Indian Internet Eco-System an Oddity

by Santosh

Back in 2006, a few VC’s left their Sand Hill Road offices and visited us to talk about what investments they would like to see happen. They cheekily talked about how they were seriously looking at the Internet and Mobile industries. However, their adopted strategies are focused on retail and infrastructure. This is also evident from Sequoia’s current portfolio of late-stage investments in Cafe Coffee Day and Idea Cellular.

Why is this so? How does this impact me?

Primarily, the Internet already has its own Google (Google).

Secondly, what India has to offer in the early-stage Mobile and Internet application space right now is not potentially large enough to fall into their sweet spot.

This is not to suggest that a late-stage deal in an Internet application company will not happen.

Instead, I am asserting that Indian Entrepreneurs need to stop trying to sell old wine in a new bottle. If you truly want to understand the web – aim to build assets that exploit the webs global and interactive nature. An Indian Internet Eco-System is hardly an exciting proposition and will probably not exist by itself.

Ask yourself how large do you need to be to be able to make the transition from good to great. Amazon.com, the darling of the worldwide E-commerce space had already grown in to 5 or more countries before it could IPO. Other E-commerce plays from India treat the web as a secondary medium for Sales after phone and retail. They are already aware of what is required to make it in their own markets.

There is a saying that goes something like – People buy from Friends, Experts and Market Leaders.

Who do you want to be?

~ Santosh

UPDATE I – A few days after I wrote this post, Sequoia Capital invested $6Mn in Printo services in India.