Nurturing Success in India
Almost anyone can tell you how to get to the Indian Institute of Technology in Bombay. You have to voyage through old India to arrive in the new India. Drive past picturesque Lake Powai, navigate the partially built bridge, jostle for space with scooter taxis, pedestrians, and perspiring policemen until you reach the gateway to the institute. As you enter, the noise of the street recedes, and the serene, tree-lined, airy campus comes into full view.
Once inside, try to locate a building called SINE, or the Society for Innovation & Entrepreneurship. That's where, it's said, the real new India lies -- if you can only find it. Deep inside the institute's grounds there's a derelict, four-story structure that looks as if it was bombed decades ago. There are no signs of life on the pock-marked cement of the ground level; nothing stirs in the silence.
But climb the wide staircase to the third floor, and suddenly, the new India appears. The marble-tiled floors are clean. The air conditioning works. Young men and women in T-shirts and khakis are busy conferring. And each of the dozen or so rooms is crammed with people peering into computer screens.
SINE is a business incubator where ideas from IIT Bombay students, professors, and alumni can be developed and commercialized. Today there are 15 companies at SINE, all of them hoping to become new India's next big phenomenon.
Perhaps the most exciting is called Webaroo. The company offers a service that lets you search for and download Web pages -- with, say, tourist information about London, or the latest news from several different sites -- to your PC, cell phone, or handheld. Then you can quickly access the content without being online.
"We need the best software engineers," says Rakesh Mathur, Webaroo's founder and an IIT-Bombay alumnus and veteran Silicon Valley entrepreneur. "Here, we have them." In spades. About 75 of Webaroo's 100 engineers are from the IITs, and all of them work in cramped quarters at SINE.
SINE is also a one-stop shop for venture capitalists looking for smart ideas coming out of India. And contrary to expectation, not all of SINE's companies are software outfits. A professor in earth sciences is building India's first geothermal power plant. A company called FEAST Software is writing programs that allow auto-parts makers to test the endurance of their components. And Eisodus Networks makes a low-cost broadband switch.
HOME AND ABROAD.
Eisodus, founded by an IIT-Bombay aeronautics professor, says its product will replace gear made by Cisco. It has signed up Indian phone companies such as MTNL and has Tata, Bharti, and Reliance as clients. "Initially India will be our market," says Eisodus CEO Sunil Mehta, "and then we'll start marketing globally."
Vispi Daver, a principal at VC firm Sierra Ventures in Menlo Park, Calif., likes that attitude. When he visited in April, Daver says he was impressed by the number of companies at SINE that aim to sell in India first, but that are all "international plays."
Daver figures the opportunity in India alone is enormous, with companies buying lots of technology and consumers buying ever more goods. Although relatively little venture capital has so far been put into products to be sold in India, "there's an emerging entrepreneurial ecosystem for products here," Daver says.
SINE itself is an investor in the startups it nurtures. In exchange for offering office space and use of its facilities at about 75% of the market rate, the incubator takes an equity stake in the companies. That works especially well for IIT professors such as Girish Saraph, who teaches electrical engineering and is working on software that eliminates the delays and static in telecom networks -- a requirement for sensitive banking operations, he says.
OUT OF THE NEST.
His company, Vegayan Systems, already has $75,000 in funding from U.S. venture capital firm Draper, Fisher, Jurvetson. "It's a big thing for us," says Saraph. "We can participate in the boom without the risk of having to quit our jobs."
However, the babying at SINE doesn't last forever. After three years the benefits stop, and companies must decamp. Eisodus, for example, is moving to its own space in Bombay in May. Other fledglings will take its place. Poyni Bhatt, SINE's chief administration officer, gets scores of applications a month but seriously considers only about a dozen a year.
The center is already running out of space. Webaroo, about a year old, has hogged five rooms and wants more. In one, some 35 engineers sit crammed into just 350 square feet of space. Others might gripe, but here, says Webaroo CTO Beerud Sheth, the team likes the close quarters: The density enhances the collaborative teamwork.
Now, Webaroo is ready for the big time. The $10 million venture launched its service in San Francisco and London on Apr. 10. But founder Mathur says a key market is India, where it appeared on Apr. 20. "You can't address the global market unless you address India," says Mathur, pointing out that India is the world's fastest-growing cellular market.
Webaroo will be a big test for SINE. "It's our first global, public debut," says SINE administrator Bhatt. There's a lot at stake for Mathur as well, as he tries to make Webaroo a global consumer brand. "We hope to lead the wave of companies that move India from being a back office outsourcer to a front office developer of branded products," Mathur says. Looking for the new India? That kind of success would surely fit right in.
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