Not many 23-year-olds would be audacious enough to decline a salary with seven zeros. But IIM-Ahmedabad student Vineeta Singh created a stir last year when she spurned a Rs 1-crore offer from Deutsche Bank, to realise her dream of becoming a first-generation entrepreneur. The only child of Delhi-based scientists, Vineeta battled parental scepticism with: "It is so much more exciting to do your own thing as opposed to a streamlined, defined role in another company."
On All Fools’ Day (1 April) last year, Vineeta launched Quetzal Online Private Limited with three of her batchmates — with each one investing Rs 25,000. The decision to mind their own business, quite literally, was anything but foolish. From registration to recruitment to revenue generation, the quartet has seen it all in less than a year: Quetzal broke even within a month and went on to become a leader in the online MBA Test Preparation market, with a user base of over 27,000.
It now employs 18 people, is planning to go public in the next two years, and is looking for a 1,000 sq feet office in Mumbai. The team also launched a Human Resource outsourcing company recently that caters to a Fortune 100 company, among others.
“Today, my father teases me about drawing a lesser salary than my employees — because I invest back into the company,” says Vineeta. “I want to go to management school campuses and tell students, ‘Please don’t take up jobs. Become entrepreneurs instead — and create value where none exists,” she adds.
With the country’s galloping GDP, open market and cash flow for new businesses, Young India is discovering its Midas touch, and rushing to grab its sliver of India shining. “Everyone wants to take a leap of faith, and make it big in life,” says Vijayendra Haryal of IIM-A’s entrepreneurship club, ‘Entre’, where Vineeta is a role model. His aspiration is echoed by the sheer confidence the Indian entrepreneur now has in his ecosystem: A KPMG-TiE study released this January says that the Indian entrepreneur’s confidence index is 3.10 on a scale of 1-5 (where 1 indicates an extremely poor state and 5, the ideally desired state). Start-ups score even higher at 3.34.
Entrepreneurs’ changing DNA
There was once a time when you became a businessman because your father was a businessman. The trend has changed dramatically in the last five years, says Laura Parkin, executive director of the National Entrepreneurship Network (NEN), which celebrated entrepreneurial opportunities in India in the ‘E Week’ from February 2-9. “There is now a new interest and acceptability of entrepreneurship among young people from zero business backgrounds, catalysed by the opening of the economy and visible role models.”
When Sanjeev Bikhchandani, founder and CEO, Info Edge, which owns naukri.com, quit his marketing job 17 years ago, he was considered an “oddball” by people of his parents’ generation. “Today, when I meet parents of young entrepreneurs, they don’t hesitate to tell me — and it’s with a tinge of pride — that their child is doing a start up. It’s now socially acceptable, perhaps even respectable, to be a struggling entrepreneur,” he says.
“Young people now believe that they can succeed without the social and cultural support of a family business,” says Prof Rakesh Besant, chair of IIM-A’s Center for Innovation, Incubation and Entrepreneurship. “It’s hard to relate to huge conglomerates. It’s far easier to relate to people who started from scratch and made it big, even if they were college dropouts,” says Vijayendra.
Angels fuelling start-ups
Thanks to a generous supply of venture capital funds to the tune of USD 1 billion in early stage businesses, a rich daddy is no longer a pre-requisite for realising one’s entrepreneurial dreams. “In 2007, 82 funds invested about USD 480 million in India in 87 transactions — accounting for almost 25 per cent of the total deals in the year,” points out Asawari Desai of KPMG’s private equity group.
Says Alok Mittal, founder of Band of Angels, a group of successful entrepreneurs that invests time and money in start-ups. “Entrepreneurship in India is not new, but as a phenomenon, it has been amplified by venture funding.” And what has spun out so many ‘angels’ out of thin air? Says Mittal, “The growing domestic market and evidence that large businesses can grow out of nothing. Companies that started in 1999 have yielded huge profits within five years.”
Clearly, things have come a long way since Bikhchandani struggled to get an over draft limit of Rs 30,000 from the Bank of India. “We got it mainly because the manager was a nice guy who felt sorry for us. We finally raised venture capital 10 years after I had become an entrepreneur."
GenNext entrepreneurs are turning conventional business wisdom on its head, and are leveraging their lifetime experience of being consumers to innovate across sectors — be it telecom, coffee shops, web-based businesses, healthcare or entertainment. “They are building businesses around ideas, taking the lead from changing lifestyles and spending patterns of youngsters like them. These are businesses that the previous generation might not understand very easily,” says Prof K Kumar of IIM-B.
The new wave of businesses is expected to create jobs, and bolster the economy. But not all these businesses will necessarily succeed, points out Pravin Gandhi, president, Mumbai’s chapter of The Indus Entrepreneurs (TiE), a network that aims to foster entrepreneurship globally. “It’s like Bollywood — there is an opportunity for every actor, but not all will succeed.” What they will provide is a democratic space where there is an alternate way of doing things, and take away the market share from older platforms over time, he says.
And market share they are poised to hog. Ask Vineeta. “We want Quetzal to be the top brand in the world in the next few years — no matter which business it is in."
(With inputs from Upala Sen)