The Valley advantage

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: Kamla Bhatt, is a researcher and a technology trend watcher. She is also the host of a popular Internet radio show: http://kamlabhattshow.com

We have all heard or read that Silicon Valley is different and this is the place to be in if you want to set up a startup in technology, bio-engineering or cleantech or whatever the latest tech trend is. I did not realise how many people within the Valley were oblivious to the eco-system and the enormous advantages they have over other entrepreneurs until recently.

A couple of months ago I met an American entrepreneur, who grew up and went to school in the San Francisco Bay area. During his downtime he came up with an idea for a startup and decided to pursue that idea and started building a prototype of his concept in his living room. So that is what he wanted to talk about and show me when we met. So, there we were sitting in the unlikeliest of places — Costco, which is a huge retail chain that resembles a warehouse. He mentioned how a couple of days earlier he got references to an entrepreneur and a venture capitalist from a parent in his little girl’s school. Now, that is something that is unlikely to happen in any other part of the world I told him and he was surprised to hear that.

Since I had just returned after a four month stint in Bangalore I had a pretty good idea of how entrepreneurs were bootstrapping and struggling to find mentors and right people to use as sounding boards for their ideas.

After my conversation with the American entrepreneur I decided to poll a few of Indian origin and find out what they had to say about Silicon Valley and what makes it a unique place to live in and work and create products. The basic ingredients to build an eco-system are people, money and knowledge. “Silicon Valley magic is a key ingredient. It allows us to think on a bigger scale, ready and mature eco-system expedites execution,” points out Brij Singh co-founder of Message Dance, a social media company. I ask Brij what else is there about Silicon Valley that is different. He replies, “Elsewhere you need to struggle to overcome eco-system hurdles. Difficulty in getting a lawyer who can work on equity basis in Bangalore is just one such example.”

Finding the right people besides technologists and engineers are people like lawyers, accountants, operations, sales and others. As Brij pointed out, finding a lawyer to work on equity basis in Bangalore is not an easy task. And for that matter I would guess finding an accountant or operations guys for a small team of unproven entrepreneurs in Bangalore might be a big challenge. But, here in Silicon Valley you will find people who are willing to work on sweat equity with unproven teams.

Finding money in Silicon Valley has gotten relatively easy over the years. There is Sand Hill Road, the Mecca of the Venture Capital world, angel investors, high net worth individuals and banks, who are easily accessible to pitch and get funding for your startup. You will find investors that are willing to fund you at various stages of the company.

And then there is the final piece knowledge or education in the form of Stanford University and University of California at Berkeley. Stanford has a vibrant environment where entrepreneurship is encouraged and nurtured. There are plenty of mentors available to provide the necessary hand-holding and to act as sounding board for your ideas. For instance, take Rahul Thathoo, who just graduated from Stanford and while there managed to rake in quite a few greenbacks developing Facebook applications along with Suchit Agarwal, a former classmate from India.

A few days ago Rahul and Suchit launched their next startup: Internwaala, which they describe is like Naukri for interns. Think of the duo as serial entrepreneurs. Last year these two former classmates started a Facebook application that got them millions of visitors and enough revenue to fund their education and their next startup. “Anything new (well most of the times, at least) that is being brought to the industry starts here at the Valley. Riding the facebook apps wave was one of the most fun and challenging experiences ever, and this would definitely not have been possible anywhere else in the world,” says Suchit.

Not everything about the Valley is rosy and pretty. There are lots of failures, failed startups and broken dreams. As Rahul put it, “Of course you see a lot of success in the valley, but it also hides a huge number of failures as well. But then again that is all part of the eco-system. You learn a lot from these failures. So, all in all, Silicon Valley in the place to be!”