New Web2.0 Venture - Younews

First of it's kind in India, a venture that plans to experiment whether user generated news can become full stream media outlet. Younews, launched as beta this week, is planned as a complete user powered news outlet where users decide what is an important news and nation can see a snapshot of what country, as a collective, think is taking place in the India.

This sounds similar to what Digg gave Internet world but success in Indian context is not guaranteed. Majority of Indian Internet is either office or cyber cafe driven.

You news can do much better if it includes India specific innovations. For example, a mobile driven open news platform can potentially tap 10 crore (100 million) minds or an additional regional language angle can take it to next step.

High Expectation Entrepreneurship - A True Indicator of Startup Ecosystem Health

CNN Money has an interesting write-up on -- what makes entrepreneurial ecosystem click? And what is a true indicator of health of new business environment?

One such indicator is World Bank’s Doing Business report, which measures the entrepreneurial climate of 175 nations in two ways: starting and operating a business. If a country enables easy start, operations & exit environment, it is rated as a business friendly country.

The most interesting part is that this index does not directly correlate with health of new venture climate in the country. Authors propose proportion of "High Expectation Entrepreneurship" as a better indicator of startup climate health. High expectation entrepreneurs are ones who start ventures not because they do not have any choice, but they start new business because they believe entrepreneurship offers better opportunity than their high paying jobs.

In India, historically, new business was a result of lack of options. Lately, I find a new breed of entrepreneurs, who are willing to give up their high potential jobs to pursue a more rewarding enterprise -- start of a new business. A sign that in future India will find a better place, compared to it’s present 46, on high potential entrepreneurship scale.

Welcome Addition to ISV Startup Ecosystem

Microsoft and Asian Venture Capital Journal (AVCJ), Group Intelligence -- including Intel, and Red Herring-- have launched an interesting platform, SoftwareAP.net, to boost new venture ecosystem in Asia Pacific region.

For ISV entrepreneurs, it provides a platform where they can submit their business plan. This business plan gets rated and routed to appropriate VCs, Angels and Govt agencies who may be interested in such ventures.

For VC community, this initiative provides an excellent deal sourcing platform. VCs can customize the kind of deals they are interested in and create relevant deal pipeline

For Govt, it aims to create a platform to provide information such as sector capital needs and important indicators of economic activity in this space.

Clean Tech India Private Equity Investment

Though venture capital has almost been inactive in clean tech space, private equity players invested $250million in year 2006 in India. Take a look at a related news item

Deal Syndication and Indian Venture Capital Industry

Venture cap firms use deal syndication -- a VC jargon for joint investment -- as a risk mitigation strategy while investing in early stage startups. Getting another VC firm to invest in early stage idea provides a strong second validation.

In India, deal sizes in early stage ventures have been small and venture equity firms have gone solo in most of the venture equity deals. Its high time firms look at syndication to get a strong second opinion about the idea they want to engage in.

Is Joint investment in iYogi by Canaan Partners & SVB Financial ($3.1M) an early sign of similar trend in Indian space?

New Venture Ecosystem India Update May 19, 2007

Vibrant equity market - a Pillar of New Venture Ecosystem

Easy availability of exit options is critical for healthy venture environment. India Inc raised a record Rs 25,000 crore from market in FY 2006-07 and thats a good news.

New Design Institutes may boost Design Centric Startups

Ministry of commerce is considering a new action plan under National Design Policy to make India a specialized innovation hub for sectors such as automobile and transportation, jewellery, leather, soft goods, electronics and IT hardware products, toys and games.

The plan also calls for four additional National Institutes of Design (NID). These centers would provide new design venture incubation and financing support through mechanisms such as venture funding apart from market development assistance for design oriented startups.

SBI Foray into Private Equity and Venture Cap

One of the biggest names in Indian Banking Industry is set to enter private equity and venture cap space with a fund size of about $1 Billion. My guess is that it is going to be more of private equity and less of venture cap, nonetheless, a sign of vibrant future for Indian venture industry.

Corporate Venture Activity a Good News for Startups

In venture private equity space, corporate venture funding has always followed the rise of fund activity by independent venture capital firms.

Though the jury is still out on effectiveness of corporate venture capital, a generally accepted belief is that fund philosophy & corporate strategy alignment is a must for success.

Corporate venturing -- early stage investments in startups from companies such as Intel, Cisco, Google and Yahoo -- is heating up again in varied flavors.

Debate on effectiveness of corporate venture funding aside, its a good news for startups

Fund activity in Mobile Content space

Phonethics Mobile Media, which creates mobile content in short multimedia format including short films, has received angel funding to take its plan to the next step. This segment though is part of very well received mobile sector, but it has not received as much attention as other infrastructure related segments. Take a look at a related story.

Proto.in Business Plan Competition


Here is the press release from Proto.in

Proto.in 2007 Summer Edition – Nominations Begin

The widely anticipated Nomination process for Proto.in 2007 summer edition is officially open. If you are a Technology start-up, be it in the initial stages, seed funded or planning to go IPO, we are accepting nominations from all across Asia. Proto.in is not just about funding your start-up, rather creating Mindshare for your Products among your clients, potential partners, with industry specialists, veteran entrepreneurs and the mainstream media. The last date for nominations is June 05th 2007.

About Proto.in

Proto.in is about giving entrepreneurs a platform to express their visions and showcase their imagination, with a working prototype, for the world to see. It's about increasing partnership, collaboration and mindshare among a distinguished, qualified and well-connected audience. Proto.in provides a unique platform for promising startup talent to communicate their creativity and innovation potential. As a meeting place for the smartest entrepreneurs, venture capitalists and professionals, Proto.in stands true to its mantra "Create, Contribute, Collaborate."

A Look back at the First Edition

During the first edition, Twenty seven companies, selected from more than one hundred nominations that came in, presented their vision and demonstrated their products to an audience which consisted of VCs, potential partners, clients and in some case even have courted potential acquirers.

There were about ten companies which presented during Proto which are courted by three VC firms on average. There were more than a handful of companies that were struggling to get clients and have signed up clients - either with someone who came for the event or with someone outside who heard about the company after Proto, have managed to establish a network of fellow and like-minded entrepreneurs, and gain valuable feedback on the business and product roadmap as they presented.

Second Edition – What’s in store?

We have widened our horizon and are looking at companies from across Asia. We are bringing in companies from countries such as Singapore, Malaysia, Hong Kong, Taiwan and China to enable cross-border collaboration in technology and perspectives.
The confirmations from the camp of Venture capitalists have come in hard and fast from Sequoia Capital, Greylock Partners, Clearstone Ventures, Canaan Partners, NEA-Indo US Ventures, Gabriel Ventures, Mentor Partners, Venture east ,Silicon Valley Bank, Plus Ventures, Matrix Partners, FootPrint Ventures, Bluerun Ventures apart from other Angel investors and Private Equity Firms.

International and Indian Organizations supporting Entrepreneurship and technological innovations such as IAMAI, TiE, TeNeT, ASES, TeDD, Malaysia IDA, Singapore have come forward and extended their support for Proto.in

New Venture Ecosystem India Update May 7, 2007

Venture Equity Firms Structured as Trusts to Get Tax Exemption

GOI favors trusts as a favored venture private equity firm structure. According to an official, trusts can avail pass-through status on any income they earn from investments made in unlisted firms in India and abroad. Pass-through status means business earnings will not be taxed at the fund level. Earnings will only be taxed at the hands of final beneficiaries (typically limited partners of the fund). Here is the full story

Where are Indian Cleantech Startups?

Going by the global startup scenario, lately, cleantech & energy has been one of the biggest buzz around. Silicon Valley venture equity circles have realized that next wave of billion dollar companies would come from clean technologies & technologies that can contribute towards solving world energy problem.

I have not seen much talk around either energy or clean tech in Indian venture private equity circles or startup ecosystem in general.

Leave alone US Silicon Valley; Closer to home, consider these facts about China

1. Last year Chinese Clean-Tech firms received 220 million in Venture funding

2. Emission trading is expected to reach $100 billion a year. China receives about 60% of present carbon credits; it translates into $60 billion a year in climate-change aid. (Read my earlier write-up on how you can use Carbon Credits as source of capital)

Absence of Indian activity in energy and clean technology space puzzles me.

Am I missing any thing? What has been your experience that can explain lack of interest of Indian venture community in this mega opportunity?

IP & GSM Marriage to Boost Rural Entrepreneurship

Two separate announcements by Nokia & Siemens, when combined together, create a very promising picture for rural economy and rural entrepreneurship.

First, Nokia announced a sub INR2000 phone, with inbuilt features to support mobile PCO operations in villages. Some of these features include time tracking / automatic time linked call ending to enable entrepreneurs to preset a time or cost limit on calls. Since a large section of rural populace can not afford individual phones, this has potential to make mobile community phone ownership (PCO centric model) a realistic dream.

Second, Nokia Siemens announced internet protocol based innovative solution to increase GSM rural coverage. This is how it is proposed to work. A village entrepreneur can take license from established GSM operator and setup a local switching network to route calls within a village. This network can connect to regional hub/GSM hub over IP to provide broader GSM connectivity. So far, high GSM network cost made rural forays economically unviable. This IP based solution is said to have a significant cost advantage over traditional option.

Marriage of these two seemingly unrelated introductions can have tremendous positive impact on rural economy.

It creates a compelling mobile infrastructure that rural entrepreneurs & enabling agencies can use to tap outside markets. For example, micro-finance organizations can use this infrastructure to promote business models beyond basic dairy & food processing to power rural economy.

Far flung villages now have a real shot at becoming next frontiers of value creation and innovation.

New Venture Ecosystem India Update - May 3, 2007

Foreign Investment in Pref Shares now on par with Debt

According to a Ministry of Finance circular, government will now treat foreign investment in preference shares that are not fully convertible into equity shares, issued by Indian companies on par with foreign debt. It has implications on typical mechanism of venture fund investment. Checkout, this business standard’s educational piece about this developing story

Clearstone Venture Partners - Sectors of Open Interest

According to Sumant Mandal, managing director, Clearstone Venture Advisors, Clearstone, is actively looking to invest in tech-driven businesses in financial services, communications, content & entertainment segments.

In India, Clearstone has so far invested in Iindiaideas.com (bill desk $5 million), DigiBee (mobile handset $5million) Games2win ($5 million) India in March. Globally it has invested in a series of successful ventures such as eToys, Overture, PayPal, United Online and MP3.com

Here is a link to original TOI news item

New Venture Ecosystem India Update - May 2, 2007

BCEI calls for Entrepreneur of the Year award nominations

Unlike other entrepreneur of the year awards, this one is for first generation entrepreneurs preferably from non-business families.

Bharti Centre for Entrepreneurial Initiatives (BCEI), a joint initiative of the Bharti Foundation and Entrepreneurship Development Institute of India (BCEI & EDI), Ahmedabad, has invited nominations for the Bharti Entrepreneur of the Year Award – 2007. Last date for nominations is May 31, 2007.

You can visit this PR release for more details

Sanjay Anandram on focus approach to picthing VCs

You have a great business idea and now you want to pitch it to VCs, get funded and get started. Sanjay Anandram, a noted VC and entrepreneurship advocate, suggests an approach you can consider while pitching your plan to VCs.

An interesting read, take a look...

Raising Money on London Alternative Investment Exchange

If SEBI does not recognize your product as valid underlying asset for listing, you can try London Alternative Investment Exchange.

According to an IANS news snippet, Shyam Benegal's movie venture is set to raise 55 million pounds on Alternative Investment Market this month .

Carbon Credits - Guilt Money Can Fund Your Venture

If your business model revolves around a green technology, thanks to Kyoto Protocol and green movement, you can get access to an additional revenue stream and access to clean technology.

Kyoto Protocol sets a limit on amount of greenhouse gases a country can emit. To limit emissions to predefined set quota, signatory nations limit emission from polluting industries. The protocol also prescribes a regulatory and market mechanism of tradable carbon credits to effectively implement a global emission control program.

This is how it works. Assume, there is a company 'A' in USA that emits 100K tons of carbon dioxide. Now, USA government brings a legislation, that forces company 'A' to restrict emission to 80K tons of greenhouse gas.

To comply, company 'A' has two options, either reduce emissions by 20K tons, that has a cost, or buy 20k tons of carbon credits from someone who has earned a right sell carbon credits.

Sellers in this market earn rights to sell carbon credits by undertaking any effort that will help reduce greenhouse gases in atmosphere. This could be a simple mechanism such as undertaking tree plantation or advanced mechanisms such as creating a business around clean technologies.

The amount of greenhouse gases emission you help prevent is the amount of carbon credits you can sell in the international market.

For developing nations the mechanism to participate in emission marketplace is Clean Development Mechanism (CDM). Under CDM, a developed country can take up a greenhouse gas reduction project activity in a developing country where the cost of greenhouse gas reduction project activities is usually much lower.

The developed country would be given credits for meeting its emission reduction targets, while the developing country would receive the capital and clean technology to implement the project. You can visit Wikipedia to know more about world of carbon credits, mechanisms such as CDM and much more.

You can call it making money out of someone else' guilt, nevertheless, going green was never so greener.