We are passionate about turning entrepreneurs into winners and we believe that the environment and market in India is just right for this to happen.
India’s economy is transforming and demonstrating sustained growth, even as countries around the world are going through a painful economic cycle. New businesses are being and will be launched – many of them small at the inception – that will have a critical role to play in this growth. There is now a greater stress on work quality, an increased awareness of entrepreneurial possibilities and the courage to look beyond traditional employment avenues in the professional class.
We also believe that India’s economic growth story is still being addressed incompletely.
The Planning Commission of the Government of India estimates an existing massive backlog of job shortfall of 35-40 million, and this will grow by an additional 10 million each year.
Creating entrepreneurial opportunities is the quickest, most productive and self-sustaining way of harnessing this potentially explosive energy for the economy. By its very nature, entrepreneurship creates chain reactions that lead to increased employment and new entrepreneurs.
The last boom during the dot-com era brought in a flood of venture funds as well. However, these mainly foreign funds used Western yardsticks to judge the suitability of investment. Since Indian costs can be one-fourth or less of Western costs, most Indian projects were not “big” enough to attract venture-funding and consequentially the funding pattern of most Indian “venture funds” resembled that of Western private equity funds which invest in mature companies. This is still true today. The funding needs in the Indian business environment are usually below the threshold investment limits for venture capital funds operating in India – for every VC-invested company there are usually 9-10 good companies that are rejected because their investments needs are too small for a VC.
In more developed markets, angel investment provides a stream of VC-investible companies. In the US the number of angel investors is estimated at over 250,000. In India there are very few angel investors, and in some cases there may even be conflicts of interest between the existing businesses of potential angels and companies that are looking for investment.
Given the relative immaturity of this market in India, there is a need for enablers and accelerators (like PVC) to help companies grow from a seed or an early stage to a level where they can attract and fully utilize VC investments.
We strongly believe that high growth companies need multiple forms of capital at their early stages, money alone is not the solution.
The right mix of “human capital” within the company and “relationship capital” in the ecosystem will allow an early-stage business to leverage amounts as small as Rs. 1 million and achieve disproportionate results.
Talk to us if you need help in growing your seed for a business. Talk to us if you want to pitch in and help us in planting these seeds and helping them grow.
[Edit, 8 August 2016: if you’re interested in our new framework, head over this way.]