Just saw a post from Om Malik's GigaOM http://gigaom.com/2007/01/21/private-equity-continues-to-pour-into-india/
that talks about VC money pouring into india.
I've been thinking about having something like the Standford university's support system for their graduates. It's important to catch them young -- I believe with the growing number of engineering graduates who also pursue an MBA, some of these graduates can be enticed to starting their own provided there's some infrastructure, advice and Capital. The capital can be Angel or VC funding.
Interesting to watch the space unfold itself.
I think a lot of it has to with the type of business. For services businesses, VC's can help with market access in the US, but less so on recruiting and operational expertise. For product companies, particularly those focused on the Indian market, the situation is exactly reversed: VC's can help with operational expertise and recruiting product talent from more product markets (like the US).
I cannot agree more with you on points 1 to 4. One of my friends wants funding for primarily one reason: So he can get good employees. The cash will be used for a "glass covered" building  and to impress upon potential employees about the "people behind the company".
Options are toilet paper. Salaries are predatory. Great work is an illusion. When prestige matters and that's what is left, venture capital is king, it seems.
 Most buildings in Bangalore are plain crappy to look at. A glass facade provides a sophisticated look that employees seem to like - and desire. After working in a glass building they don't want to "downgrade" to where the concrete is visible - to my chagrin at my last startup.
I come across your blog through Himanshu's blog. Gr8 Analysis & research you are doing in the area of Enterpreneour, VC funding, Indian economy(India Poised).
Informative blog you have.(first impression).
I totally agree that VC firms can create wonders. After all its money that important to play any game. If you have money you can hire good men, get better quality and in return better projects and good client base.
VC (monmey) act like oil that can make any machine run like anything.
One thing that comes to my mind is why VC are limited to big or mid size companies. If a small company is looking for funds no one will come ahead. Every one wants to pay big games. If apart from Indian govt takes interest and gives helping hands to these small start ups then sooner or later these companies can also leave a land mark.
When i wanted to start a firm i didn’t get any help from any VC or Indian Govt what i got was tons of paper work. I don’t should i follow up clients for projects or follow Indian govt to fill this paper’s
I am still looking for helping hand.
Imho, the biggest value that a VC can bring to a startup is help build an ecosystem in distribution and customer acquisition, the two parameters that can go a long way in making the enterprise valuable. I am not discounting the importance or value of cash.
Another contribution is to build the team (non-technical) by bringing in performing CEOs to manage the operations so that the founders can focus on building great products. I am reminded of the Google Story where the VCs pressured the founders to bring in Eric Schmidt.
VCs also ought to look at smaller amounts (in terms of their investment) so that they can really catalyze many startups rather than look at a few.
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