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Tuesday, December 27, 2005
Information Revolution according to Peter Drucker
Click here to read what the inventor of management, Peter Drucker says about Information Revolution and what lies ahead.
Saturday, December 24, 2005
Google desperate to attract AdWords buyers.
Google is doing ad campaigns to sell its AdWords. This means Google is getting defensive.
Thursday, December 22, 2005
Best technique to uninstall Linux
If you have only Linux (any distro) installed on your computer, the following procedure will totally wipe off Linux from your hard drive and also all the data on it.
Step 1: Boot Linux.
Step 2: Open the Terminal.
Step 3: If you are not logged in as root, log in as root.
Step 4: Type this command:
dd if=/dev/zero of=/dev/hda bs=512 count=1
Step 5: Hit Enter.
Step 6: Restart your computer.
When you restart your computer you will see that there is no OS on your hard drive. So before doing this be sure you have your other OS cd with you so that you can install that.
Step 1: Boot Linux.
Step 2: Open the Terminal.
Step 3: If you are not logged in as root, log in as root.
Step 4: Type this command:
dd if=/dev/zero of=/dev/hda bs=512 count=1
Step 5: Hit Enter.
Step 6: Restart your computer.
When you restart your computer you will see that there is no OS on your hard drive. So before doing this be sure you have your other OS cd with you so that you can install that.
Friday, December 16, 2005
Wednesday, December 07, 2005
XQuery based native XML databases
Deciding when an XQuery-based native XML database is better than an SQL database: Link
A plethora of information about Native XML Databases can be found at www.rpbourret.com
Of all the available NXDs Berkeley DB XML seems to be the better choice.
Berkeley DB XML is a library, and as such is linked into your application just as any other library would be, it does not incur the overhead of client/server communication. You interact with Berkeley DB XML using one of the supported language APIs. The primary one is C++, as the product is written in C++. Java, Python, Perl, PHP, and TCL are all supported API languages.
A plethora of information about Native XML Databases can be found at www.rpbourret.com
Of all the available NXDs Berkeley DB XML seems to be the better choice.
Berkeley DB XML is a library, and as such is linked into your application just as any other library would be, it does not incur the overhead of client/server communication. You interact with Berkeley DB XML using one of the supported language APIs. The primary one is C++, as the product is written in C++. Java, Python, Perl, PHP, and TCL are all supported API languages.
Wednesday, November 30, 2005
14,159,265
Why Google offered exactly 14,159,265 shares for sale?
Because (pi - 3) * 100,000,000 = 14,159,265.
Read full story here.
Because (pi - 3) * 100,000,000 = 14,159,265.
Read full story here.
IPOs of super successful technology companies
| Company name | Year of IPO | $ per share |
|---|---|---|
| Apple | Dec 12, 1980 | 22 |
| Microsoft | March 13, 1986 | 21 |
| Oracle | March 12, 1986 | 15 |
| Sun Microsystems | March 4, 1986 | 16 |
| Dell | June 22, 1988 | 8.50 |
| Yahoo! | April 1996 | Click here |
| Amazon.com | May 15, 1997 | 18 |
| eBay | September 24, 1998 | Click here |
| August 18, 2004 | 85 |
Monday, November 28, 2005
Saturday, November 26, 2005
Google AdSense "click fraud"
Google executive calls click fraud the biggest threat to the Internet economy, urges quick action.
"I think something has to be done about this really, really quickly, because I think, potentially, it threatens our business model," Google Chief Financial Officer George Reyes said.
I always wondered if the pay-per-click model of revenue is for real. Its pretty funny to see that a giant Internet company like Google relies on just "ads" for revenue, though the beauty of Google's ad revenue is that it creates ads specific to key word search.
I also doubt it if advertisers really increase their sales by using Google's AdWords program given the rampant click fraud.
"I think something has to be done about this really, really quickly, because I think, potentially, it threatens our business model," Google Chief Financial Officer George Reyes said.
I always wondered if the pay-per-click model of revenue is for real. Its pretty funny to see that a giant Internet company like Google relies on just "ads" for revenue, though the beauty of Google's ad revenue is that it creates ads specific to key word search.
I also doubt it if advertisers really increase their sales by using Google's AdWords program given the rampant click fraud.
Friday, November 25, 2005
Google threatens
Wired has an interesting article on why almost all tech companies need to be threatened by Google. The following is an excerpt from the that article relating to Google's foray into online classifieds.
CLASSIFIEDS
When secrecy-obsessed Google let news of "Google Base" slip, it looked like an aggressive entrée into online classifieds. The test service can search ads like used-car and personals listings, which would mesh with Google Local and might even kick-start Orkut, Google's social network.
Who's threatened: craigslist, eBay, Monster, Tribe.net
Signs of panic: Within hours of the Base bombshell, eBay's market value dropped by almost $2 billion. And even before that, the classified sites were nervous. CareerBuilder and others fretted about letting Google host their feeds.
Reality check: This may be an extension of Froogle rather than a stand-alone product. But it could expand to everything from travel to eBay-like offerings.
CLASSIFIEDS
When secrecy-obsessed Google let news of "Google Base" slip, it looked like an aggressive entrée into online classifieds. The test service can search ads like used-car and personals listings, which would mesh with Google Local and might even kick-start Orkut, Google's social network.
Who's threatened: craigslist, eBay, Monster, Tribe.net
Signs of panic: Within hours of the Base bombshell, eBay's market value dropped by almost $2 billion. And even before that, the classified sites were nervous. CareerBuilder and others fretted about letting Google host their feeds.
Reality check: This may be an extension of Froogle rather than a stand-alone product. But it could expand to everything from travel to eBay-like offerings.
Saturday, November 19, 2005
The Web - What it can and can't
Amazon, eBay, rediff and almost all e-commerce companies are built on the idea that people will buy goods "through the Internet". This is absurd, because the web can't deliver goods or anything tangible. The web can only deliver information.
Claude Shannon is known as the father of information theory. He defined information as the reduction of uncertainity.
Claude Shannon is known as the father of information theory. He defined information as the reduction of uncertainity.
Thursday, November 17, 2005
Google Base launched
Google Base has finally been launched. I'm not impressed by the way it works. I was expecting something much better from Google.
Thursday, November 10, 2005
Bill Gates and Ray Ozzie on software as a service via Internet
Bill Gates' e-mail:
From: Bill Gates
Sent: Sunday, October 30, 2005 9:56 PM
To: Executive Staff and Direct Reports; Distinguished Engineers
Subject: Internet Software Services
From: Bill Gates
Sent: Sunday, October 30, 2005 9:56 PM
To: Executive Staff and Direct Reports; Distinguished Engineers
Subject: Internet Software Services
Microsoft has always had to anticipate changes in the software business and seize the opportunity to lead.
Ten years ago this December, I wrote a memo entitled The Internet Tidal Wave which described how the internet was going to forever change the landscape of computing. Our products could either prepare for the magnitude of what was to come or risk being swept away. We dedicated ourselves to innovating rapidly and lead the way much to the surprise of many industry pundits who questioned our ability to reinvent our approach of delivering software breakthroughs.
Five years ago we focused our strategy on .NET making a huge bet on XML and Web services. We were a leader in driving these standards and building them into our products and again this has been key to our success. Today, over 92% of the Fortune 100 are utilizing .Net and our current wave of products have XML and Web services at their core and are gaining share because of the bold bet we made back in the year 2000.
Today, the opportunity is to utilize the Internet to make software far more powerful by incorporating a services model which will simplify the work that IT departments and developers have to do while providing new capabilities.
In many ways this is not completely new. All the way back in 1998 we had a company meeting where we outlined a vision in which software would become more of a service over time. We've been making investments since then -- for example, the Watson service we have built into Windows and Office allows us and our partners to understand where our users are running into problems and lets us improve their experience. Our On-line help work gives us constant feedback about what topics are helping our users and which we need to change. Products from MSN like Messenger and Hotmail are updated with new features many times throughout the year, allowing them to deliver innovations rapidly. Our Mappoint service was a pioneer in letting corporations connect up to a web based API on a subscription basis.
However, to lead we need to do far more. The broad and rich foundation of the internet will unleash a "services wave" of applications and experiences available instantly over the internet to millions of users. Advertising has emerged as a powerful new means by which to directly and indirectly fund the creation and delivery of software and services along with subscriptions and license fees. Services designed to scale to tens or hundreds of millions will dramatically change the nature and cost of solutions deliverable to enterprises or small businesses.
We will build our strategies around Internet services and we will provide a broad set of service APIs and use them in all of our key applications.
This coming "services wave" will be very disruptive. We have competitors who will seize on these approaches and challenge us – still, the opportunity for us to lead is very clear. More than any other company, we have the vision, assets, experience, and aspirations to deliver experiences and solutions across the entire range of digital workstyle & digital lifestyle scenarios, and to do so at scale, reaching users, developers and businesses across all markets.
But in order to execute on this opportunity, as we've done before we must act quickly and decisively. This next generation of the internet is being shaped by its "grassroots" adoption and popularization model, and the cost-effective "seamless experiences" delivered through the intentional fusion of services, software and sometimes hardware. We must reflect upon what and for whom we are building, how best to deliver new functionality given the internet services model, what kind of a platform in this new context might enable partners to build great profitable businesses, and how our applications might be reshaped to create service-enabled experiences uniquely compelling to both users and businesses alike.
Steve and I recently expanded Ray Ozzie's role as CTO to include leading our services strategy across all three divisions. We did this because we believe our services challenges and opportunities will impact most everything we do. Ray has long demonstrated his passion for software, and through his work at Groove he also came to realize the transformative potential for combining software and services. I've attached a memo from Ray which I feel sure we will look back on as being as critical as The Internet Tidal Wave memo was when it came out. Ray outlines the great things we and our partners can do using the Internet Services approach.
The next sea change is upon us. We must recognize this change as an opportunity to take our offerings to the next level, compete in a manner commensurate with our industry responsibilities, and utilize our assets and our broad reach to reshape our business for the benefit of the users of our products, our customers, our partners and ourselves.
Bill
Click here to read Ray Ozzie's memo.
Wednesday, November 09, 2005
Mr. Google vs Mr. Gates
Mr. Google: "Google's mission is to organize the world's information and make it universally accesible and available."
Mr. Gates: " Google is great, they are smart people, the press should continue to feed their arrogance as much as possible,’ he says.
‘They say they are going to organise the world’s information. Well, we don’t think that is our job. We think you need to get tools to editors and subject experts to let them organise the world’s information. There is a bit of a philosophy difference here. The only sure winner is the consumer.’ "
There is an interesting difference in the way the two companies approach the concept of delivering information.
Mr. Gates: " Google is great, they are smart people, the press should continue to feed their arrogance as much as possible,’ he says.
‘They say they are going to organise the world’s information. Well, we don’t think that is our job. We think you need to get tools to editors and subject experts to let them organise the world’s information. There is a bit of a philosophy difference here. The only sure winner is the consumer.’ "
There is an interesting difference in the way the two companies approach the concept of delivering information.
Tuesday, November 08, 2005
Windows to Mac converts
AppleInsider reports:
The momentum generated by Apple's iPod digital music players and related products continues to translate into new Macintosh sales according to one Wall Street analyst who estimates that over one million Windows users have purchased a Mac in the first three quarters of 2005.
"If we assume that all of the growth in Mac shipments during the past three quarters resulted from Windows users purchasing a Mac, then purchases by Windows users exceeded one million," the analyst said. "Indeed, the number of Windows users purchasing Macs in 2005 could easily exceed our forecast of 1.3 million switchers in 2006."
Read the full story here.
The momentum generated by Apple's iPod digital music players and related products continues to translate into new Macintosh sales according to one Wall Street analyst who estimates that over one million Windows users have purchased a Mac in the first three quarters of 2005.
"If we assume that all of the growth in Mac shipments during the past three quarters resulted from Windows users purchasing a Mac, then purchases by Windows users exceeded one million," the analyst said. "Indeed, the number of Windows users purchasing Macs in 2005 could easily exceed our forecast of 1.3 million switchers in 2006."
Read the full story here.
Saturday, November 05, 2005
Where to get ideas for startups?
Paul Graham gives an elaborate explanation of "where to get ideas". He says:
"I think people believe that coming up with ideas for startups is very hard-- that it must be very hard-- and so they don't try do to it. They assume ideas are like miracles: they either pop into your head or they don't.
I also have a theory about why people think this. They overvalue ideas. They think creating a startup is just a matter of implementing some fabulous initial idea. And since a successful startup is worth millions of dollars, a good idea is therefore a million dollar idea.
If coming up with an idea for a startup equals coming up with a million dollar idea, then of course it's going to seem hard. Too hard to bother trying. Our instincts tell us something so valuable would not be just lying around for anyone to discover.
Actually, startup ideas are not million dollar ideas, and here's an experiment you can try to prove it: just try to sell one. Nothing evolves faster than markets. The fact that there's no market for startup ideas suggests there's no demand. Which means, in the narrow sense of the word, that startup ideas are worthless."
What I believe is, successful startups and companies were not built on ideas that popped into the founders' heads but, they were built on a vision. You feel something is wrong with the way a particular thing works or the way certain task is accomplished and you want to express everyone what is the right way of doing things -- this is how successful companies were born. And one more thing I feel is, you should have a genuine desire to help or serve people a desire and passion to create some excellent product or service that will allow people to do things in a better or easier way.
"I actually think there's actually very little distinction between an artist and a scientist or engineer of the highest caliber. I've never had a distinction in my mind between those two types of people. They've just been to me people who pursue different paths but basically kind of headed to the same goal which is to express something of what they perceive to be the truth around them so that others can benefit by it." -- Steve Jobs.
"I think people believe that coming up with ideas for startups is very hard-- that it must be very hard-- and so they don't try do to it. They assume ideas are like miracles: they either pop into your head or they don't.
I also have a theory about why people think this. They overvalue ideas. They think creating a startup is just a matter of implementing some fabulous initial idea. And since a successful startup is worth millions of dollars, a good idea is therefore a million dollar idea.
If coming up with an idea for a startup equals coming up with a million dollar idea, then of course it's going to seem hard. Too hard to bother trying. Our instincts tell us something so valuable would not be just lying around for anyone to discover.
Actually, startup ideas are not million dollar ideas, and here's an experiment you can try to prove it: just try to sell one. Nothing evolves faster than markets. The fact that there's no market for startup ideas suggests there's no demand. Which means, in the narrow sense of the word, that startup ideas are worthless."
What I believe is, successful startups and companies were not built on ideas that popped into the founders' heads but, they were built on a vision. You feel something is wrong with the way a particular thing works or the way certain task is accomplished and you want to express everyone what is the right way of doing things -- this is how successful companies were born. And one more thing I feel is, you should have a genuine desire to help or serve people a desire and passion to create some excellent product or service that will allow people to do things in a better or easier way.
"I actually think there's actually very little distinction between an artist and a scientist or engineer of the highest caliber. I've never had a distinction in my mind between those two types of people. They've just been to me people who pursue different paths but basically kind of headed to the same goal which is to express something of what they perceive to be the truth around them so that others can benefit by it." -- Steve Jobs.
Thursday, November 03, 2005
Windows Live
Microsoft has unleashed its next killer application. Its called "Live". Microsoft boss, Bill Gates calls it the "live era" of software. At a press event in San Francisco, Chairman Bill Gates kicks off Microsoft's "live software" push. He details the upcoming "Windows Live" and "Office Live" products, a fusion of software and services that are delivered across the Internet. Read the complete news about "Live" here.
Live.com the website: Its just awesome. Full of AJAX programming, you find everything you want from your e-mail to weather in any city to news about anything on a single webpage. This is really something Google has to worry about. www.live.com
Live.com the website: Its just awesome. Full of AJAX programming, you find everything you want from your e-mail to weather in any city to news about anything on a single webpage. This is really something Google has to worry about. www.live.com
Wednesday, November 02, 2005
Steve Jobs on TIME magazine cover again.
Steve Jobs appeared on the cover page of TIME magazine dated 24th Oct, 2005. TIME takes a look at how Apple manages to create great products again and again. Read the full cover story here.
.NET will conquer the world.
The reason so many Microsoft standards have become de facto development standards is that Microsoft uses those technologies internally. COM's popularity was driven by the degree to which Microsoft used COM in its own products. This made it a business requirement for competitors to support COM, simply because their products would look less feature-rich without the reusable, cross-language COM functionality offered by Microsoft products.
Click here to see how .NET will conquer the world.
Click here to see how .NET will conquer the world.
Saturday, October 29, 2005
Wednesday, October 26, 2005
Innovation and Business
"I never perfected an invention that I did not think about in terms of the service it might give others... I find out what the world needs, then I proceed to invent...." - Thomas Alva Edison.
The most daunting thing for an innovator is to make a living out of his innovations. Professors and scientists at universities do research and claim to be working towards inventing something, but the million dollar question is, "can they commercialize their innovation?" A great innovator who makes money out of his inventions is the one who has a unique and gifted talent to mix business-mindedness with the single-mindedness required to do research.
Most people fail to create exactly this balance. Either they do more research, which is not needed by anyone or they focus more on the business side of the things, trying to focus on "branding" and spending time and money marketing a weak product.
A great innovator-entrepreneur is the one who can look at things in a way no one has ever done before and goes out to express to everyone what he percieves as the truth around him and has a vision to create great products/services with an attitude to serve people.
Tuesday, October 25, 2005
Monday, October 24, 2005
Friday, October 21, 2005
Love your independence
"If I would be a young man again and had to decide how to make my living, I would not try to become a scientist or scholar or teacher. I would rather choose to be a plumber or a peddler in the hope to find that modest degree of independence still available under present circumstances."
-- Albert Einstein, The Reporter, November 18 1954
-- Albert Einstein, The Reporter, November 18 1954
Wednesday, October 19, 2005
Sunday, October 16, 2005
Tech leaders on Web 2.0
"e-commerce has not even begun." -- Bill Gates
"In the 2000s, there will be two kinds of businesses -- ones that are online and the ones that are out of business." -- Bill Gates
"It's still day one. We're in the stone age of computing." -- Jeff Bezos, Amazon.com
"Never underestimate the Internet. Manipulate it. Respect it. But don't try to dominate it."
-- Jerry Yang, Founder, Yahoo Inc.
"I think the XML message form will really be the thing that unlocks the future" -- Steve Ballmer, CEO, Microsoft Corp.
......
Will be updated
"In the 2000s, there will be two kinds of businesses -- ones that are online and the ones that are out of business." -- Bill Gates
"It's still day one. We're in the stone age of computing." -- Jeff Bezos, Amazon.com
"Never underestimate the Internet. Manipulate it. Respect it. But don't try to dominate it."
-- Jerry Yang, Founder, Yahoo Inc.
"I think the XML message form will really be the thing that unlocks the future" -- Steve Ballmer, CEO, Microsoft Corp.
......
Will be updated
Friday, October 14, 2005
Thursday, October 13, 2005
What leaders are saying
Bill Gates had been to M.I.T recently to interact with students and encourage them to pursue computer science as a career.
Mr. Gates said electronic commerce had not yet even begun, and that huge gains in communication, convenience and productivity are on the near horizon. He acknowledged that there were challenges to be overcome in areas like privacy and computer security, skipping lightly over the fact that security flaws have bedeviled many Microsoft products. But even the headaches, he said, are merely intriguing problems for smart computer people to conquer, and profit from.
Jeff Bezos likes to say when exhorting his staff to innovate, "It's still day one." We're in the stone age of computing.
Mr. Gates said electronic commerce had not yet even begun, and that huge gains in communication, convenience and productivity are on the near horizon. He acknowledged that there were challenges to be overcome in areas like privacy and computer security, skipping lightly over the fact that security flaws have bedeviled many Microsoft products. But even the headaches, he said, are merely intriguing problems for smart computer people to conquer, and profit from.
Jeff Bezos likes to say when exhorting his staff to innovate, "It's still day one." We're in the stone age of computing.
Wednesday, October 12, 2005
Web 2.0 e-commerce company
I feel the web is moving towards a more generalized pattern and towards a standard.
Like, personal web pages were random and radically different from eachother while all the blogs follow a specific design and pattern and framework. Same thing with Wikipedia. Wikipedia.org provides information about each and everything but in a definite pattern and model and everything fits into that model.
My vision is to create such a pattern, standard and framework for an e-commerce company. eBay and Amazon are not working like wikipedia or blogs hence I consider them to be web 1.0 companies. Information about buyers and sellers in eBay and Amazon is not formatted and doesnt fit into a framework. This will not be the case in a web 2.0 e-commerce company.
So far what I have learnt from web 2.0 is "information shouldnt be presented as flashy and haphazard, information should be presented in an organized and disciplined manner and should fit in a framework".
Like, personal web pages were random and radically different from eachother while all the blogs follow a specific design and pattern and framework. Same thing with Wikipedia. Wikipedia.org provides information about each and everything but in a definite pattern and model and everything fits into that model.
My vision is to create such a pattern, standard and framework for an e-commerce company. eBay and Amazon are not working like wikipedia or blogs hence I consider them to be web 1.0 companies. Information about buyers and sellers in eBay and Amazon is not formatted and doesnt fit into a framework. This will not be the case in a web 2.0 e-commerce company.
So far what I have learnt from web 2.0 is "information shouldnt be presented as flashy and haphazard, information should be presented in an organized and disciplined manner and should fit in a framework".
Web1.0 vs Web2.0
Web1.0 -------------------------------------- Web2.0
DoubleClick ----------------------------------Google AdSense
Personal Websites ----------------------------Blogs
Ofoto -----------------------------------------Flickr
mp3.com -------------------------------------Napster
Britannica Online -----------------------------Wikipedia
eBay/Amazon -------------------------------- ?????
So, what will be the web 2.0 company for e-commerce? Will eBay or Amazon continue to be considered as web2.0 companies or will some new company with a novel idea and big vision become the web2.0 company for e-commerce?
For information on Web2.0 click here
eBay buys VeriSign
eBay's buying spree continues. Not even a couple of months after buying Skype, eBay has bought VeriSign for $370 Million.
Here is what Jeff Jordan, President PayPal (also aquired by eBay) says:
"I’m excited to let you know that PayPal has agreed to acquire VeriSign's payment gateway. This acquisition will allow PayPal to accelerate its growth in off-eBay merchant services, and will provide merchants with even more processing choices from a single provider – including VeriSign's gateway, PayPal’s Website Payments Standard, Express Checkout or Website Payments Pro.
Here is what Jeff Jordan, President PayPal (also aquired by eBay) says:
"I’m excited to let you know that PayPal has agreed to acquire VeriSign's payment gateway. This acquisition will allow PayPal to accelerate its growth in off-eBay merchant services, and will provide merchants with even more processing choices from a single provider – including VeriSign's gateway, PayPal’s Website Payments Standard, Express Checkout or Website Payments Pro.
In addition, eBay and PayPal have signed a multi-year agreement with VeriSign for a variety of technologies, including authentication tokens, which protect the security of online transactions. eBay and PayPal users will benefit with enhanced security and privacy of their account data.
We’ll keep you informed about how these technologies will be integrated with eBay and PayPal in 2006."
More detailed news here
Tuesday, October 11, 2005
Bill Gates on his competitors
Microsoft Corp. is grappling with "a lot of smart competitors," including Google and Apple, who are ahead of the Redmond company in some key markets, Bill Gates acknowledges.
But the Microsoft chairman on Tuesday said his company remains the overall industry leader, and he compared the current rivalries to legendary ones with Lotus, Novell and WordPerfect -- situations in which the Redmond company ultimately overcame steep odds to prevail.
"At any point in our history, we've had competitors who were better at doing something," Gates said in an interview with the Seattle Post-Intelligencer, underscoring the fact that it wouldn't be unprecedented to come from behind now. Read more here
In an other interview with CNET Microsoft Boss Bill Gates talks about Google, he said: "Google, because they are in the honeymoon phase, people think that they do all things at all times in all ways". Read more here.
But the Microsoft chairman on Tuesday said his company remains the overall industry leader, and he compared the current rivalries to legendary ones with Lotus, Novell and WordPerfect -- situations in which the Redmond company ultimately overcame steep odds to prevail.
"At any point in our history, we've had competitors who were better at doing something," Gates said in an interview with the Seattle Post-Intelligencer, underscoring the fact that it wouldn't be unprecedented to come from behind now. Read more here
In an other interview with CNET Microsoft Boss Bill Gates talks about Google, he said: "Google, because they are in the honeymoon phase, people think that they do all things at all times in all ways". Read more here.
How Microsoft will "kill" Google
When Steve Ballmer yelled at a departing Microsoft employee that he would "kill Google" we had no idea just how direct a method he had in mind. Buying all or part of AOL may be the first part of the master plan, as Google relies heavily on the advertising pages that come from AOL, since it now syndicates its search to Google.
Best Entrepreneurs under 25
BusinessWeek Online is conducting a search for the country's (USA) most talented entrepreneurs under 25. To submit your nomination click here
Some of the best business ideas are hatched over cold pizza in college dorm rooms. If you need proof, look no further than the Dell computer likely sitting on your desk. Considered a generation ago to be the career path for those without one, the term "entrepreneur" has gradually shed its stigma and become the rock star of the business world -- a ticket to riches, independence, and sometimes, celebrity.
With the proliferation of related classes and competitions on campuses across the nation, not to mention an array of publications like SmallBiz, budding business owners have more resources than ever. The result has been savvier startups coming from increasingly younger founders.
With this in mind, BusinessWeek Online is embarking on a nationwide search for the best entrepreneurs under 25. We're looking for young people running their own companies -- real, fully operational companies. And that's about the only criteria.
Business plans are important, of course, but we're really out to find young business leaders who have taken the proverbial plunge and already put those plans into action. And by no means do they have to come from the friendly confines of academia.
Some of the best business ideas are hatched over cold pizza in college dorm rooms. If you need proof, look no further than the Dell computer likely sitting on your desk. Considered a generation ago to be the career path for those without one, the term "entrepreneur" has gradually shed its stigma and become the rock star of the business world -- a ticket to riches, independence, and sometimes, celebrity.
With the proliferation of related classes and competitions on campuses across the nation, not to mention an array of publications like SmallBiz, budding business owners have more resources than ever. The result has been savvier startups coming from increasingly younger founders.
With this in mind, BusinessWeek Online is embarking on a nationwide search for the best entrepreneurs under 25. We're looking for young people running their own companies -- real, fully operational companies. And that's about the only criteria.
Business plans are important, of course, but we're really out to find young business leaders who have taken the proverbial plunge and already put those plans into action. And by no means do they have to come from the friendly confines of academia.
Saturday, October 08, 2005
e-commerce + e-communication : eBay + Skype
eBay to Acquire Skype
London, September 12, 2005 – eBay Inc. (Nasdaq: EBAY; www.ebay.com) has agreed to acquire Luxembourg-based Skype Technologies SA, the global Internet communications company, for approximately $2.6 billion in up-front cash and eBay stock, plus potential performance-based consideration. The acquisition will strengthen eBay’s global marketplace and payments platform, while opening several new lines of business and creating significant new monetization opportunities for the company. The deal also represents a major opportunity for Skype to advance its leadership in Internet voice communications and offer people worldwide new ways to communicate in a global online era. Skype, eBay and PayPal will create an unparalleled ecommerce and communications engine for buyers and sellers around the world.
“Communications is at the heart of ecommerce and community,” said Meg Whitman, President and Chief Executive Officer of eBay. “By combining the two leading ecommerce franchises, eBay and PayPal, with the leader in Internet voice communications, we will create an extraordinarily powerful environment for business on the Net.”
Founded in 2002 by Niklas Zennström and Janus Friis, Skype offers high-quality voice communications to anyone with an Internet connection anywhere in the world. The Skype software is easy to download and install, and enables free calls between Skype users online. Skype’s premium services provide low-cost connectivity to traditional fixed and mobile telephones. Skype’s software also offers a robust set of features, including voicemail, instant messaging, call forwarding and conference calling. Upcoming product innovations include Skype video, expressive content such as avatars, and customized toolbars for Outlook and Internet Explorer.
One of the fastest growing companies on the Internet, Skype already has 54 million members in 225 countries and territories. Skype is currently adding approximately 150,000 users a day and has created a thriving ecosystem of products, services, developers, and affiliates. Skype is considered the market leader in virtually all countries in which it does business. In North America alone, Skype has more users and serves more voice minutes than any other Internet voice communications provider.
“Our vision for Skype has always been to build the world’s largest communications business and revolutionize the ease with which people can communicate through the Internet,” said Niklas Zennström, Skype CEO and co-founder. “We can’t think of any better platform to fulfill this vision to become the voice of the Internet than with eBay and PayPal.”
“We’re great admirers of how eBay and PayPal have simplified global ecommerce and payments,” said Janus Friis, Skype co-founder and senior vice president, strategy. “Together we feel we can really change the way that people communicate, shop and do business online.”
Zennström and Friis will remain in their current positions. Zennström will report to eBay CEO Whitman and join eBay’s senior executive team.
A Powerful Ecommerce and Communications Engine
Online shopping depends on a number of factors to function well. Communications, like payments and shipping, is a critical part of this process. Skype will streamline and improve communications between buyers and sellers as it is integrated into the eBay marketplace. Buyers will gain an easy way to talk to sellers quickly and get the information they need to buy, and sellers can more easily build relationships with customers and close sales. As a result, Skype can increase the velocity of trade on eBay, especially in categories that require more involved communications such as used cars, business and industrial equipment, and high-end collectibles.
The acquisition also enables eBay and Skype to pursue entirely new lines of business. For example, in addition to eBay’s current transaction-based fees, ecommerce communications could be monetized on a pay-per-call basis through Skype. Pay-per-call communications opens up new categories of ecommerce, especially for those sectors that depend on a lead-generation model such as personal and business services, travel, new cars, and real estate. eBay’s other shopping websites — Shopping.com, Rent.com, Marktplaats.nl and Kijiji – can also benefit from the integration of Skype.
PayPal and Skype also make a powerful combination. For example, a PayPal wallet associated with each Skype account could make it much easier for users to pay for Skype fee-based services, adding to the number of PayPal accounts and increasing payment volume.
In addition, Skype can help expand the eBay and PayPal global footprint by providing buyers and sellers in emerging ecommerce markets, such as China, India, and Russia, with a more personal way to communicate online. And consumers in markets where eBay currently has a limited presence, such as Japan and Scandinavia, can learn about eBay and PayPal through Skype. Skype can also help streamline cross-border trading and communications.
With its rapidly expanding network of users, the Skype business complements the eBay and PayPal platforms. Each business is self-reinforcing, organically bringing greater returns with each new user or transaction. The three services can also reinforce and accelerate the growth of one another, thereby increasing the value of the combined businesses. Working together, they can create an unparalleled engine for ecommerce and communications around the world.
Transaction and Financial Information
eBay will acquire all of the outstanding shares of privately-held Skype for a total up-front consideration of approximately €2.1 billion, or approximately $2.6 billion, which is comprised of $1.3 billion in cash and the value of 32.4 million shares of eBay stock, which are subject to certain restrictions on resale.
The maximum amount potentially payable under the performance-based earn-out is approximately €1.2 billion, or approximately $1.5 billion, and would be payable in cash or eBay stock, at eBay’s discretion, with an expected payment date in 2008 or 2009. Skype shareholders were offered the choice between several consideration options for their shares. Shareholders representing approximately 40% of the Skype shares chose to receive a single payment in cash and eBay stock at the close of the transaction. Shareholders representing the remaining 60% of the Skype shares chose to receive a reduced up-front payment in cash and eBay stock at the close plus potential future earn-out payments which are based on performance-based goals for active users, gross profit and revenue.
The above-mentioned dollar and eBay share amounts are approximate, based on the Euro-Dollar exchange rate and eBay’s stock price as of September 9, 2005. The final value of the stock component of the consideration may vary significantly from this estimate based on the value of eBay stock at closing.
Skype generated approximately $7 million in revenues in 2004, and the company anticipates that it will generate an estimated $60 million in revenues in 2005 and more than $200 million in 2006. For Q4-05, eBay expects the acquisition to be dilutive to pro forma and GAAP earnings per share by $0.01 and $0.04 respectively. For the full year 2006, eBay expects the transaction to be dilutive to pro forma and GAAP earnings per share by $0.04 and $0.12 respectively, with breakeven on a pro forma basis expected in the fourth quarter of 2006. On a long-term basis, eBay expects Skype operating margins could be in the range of 20% to 25%.
The acquisition is subject to various closing conditions and is expected to close in the fourth quarter of 2005.
About eBay Inc.
Founded in 1995, eBay pioneers communities built on commerce, sustained by trust, and inspired by opportunity. eBay enables ecommerce on a local, national and international basis with an array of websites – including the eBay Marketplace, PayPal, Kijiji, Rent.com and Shopping.com – that bring together millions of buyers and sellers every day.
About Skype Technologies SA
Skype, the Global Internet Communications Company™, allows people everywhere to make free, unlimited, superior quality voice calls via its award-winning innovative peer-to-peer software for Windows, Linux, Mac OS X, and Pocket PC platforms. Skype is available in 27 languages and is the fastest growing voice communications offering worldwide. Since its launch in August 2003, Skype has been downloaded more than 163 million times in 225 countries and territories. Fifty-four million people are registered to use Skype’s free services, with over 3 million simultaneous users on the network at any one time. Skype Technologies SA is headquartered in Luxembourg and is growing its offices in London and Estonia.
Forward-Looking Statements
This announcement contains forward-looking statements regarding Skype and the expected impact of the acquisition of Skype on eBay’s financial results. Those statements involve risks and uncertainties, and actual results could differ materially from those discussed. Factors that could cause or contribute to such differences include, but are not limited to, the timing of the closing of the transaction, the possibility that the transaction may not close, the reaction of the users of Skype’s services, the future growth of Skype’s user base and public acceptance of Internet voice communication services, rapid technological changes in the Internet voice communications sector, the reaction of competitors to the transaction, global developments in the regulation of Internet voice communication services including those provided by Skype, the possibility that integration of Skype’s offerings following the transaction may be more difficult than expected, and the possibility that entry by Skype and eBay into potential new lines of business will not be successful. More information about potential factors which could affect eBay’s business and financial results is included in eBay’s Annual Report on Form 10-K for the year ended December 31, 2004, the company’s Quarterly Reports on Form 10-Q, and current reports on Form 8-K. All forward-looking statements are based on information available to eBay on the date hereof, and eBay assumes no obligation to update such statements.
Friday, October 07, 2005
Indian engineers good only at theory: Microsoft
India does not produce enough computer engineers and those it does are good at theory but not very well equipped to handle the practical aspects, according to Microsoft Corporation's Chief Technical Officer Craig Mundie, who is on a visit to India.
"India produces a lot of engineers. But the production of computer science engineers is low, pro rata.
"Computer engineers are more into theory and less in managing businesses, building businesses or writing source codes, the key to software development," Mundie told Business Standard.
Microsoft has a large number of Indian software engineers on its rolls in India as well as abroad. Out of the 2,000 people working for Microsoft in India, a sizeable proportion comprises software engineers. India produced 401,791 engineers in 2003-04, of which 35 per cent were computer engineers. The number increased to 464,743 in 2004-05, of which 31 per cent were computer engineers.
According to Mundie, the problem with the engineers can be attributed to policy issues. Universities in India, he said, did not get proper funding for research and were not directed towards software development. "The lack of trained staff is addressed by firms through internal arrangements for proper training," he said.
Besides, he said, India did not have enough software companies nor were enough companies developing India-specific applications.
"There are so few Indian software companies developing local software. That is a negative reinforcement, because there is no local software and no new applications," he said.
What Vinod Khosla is doing these days
"I recently visited Vinod Khosla, who since the 1980s has been a general partner in seven funds at VC firm Kleiner Perkins Caufield & Byers, which has funded such companies as Google, Genentech, and Sun Microsystems, where Khosla was a co-founder. Last year, when KPCB raised its eleventh fund, Khosla opted not to participate as a GP. Though he still keeps an office at the firm, he now invests his own money, sometimes alongside KPCB, sometimes with other VC firms, and sometimes solo. He is still a GP in past KPCB funds, some of which are fully invested but not yet fully distributed to limited partners. He manages his investments from those funds and serves on some boards on behalf of KPCB. But when making new investments, he bets only his own money. I asked him why he chose to go it alone and what he's up to.
When you walk into Khosla's office, the first thing you notice are the enlarged photos of his four kids that line the walls. There must be 20 or more pictures. Khosla says his kids are the main reason why he chose his current work arrangement. "For the next four or five years, they're all going to go through high school, and it's pretty important to me that I have the flexibility of my time and schedule," he says.
The new schedule also lets him devote time to ventures that aim for maximum social impact rather than maximum profit. Khosla is especially interested in social ventures that use Silicon Valley-style entrepreneurship to create self-sustaining organizations. Two weeks ago at the TiECon 2005 conference, he moderated a panel with some of the organizations he has been working with: Share Microfin Ltd., Aravind Eye Hospital, and Institute for OneWorldHealth.
Investing solo lets Khosla fund pet projects that many VCs wouldn't touch. "I can invest in more seed and speculative ventures," he says. Khosla has always had an interest in pure research that promises to produce breakthrough technologies--the kind of initiatives that don't yet fit neatly into a business plan. He calls them "science projects."
For example, he recently teamed with MIT professor Srini Devdas on a project they're calling Puffco. Devdas is developing a tiny chip that can uniquely identify an object and, according to Khosla, can't be counterfeited. Applications for the invention aren't yet certain. It could be placed inside a Rolex watch to ensure authenticity. It could be incorporated into radio frequency identification (RFID) tags to uniquely identify each tagged item. It could ship inside every laptop to make sure only a rightful owner gains access to stored contents.
Investing at the science-project stage is highly risky since the entrepreneur hasn't yet proven his or her technology can work, much less attract customers. But Khosla has experience with investing at that stage. Over half his investments at KPCB from 1996 to 2001 were infusions of $1 million or less into barely formed startups. That period was a golden era for him, giving rise to such hits as optical networking company Juniper Networks, which returned KPCB's invested capital over 1,000 times.
Investing alone also lets Khosla explore industries VCs have rarely funded in the past. Recently, he has looked at investing in bio refineries, which use sustainable crops or agricultural waste to produce fuel. He has also considered synthetic biology, the creation of new life forms (or alteration of existing life forms) through genetic engineering. He's also interested in fuel cells and solar cells.
He's still doing traditional VC deals, too. He recently invested alongside Sequoia Capital in a second round of funding for Beceem, a WiMax chip startup. In February, he invested with KPCB in Spatial Photonics, a display company. That deal has given him the opportunity to serve on the same board as KPCB general partner John Doerr--something he never got to do at KPCB since the firm assigns only one partner per board. He has also invested with KPCB in chipmaker eAsic and data center equipment maker Xsigo, where he serves on the board with KPCB general partner Ray Lane. After leaving the partnership, Khosla is finally getting to see his former partners in action."-Justin Hibbard (From BusinessWeek)
Wednesday, October 05, 2005
Adam Smith's theory of markets from the Internet-perspective.
"If every buyer knew every seller's price and every seller knew what every buyer was willing to pay, everyone in the "market" would be able to make fully informed decisions and society's resources would be distributed efficiently." - Adam Smith in his book, The Wealth of Nations.
Often a buyer doesnt have enough information when he goes into the market for shopping. This bottleneck can only be eliminated in this Information Age with the help of the Internet. Adam Smith's theory of markets can be implemented successfully if we can devise Internet-based applicatons that allow a buyer to have total information before making any purchasing decision. I think this is the future of e-commerce - providing full information to a buyer in an organized manner so that he can make an informed and wise decision.
Bill Gates in his book, The Road Ahead confirms that we are in the Information Age and in this age unlike previous ages, people wont fight for natural resources but will fight for Information. The more information you have and can sell the wealthier you become.
I think, to create an Internet application to provide full information about sellers to a buyer would be the next killer application and the right approach to conquer the e-commerce puzzle.
Often a buyer doesnt have enough information when he goes into the market for shopping. This bottleneck can only be eliminated in this Information Age with the help of the Internet. Adam Smith's theory of markets can be implemented successfully if we can devise Internet-based applicatons that allow a buyer to have total information before making any purchasing decision. I think this is the future of e-commerce - providing full information to a buyer in an organized manner so that he can make an informed and wise decision.
Bill Gates in his book, The Road Ahead confirms that we are in the Information Age and in this age unlike previous ages, people wont fight for natural resources but will fight for Information. The more information you have and can sell the wealthier you become.
I think, to create an Internet application to provide full information about sellers to a buyer would be the next killer application and the right approach to conquer the e-commerce puzzle.
Monday, October 03, 2005
The beauty of proactivity
You have a dream, an ambition, a vision that you believe is reasonable and will be accepted in the market. And you start taking steps in the direction to make that dream come true. Despite any number of initial setbacks you keep working and pretend that what you are doing is absolutely normal (though at the back of your mind you know that you are doing something extraordinary (not abnormal)) and believe that you can make that dream come true. That is the essence of proactivity. This is exactly what Bill Gates did and Steve Jobs did and any successful entrepreneur does. You need to dream up big things and push yourself and people to make that dream come true. Its not absolutely nessecary that your dream be as brilliant as Edison's idea of creating a bulb but the trick is to be proactive and have a genuine desire to serve the people by creating great products/services.
"Whatever the mind of man can concieve and believe, it can achieve."
Napoleon Hill
"Great men are those who see that thoughts rule the world"
Ralph Waldo Emerson
"Whatever the mind of man can concieve and believe, it can achieve."
Napoleon Hill
"Great men are those who see that thoughts rule the world"
Ralph Waldo Emerson
Friday, September 30, 2005
Definition of creativity
"If you've ever watched a child with a cardboard carton and a box of crayons create a spaceship with cool control panels, or listened to their improvised rules, such as "Red cars can jump all others," then you know that this impulse to make a toy do more is at the heart of innovative childhood play. It is also the essence of creativity." - Bill Gates.
New model for e-commerce
Say "online shopping" and there will emerge feelings of inconsistency, confusion, dis-trust e.t.c. Currently in India, people have only one reliable platform for e-shopping and thats eBay. I believe there are a lot of flaws in the eBay model and there are some appreciable facts also about it though.
My vision: There should be a better model/platform for online selling/buying, a website where sellers can sign up for free and run their business online. Buyers can sign up for free, log in and search for the particular product they are looking for and locate a buyer nearer to them who is selling the product for a reasonable price. There should be an easy to use User Interface, a very clean and uncluttered design, unlike eBay or Amazon that show hundreds of things on a single page and confuse the buyer.
If you have any ideas or have any complaints about the existing e-shopping models, please drop in an email (ahmed0101@gmail.com) or post a comment.
My vision: There should be a better model/platform for online selling/buying, a website where sellers can sign up for free and run their business online. Buyers can sign up for free, log in and search for the particular product they are looking for and locate a buyer nearer to them who is selling the product for a reasonable price. There should be an easy to use User Interface, a very clean and uncluttered design, unlike eBay or Amazon that show hundreds of things on a single page and confuse the buyer.
If you have any ideas or have any complaints about the existing e-shopping models, please drop in an email (ahmed0101@gmail.com) or post a comment.
Engineering, Science and Art
Whats common between Engineering, Science and Art? People generally dont tend to look at engineering/technology as an art.
Here is what Steve Jobs says about art and science: "I actually think there's actually very little distinction between an artist and a scientist or engineer of the highest caliber. I've never had a distinction in my mind between those two types of people. They've just been to me people who pursue different paths but basically kind of headed to the same goal which is to express something of what they perceive to be the truth around them so that others can benefit by it."
"I think the artistry is in having an insight into what one sees around them. Generally putting things together in a way no one else has before and finding a way to express that to other people who don't have that insight so they can get some of the advantage of that insight that makes them feel a certain way or allows them to do a certain thing. I think that a lot of the folks on the Macintosh team were capable of doing that and did exactly that.
If you study these people a little bit more what you'll find is that in this particular time, in the 70's and the 80's the best people in computers would have normally been poets and writers and musicians. Almost all of them were musicians. A lot of them were poets on the side. They went into computers because it was so compelling. It was fresh and new. It was a new medium of expression for their creative talents. The feelings and the passion that people put into it were completely indistinguishable from a poet or a painter. Many of the people were introspective, inward people who expressed how they felt about other people or the rest of humanity in general into their work, work that other people would use. People put a lot of love into these products, and a lot of expression of their appreciation came to these things. It's hard to explain." - Steve Jobs.
To unleash a killer app, we need to look at technology as an art, from a humanitarian perspective and think how we can create great products so that we can serve people better. There is nothing magical or mysterious about innovation. Innovation is nothing but how "YOU" look at things around you. Your own opinion about things. How you want things to be.
Here is what Steve Jobs says about art and science: "I actually think there's actually very little distinction between an artist and a scientist or engineer of the highest caliber. I've never had a distinction in my mind between those two types of people. They've just been to me people who pursue different paths but basically kind of headed to the same goal which is to express something of what they perceive to be the truth around them so that others can benefit by it."
"I think the artistry is in having an insight into what one sees around them. Generally putting things together in a way no one else has before and finding a way to express that to other people who don't have that insight so they can get some of the advantage of that insight that makes them feel a certain way or allows them to do a certain thing. I think that a lot of the folks on the Macintosh team were capable of doing that and did exactly that.
If you study these people a little bit more what you'll find is that in this particular time, in the 70's and the 80's the best people in computers would have normally been poets and writers and musicians. Almost all of them were musicians. A lot of them were poets on the side. They went into computers because it was so compelling. It was fresh and new. It was a new medium of expression for their creative talents. The feelings and the passion that people put into it were completely indistinguishable from a poet or a painter. Many of the people were introspective, inward people who expressed how they felt about other people or the rest of humanity in general into their work, work that other people would use. People put a lot of love into these products, and a lot of expression of their appreciation came to these things. It's hard to explain." - Steve Jobs.
To unleash a killer app, we need to look at technology as an art, from a humanitarian perspective and think how we can create great products so that we can serve people better. There is nothing magical or mysterious about innovation. Innovation is nothing but how "YOU" look at things around you. Your own opinion about things. How you want things to be.
Monday, March 21, 2005
Creating Indian Entrepreneur - Rajat Gupta, ex-CEO, McKinsey.
Rajat Gupta
India Today
February 12, 2001
India needs entrepreneurs. It needs them for two reasons: to capitalise on new opportunities and to create wealth and new jobs. A recent McKinsey & Company-Nasscom report estimates that India needs at least 8,000 new businesses to achieve its target of building a $ 87 billion IT sector by 2008. Similarly, in the next 10 years, 110-130 million Indian citizens will be searching for jobs, including 80-100 million looking for their first jobs; that's seven times Australia's population. This does not include disguised unemployment of over 50% among the 230 million employed in rural India. Since traditional large employers – including the government and the old economy players – may find it difficult to sustain this level of employment in the future, it is entrepreneurs who will create these new jobs and opportunities.Fortunately, today's knowledge-based economy is fertile ground for entrepreneurs in India. The success stories of businesses built on a great idea executed by a talented team have great appeal in India, where access to capital is scarce and regulation has often created barriers to success. And young Indians have a dream: to be the next Sabeer Bhatia of India. Estimates indicate that several thousand 'new economy' businesses were launched last year in India. This is not just a "big-town" phenomenon. For example, when McKinsey & Company launched India Venture 2000, a business plan competition to catalyse entrepreneurship in India, many of the 4,500 teams that participated were from small towns such as Meerut, Siliguri, Warangal and Pollachi.I believe India has an extraordinary talent pool with virtually limitless potential to become entrepreneurs. India must, however, commit to creating the right environment to develop successful business builders. To do this, I believe India must focus on four areas.
1. Create the right environment for success: Entrepreneurs should find it easy to start a business. To do so, most Indians would start slow with capital borrowed from family and friends, the CEO playing the role of salesman and strategist, a professional team assembled months or perhaps years after the business was created, and few, if any, external partners. Compare this with a start-up in the Silicon Valley: a Venture Capitalist (VC) or angel investor would be brought in early on; a professional management team would drive the business; a multifunctional team would be assembled quickly; and partnerships would be explored early on to scale up the business.To a large measure, culture shapes this style. Silicon Valley is abuzz with ideas to build global businesses; deals are continually being negotiated, teams are pulled together and partners are identified. There is almost unlimited access to multiple VCs and angel investors. Critical support services abound, including professional managers, legal firms, venture capitalists, angel investors, and placement agencies. Combine this with excellent infrastructure – connectivity, communication, and office space – and getting started is easy.A first challenge for India is to create a handful of such areas of excellence – the breeding ground where ideas grow into businesses. Some already exist in a very preliminary way (the businesses are there). For example, Gurgaon and Hyderabad for remote services, or Bangalore for IT services. But these areas of excellence need strengthening before they can claim to be India's own "Valley." One way of strengthening these areas is to consider the role of universities and educational institutions - places where excellence typically thrives. Creating such educational institutions by strengthening the Indian Institutes of Technology (IIT's) and starting new ones is going to be very important.
2. Ensure that entrepreneurs have access to the right skills: A survey McKinsey & Company conducted last year revealed that most Indian start-up businesses face two skill gaps: entrepreneurial (how to manage business risks, build a team, identify and get funding) and functional (product development know-how, marketing skills, etc.). In other countries, entrepreneurs either gain these skills by hiring managers or have access to "support systems" such as universities or other institutions that may nurture many regional businesses. In addition, business schools give young graduates the skills and knowledge required for business today. India can move toward ensuring that the curriculum at universities is modified to address today's changing business landscape, particularly in emerging markets, and to build 'centres of entrepreneurial excellence' in institutes that will actively assist entrepreneurs. We believe the Indian School of Business (ISB) at Hyderabad provides a start in developing outstanding entrepreneurial leaders. ISB's program is designed primarily to prepare managers to respond to the challenges of rapidly changing business environments. Within an environment of intellectual vibrancy, the 500+ students who graduate each year will have studied entrepreneurship, strategy and the impact of technology on commerce. They will have spent time developing their own projects, while utilising state-of-the-art communications technology to interact with members of industry and experts worldwide. The ISB will have an Entrepreneurship Centre founded, led and managed by several leading Silicon Valley entrepreneurs, who are on the school's Governing Board. The Centre will help students become successful entrepreneurs by offering a diverse set of programmes, activities and facilities such as a New Business Development Project, an on-campus incubator, an Entrepreneur-in-Residence programme, field projects, and a Young Entrepreneurs Club.
3. Ensure that entrepreneurs have access to 'smart' capital: For a long time, Indian entrepreneurs have had little access to capital. It is true that in the last few years, several Venture Funds have entered the Indian market. And, while the sector is still in its infancy in India (with estimated total disbursements of <$ 0.5 billion last year), VCs are providing capital as well as critical knowledge and access to potential partners, suppliers, and clients across the globe. However India has only a few angel investors who support an idea in the early stages before VCs become involved. Our experience during India Venture 2000 showed this to be a critical gap. While associations such as TIE are seeking to bridge the gap (by working at creating a TIE India Angel Forum), this is India's third challenge: creating a global support network of 'angels' willing to support young businesses.
4. Enable networking and exchange: Entrepreneurs learn from experience - theirs and that of others. Much of the success of Indians in Silicon Valley is attributed to the experience, sharing and support TIE members have extended to young entrepreneurs. During India Venture 2000, we were delighted by the eagerness with which established entrepreneurs, who still remembered the challenges they faced, offered to support start-ups. Clearly, India would benefit from creating a strong network of entrepreneurs and managers that entrepreneurs could draw on for advice and support.The rapid pace of globalisation and the fast growth of Asian economies present tremendous opportunities and challenges for India. Through planning and focus, India can aspire to create the pool of entrepreneurs who will be the region's – and the world's – leaders of tomorrow. Rajat Gupta is the Managing Director of McKinsey & Company and also the Chairman of the Board of Governors of the Indian School of Business.
This article was first published in India Today, February 2001.
India Today
February 12, 2001
India needs entrepreneurs. It needs them for two reasons: to capitalise on new opportunities and to create wealth and new jobs. A recent McKinsey & Company-Nasscom report estimates that India needs at least 8,000 new businesses to achieve its target of building a $ 87 billion IT sector by 2008. Similarly, in the next 10 years, 110-130 million Indian citizens will be searching for jobs, including 80-100 million looking for their first jobs; that's seven times Australia's population. This does not include disguised unemployment of over 50% among the 230 million employed in rural India. Since traditional large employers – including the government and the old economy players – may find it difficult to sustain this level of employment in the future, it is entrepreneurs who will create these new jobs and opportunities.Fortunately, today's knowledge-based economy is fertile ground for entrepreneurs in India. The success stories of businesses built on a great idea executed by a talented team have great appeal in India, where access to capital is scarce and regulation has often created barriers to success. And young Indians have a dream: to be the next Sabeer Bhatia of India. Estimates indicate that several thousand 'new economy' businesses were launched last year in India. This is not just a "big-town" phenomenon. For example, when McKinsey & Company launched India Venture 2000, a business plan competition to catalyse entrepreneurship in India, many of the 4,500 teams that participated were from small towns such as Meerut, Siliguri, Warangal and Pollachi.I believe India has an extraordinary talent pool with virtually limitless potential to become entrepreneurs. India must, however, commit to creating the right environment to develop successful business builders. To do this, I believe India must focus on four areas.
1. Create the right environment for success: Entrepreneurs should find it easy to start a business. To do so, most Indians would start slow with capital borrowed from family and friends, the CEO playing the role of salesman and strategist, a professional team assembled months or perhaps years after the business was created, and few, if any, external partners. Compare this with a start-up in the Silicon Valley: a Venture Capitalist (VC) or angel investor would be brought in early on; a professional management team would drive the business; a multifunctional team would be assembled quickly; and partnerships would be explored early on to scale up the business.To a large measure, culture shapes this style. Silicon Valley is abuzz with ideas to build global businesses; deals are continually being negotiated, teams are pulled together and partners are identified. There is almost unlimited access to multiple VCs and angel investors. Critical support services abound, including professional managers, legal firms, venture capitalists, angel investors, and placement agencies. Combine this with excellent infrastructure – connectivity, communication, and office space – and getting started is easy.A first challenge for India is to create a handful of such areas of excellence – the breeding ground where ideas grow into businesses. Some already exist in a very preliminary way (the businesses are there). For example, Gurgaon and Hyderabad for remote services, or Bangalore for IT services. But these areas of excellence need strengthening before they can claim to be India's own "Valley." One way of strengthening these areas is to consider the role of universities and educational institutions - places where excellence typically thrives. Creating such educational institutions by strengthening the Indian Institutes of Technology (IIT's) and starting new ones is going to be very important.
2. Ensure that entrepreneurs have access to the right skills: A survey McKinsey & Company conducted last year revealed that most Indian start-up businesses face two skill gaps: entrepreneurial (how to manage business risks, build a team, identify and get funding) and functional (product development know-how, marketing skills, etc.). In other countries, entrepreneurs either gain these skills by hiring managers or have access to "support systems" such as universities or other institutions that may nurture many regional businesses. In addition, business schools give young graduates the skills and knowledge required for business today. India can move toward ensuring that the curriculum at universities is modified to address today's changing business landscape, particularly in emerging markets, and to build 'centres of entrepreneurial excellence' in institutes that will actively assist entrepreneurs. We believe the Indian School of Business (ISB) at Hyderabad provides a start in developing outstanding entrepreneurial leaders. ISB's program is designed primarily to prepare managers to respond to the challenges of rapidly changing business environments. Within an environment of intellectual vibrancy, the 500+ students who graduate each year will have studied entrepreneurship, strategy and the impact of technology on commerce. They will have spent time developing their own projects, while utilising state-of-the-art communications technology to interact with members of industry and experts worldwide. The ISB will have an Entrepreneurship Centre founded, led and managed by several leading Silicon Valley entrepreneurs, who are on the school's Governing Board. The Centre will help students become successful entrepreneurs by offering a diverse set of programmes, activities and facilities such as a New Business Development Project, an on-campus incubator, an Entrepreneur-in-Residence programme, field projects, and a Young Entrepreneurs Club.
3. Ensure that entrepreneurs have access to 'smart' capital: For a long time, Indian entrepreneurs have had little access to capital. It is true that in the last few years, several Venture Funds have entered the Indian market. And, while the sector is still in its infancy in India (with estimated total disbursements of <$ 0.5 billion last year), VCs are providing capital as well as critical knowledge and access to potential partners, suppliers, and clients across the globe. However India has only a few angel investors who support an idea in the early stages before VCs become involved. Our experience during India Venture 2000 showed this to be a critical gap. While associations such as TIE are seeking to bridge the gap (by working at creating a TIE India Angel Forum), this is India's third challenge: creating a global support network of 'angels' willing to support young businesses.
4. Enable networking and exchange: Entrepreneurs learn from experience - theirs and that of others. Much of the success of Indians in Silicon Valley is attributed to the experience, sharing and support TIE members have extended to young entrepreneurs. During India Venture 2000, we were delighted by the eagerness with which established entrepreneurs, who still remembered the challenges they faced, offered to support start-ups. Clearly, India would benefit from creating a strong network of entrepreneurs and managers that entrepreneurs could draw on for advice and support.The rapid pace of globalisation and the fast growth of Asian economies present tremendous opportunities and challenges for India. Through planning and focus, India can aspire to create the pool of entrepreneurs who will be the region's – and the world's – leaders of tomorrow. Rajat Gupta is the Managing Director of McKinsey & Company and also the Chairman of the Board of Governors of the Indian School of Business.
This article was first published in India Today, February 2001.
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