Learning to love discontinuity

Written by Ganesh Natarajan | Updated: Oct 22 2012, 09:06am hrs
Does anybody remember the great dotcom boom that happened in the last decade of the previous century The great hype around the proliferation of the internet and the world wide web, the irrational euphoria that created new measures of business and financial success like eyeballs and page hits rather than revenues and profits and the not unexpected denouement where the great drama ended with an almighty crash! As my leadership guru then and now Dean of Harvard Business School Nitin Nohria once said, every HBS student of those years wanted to set up a dotcom, not because they saw great value but because you could not be young and intelligent in those days and not be part of the great new gold rush that the internet economy presented!

Speaking at the opening session of the first Emergeout conference for start-up and emerging companies organised by Nasscom in Pune recently, it was heartening to see the hundreds of bright young entrepreneurs and entrepreneur wannabes who listened to successful CEOs who had done a credible job building companies from infancy through the trials and tribulations of early stage legitimacy, and seen them through the scaling process to success. The conference itself could not have been more timely because there are exciting technology pushes happening through the rapid deployment of broadband in the country and the stabilisation of cloud computing, enterprise mobility and other potential extensions of the realm of influence of corporations are providing the demand pulls that should open up ample opportunity for innovative start-ups.

The start-up potential in the technology space is not just in the internet and e-commerce area, though that certainly is one of the fastest growing entrepreneurial opportunities. However if one has to avoid a repeat of the dotcom boom and bust cycle, young starry eyed innovators should look for real discontinuities or asymmetries in traditional value propositions and invest in getting exhaustive customer insights before plunging headlong into new ventures. Fortunately, the angel and venture capital community in the country, many of them burnt in the euphoria a dozen years ago, will also be more circumspect and ask the right questions.

A few investments I have personally been associated with along with colleagues from the Indian Angel Network will serve to elucidate this. Sapience, a company that designs software for polling activity on computers is a much awaited capability enhancement for software and financial services companies that would like to avail the benefits of hot desking and home working but would still want to keep tabs on the efforts put in by their associates. And Aurus Networks is an exciting new company set up by two recent IIT Kanpur graduates that enables learning and tutoring to be done through the internet more effectively by disaggregating video content.

In simple terms it means that the choice of content is determined by the bandwidth available at the learners end. Full video can be received in the big cities while the video can be intermittent in towns but the learning content and audio can still be received. And in really deprived locations, only audio can be streamed and the content sent in advance to ensure that the learning can still happen with near 100% effectiveness

Why are Sapience and Aurus and a few other Made in India start-ups good examples of innovative thinking They exploit a discontinuity in service that may be temporary but still provide a good business opportunity to be commercially exploited. It is very likely that the broad sweep of the broadband revolution will make the unique selling proposition of Aurus less valuable, but evolutionary processes will see them monetise their customer bases for a new range of services. And more output and outcome based measures might make it less essential to poll the actual time spent on computers but Sapience will be planning new ways of adding value, for the company and the individuals.

The imperatives for building a businessa continually refreshed value proposition, a team that possesses the complementary skills needed for any successful company and adherence to the old maxim Never run out of cash must be followed and there is no doubt that tens of thousands of young and old folk will explore find local and global opportunities and keep painting new pictures on the canvas of global entrepreneurship.

The dotcom phase was a heady time for all of us and having been part of one successBconnectB, a business to business extended enterprise platform for companies and a few failuresElectraworks, Cinexplore etc, I can vouch for the fact that excitement pervades the start-up scene. It does not really matter who succeeds and who fails, it is the lessons one learns that serve the individual and the society well as new industries emerge and flower to keep the economic activity in the country humming at a brisk pace.

The writer is vice-chairman & CEO of Zensar and chairman of the National Knowledge Committee of the CII