the main characters and the background is lit in a stray fashion. Then there are shows like Kaun Banega Crorepati, where the lighting design was integrated with the scheme of the show. In most cases, the former or conventional kind of lighting equipment is used, since most choose not to be sensitive enough to figure out that there is a noticeable difference that creates an impact. What are the challenges faced in this service? As the years progress, we are seeing more and more fashion weeks happen-
Viraaf Pocha, Landmark Events, is a lighting design veteran and has arranged the lighting setup for many fashion shows. He serviced clients like The Times of India, Mercedes Benz, World Gold Council, Smirnoff, SSC&B Lintas, ITC, and many more. He spoke to DARE to give insights of the industry - A primer for entrepreneurs on the segments worth considering in this field. ing. In this field, the production value (in this segment of business) keeps suffering. Everybody is impressed by shows in the United States and Europe, and wants the same effects here for their show. However, when it comes to arranging for equipment that is required to pull off that effect, everyone takes a step back. If you ask me, we are already at the minimal cost, and as the frequency and number of such events keep increasing, we are under a constant pressure of doing what we do in the ever so tight budgets. The main problem is that the people going for the services of a light designer are not well aware of what is possible and can be done, and the cost factors. The second hurdle, if the first one is tackled, is that the monies required to do it is not what they budgeted for. So where is the money? The field of light designing is fairly small. There are many players in the market, and even though not many are equipped with the requisite so-
phistication and expertise. The clients choose to not go for the top-shelf Italian optics recommended to them, as the cost runs above Rs 3 lacs for just this one equipment. Lighting needs to have a certain theme, a certain purpose. It is a tool to get the required effect on the stage or ramp. Often what is asked for today is bright, flashy, trash lighting! The way the market is operating, where there is a requirement for five lights, they bring in 40 lights, point them in the right direction and hope for the best. I do not believe there is huge demand for light engineering. If you really want to make money, you have to be in the business of distributing cheap and efficient fixtures, as widely as possible. In India, this business is personal driven than industry driven. A lot of business happens depending on personal contacts and networking. The revenue scheme, therefore, is again at a personal level. Unlike in an industry, where a clear cut credit period is defined, in this line of business it really depends on the kind of relation you DAR E build with the client. OCTOBER 2008 73
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Off to a Hot Start It couldn’t get hotter than this! Over 350 startups from across the country nominated for TATA NEN Hottest Startups in its first month
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startup working on combating the tiniest of cancer tumours. Another manufacturing a device that can stop profuse bleeding in two minutes. A startup leading the Second Generation Outsourcing wave. A BPO for rural India. Mobile applications that converts your low cost cellphone into an action-packed gadget. A team that prepares youth of small towns for big jobs across
the globe. A couple rekindling the love for Maths in over a lakh students. A company that lets you up your karma rating. A young company that delivers a surprise to any place, any time. Two people who makes a writer out of you. An internet startup ensures that you never go hungry. Revolutionary, visionary, passionate, practical or plain good fun - The TATA NEN Hottest Startups has space for every genre of startup. Presented by National Entrepreneurship Network and the TATA Group, in partnership with Helion Ventures, Seedfund and Mint and a number of associations 74
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and other groups supporting entrepreneurship, the contest launched on August 27. The contest is showcasing high-potential, high-growth startups on a national platform. Over 350 nominations were received in the very first month of launch, reflecting the variety, diversity and uniqueness that exist in the entrepreneurial world today. Not all of these startups belong to metros like Mumbai or Bangalore or Delhi, the oft-cited
bustling grounds of entrepreneurship. Breaking this myth are exciting startups from smaller towns like Trivandrum and Udaipur who have made it to the Hottest Startups hot list. As hoped, Hottest Startups isn’t only about IT either. From art, to cleantech, to even cane juice – fascinating examples of business enterprise are being
shared, commented upon and hotly debated over at the TATA NEN Hottest Startups website. Over 6,000 people have cast their votes for hottest startups, even as nominated entrepreneurs are using SMS, blogs and websites in interesting ways to gather votes for their startups. According to Laura Parkin, Executive Director, National Entrepreneurship Network, Hottest Startups, since its launch, is trying to engage people in the identification and appreciation of startups through processes like nomination and
voting. “Our intent is to get people thinking about their own regions, their own cities, their fellow alumni from institutes: has someone they know started a great company? In a sense, nomination can provide a deeper connection with startups than voting. We feel it is important to reach smaller
DARE.CO.IN cities, as well as reach the startups in major metros. Therefore, we are working with different groups: associations, Chambers of Commerce, NEN student e-cells, to reach out across sectors and areas,” she reveals. Samir Kumar, Managing Director of Inventus Capital Partners, who has reviewed and rated some of the nominated startups as an expert, is optimistic about the quality of young companies today. “Most of the startups featured in Hottest Startups have mature teams, address good marketing opportunities, successfully differentiate their products, and hold potential to become large companies in future. It is exciting to witness the new generation of startups in India,” he feels. Amit Grover of Mumbai Angels and Hottest Startups expert looks at Hot-
Hot Facts 130 nominees are from smaller cities like Jodhpur, Raipur, Muzaffarpur, Raichur, Meerut, Bikaner, Bhopal, Indore, Jaipur, Durgapur, Dehradun, Imphal, Haridwar 61 nominees, or 17%, are in their early 20s 269 nominees, or 77%, are first generation entrepreneurs 242 startups, or 69%, are funded by personal savings 57 nominees, or 16%, studied abroad 119 nominees, or 34%, are serial entrepreneurs (Total Pool: 350 nominees, as on September 23) Datelines • Nominations open till: October 22, 2008 - Each nomination will be reviewed and rated by two Expert Judges. The number of Public Votes and Experts’ Ratings together determine the shortlist. • Voting closes, and shortlist of 30 startups declared: November 6, 2008 • Campaigning and voting for Top 5 Winners begins: November 6, 2008 • Announcement of Top 5 TATA NEN Hottest Startups 2008 winners: December 23, 2008 Criteria for Participating Startups • 5 or fewer years old • Headquartered in India • A stand-alone venture (not a subsidiary or division of a larger company) • Should be innovative, growing rapidly and have the potential to reshape their industries test Startups as a unique opportunity for startups to network, share and learn from each others stories, irrespective of which sector they belong to. “It is more of a community building exercise, and not just a contest. It provides a platform not only for IT and telecom-related startups, but also those from manufacturing, real estate, hospitality, education and other diverse fields as well,” says Grover. Parkin agrees with Grover. “We have structured Hottest Startups as an open contest in order to provide value to every single nominee through visibility and engagement. And we’re happy to see that it’s starting to work. I think the general excitement to learn about all the nominees – regardless of the nomi-
nees’ votes, expert reviews or rankings – shows that people understand that this contest is not just about the handful of winners, but rather a showcase of the amazing entrepreneurial energy in India today.” “In fact, we all know that the path from startup to large company is fraught with challenges, and no one’s success is guaranteed. But these Awards, and indeed the entire contest, are a celebration of the spirit shown by these entrepreneurs and their teams, in taking the first steps on that path. And in that way, each and every nominee has already DAR E succeeded,” she shares. More articles on www.nenonline.org. Content provided by NEN OCTOBER 2008 75
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society/education
What is Edu-drama?
Drama for education British entrepreneur Julia Gabriel’s education-drama helps children across Asia learn while they act
/Vimarsh Bajpai
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t is a Saturday forenoon and a boisterous bunch of children are ready to break into a drama session at Julia Gabriel Center for Learning in the southern part of Delhi. The children, in the age bracket of 6-7 years, will be both creative problem solvers and learners during the exercise that will be a mix of fun and education. For this, the barefooted participants have huddled into a colorful room that provides the perfect ambience for re-enactment of an age-old fable – The Ant and the Grasshopper. Two lively teachers – Jenny and Surbhi – share the responsibility of leading this animated bunch into a journey of discovery through the simple act of helping the ant teach the grasshopper a lesson in managing time and being prepared or organized for the challenges of facing winter. The lights are dimmed out, as Jenny stops the story at a point of conflict and asks the young participants if they can think of a way to approach this problem. The length and breadth of the stu-
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dio is transformed into a garden where the ant and the grasshopper live. The children take on the active role of discussing various options and engage in trying these out to see which one will convince the grasshopper to be more prepared and organized in future. It is remarkable how easily the children slip into their respective roles with gleeful enthusiasm. With each set of ideas being proposed, they begin to learn from each other’s perspectives and when they disagree it is interesting to note how they themselves negotiate and persuade each other to try out a certain idea and test its viability with the grasshopper. Time passes very quickly in the world of creative drama where the participants create their own learning through this dynamic medium of interaction and play. As the drama evolves, the tiny hearts take home the message that being lazy (like the grasshopper) is no good; that one should go out and help someone in need. The whole exercise packs in
Edu-drama is a process whereby students create and take part in impromptu drama together, drawing on their own interpretation of a poem or story and adding their own experiences to it. Such creative drama builds self-expression, confidence and problem-solving skills, besides promoting self-leadership. its theme a quick dose on organizing oneself, working together as a team, engaging the children in the physical role play of building a home for the grasshopper, and the basic manners of welcoming and expressing gratitude where it is due. Once over, the children are asked questions on what they discovered and what transpired when they met the grasshopper (sometimes the teacher takes on the active role of creating conflict as in this case playing the role of the grasshopper; while in many other classes one of the children may decide to play that role too!). This is generally followed by a writing exercise that is creative and helps children express through writing what they have discovered. Depending on the individual’s need for challenge some may be asked to write down what transpired in the drama, some may be asked to report as a news reporter on what happened in this world. Some may even want to
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This is an enrichment program that children take up besides their normal studies at school. The India centre has 500 students from toddlers to teenagers, who benefit from this interactive education technique. The centre also works with schools covering around 400 more students. experiment with telling the story in the form of a poem. The purpose of an Edu-drama class is thus fulfilled. “Edu-drama is all about creating our own learning through engaging in the act of problem solving that may arise from a conflict in the story or a poem or any other text. With older children it can arise from any idea or a discussion or emerge from an experience at home, school or with friends” says Shalini Pattabiraman, senior teacher- Edu-drama (Level 1 to Level 6). “All of a sudden you have children coming up with quirky answers,” says Meenakshi Chibba, who runs the India centre, which is a joint venture with Julia Gabriel’s School of Learning in Singapore. Chibba’s centre has 500 students from toddlers to teenagers, who benefit from this interactive education technique. She works with schools such as Amity and Delhi Public School, where teachers hold speech and drama classes, covering around 400 more students. Asked about the fee structure, the centre’s marketing manager Seema Kumar said it is only given to the parents at the time of admission and refused to divulge the monetary arrangement with 78
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society/education the schools. This is an enrichment program that children take up besides their normal studies at school. This is not a substitute to the education that they get at school but a value-add to what they learn. On weekdays, children visit the center after school for a 90-minute session, and on Saturdays the exercise is done all through the day. The centre also offers the Julia Gabriel Foundation Teaching Certificate in Speech and Drama for teachers, parents and adults who want to use this methodology. This course further acts as a precursor to the Trinity Guildhall Foundation Teaching Certificate in Speech and Drama.
Bringing Edu-drama to India During her visit to Singapore around the year 2000, Chibba met Julia Gabriel, the British entrepreneur who conceived and evolved the idea of Edu-Play and Edu-drama, and ran her start-up in the city-state. Quite enchanted with the education that Julia was offering, Chibba got the idea of having such a centre in India too. It was most certainly a lucrative business opportunity, as more and more Indian parents were opening up to letting their children follow their creative instincts. “Because I wanted to know what exactly it is, I first put my children in the centre, and they loved it,” she says. The next step was the signing of the agreement and training for Chibba on how she would run the India centre in tandem with the parent organization. Soon Chibba felt that she wanted to grow in what she was doing. So from just managing the centre, she decided to upgrade her skills. “Today I am qualified to teach a class in speech and drama at the primary level. Some of my teachers including me went for a primary teaching certificate from Trinity-Guildhall (Speech Communication Arts Primary teaching Certificate or SCAPT) to evaluate our own learning and reflect over it as we set out to grow further in our journey as facilitators”. “During the early days, the whole concept of Edu-drama was very new. It was only associated with theatre and not education”, says Chibba, adding
“We started the program with EduPlay which is for 18-month year old babies and is a parent-interactive program. The challenge was in letting the parents know what this was all about and helping them accept that learning doesn’t start at a certain age and contrary to a wide perception, a child is at its most receptive stage of learning from an age as early as 0-six months.” The centre uses a wide range of literature as a spring board for story telling and introducing drama. Children and teachers engage in improvisation, mime, puppetry, role-play, masks, storytelling, problem solving, et al. The India centre is a 51:49 JV between Chibba and the Singapore centre. “Our agreement is for whole of India, not Delhi alone. So whoever is interested in opening such a centre here, we are responsible for helping out,” she adds. The Julia Gabriel Centre in India is now in an expansion mode. The Noida and Gurgaon centers will be up and running in the next six months. This would be followed by similar activities in Bangalore and Mumbai. Chibba stresses that it would be important for the person who wants to run such a centre to be absolutely passionate about the creative aspects of this business. It is about Julia Gabriel’s culture, she says.
The Early Days Armed with her qualifications from the Guildhall School of Music and Drama, London, Julia Gabriel returned to Singapore in the early 1980s where she started teaching children at home. By 1990, the teaching methodology had gained enough momentum for her and her husband to set up Julia Gabriel Speech and Drama Centre. In 2004, her training programme was trademarked as Edu-drama. Today, she has a team of over 200 skilled professionals involved in education and communication: teachers of voice, speech, drama, literature, early childhood educators, musicians, linguists, speech and language therapists. Besides Singapore and India, the centers are also located in Indonesia, DAR E Malaysia and China.
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strategy/Couple Entrepreneurs
Couples as Entrepreneurs Couple entrepreneurs should focus on complementary roles, respect and understanding to make their startup a success /Vimarsh Bajpai
W
hen Kaushal Mehta and his wife Parul launched their first startup in the spring of 1998, both brought their complementary skills to the table besides their personal savings. While Parul took charge of operations, Kaushal focused on business development at their IT firm. The two had worked in technology giants in the US for several years but were back to their native Ahmedabad to be with the family and to give their children an Indian upbringing. Their second startup Motif, a BPO, was launched in 2000. The biggest challenge for the Mehtas at work was to ensure that their employees perceived them as professionals to the core and not as couples running some family establishment. “For our direct reports, we had made it clear that we are very dif-
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ferent individuals and our relationship will not affect anything,” says Parul. “If we are in a conference room, it would be hard for anyone to know that we are husband and wife,” she says. On the
“
Do not hesitate about articulating your professional needs; what are the goals you are aspiring for. You don’t have a boss but you do have a partner.
”
— Anupama Arya Mobera Systems
personal level, it was difficult for both of them to be away from their children for long hours. Also, ensuring that they don’t discuss work at home was not easy. However, eight years down the line, Motif’s revenue has grown to $10 million with 450% excess cash and zero debt. With a headcount of 800, the company also has offices in the Philippines and the US. More and more couples today are coming together to start their own ventures. This is partly because it is easier to put faith in your spouse rather than a stranger when it comes to finding a co-founder for your business. Also, “couple entrepreneurs induce a lot of confidence among VCs and employees that they are there for the long haul. It is believed that the team (being that of husband and wife) would have al-
strategy/Couple Entrepreneurs ambiguity in the message could cost the startup dear. It is believed that couple entrepreneurs would have similar goals and vision for the company, and the message that goes out would be loud and clear. This is a big positive, given that many startups falter because the cofounders fail to see through each other’s vision. In a business, everyone seems to be together when profits are flowing in; it is only during trying times that the co-founders are put to test. This is where mutual trust, compassion, understanding and commitment among the founding members come into play. This goes a lot in favor of couple entrepreneurs who may weather — Kaushal & Parul Mehta such storms better. On the ip side, however, running a Motif flstartup is time-consuming, and it could see the most similar goals for the company,” couple spending long hours says K Ganesh, co-founder TutorVista, at work and even discussing a global education services company. business issues at home. Ganesh with his wife Meena had earlier co-founded Customer Asset, a BPO How to make it work? that was later sold to erstwhile ICICI It all starts with respect. This OneSource (now Firstsource). rule of personal relationship While it looks easy to have found a also applies in the profesco-founder for your startup at home, sional sphere. “Respect is the chemistry is not always that sim- another name for love. It is ple. A judicious thought process hard not to love someone if should go behind such a venture oth- you respect him/her,” says erwise it doesn’t take long for things Dr Rajendra K Misra, practo fall apart. “It is a tough balancing ticing Psychologist in the act. Either you will come really close, US. He adds that giving each or you end up in a divorce. It is 50:50 other personal space by havchance,” says Anupama Arya, a serial ing overlapping schedules entrepreneur who runs Mobera Sys- and not same work hours tems, an IT firm she co-founded with may work well. “Offering her husband Puneet Vatsayan. your spouse a cup of coffee, without him/her asking for it, dusting her/his workPros and Cons Starting a business and nurturing it desk, without re-arranging over the years requires, among other things, and giving her/him a things, a good synergy between its co- peck on the cheek whenever founders. This is true when it comes to you accidentally bump into approaching investors, dealing with each other are sweet gescustomers or hiring employees. Any tures of love,” says Misra.
Litmus Test: Go in a mock and argue about some issue in front of a group of friends. And see if the next day you can leave that behind and continue with your personal life.
“
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Giving each other personal space by having overlapping schedules and not same work hours may help.
”
— Dr Rajendra K Misra Psychologist
Respect is also about understanding each other’s professional compulsions and not making a fuss about it. “If Kaushal has to take a call from the client at 3 am, I would not crib about it. I know the expectations of the business. Similarly, if I am at office at 2 am, Kaushal would not tell me that I have to come back and look after the children,” says Parul of Motif. “We would want the young entrepreneurs to understand that although
The first year is tough. There will be an acute need to support each other through the thick and thin, providing positive reinforcements through words and actions. — Preeti & Rohit Gupta Pragma Communication OCTOBER 2008 81
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strategy/Couple Entrepreneurs
Couple entrepreneurs can induce a lot of confidence among VCs and employees that they are there for the long haul. — K Ganesh TutorVista time together is important, so is not crowding each other. As a couple, we need to work together very well with well-defined roles and boundaries,” says Upendra Giri who co-founded AstoWix, a project management firm, with his wife Seema. Clarity of roles at work makes things easier. Agrees Anupama of Mobera Systems, it was soon after she and her husband Puneet
“
Although time together is important, so is not crowding each other. As a couple, we need to work together very well with well-defined roles and boundaries.
”
— Upendra Giri AstroWix
started out that they realized there were things to be worked out. “We can’t be just shooting off in whatever direction. If we were venturing into each other’s territory, we had to find a way out,” she adds. Preeti and Rohit Gupta, co-founders, Pragma Communication, a public relations firm, preferred to undergo counseling to have a more clear perspective on what theywere planning to do. The counseling session helped them with a key input towards avoiding inter-personal conflicts, dividing tasks between them and maintaining a clean overlap between their activities. Having well-defined corporate governance code can send out the message that despite having a team of husbandwife entrepreneurs at work, there is no place for nepotism in the company. In their startup, it was clear that Ganesh, despite being the CEO, would not apprise his wife Meena, the COO of the company. Instead, they have a director on the board to do the job. Having appropriate conflict resolution mechanisms in place also helps a lot. But it requires open communication and trust, with each partner willing to part with some authority. If both look at the bigger picture, ie, the growth and the best interests of the company, it would be easier to resolve issues. “Sometimes agree to disagree,” says Kaushal. He cites an example of one such incident relating to having a dress code for Motif employees. Parul and the HR department believed that employees should have a dress code. Kaushal, however, was in disagreement. After a meeting of the senior management that saw a 50:50 division, Kaushal agreed to disagree, and the dress code came into existence at Motif.
Challenges It is not always easy to keep your personal and professional relationship separate. Many a times, personal differences could spill over and spoil a mature professional relationship. Both partners would need mental maturity to be able to thrash the personal or work-related differences out through effective communication.
DARE/quick points • Couples should bring in complementary roles needed for the business • Neither should hesitate in airing his/her professional needs • Having clarity about roles and responsibilities helps • Have a clear conflict resolution mechanism in place • Must set aside some private time for each other and the family every day • Have a clear corporate governance code in place • Love and respect have to be the foundation • Channels of communication should always remain open • Couples should guard against comments aimed at creating a wedge • Going on short vacations or taking up a hobby helps de-stress Keeping work out of home could be another big challenge. Says Anupama, “The harder thing for me to do was to put a boundary around work. I personally tend to think and talk about work a lot. And Puneet is good at saying it ends for me here and I am switched off for the day.” She adds that she had to work on it to ensure that she did not make it an all-consuming thing. Sometimes challenges could be a blessing in disguise and could strengthen the bond. “Having worked together, we both eliminated our respective differences and the bond between us has matured and grown stronger. I would say that the quality of our personal lives has improved drastically since we started working DAR E together,” says Preeti. OCTOBER 2008 83
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/straight talk
How can we make organizations creative?
TINA SEELIG Executive Director Stanford Technology Ventures Program y not punishing failure. If you don’t take risks,
B
you won’t fail. However, you need to take some
risks in order to be creative. There will be times when your ideas won’t work. Therefore, organizations should understand that making mistakes is part of the creative 84
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/straight talk
process and should have a policy of trying out several things and keeping the ones that work. It should celebrate success, as well as the other way round.
RAMAN ROY Chief Executive Officer Quatrro BPO Solutions reative organizations are built by allowing people the
C
freedom to come up with ideas, nurturing them and
talking about them. And telling them why their idea is stupid. And they telling you why it is not. And then taking it forward and experimenting with it. And then having the humility to say, “By the way your idea was good. My thinking that it will not work was wrong.” With this, you create a kind of energy that is difficult to contain.
PREETI VYAS GIANNETTI Chairperson and Chief Creative Officer Vyas Giannetti Creatives (VGC) ven in an ad agency, creativity is not limited to a depart-
E
mental activity, and anybody in the organization can be
creative. This is the key value that we instill in anyone who joins VGC, for creativity is not just about a press ad or a commercial. Creativity is about seizing a moment, an opportunity or an expression. An organization should approach creativity in a holistic manner. For example, Aditya Birla Group came to us for a logo. We realized that what the Group really wanted to do was make a certain business statement. We conducted market research for them, articulated the emotional demands of their consumers, identified their communication needs and came out with an entirely new set of business processes. We even introduced a scholarship for students. These results were made possible because everyone in the organization thought creatively. More NEN Straight Talks on www.nenonline.org
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OCTOBER 2008 85
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strategy/legal
Brand Management Checklist: Legal Issues In Brand Management /Rodney Ryder
Part I: Primary considerations • Do you know that coined names and fanciful or arbitrary marks are the most protectable by law? • Is your trademark distinctive? • Have you completed a full trademark search for any new brand name you are considering using? Have you completed this search in all countries in which the brand might operate? • Have you registered your trademark at the national level and in all countries in which your brand will operate? • Have you marketed your brand abroad? (The first organisation to use a particular name in a specific geographical area has ‘priority of use’ protection in that area under common law.) • Have you searched to ensure that the brand name you are considering is available as an Internet domain name? Have you registered that domain name? Have you registered typical variations of that domain name? Have you registered that domain name as ‘.com’, ‘.org’, ‘.net’, etc? • Do you know the difference between trademarks with a TM and a ®? • Do you use the TM and ® symbols when appropriate? • Do you always use your brand name as an adjective (versus as a noun)? If you are concerned that your brand name may become a category generic descriptor, are you using the following wordings in all of your brand communications: ‘[brand name] brand [product category descriptor]’? • Do you design your brand’s trade dress to have as many arbitrary design elements as possible so that you are more likely to in a trademark infringement win the legal battle with your competitors? • Does your brand identity system include as many elements as possible (beyond name and logo)? (Examples: visual style, brand voice, colours, icons, typography, slogan, mnemonic devices.) • Do you retain experts to help you protect your brand mark online? • Did you know that trademark protection is enhanced through proper use and can be lost through improper use? 86
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strategy/legal
• Did you know that you can sue another company for using your brand’s name or slogan in its site’s meta-tags? • Did you know that using another organisation’s well-known mark as a domain name is also illegal, even if used associated with an unrelated product or service category?
Part II: Other considerations • Do you aggressively pursue those who are using your brand mark improperly or illegally? • Do you have strong brand identity standards and systems that are available to all employees and vendors? Have you trained all people who might use the trademark in its proper use? • Are you very careful to whom you license your trademark? Do you have processes in place to monitor their use of your mark and to immediately stop (or correct) their use of your mark if they are using it improperly? • Are you very cautious about creating registered users of your mark internationally? [In most cases, they will have rights to your mark forever, even after you have severed a business relationship with them.] • Are you also protecting your intellectual properties through patents, copyrights and trade secrets? • Have you maintained thorough records of trademark development and use? • Have you kept your Web site’s log files to validate that your brand has been operating in India and foreign countries? • Did you know that people can legally use your brand mark if the following three conditions are met: 1) it is a necessary use; 2) the use is limiting; 3) there was no consumer deception? (For instance, a watch repairman who repairs Timex watches can say in advertising copy (or on the side of his building) that ‘I repair Timex watches’ even if he is not employed or licensed by Timex to do so. This, however, does not give him the right to use the Timex logo improperly.) • Did you know that under the Indian Trademarks Act, 1999, you can now stop others from using your trademark if it weakens, blurs or tarnishes the mark? • Did you know that you can take action against a competitor for false or misleading advertising claims? Do you know the process you must follow and what you must prove? • Have you appointed an “IP Manager” within your organisation? Is that person consulted on brand management/brand building issues? This article uses references from wikipedia.org, mreinfo.com, wapedia, clickz.com, eprise.com, jipo.gov.jm, out-law.com, and ipos.gov.sg
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/blogs
Uncle Sam’s Long Shadow L ike it or not, the financial crisis in the United States of America could affect your life in ways you never thought it would. Exports from the world’s largest democracy (India) to the second largest democracy (the US) would slow down: be these garments or information technology enabled services. Indian stock markets would remain volatile and, in all likelihood, by and large bearish because US-based foreign institutional investors are in terrible shape—many of them are struggling to survive—and have withdrawn much of their money from so-called “emerging economies.” No tears need be shed for our super-smart MBAs from the IIMs who will be denied jobs with American investment banks carrying fancy salaries and even more fancy perquisites. Employees of Indian associates of some of the best-known names on Wall Street—Bear Sterns, JP Morgan, Merrill Lynch, Lehman Brothers and Morgan Stanley, not to mention the world’s biggest insurance conglomerate, the American International Group—may not find their lives getting difficult. There would be no bloodbath of the sort going on in the Big Apple. Here’s a small excerpt from a statement issued on September 15 (the real Black Monday) by New York Governor David A. Paterson: “Approximately 11,000 jobs were lost in New York’s finance and insurance sectors between July 2007 and July 2008. More recent data will likely show this number continues to grow and based on past data, approximately 40,000 jobs in the financial services industry in the New York City area can be expected to be lost in the current downturn. All told, approximately 120,000 jobs may ultimately be directly and indirectly affected as a result of financial sector turmoil.” Yes, we in India are a bit better off. But do we really have reasons to rejoice? Prime Minister Manmohan Singh and Finance Minister P. Chidambaram have repeatedly sought to assuage apprehensions that the financial meltdown in the US would have a significant negative impact on the Indian economy. The PM has, at the same time, stated that the country has to “remain alert” about the impact of the US recession. Since India’s economy in general and our financial sector in particular have become increasingly integrated with the rest of the world, it would be unrealistic to expect the slowdown in the US and the world economy to not have any influence here. The FM has acknowledged that only a few private sector banks, notably the second largest bank in the country, ICICI Bank, have had exposure to risky derivatives (or financial instruments that derive their values from other instruments) and would, hence, be directly affected by what has happened in the US. None of the major public sector banks, including the State Bank of India, have the kind of exposure to securi90
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/Paranjoy Guha Thakurta
ties of American investment banks that would be considered worrying. Insurance companies in India, including Tata AIG, too have no reason to fear that they could default on their payment obligations. Chidambaram has cautioned that there could be a tightening in credit supply. This means the chances of interest rates coming down substantially are not very bright even if the rate of inflation stabilizes or even comes down a bit. The Deputy Chairman of the Planning Commission, Montek Singh Ahluwalia, has conceded that “there will be an indirect effect (of the financial crisis in the US) because if the rest of the world gets disturbed and capital flows and liquidity shrinks, there is bound to be spillovers, not just on India but all over the world.” In April, the International Monetary Fund said the US economy is expected to grow at 0.5 per cent in 2008, slower than the rate of growth of the American population. The IMF added that turbulence in international financial markets would continue. Nobody is now wary of using what was once the dreaded ‘R’ word. Recession is reality today. The impending crisis became evident in 2007. It started in the housing loan market in the US. Non-creditworthy borrowers were encouraged to pick up loans. Sub-prime borrowers began defaulting repayment of loans but banks and financial institutions went on bundling housing mortgages securitizing these in the hope of hedging risks. These complex financial instruments or derivatives were sold to large investment bankers and financial institutions It was wrongly presumed that the party would never end. But it did. The American economy started slowing down and inflation picked up because of high oil prices. As the loan defaults continued, home values crashed by a fifth in a year. Paper was traded for more paper without underlying assets. The crisis spread from the housing loans market to the whole of the banking and insurance sectors. Then came one government bail-out after another. The total amount that is expected to be spent by the US Administration on “socializing” the losses of giant financial firms will, in real terms, exceed India’s total national income, which is around $ one trillion (Rs 45,00,000 crore) during the current year. There is no doubt that this is the biggest crisis being faced by international capitalism since World War II. The US has less than five per cent of world’s population. But American citizens consume over a quarter of the planet’s resources. Economists like Nobel laureate Joseph Stiglitz have for long been pointing out that the principal reason for volatility in international capital movements is the huge deficit of the US, which has been borrowing no less $3 billion from rest of the world every day, two-thirds of it from developing countries. The bubble had to burst. It has. Good luck. Things can DAR E get worse.
The author is an educator, an economic analyst and a journalist with over 30 years of experience in various media—print, radio, television, Internet and documentary cinema.
Organizations DARE.CO.IN
covered in this issue, in alphabetic order; first appearance
Ad-Ring...................................................................... 18
ICICI Bank ................................................................. 90
Pfizer ......................................................................... 22
CISCO ....................................................................... 18
Idea Cellular .............................................................. 52
Playboy ...................................................................... 48
a2zApplications ......................................................... 56
Indexpo Corporation .................................................. 37
Porsche...................................................................... 21
ActionAid India........................................................... 66
India Brand Equity Foundation .................................. 28
Pragati Offset............................................................. 49
Affordable Business Solutions ................................... 56
Indian Agro & Recycled Paper Mills Association
Pragma Communications .......................................... 83
Akanksha Foundation ................................................ 66
(IARPMA) .................................................................. 64
Rin ............................................................................. 42
Amazon.com.............................................................. 58
Indian Cellular Association ........................................ 16
Roli Books ................................................................. 50
American Embassy School........................................ 68
International Monetary Fund ..................................... 90
Royal Enfield.............................................................. 48
American International Group ................................... 90
ITC ............................................................................. 64
RSBconsult ................................................................ 22
Apple ......................................................................... 20
Jamba ........................................................................ 18
salesforce.com........................................................... 58
Appscale Technologies .............................................. 57
Jana Kalyan Welfare Society ..................................... 66
Savvy wigs and Hair International ............................. 42
Archies Greetings and Gifts....................................... 68
JDC Recycling ........................................................... 65
Sense International ................................................... 66
AstoWix ..................................................................... 83
Jelly Beans ................................................................ 30
Sequoia Capital ......................................................... 52
Bear Sterns ............................................................... 90
Jogarao Bhamidipati .................................................. 64
SKS Microfinance ...................................................... 52
Betapharm Arzneimittel ............................................. 22
JP Morgan ................................................................. 90
SmartGrow ................................................................ 40
Bharti Telesoft ............................................................ 52
Jute Emporium .......................................................... 37
Sobti Group ............................................................... 26
Birla Corporation ....................................................... 38
Kalyani Group ............................................................ 22
Springboard Research............................................... 56
Blair Blacker .............................................................. 41
Katz ........................................................................... 58
State Bank of India .................................................... 90
Briatore ...................................................................... 20
Kennel Club of India .................................................. 62
Sunshine.................................................................... 30
Bumblebee ................................................................ 29
Kingfisher................................................................... 66
Tata AIG..................................................................... 90
Business Week .......................................................... 61
Lady Shri Ram College.............................................. 68
Tata Elxsi ................................................................... 17
Cafe Coffee Day ........................................................ 52
Laggar Industries ....................................................... 26
Tatas .......................................................................... 21
Child Rights and You.................................................. 68
Landmark events ....................................................... 72
TCS ........................................................................... 22
Cipla .......................................................................... 67
Lehman Brothers ....................................................... 90
Telcos ........................................................................ 17
Cisco.......................................................................... 52
Lola’s World ............................................................... 30
The Hair India People ................................................ 66
Coca-Cola ................................................................ 33
Lucent Technologies and Texas Instruments ............. 16
The Heritage Auction House ..................................... 40
Delhi Business School ............................................... 56
Lux ............................................................................. 42
The Naz Foundation (India) Trust .............................. 67
Dignity Foundation..................................................... 66
Make-A-Wish Foundation .......................................... 67
The South Asian Fund Raising Group ....................... 70
Dollar General ........................................................... 41
Mattel Toys................................................................. 68
Thomson Press ......................................................... 49
Dr Reddy’s Laboratories ............................................ 22
MCKS Food for Hungry Foundation .......................... 67
Torrent Pharmaceuticals ............................................ 22
Edelweiss Capital ...................................................... 52
Merrill Lynch .............................................................. 90
TringMe ...................................................................... 16
Facebook ................................................................... 68
mGinger ..................................................................... 17
TutorVista................................................................... 81
Firstsource ................................................................. 81
Microsoft .................................................................... 18
UNICEF ..................................................................... 68
Flextronics ................................................................. 52
Missionaries of Charity .............................................. 66
University of Florida ................................................... 41
Gloria books .............................................................. 49
MNR Exports ............................................................. 37
V3 fitness commune ................................................ 33
Google ....................................................................... 17
Mobera Systems........................................................ 81
Virgin ......................................................................... 21
Guildhall School of Music and Drama ....................... 78
Morgan Stanley ......................................................... 90
Vividha Home Fashions ............................................. 29
GVK Biosciences ....................................................... 52
NASA ......................................................................... 40
Voice .......................................................................... 66
Harley Davidson ........................................................ 20
Nike ........................................................................... 21
Volkswagen Group..................................................... 21
Harper Collins India ................................................... 49
Niyogi Books.............................................................. 50
Wall Street ................................................................. 90
HCL ........................................................................... 18
Oracle ........................................................................ 52
Wal-Mart .................................................................... 41
HelpAge India ............................................................ 67
Papier Mache Craft .................................................... 65
Walt Disney Company ............................................... 68
Heumann Pharma ..................................................... 22
Parle Agro ................................................................ 33
WebEx ................................................................. 56, 58
Hyatt Hotels and Resorts .......................................... 68
Paypal ........................................................................ 52
Yahoo......................................................................... 17
IBM ............................................................................ 21
Peek-A-Boo Patterns ................................................. 29
YouTube ..................................................................... 52
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People DARE.CO.IN
covered in this issue, in alphabetic order; first appearance Michael Pfeiffer .................................. 23
Aaron Katz ......................................... 56
Mohit Bhatnagar ................................ 52
Abdul Gulab Wahab........................... 61
Montek Singh Ahluwalia .................... 90
Alice Andrew...................................... 66
Mother Teresa .................................... 66
Alisha Chauhan ................................. 32
Nadia Chauhan.................................. 32
Amit Malhotra .................................... 41
P. Chatterji.......................................... 38
Anupama Arya ................................... 81
P. Chidambaram ................................ 90
Anuradha Mukherjee ......................... 67
P.G. Mukundan .................................. 64
Ashok Pratap Rai............................... 61
Pankaj Mahindroo .............................. 16
Bikash D Niyogi ................................. 50
Paul Valery......................................... 20
Brian Lara .......................................... 63
Phil McCrory ...................................... 40
Chaitanya Nallan ............................... 17
Prakash Chauhan ............................ 33
Dakhina Mitra .................................... 67
Prasanna Gokhale ............................. 17
David A. Paterson .............................. 90
Puneet Vatsayan ................................ 81
David Kirby ........................................ 20
Rajalakshmi ....................................... 37
Devendra Pathak ............................... 56
Rajendra K Misra ............................... 81
Elizabeth Taylor ................................. 63
Rani Advani ....................................... 29
Garima Agarwal ................................. 29
Ranjay Kumar Jha ............................. 65
George Auckland ............................... 36
Roger Dorf ......................................... 18
Gerard da Cunha ............................... 49
Rohit Gupta ....................................... 83
Harvinder Singh Bakshi ..................... 67
Rudrangshu Mukherjee ..................... 49
Hina Goyal ......................................... 67
Ruma Dutt ......................................... 37
Joseph Stiglitz ................................... 90
Sachin Tendulkar ............................... 63
Julia Gabriel....................................... 76
Schuana Chauhan ............................. 32
K. Ganesh .......................................... 81
Shalini Pattabiraman.......................... 78
K.P.S Gill ............................................ 26
Srikant Rao ........................................ 56
Kamal Jyoti Das................................. 65
Steve Jobs ......................................... 20
Kantanu Kundu .................................. 57
Sumeet Chopra ................................. 65
Kapil Kapoor ...................................... 48
Sunil Gavaskar .................................. 63
Kaushal Mehta................................... 80
T.E. Gautham ..................................... 57
Kevin Pietersen.................................. 63
Upendra Giri ...................................... 83
Kiran Datar ........................................ 56
V.K. Karthika ...................................... 49
Manmohan Singh .............................. 90
Veena Deepak ................................... 28
Mario Miranda.................................... 50
Vir Sanghvi ........................................ 49
Matthew Hayden ................................ 63
Viraaf Pocha ...................................... 72
Meenakshi Chibba ............................. 78
Vishwanath Alluri ............................... 17
Michael (Mike) Hussey ...................... 63
Yusuf Motiwala................................... 16
EVENTS
A. Kumar ............................................ 37
DARE is not an acronym. It represents the daring spirit of the entrepreneur. The red color for the R of DARE represents the fire in the belly of the entrepreneur. You could think of the D representing the face, A representing the chest, R representing the belly and E representing the feet of the human body. Hence the red R. The entrepreneur dares to do things. (S)he dares to do things differently
SMS “DARE <your comments, questions or suggestions>” to
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Is India ready for peer to peer lending companies? Posted by: Krishna Kumar in opportunity, news, micro finance, loans, investment, idea, funding, entrepreneurship.
T
ONLINE
he latest buzz in the micro finance sector is peer to peer loans. With interest rates, particularly for personal loans on a steep upward climb, is this the right time for peer to peer loan organizations to get going? Definitions first. Peer to peer lending is like borrowing from friends and family. The Internet enables the circle to expand beyond just friends and family. The premise is simple; get together a set of people willing to lend small amounts and a set of those who need to borrow small amounts. Have them state their need and their ability to repay. Now have the investors bid for the business at a rate they specify. You need not bid for the whole amount that a borrower needs. You can bid to fund a part at a rate you specify. The lowest rate bids are combined to fund the borrower . The lending company enables the transactions, does credit verifications and works as the actual intermediary. At prosper.com, for example, "the loans are being made by Prosper and then sold to you, making you a loan purchaser. The term "lender" is used through the site for the sake of simplicity". This area is currently buzzing with activity. • kiva.org is active in the social sector and tries to do loans that change lives. Most of the loans are to small
entrepreneurs in Africa and the site currently claims to do a loan every 14 seconds. • Zopa.com is active in Italy, US, UK and Japan • While Prosper lets prospective borrowers define what interest rates they are willing to pay, Lending club assigns ratings and associated interest rates to loan requests. • Circle lending became Virgin money • Greennote.com and Fynanz.com focuses on student lending • Wiseclerk.com is a forum for tracking and discussing various P2P lending organizations and operating on them. That brings us to our question: Is the time ripe for P2P loan operations to start up in India? My guess is that they would be classified as NBFC's (Non- Banking Financial Companies). The biggest challenge in starting up would be in getting and publishing credit ratings. Would one or more banks be willing to back end P2P lending companies and provide them with not just funding, but also credit rating information? Are you interested to be an early mover in this area? Comment by Arpit Agarwal In fact, one company www.rangde.org has already launched its services on Jan 26. It is backed by ICICI Foundation. I am surprised no one knew about it! RangDe's founder Ramakrishna gave a talk at Startup Saturday Mumbai. Check www.headstart.in for more details. Reply by Krishna Kumar Arpit, Thanks for pointing that out.
OCTOBER 2008
Barack Obama, John McCain, Sarah Palin and the race to be the next American President Posted by: Krishna Kumar in news, information, general, elections, American President
I
have been spending an inordinate amount of time following the American pPresidential elections. Partly it is fun to watch as an outsider. Partly,the American President has a huge impact on the rest of the world; in word if not in deed. Let me go back in time to build a proper perspective. I think Bill Clinton was good as an administrator and had a larger world view, in spite of personal issues like Lewinsky . We should not forget that the Clinton years were some of the most prosperous in recent memory and not just for the US. So, I do not quite understand the angst against Bill Clinton during the primaries- Is it just Lewinsky? Or am I missing some-
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Yes, I had missed it. Rangde is a social initiative that does a slightly different model. They are into micro credit. Another interesting point: Loan repayment by the borrower is at 8.5% while the lender gets 3.5 %. 5% goes to field organisations that deal with the borrower to meet their costs. Currently operational in Maharashtra and TamilnadunnRangde is not approachable by the general borrower . That space is open and waiting ;)
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thing? After all the guy gave you 8 years of prosperity. George Bush could have done better for the world, particularly its environment, but gave India the nuclear deal after William Jefferson Clinton first opened up US India relationships after a long freeze. Obama comes across as fresh, much like Rajiv Gandhi was when he first became prime minister. He is a fabulous orator and the way he handled the Wright issue was simply brilliant. To take on HRC whose nomination at that time was a foregone conclusion and come out ahead takes some lots of guts, organization and luck. He obviously had all three. His communications (email), like his oratory is clear, direct and brilliant. He has leveraged the internet like no one else- Howard Dean tried earlier, but could not quite do it fully -. All candidates have now embraced his message of change in some form. But did he get caught when faced with Sarah Palin? McCain is a trier. Just look at how he has tried over 12 years and three attempts to be President. And his comeback from a collapse earlier on, though much is not known about how exactly he managed that, talks a lot. Was the choice of Sarah Palin as his Vice Presidential running mate an act of desperation given less than enthusiastic response to his candidature? And the way the entire nation seemed to go ga-ga over her and forget everything else - what do you make of it? Or of the way the media (particularly)seemed to turn around completely in less than a week? The American electoral system seems frozen in time. Where else would
DARE.CO.IN someone (Al Gore) loose an election after winning the majority of votes? Where else would voters in only one state (Texas) primary get to vote two times on the same day? Where else is it that the votes are never fully counted as long as TV projects a victor? And then it takes months together to actually count them if you have to? Incidentally in India we can count votes all in a country wide election in about 3 days, and we do not have sophisticated touchscreens to vote on nor have hanging chads in our ballot papers. Talking of ballot papers, I don't think that our younger voters would have ever seen one. All votes are on electronic voting machines and we use similar machines across the country. And finally where else would large scale propagation of stories like swiftboats and invention of the Internet change the course of an election?
If you have it, flaunt it Posted by: Vimarsh Bajpai in entrepreneurship
I
f you offer value-added services, let the world know about it Sometimes I avail the services of a cyber café, a 5-minute walk from my home in New Delhi. It is a cozy and spacious shop, located in the basement of a residential property. If it were not for a signboard that reads ‘MAX Cyber Café’, chances are that you would not even notice that it exists. The owner, Akaash, a 30-year-old graduate, has been in the business for the last 5 years. I have seen his business grow from scratch. He started with two comput-
ers with pathetic Internet connectivity, bare minimum furniture and two ceiling fans. Despite competition from other cafes in the vicinity, Akaash’s business has grown steadily. He now owns more than 10 machines, some brand new, that sit on separate small wooden tables located at an arm’s length from each other. The Internet connectivity couldn’t be faster, and an air-conditioner keeps the place cool. However, it was only yesterday that I came to know that the café is also WiFi enabled, and it has been so for over a year now. How come I never came to know about it, I thought. Every time I had to e-mail large documents from my laptop, I would transfer it on to a pen-drive, and carry it to the cafe to mail it across. Had I known about this service, I would have carried my laptop instead. I take the blame for not having enquired myself earlier. But how would I as a customer know what’s on offer, until told? I put this question to the owner, and was disappointed with his answer. “Sir, you never asked about WiFi,” he said. Hello! The onus of selling the service is on you, why blame the customer, I wondered. Your customer doesn’t get the dream about the valueadded services you offer. It is up to you to keep him informed. Today, a host of marketing and advertising tools and services are available for entrepreneurs to ensure that the world knows what they offer. I also came to know yesterday only that Akaash offers a host of other value-added services, such as selling hardware, assembling home computers, and can be reached for minor trouble-shooting too. But while his
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DARE.CO.IN services grew over the years, unfortunately, the signboard outside his shop has remained unchanged. It is still that shoddy iron-plate that only tells that the business exists. For many customers, MAX Cyber Café is the same as it was 5 years back, only useful for checking the e-mail and surfing the net.
‘Incentives’ for seed-stage funding Posted by: Vimarsh Bajpai in research, funding, entrepreneurship
A
comprehensive study on entrepreneurship carried out by the National Knowledge Commission
(NKC), a top-level advisory body to Prime Minster Manmohan Singh, has stressed the need to “incentivize” seed-stage and early-stage funding for entrepreneurs. One of its suggestions is to set-up a public fund on the lines of the Small Business Investment Company (SBIC) scheme in the US. This scheme allows seed and VC fund investors to borrow money at favorable terms from the government. ‘These loans are then invested as equity in start-ups, where the seed investor also provides crucial mentoring skills and contacts with business networks.’ The recommendation should be seen in the light of the statistics on start-up financing presented by the NKC. It interviewed 150 entrepreneurs
between the age groups of 21 and 70. The median age of the sample of entrepreneurs was 43 years. It found that: 1. 63% of those interviewed had been self-financed at startup stage. 2. 22% relied on bank loans 3. 9% received loans from state finance corporations, and 4. Only 6% got funded from VCs and angels 5. Nearly half of the self-financed entrepreneurs borrowed start-up money from family or friends 6. Most entrepreneurs perceive that getting money from banks is very difficult at the start-up stage but becomes comparatively easy at the growth stage.
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If you have it, flaunt it very true and well expressed. If you are not on Google search, you dont exist! Good point , Syamant. And the process is fairly painless too. Online movie rental business I really liked the above article....very informative & well researched Mango kernel extracts for being beautiful! kindly mail me the list of organisations and individuals inclined in such projects(agro-based)......... Mango kernel extracts for being beautiful! my family had a canning factory and we were in mango pulp canning and mango ,pinnaple jams n juces i...
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