On Saturday, June 16, I arrived in New Delhi with my colleagues for a fact finding meeting of angel investors, and entrepreneurs. Amy Millman, CEO of Springboard Enterprises, and serial entrepreneur Shoba Purushothaman (2002 Springboard alum), were seeking advice about the state of angel and venture investing in New Delhi, and in general in India, with no preconceived outcome in mind.
Springboard Enterprises is a venture catalyst organization that selects, trains and presents women entrepreneurs to raise venture capital. We were delighted to meet with Padmaja Ruparel, president of the Indian Angel Network (IAN) which is 300 members strong, and Geetika Dayal, executive director of The Indian Entrepreneurs (TIE), in Delhi. They had helped us to assemble a group of women entrepreneurs, lawyers and accountants working in the angel and venture community. All were women with the lone exception of Sanjeev Kakar -- angel investor and incubator founder who exhibited bravery in joining the group.
What we learned was enlightening and defined for us the status of the entrepreneur in a culture that has only been emerging for the past 20 years from the influence of British rule. Remarkably, we learned that only 50 angel investments had been made in the entire country of India in 2011.
This is startling, considering the high level of success Indian entrepreneurs have in the US. Surely this was a class of entrepreneurs who understand the risk and rewards of angel and venture investing, However, the acceptance of failure, so ingrained in the culture of Silicon Valley, had not yet made its way back to the India in a meaningful way.
The free flow of capital in the U.S. was what attracted these Indian computer scientists, mathematicians, and life science specialists to become entrepreneurs. Now, they are attempting to build the ecosystem in India that supports the risk inherent in the capital markets of the U.S.
It was illuminating to hear the eight women entrepreneurs in the room tell us they were battling not only the lack of early stage capital, but a cultural expectation that they would stay home to serve their families' needs. So while women comprised a significant number of students in mathematics, engineering, computer sciences and other skills, they often worked in corporations and government for a few years until they had children and then drop out to stay at home.
Among those we heard from was Puja Arora, founder and CEO of School Admissions, who launched a business in 2008 to fill a need she had while raising her toddler son. She wanted to register him for nursery school, but found the process highly confusing. She started working with nursery schools to put together a data base of each schools' offerings which resulted in a searchable database for parents looking to place their children in quality nursery schools. Now four years later, Puja has gained financial backing from the Indian Angel Network (IAN) and is looking to scale her business beyond Delhi to other cities throughout India She expressed frustration with the general lack of capital. She is solving a significant problem for families with young children by making the application process an open platform and she has chosen a freemium business model to support growth. She is on the hunt for growth capital.
Another promising business, Fleximoms, was co-founded by Sairee Chahal. Her firm offers flexible work hours and locations, allowing women to work from home during critical child-raising years. She explained, " There just isn't a reliable child care network in India that women can rely on, yet there are women who want to continue to work from their home environment." These women include engineers, software developments, educators and a host of other skills. She conducts classes on how to enter the workforce, and takes her talent roster to corporations, offering to fill open posts with a combination of skilled workers.
My biggest frustrations," Sairee offered, "are the women who say they want to start a business, many of which are lifestyle businesses. We have start up classes and offer mentoring to get them into the market, but often they drop out for lack of ambition or support. We are trying to get them over that fear of the start up."
Undoubtedly, one of the successful early stage companies is Fashion and You, launched by engineer Pearl Uppal to transfer the successful flash sale business to India Having launched in November 2009, she obtained early stage funding from a European partner, who introduced her to Norwest Venture Partner and Sequoia Capital. Having raised $40 million, she is scaling her business rapidly to fulfill the apparel and accessory desires of Indian women to obtain global designs. She intends to launch in the Middle Eastern countries soon.
My take-away? We were encouraged by the open discussion and the expressed expectation of rapid growth even though the entrepreneurial market is nascent in India.
This was the first of several meetings we had in New Delhi, but the perception of the challenges and opportunities was beginning to take shape. The ecosystem needs formation, education, incubators, funding and human capital to bring this market to fruition. We were, however, impressed with the conviction of the people we met, to build an extraordinary platform for entrepreneurs, and getting in on the ground floor.