NW Venture Voice has a post by Martin Tobias on his visit to India:
– The Indian economy is firing on all cylinders. Auto sales, pharma sales, real-estate, outsourcing and IT jobs are up double digits YonY.
– India’s growth is accelerating even as China comes on line.
– Indian companies are moving up the value chain, especially in IT. There is a consolidation going on at the top of the IT outsourcing business by Wipro, Infosys leaving the middle market and small players looking to product development for growth. Look for Indian companies to get into original branded software product development in a big way (look out America).
– The bio/pharma sector is probably hotter than the IT sector. A partner in a leading executive recruiting firm said he has triple the number of searches going on in bio/pharma versus IT.
– The VCs that only visit Bangalore and think the India story is only about BPO are missing the mark.
– The Indian government is serious about divesting state owned enterprises (the old bedrock). Twelve new ones are being offered in the next three months.
The most interesting one to me was the fact that every day in the Economic Times of India was another article on an Indian IT company moving up into product development. And details of all the government programs to support this. While the culture of development is significantly different from the culture of a call center, it is probably just a matter of time. The recruiter I was talking to said most of his “C” level hires are returnes from America and Europe. Salaries go MUCH farther in India. India produces more computer engineers than America. It is only a matter of time before this combination of American trained management and inexpensive raw talent starts to deliver really cool products.
While I didn’t spend alot of time looking for investments or talking with potential partner companies, it was clear to me that there is WAY more going on in India than most people are considering. I advise every start-up I work with to consider what their strategy to leverage India and China is. It can be as simple as outsourcing QA/testing or call center. It can be as complex as outsourcing all development and selling into the local markets. Whatever the strategy, the CEO who doesn’t leverage the growth and market efficiencies going on in India/China does so at his peril.