Some Catching Up To Do
In 2010 President Obama had exhorted American students to toil harder in schools, as their hard work and success would determine America’s leadership and hegemony in an increasingly multipolar world. He warned that other countries were competing with America like never before and that children in Bangalore and Beijing were working hard to race ahead. He also came up with the slogan ‘Say no to Bangalore and yes to Buffalo’. President Trump on the other hand came into the White House with the promise of ‘Making America Great Again’. He promised that companies that outsourced domestic jobs would be penalized and that every effort would be made to ensure that jobs returned to American shores.
Increasingly, the greatest competition to American companies in the tech space are Chinese hardware and Indian software. It is no surprise that the current CEO of Google, Microsoft and Adobe are all Indian American honchos. Companies like Infosys and Wipro have made huge inroads in the Information Technology (IT) sector and both these booming business have been started by entrepreneurs in the India’s IT city, Bangalore.
Two Indian IT veterans have set up Fundamentum, a $100 million fund that they hope will produce efficient, smart and user friendly startups for a global markets. One of the veterans is Nandan Nilekani, a co-founder of $33 billion IT services company Infosys. He has already transformed the Indian surveillance scenario with the mandatory Unique Aaadhar card (Unique Identification Code for every Indian). The other veteran is Sanjeev Aggarwal who founded BPO firm Daksh.
$50 million of the fund has already been earmarked by Fundamentum for covering the funding gap for India’s most promising tech firms. The rest of the fund will be invested in other startups that will probably leave a mark not only on booming Internet based services in India but other countries as well. The fund initiation is a wise investment given that India already boasts of Eight billion dollar valued technology companies.
These include e-commerce firms include Flipkart, Paytm, Snapdeal and Shopclues. Uber’s main competitor in India ‘Ola’ is also among the billion dollar companies. This list will definitely see other names being added to it as Indian markets are booming. The demonetization move by Prime Minister Modi and the latest bill of legislation (Goods and Services Tax, GST) has buoyed the investors to expand more in this developing country. The growth has been largely propelled by its magnanimous middle class.
The two veterans have hinted that they may sign only two or three deals in a year to select the ‘exceptional startups’ that have a world-class potential and would largely benefit from capital investment and mentoring. They also expect institutional investors to come alongside them in the future and widen the fund to a potential $200 million.
The two veterans behind Fundamentum will be mentoring companies that they believe have the potential to go big across the world but they haven’t specified any particular business sector. The goal will also be to ensure that India’s software services would be accessible to the different countries of the world. They have already initiated the process for identifying team members and making certain plans. It would be imperative on the part of American companies and leaders to invest and nurture such companies of their own. Indeed, it seems the Americans are the ones with some catching up to do.
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