Start-up boom boosts brain gain in India

Staff at work in Urban Ladder's offices in Bangalore. The start-up employs 1,500 staff and sells own-brand interior furnishings. (File photo, February 22, 2016.)


The story of the computer-savvy Indians has been around for a while: India has legions of well-trained IT specialists who provide high-tech services for tiny pay to firms round the globe. Get set for another story to replace it: Many of those smart Indian software experts are now becoming their own bosses.
India is experiencing an incredible start-up boom. India is now in third place behind the US and Britain in setting up digital businesses, with 4,200 technology firms set up in the past few years.
One of these success stories is Urban Ladder, a company set up in 2012 which sells its own-brand furniture online. The company’s wares can be seen in its Bangalore headquarters: hanging chairs, modern rocking chairs, shelves that are reminiscent of Ikea, multi-coloured lampshades.
The 1,500 employees, including the 300 in the Bangalore office, can play table tennis and pool during working hours, eat free snacks or even take a nap in sleeping rooms – just like in Silicon Valley.
The management of the IT department of Urban Ladder is female with 38 being the average age – and most have only recently returned to India from the United States.
“When I left Bangalore in 2000, there was only a couple of service providers here. Now Google and LinkedIn have built huge campuses,” says Sonia Parandekar. For a long time she was employed by Microsoft, then by Groupon. Now she’s back home. “There are so many opportunities for us here!” she says.
It’s estimated that last year around 9 billion dollars was invested in Indian startups. The previous year that figure was 2.2 billion dollars. The emerging country with a billion-strong population has a very valuable resource: many bright people.
If investors spread their money around the chances are high that it’ll flourish somewhere on the fertile soil of the subcontinent. “So much money is flowing,” says Parandekar. “Everyone’s totally excited.”
Urban Ladder has so far amassed 77 million dollars in investment. Last year founder Ashish Goel had to do little more than raise his arm to win funding. This year it’s likely to be more difficult. But he’s confident for the future: “Magic will certainly happen here.”
The city is vibrant and in every cafe people are discussing the app or website they’re working on. Surge, a start-up conference held recently, attracted more than 5,000 people from around the world. The government of India is also encouraging the startup trend. Prime Minister Narendra Modi wants India to replace China as the manufacturing workshop of the world.
Pete Lau, head of Chinese Smartphone manufacturer OnePlus, told Surge he sees many parallels between India today and where China was a few years ago. But the government’s “Make in India” campaign is not running particularly well. In January the prime minister announced a new programme – “Start up India” – in which the government is to invest hundreds of millions of dollars.
Start-up veterans like Anil Srivatsa are sceptical about government involvement in the start-up sector. One reason the IT sector and the call-centre business have done so well in India is because government has neglected to lay down rules and regulations for them.
“I seek to do business where I don’t need government,” Srivatsa says. He has founded eight companies, including Radiowalla, an online music platform which provides around 7,000 cafes, restaurants and shops with background music.
The tax authorities came to visit recently, Srivatsa says. “They wanted to collect income tax for the investor funds that Radiowalla had received. Totally crazy!” he says. The climate is not really entrepreneur-friendly, he complains.
He lived for a long time in the United States and returned to India to help
build up the country. However, “if the government regulates the internet, I’ll go back,” he says.

Urban Ladder's offices in Bangalore feature basket-style chairs and Silicon Valley style for the 1,500 staff. (File photo, February 22, 2016.)

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