The Venture Intelligence Blog

Red Herring's December event to feature Offshore Outsourcing "Outsourcing in India and elsewhere" features prominently among the topics listed for the Red Herring Fall conference, an invitation-only event to be organized by the newly relaunched technology and entrepreneurship publication Red Herring . Other topics to be covered include restructuring of the venture capital industry, 3G and other wireless technologies, China, and the digital home. Sachio Semmoto of eAccess, Guy Gecht of EFI, Lawrence Calcano of Goldman Sachs, Guerrino De Luca of Logitech, Craig Conway of PeopleSoft, Thomas Weisel of Thomas Weisel Partners, Stratton Sclavos of VeriSign, and Gary Bloom of Veritas are listed among the speakers at the conference. Event Details Location: Monterey, California, USA Venue: Monterey Plaza Hotel Date: December 8-10, 2003 Click Here for more information about the event.

SEBI's Venture Capital advisory committee submits report The Advisory Committee on Venture Capital has submitted its report to India's capital market regulator, SEBI. The committee, under the Chairmanship of Dr. Ashok Lahiri, Chief Economic Advisor, Ministry of Finance, was set up to advise SEBI in matters relating to the development and regulation of the VC industry in the country. The report has been placed on the SEBI website for public comments. Some of the key recommendations of the report include: * Removal of the requirement of lock-in of shares post the listing of their investee companies. (At present, the VC funds are subjected to a lock-in for a period of one year after listing.) * Allowing venture capital funds to invest upto a third of their corpus in listed companies (against 25% of their corpus allowed currently) . The report has however said VC funds will not be given any special exemption from the clauses governing the takeover code. * Introduction...

Manish Sabharwal's interview to Knowledge@Wharton In a fascinating interview to Knowledge@Wharton, Manish Sabharwal, Founder & Managing Director of pioneering HR BPO firm, India Life Hewitt, provides both solid and witty insights into a range of industry issues: how he started out, why he sold out, why he focused on India as a market, etc. Some extracts: Business schools as venture incubators I think VCs who started incubators got it wrong; business schools like Wharton are the best incubators in the world. I milked the school's ecosystem. India Life was my final project in six classes. Many professors helped me think things through, and I had a group of first-year students do a field application project. I used the summer between the two years to travel to India and refine the plan, and then moved back to India straight after school. I guess it would make a better story if I said all my professors gave me bad grades for my business plan. But they didnÂ’t; they...

Products and services businesses require completely different DNA: Infosys sales chief "(When) someone asks me why my company (Infosys Technologies) isn't being more aggressive with products, I will just put it down to misplaced national pride. They want India to be known for great software products. It should. But India is already well known for its services companies. And that's something to be proud of," says Basab Pradhan, Infy's Senior Vice President and Head - Worldwide Sales & Retail (North America), in a column for Rediff.com. Some extracts: * The products and services businesses are so different, that the odds against a company with a dual strategy are fairly high. * Indian IT services companies Infosys and Cognizant both show far better margins and growth compared to leading software product companies Siebel and PeopleSoft. (Pradhan substantiates this statement with a table containing actual figures.) * It is true that in the last two y...

"Venture Capital is not available for start-ups" "Today, there are no true start-up VCs. Investments are happening in companies which have made cash profits and are looking for funds for the second phase of growth." says venture capitalist Vishal Nevatia of GW Capital in an interview to Economic Times. GW Capital is focussed on mid-sized companies in the media & entertainment, retailing, and BPO sectors. Around 60% of the fund's Rs.150 crore corpus has been invested in these sectors, Nevatia said. Click Here to read the full interview.

Selecting an offshore software development partner The McKinsey Quarterly recently published a primer on offshore software development with an aim to help US companies identify which projects they should outsource to an offshore vendor and to whom. Some extracts: * Only companies with fairly large IT staffs—more than 50 in-house employees focusing on software development or maintenance—should consider offshore software partnerships, since much time and substantial resources are required to negotiate them and to oversee the work and the integration of development teams. Furthermore, a company that outsources software development shouldn't have a taste for "bleeding-edge" technology, which ought to be created in-house since it requires a high number of design-code test-redesign feedback loops. * Offshore outsourcing is a particularly important option for maintaining legacy systems—often a large and onerous part of an IT organization's workload and one that...

What's slowing India's economic growth? A recent study by global consulting firm McKinsey found three main barriers to faster growth in India: the multiplicity of regulations governing product markets, distortions in the market for land, and widespread government ownership of businesses. "We calculate that these three barriers together inhibit GDP growth by more than 4 percent a year. Removing them would free India’s economy to grow as fast as China’s, at 10 percent a year. Some 75 million new jobs would be created outside agriculture--enough not only to absorb the rapidly growing workforce but also to reabsorb the majority of workers displaced by productivity improvements," the report says. Click Here for more information about this report. (Free registration required).