Q: What are some of the little-known pitfalls or common mistakes founders make on the road to developing tech startups in India?
The most important element for a successful business is having both technological and social innovation at the core of the business. However, when you are seeking to make change there will always be obstacles. They may involve recruiting the best talent, finding adequate funding, marketing efficiently, or training your workforce. That is true anywhere in the world, not just in India.
Q: How can these pitfalls be avoided?
Have the courage to step out of a system that no longer serves you or the world and do things in a different way. In the 1970s, dedicated labor in India was hard to find. The men who typically filled entry-level assembly positions would hop from town to town in search of other options. The costs of constantly training new workers added up quickly. So I stopped hiring men. They could find jobs anywhere. Women, on the other hand, were legally prohibited from working at night. Families often didn’t want them to work because of cultural reasons and no jobs were available to them anyway. But I saw these women as an untapped pool of industrial talent so I hired an all-female electronic assembly team. These women delivered a strong work ethic, loyalty and superior manual dexterity for high-precision electronics assembly.
In this case, the pitfall was the lack of a reliable labor pool, and the solution was to find a way to hire women. The goal isn’t always to avoid pitfalls, but to use innovative thinking and a genuine willingness to embrace change so you can find solutions to inevitable challenges.
Q: Can you share an example of how Tandon Group has helped a tech startup overcome obstacles and succeed in India?
Under the leadership of my sons, Sandeep, Jaideep and Sudeep, Tandon Group has focused on investing in tech startups and operating successful companies in India since the early 2000s. One of our most successful startup companies is FreeCharge, which was sold to SnapDeal in India’s largest M&A internet deal. Sandeep co-founded FreeCharge with Kunal Shah, who was one of our business process managers at the time, and Sudeep joined the company later to scale it. Together, they helped FreeCharge get its operations off the ground and double its user base by tapping into the increased penetration of smartphones in India. This has enabled the market to leap from a 90-percent cash-based economy to cardless digital payments. Banks and telecommunication companies had struggled to get Indian consumers online. FreeCharge saw, and capitalized on, the opportunity to target a population with more access to mobile phones than access to the Internet. Getting consumers online required a major change in thinking, but FreeCharge had the courage to bring a good idea to market and they have transformed the way Indians pay.
To help FreeCharge find success despite the obstacles inherent in establishing an entirely new method of payment, Tandon Group helped in recruiting retail partners, nurturing relationships with banks and telecommunications companies to build out the payment platform, raising funds, driving sales, and facilitating hiring for key positions in the company. Each of those elements was necessary to overcoming the central obstacle.
Q: What’s the most important question startup founders should ask themselves as they consider developing tech startups in India?
India has a thriving economy and entrepreneurship is coming of age right now. Indian entrepreneurs are passionate about solving big problems and making significant change. It is an appealing place to launch your start up. But, you would be wise to consider how much you know about the culture, government and regulations. India is now more welcoming to tech startups than ever before, but you may need to find partners to help you navigate government rules and regulations.
Q: Can you share a lesson you learned early on, that still impacts how you do business today?
Social innovation isn’t just the right thing to do, it’s a key marker of success. You are not only the creators of new standards and technologies; you are the creators of new perceptions that change people’s lives for the better. Also, you need to respect every individual on your team. No matter who they are, trust in their ability to do what you want them to do. No matter how big or small the job is, every person is important. Empower your team to take ownership of their work and keep your mind, ears and door open to them. Make your ideas big and keep your business small and nimble enough to succeed. Approach problems with innovation and tenacity, economically and socially. Think different and do well.
Tandon Group has offices in San Jose, Mumbai and Singapore. You can learn more at TandonGroup.com.