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June 03, 2010

Is Bangalore losing its start-up edge?

Deepak Srinath of Viedea Capital, an angel funded investment bank that recently opened its first non-Bangalore office in Mumbai, has a post on why the firm "does not have a single client in Bangalore today (and) what’s more, in the last six months, we have hardly come across a firm from Bangalore that has really excited us."
...we continue to see plenty of startup’s from Bangalore, but very few of them are ‘doable’. I think the real reason is because the Bangalore entrepreneurs’ greatest strength (tech savvyness) is also his greatest weakness. He/She is enamored by a brilliant technical idea, but fails to do enough diligence on the market or requirements of the intended users. The real opportunity today is for businesses that seek to serve the burgeoning Indian domestic market. In our interactions, we often find that entrepreneurs from Mumbai, Delhi and even Pune, seem to have a much better understanding of the market and consumers than those from Bangalore. They build their products and services for the market and not the other way round, ie, build a product and then try to find a market for it.

Arun Natarajan is the Founder & CEO of Venture Intelligence, the leading provider of data and analysis on private equity, venture capital and M&A deals in India. View free samples of Venture Intelligence newsletters and reports. Email the author at arun@ventureintelligence.in