India ranks 3rd behind USA and China for start ups that have been able to significantly scale up reaching a sustainable size, the percentage being a mere 4%- as per a study done by University in California. Yes, there is no doubt on breakthrough ideas, products and services that India Inc. comes up with , and no dearth of funding- yet what slows or stalls there growth. In my experience and interaction with Indian entrepreneurs I have broadly seen the following 4 factors that are holding them back:
- Inability to embrace external professional expertise: Traditional Indian entrepreneurs typically work with a mindset of manufacturing and selling, often undermining the importance of professional expertise in functions like supply chain, marketing, finance, human resources and legal services that would be needed to scale up quickly. Some of them have confidence of having delivered success in other businesses or having brought the business to a particular level and fail to realize that scaling up will be a different game.
- Building an inclusive and rewarding environment to retain talent: They miss out on realizing that a start up is about joint value creation by founders, investors and eventually employees that burn the midnight oil to make the start up a win. Good talent requires progressive and inclusive reward mechanism, and is critical for sustained growth of a dream built together.
- Missing out on creating brand love: Loyalty, repeat purchases, market share are eventually a function of making your consumer fall in love with your offering. Driving brand awareness does not tantamount to brand building. Right product proposition along with romancing the offering still is an essential ingredient to success. At a time when products are quickly getting commoditized , technology easy to replicate and plethora of services being marketed- this becomes all the more important. Brand love doesn't always cost tons of money, when done right.
- Being internally focused and comfortable without realizing their blind spots. We are living a galloping era of economic, technical, demographic transformation with set backs of economic uncertainty and inflation- success requires immense diversity and inclusion of talent ranging from skills, gender, generations to be able to offer and win with a large base of evolving consumer.
Strategy & Corporate Development | M&A | Venture Capital - Investment Management, Portfolio Growth & Exits | Private Equity & Secondaries | Board Advisory | Investor Relations & Governance
2 年Very well articulated
Investor | Advisor || Fintech| Payments | Technology | Outsourcing | Infrastructure || Emerging Markets
2 年Richa, great insights. The question I would ask is.... Is it an india specific phenomenon (as you make it out to be) or is it actually almost always the same challenges across any global start up.....? My experience, largely emerging markets, is thst it is indeed almost always applicable across the board........if it was india specific (more than other markets) then indian wouldn't be among the top 3 globally.
Carbon the new black gold….
2 年Inspite of all the pointers companies fail to grow . The attrition rate is high. No matter how many esops are doled the general trend is milch the cow. Everyone in the chain is there to make money or to direct money to be made. Else no valuations no $ and hence no unicorn. Lastly is the ecosystem, where missing links are promised but seldom delievered. Leading to startups falling to guides who may just be there to make money and leave them in the sun to roast.