Will we have Google or Facebook in India?
The start-up ecosystem in India is strong. It may not be as big as Silicon valley, but it is definitely going in a good direction. The Mint based on Rajan Anandan’s input has put 100 unicorns by the year 2025 despite the impact of covid in India. But, I have always thought about one question, is there a company which would be big like Google or Facebook in India?
These companies started in silicon valley, which has unfettered access to world outstanding educational institutes like Stanford university. These companies were founded by great thought leaders and have hired the best tech talent in the world. The strong and relatively homogeneous economy of the US has also allowed a good breeding market for these companies.
The other country to look for is China, where we arguably have companies of similar size and huge potential like those of these US giants. The chinese behemoths have benefited from the tech talent of China, and also from a larger market access of the domestic market. Another reason for such large companies to have had a great support of the chinese government and the manner in which it did not allow the foreign competitors to make inroads in the domestic market.
Europe has fewer global tech giants to its list like spotify and booking.com. EU is a rather heterogeneous market with different languages and different consumer mindsets. It is home to great universities, but the economy is not as open as the US for immigration. Unfettered access to the market has allowed foregn companies (from US and China) dominating EU markets.
In India, the market is a mix of the above.
The investment of the US tech giants in Jio has created a new behemoth in India. Amazon has continued to make huge inroads in the market and so has facebook (esp whatsapp) and Google. This means that the new startups will have to compete with the US+China+Jio giants in the country.
There is no dearth of tech talent in India and there is a good amount of reverse brain drain from western economies, which adds to the talent pool.
India is a heterogeneous market like Europe, though arguably urban India is pretty homogenous in terms of English being the single language and consumer habits largely urban / young.
Government is supportive of the startups, but it is nowhere near what the chinese government does.
Corruption and the changing regulatory environment further adds instability.
Based on this it is pretty hard to say whether India will be like the US / China or more like Europe.
But I feel the above factors, albeit important, are not the main factors for creating giants in India. I think there is a mindset change that is needed for India to have large tech giants.
One mindset is to focus on long term customer value rather than immediate revenue opportunities. There is a pressure on Indian startups to show profitability earlier than the US peers. Many startups in the US are building great products before getting them monetized.
The other is our work culture, which still remains somewhat hierarchical, with a lesser element of safety / autonomy. People should be able to discuss freely, openly question and debate ideas. With the top driven culture (even in startups), it would be hard for Indian startups to create such an environment.
I believe these factors make me pessimistic in believing this story. In the end, I am desperately hoping that I am proved wrong.
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