What do Microsoft, Facebook and Google have in common? Well, each has a market value of more than $75 billion, their products have changed our lives, and they were started by students. A vibrant reality in the US for years, student entrepreneurship is a very recent, positive development in India. And while the current batch of Indian student ventures may not harbour the next Google, the start-ups are already creating value, and their number serves as a good indicator of the country’s future entrepreneurial growth.
The question is: how to accelerate this trend and take them to the next level? What will it take for India to produce its own set of student-launched game-changers?
In the past three years in India, there has been a sharp increase in the number of youngsters starting companies while still full-time students, according to a survey the National Entrepreneurship Network (NEN) conducted last year. In a sample of 30 NEN member institutes, all of which have steadily built up their campus entrepreneurship programmes, NEN found that five years ago, all these institutes combined produced only a single student entrepreneur. Four years ago, the same result. But by last year, the total number of student-run start-ups on these campuses had jumped to 47. This year, the student entrepreneurship platform, TATA First Dot powered by NEN, has more than 200 student start-ups competing from more than 25 cities. NEN is a strategic partner of Mint.
The growing number of these start-ups is cause for celebration. The 202 student start-ups competing in this year’s TATA First Dot have created more than 2,400 jobs, including the 268 founders. In addition to information technology (IT) services, retail and food-and-beverage companies, a few of the start-ups are tackling critical problems in education, healthcare and energy. One company allows you to schedule diagnostics and receive your reports online. Another has developed technology to visualize proteins and small molecules. Yet another developed and supplies more efficient water heaters. A fourth sells roof-top windmills for household power production.
Perhaps of equal importance to the potential of their companies are the lessons learnt by these enterprising young people, who become better equipped to create even more value after graduating. Ajay Kiran P., founder of Rocket Events and a fresh graduate, explained that by starting and running his own business. “I got to understand the importance of standing by myself and facing the world. I got the courage to fight back in difficult situations,” he said. “I found the value of creative thinking and I’ve developed the ability to work hard and effectively.” Another student entrepreneur, Durgesh Nandan of AutomotionAds, said: “From nowhere else I would have got this learning experience.”
Within the confines of India’s highly regimented educational system, opportunities to develop critical skills including selling, evaluating opportunities, recruiting and managing teams, raising resources, and handing finances are rare. Campus entrepreneurship programmes, including those that facilitate and support student start-ups, fill that gap.
Unlike most participants in business plan competitions, not only have these youngsters started ventures, but the vast majority plan to continue after graduating.
Of the 268 founders of the 2012 TATA First Dot competitors, 256 have declared in their First Dot nomination forms that they plan to be entrepreneurs after they graduate. As many as 209 of them want to continue with their current companies, 35 are planning new ventures, and the remaining didn’t indicate either way.
Additionally, an NEN analysis on the 2011 First Dot competitors showed that the majority of student entrepreneurs emerged on campuses that have built robust, hands-on and comprehensive entrepreneurship programmes. The student entrepreneurs represent a small subset of the total students actively engaged in the entrepreneurship programmes at these institutes.
One can, therefore, take the number of student entrepreneurs as a short-hand indicator of future entrepreneurial activity within the group of educated young people.
This trend in youth entrepreneurship is still nascent, however, and the types of start-ups in the current TATA First Dot powered by NEN, are predominantly “me-too” models, serving the needs of their immediate community.
Given how much these young people learn from starting any kind of business, this isn’t cause to fret overly much. That said, it would be good to see a shift, over the coming years, to more ventures that better leverage or develop innovative technologies, with more of them targeting the large and growing opportunities in sectors ranging from energy to healthcare, education, water, and waste management.
With 60% of the current batch of student entrepreneurs being engineers, and more management students with engineering backgrounds, this shift should be possible, if approached systematically.
However, scaling up innovative and hands-on entrepreneurship programmes within higher education in India faces many challenges. Today, most of these activities run outside the curriculum, in a parallel universe. Time and resources are, therefore, constrained, and institutes struggle to build the types of advanced programmes that yield concrete results.
Given the promising results when young people engage in these programmes, as evidenced in the growing number of student entrepreneurs emerging, perhaps it’s time to make more room for entrepreneurship in the official curriculum. In the meantime, efforts should be made to support those young entrepreneurs who have already started—an investment that will surely pay off.
Laura Parkin is chief executive officer and co-founder of National Entrepreneurship Network, an initiative of the Wadhwani Foundation.
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