Technology entrepreneurship that has taken India’s information technology (IT) giants years of planning and persistence can now be nurtured in a classroom. The Founder Institute (FI), a for-profit global training company that focuses on technology-related start-ups and helps entrepreneurs (existing and prospective) create meaningful technology companies through a four-month programme, is coming to India in June.
Whether it is Eren Bali, 28, CEO and co-founder of Udemy, an online learning company in the US that has raised $12 million (around Rs.65 crore), or Quang (who uses only his first name), chief operating officer of Appota Corp., a mobile content provider, in Hanoi, Vietnam, the FI has not only helped develop successful revenue models for technology start-ups but has also put its participants through the rigours of building a company from scratch. Maren Kate Donovan, founder of San Francisco-based Zirtual, a company that provides virtual assistants to handle the personal and official tasks of busy corporate executives, calls the FI a “boot camp for a tech start-up”. “They gave me basic building blocks of starting a company, especially in the very competitive Silicon Valley,” says Donovan, who attended the programme in 2010.
Founded in 2009 in Mountain View, California, the FI will be setting up chapters in India this year, starting with Bangalore. The company, possibly the first of its kind in India for its hands-on training modules and flexible curriculum to accommodate part-time students, comes to India after successful operations in 40 cities across 24 countries, including Canada, Israel, Vietnam and Malaysia, and has helped raise 750 technology services companies. One unique aspect of the programme is the short duration, which would make it quite attractive for working executives and fledgling entrepreneurs.
“We have identified 11 mentors in Bangalore who can run the chapter and we expect this to grow to 30 by the time we launch in June,” says Adeo Ressi, founder and chief executive officer of the company, who runs eight of his companies and even founded a virtual city guide that was later acquired by AOL.
Silicon Valley entrepreneur and strategy consultant Sramana Mitra, who founded One Million by One Million (1M/1M), a global virtual entrepreneurship incubator, says: While such courses draw enough flak from critics who believe entrepreneurship cannot be taught in a class, these work instead of programmes offered by many business schools. “I run one myself. MBA schools, with all due respect, in India or elsewhere, have limited ability to teach entrepreneurship,” she adds.
Boot camps inviting entrepreneurship pitches from aspiring and fledgling entrepreneurs started in mid-April in Bangalore and will run through May—72 people signed up for the two such events held so far. “The programme format remains the same as in other countries but customization will happen with mentors who will bring their own India-specific experiences to the class,” says Naveen Lakkur, director of the Bangalore chapter, who describes himself as a serial entrepreneur and innovator.
Bangalore, Lakkur stresses, has all the ingredients of an Indian Silicon Valley for tech start-ups. “Here, aspiring entrepreneurs are perhaps the largest in number, and even technology manpower isn’t a problem,” he says.
The company also describes Mumbai, for which they are in the process of identifying mentors, as a market primed for start-up growth. “First, the underlying infrastructure for the early-stage investment already exists in Mumbai, and it is growing. It is a financial hub with a good base of venture capitalists and angels. Second, the talent needed to build meaningful and enduring technology companies exists in Mumbai as well—namely, through the Indian Institute of Technology and other such institutes,” says Jonathan Greechan, a partner at the FI in California.
The FI has set its eyes on India at a time when technology entrepreneurship is at a momentous phase—the combined impact of social media and mobile service platforms has generated enormous interest in technology-driven start-ups. Yet no innovation out of India can match technology entrepreneurs like Apple Inc., Google, Facebook or Twitter. “Anybody can see that India as a whole is primed for start-up growth. We believe that companies like Snapdeal, Flipkart, RedBus and Freecharge are just the beginning,” says Ressi.
For tuition fees of about Rs.50,000, the FI’s Bangalore chapter will help students create a fully operational company by the time they graduate. The admissions to the four-month programme will be stringent: There will be a test evaluating entrepreneurial personality traits. “In fact, you don’t even need to provide an idea to apply because our programme focuses on finding and developing the promising people,” says Greechan. “We support a wide range of technology industries including digital media, software, biotech, clean tech, e-commerce, advertising and consumer electronics.”
The company will earn partly through course fee and through its equity stakes in the companies created by its graduates. Approximately 42% of FI companies receive external funding within the first six months of graduation, claims Ressi. “We have 756 graduate companies and it will cross a thousand-plus in the next three months. We plan to add a thousand more by the end of 2013. Ninety per cent of our businesses are operating and 45% of them are being funded by angels and investors,” he claims. About 10% of them have gone bankrupt, Ressi adds.
The programme has been useful in countries that may be great at building technology but not great at sustaining businesses. The course is part-time so that people don’t need to quit their day job—the average age of an FI class is 34.
“One unique element (about India) is the significant social stigma associated with failure here, which can prevent people from taking risk,” Greechan says.
The other issue is red tape, says Ressi. “It takes months to get a company operational here,” he says. Mitra says a lot can be done to stimulate entrepreneurship by way of tax exemptions for entrepreneurs and funding schemes et al. “None of that has really happened in any well-thought way,” says Mitra.