A year ago, I was the first from India to join a team of two entrepreneurs (Adarbad Master and Freeman Murray) who had come down from the valley with funding (from Com Ventures) to India to start a Web 2.0 venture. From a three people team, we have now become a full fledged 25 people team (in both India and US combined), and recently launched our product Mixercast. And with our CEO Jennifer Cooper pushing the throttle, things are looking damn good!
In the last one year, we gave gone through ups and downs thats typical of a startup, but the true beauty of the idea has been the ability to feel the market direction and rapidly adapt with an incredibly low burn. The cost advantage and talent pool that India offers turned out to be our biggest advantage over others who were aiming for the same market. It also gave us the ability to come up with a super-extensible platform that can now be integrated into a variety of different verticals.
In that way, the model is very clear -- Have an idea? Come to India and startup in 1/10th the cost! Hell, you could even test waters in the Asian market before going global!
Today, I was delighted to read the following post in GigaOm, as a true formalization of the model we hit.
"HitForge is an entrepreneur cooperative composed of independent small teams, where people can apply with their ideas, join the team, and see their idea go from idea to product in a few weeks, largely with help of an offshore engineering team.
If it works, then the product is turned into a company. If itdoesn’t work, the product is killed, and the team moves onto something new. HitForge is out of a few thousand dollars. The team whose product got killed still gets to share in the hits that come out of the cooperative, Ravikant says.
Ravikant argues that the start-up creation model - have an idea, start a venture, raise capital and then release a product - might have worked in the past, but now it doesn’t, at least when it comes to consumer web start-ups. In the world of consumer Internet start-ups, only the hits win. Today while it takes less capital to start and launch a company, it doesn’t necessarily mean it is going to be a hit. As Ravikant says, “Web businesses are unpredictable despite the best of intentions and execution.”
“What these are, are products that needed to be tested out in the market before becoming a company,” says Ravikant. Only the hits should become companies, since hits are the only ones that get consumer adoption, and have some sort of an exit event. Hedge funds use this “momentum investing” philosophy, and so does Sequoia Capital, that has done well by betting on growth."
More on Mixercast very soon, but I think its high time that all VC firms and entrepreneurs realize the potential, and decided to do all their startups here. ;)