IT and telecom start-ups should get funds from Tatas, Birlas, Ambanis and others

India’s large corporates — Tatas, Birlas, Ambanis and others — need to invest in IT and telecom start-ups to ensure the country’s growth and prepare for the future.

We know that we can create a Facebook or Dell. But India’s funding culture for start-ups does not attract young entrepreneurs to start their business or innovations.

Lack of support from angle investors is also a major concern. India’s mobile VAS industry faces crisis due to lack of funds. Everyone wants guaranteed returns or near 100 percent stake in start-ups even before they start chats with young entrepreneurs.

There are successful investors and young entrepreneurs as well.

Several corporates invest in CSR activities. They should now look for tech and other start-ups to ensure that the country’s going in the right direction.

Today, Times of India reported that new data based on consumption expenditure surveys shows that income disparity is growing and at a rapid clip.

Spending and consumption by the richest 5 percent zoomed up by over 60 percent between 2000 and 2012 in rural areas while the poorest 5 percent saw an increase of just 30 percent. In urban areas, the richest segment’s spending increased by 63 percent while the poorest saw an increase of 33 percent. The effect of inflation was removed while making these comparisons.

This creates an alarming situation. If poor is getting more funds for use, India’s IT and telecom industry will flourish. The ARPU of mobile operators will improve significantly.

Indian IT and telecom start ups need funds

According to Amartya Sen, India does not have an educated and healthy labor force. Investment in IT and telecom will create demand for education and better life.

I am giving an example of Reliance Industries (RIL). Its first quarter profit was Rs 5,352 crore on revenue of Rs 90,589 crore. I am requesting RIL’s billionaire promoter Mukesh Ambani to fund at least 100 start-ups every year.

I am sure Mukesh Ambani-funded start-ups will be able to create Facebook or Dell in India. We have enough garages and homes that can be converted into telecom and IT start-ups.

IT industry body Nasscom has taken some major steps to improve start-up culture. There’s also Kerala Village. We need more such initiatives.

I am taking this opportunity to highlight the future of several media start-ups and blogging communities. They are not getting any funds since they are not technically innovative.

For instance, Kizhakedath Media Services Pvt. Ltd. that publishes four tech portals: TelecomLead.com, GreentechLead.com, InfotechLead.com and GizmoLead.com, is still working hard to find an investor. We have around half a million page views per month. (I am the co-founder)

The business model is strong since we follow working from home model and spend very less on daily operations. We work like any other established media companies and follow similar revenue models. But we do not have enough funds to spend to scale up.

The other option is to raise finance from banks. Banks tell us that I will be eligible for bank loans once we cross the Rs 2-3 crore mark revenue. I feel that I will achieve Rs 2-3 crore revenue in 1-2 years without investing much. Once I achieve this, I may not need a bank to fund me.

Baburajan K
editor@telecomlead.com

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