March - 2000 - issue > Inbox

Utpala Anand's article, "A Venture For Those Who Dare," (siliconindia, January '00) was an excellent synopsis of the dynamics of the venture capital industry. The venture capital industry has historically demonstrated that there is an abundant pipeline of capital flowing through venture capital firms from multi-billion dollar corporations, institutional investors, pension funds and endowments.

While this phenomena has made fundraising a faster and easier process, competition among venture capital firms has heightened and, as a result, given birth to a new breed of venture firms. These new venture firms are what I like to call "operating companies." In an era of rapid technological advancements, execution and time to market becomes as important as the idea or the technology. The primary difference between the pure venture capitalists and the evolved operating companies is evident in the name.

With the abundance of deals that venture capitalists are doing, it is difficult for traditional venture capitalists to take the step beyond providing monetary capital to providing human capital that is critical to the success of startups in this new era of heightened competition.

These operating companies, who typically have similar profiles to their venture capitalists counterparts, go beyond "just doing deals." They, in effect, partner with the management of companies and use their experience and networks to execute the business plan. With specialized teams that provide additional services such as web-site development, hosting, public relations, finance, legal and executive recruitment, operating companies work with management to focus on the development and execution of the idea.

In an industry where the ultimate measure is ROI, this new breed of operating companies has established a new paradigm that provides a way to better control the final outcome of venture capital investments. - Samir Parikh, Associate, divine interVentures, inc.


Perplexing Comparison

Rafiq Dossani's article "The Venture Capital Business Environment," was interesting but its attempt to compare Israel with India left me puzzled. While the writer thinks that Israel's projects could be "object lessons for the Indian government," he says in the very next sentence that "the Israeli experience….may have limited relevance to India."

It is all the more perplexing when Dossani says that India can still learn "important lessons from ….US-style legal, regulatory, tax and institutional environment."

When India can learn these lessons directly from the US, I fail to see why it should go to Israel to learn these.

We all recognize Israel's ability to develop new technology and the role of its infrastructure, including government policy, but it is not clear how exactly we can learn from Israel's experience. An article that details those aspects will be very useful to us. - Thomas Mathew


AGGRESSIVE TRANSFORMATION OF INDIA

I enjoy all of Sam Pitroda’s articles and what you stand for. I would appreciate if he would write columns that are more aggressive in transforming India to dominate in the IT sector at such rapid pace without endlessly waiting on bureaucratic government red tape to make some petty changes.

The current rate of growth of IT in India is not good enough. When it comes to global competition, the goal should be to become the undisputed global leader in the IT sector within a year or two. India should run towards this at the pace of a Silicon Valley startup company or else India will definitely to miss this boat.

I applaud siliconindia for all the efforts it has made so far. - K.V. Krishnamurthy, Fremont, CA


WTO - VIEW FROM THE OTHER SIDE

Some parts of Maya Vengadasalam's article "WTO - An Insider's View," (siliconindia, February '00) pleased me and some concerned me.

I was one of the protesters at the event -- one of the people in the street getting tear-gassed and abused by the police. So fundamentally I believe we might have some differences of ideology; namely that the WTO conference being held had the interests of the people of India or America in mind, or that the presidents of the corporations whose speeches you wrote about (Boeing, Microsoft, Amazon.com, Fujitsu, UPS...) are leaders to whom we should look up to.

The 'pepper spray' you refer to was actually tear gas. Pepper spray was certainly used, and its effects far worse than the temporary stinging of tear gas.

I don't want to make excuses for all of the protesters. Certainly in a crowd of 70,000 or so people you can't agree with everyone. I think a fundamental perspective bias is at work when you say that "those same individuals [who were compassionate for one another] were fierce when confronting WTO participants."

The viewpoint of the protesters would be that those same WTO participants, helped create the machines of death that kill innocents from Central America to South East Asia to Kosovo, exploited prison labor, flagrantly violated OSHA regulations, that they were fierce when they further centralized and dehumanized the world of literature and other cultural institutions, shutting out small stores and homogenizing the country even more in the name of the holy 'efficiency'; that they were fierce when they treated their workers so poorly and used their money to buy favors from politicians.

I do appreciate greatly your refreshing, positive comments about the protesters and your observations that they were not trying to simply cause problems or get attention; unfortunately a negative impression is often all that is portrayed in our mass centralized media. We were frustrated about many things, including, as you say, the fact that we could not get our message out. But many have, I believe, embraced a kind of fatalism regarding that. We no longer expect that we will be able to get our message out except through channels that we create outside of the mass media; channels like the Seattle demonstrations.

The high-tech outsourcing will not lift India out of its problems, deregulation of government economic controls and an opening-up of the nation to foreign corporate investment will certainly not hold in mind the best interest of subsistence farmers, or the millions of poor filling the cities, none of whom mean anything or have anything to offer these inhuman organizations except their unregulated labor.

I look to the work of Dr. Vandana Shiva (my Indian delegate of choice) and others for inspiration that sensible development can happen in India. The problems there are certainly enormous, and if we continue to place our trust in representatives of organizations whose basic interest is profit, that sickness of the soul will infect us as well and only guarantee our failure. Instead we will agitate, reform, fight, compromise, discuss, protest, and do whatever else we can do to protect the interests of the many from those of the few (and to show that, indeed, at the roots, the interests are the same.) The next major stop is Washington D.C. where we will protest the World Bank and the IMF. Maybe we'll see you there. - Casey