Date: Thursday , May 01, 2008
The month of May 2008 brings together thousands of entrepreneurs, VCs, and industry experts at the TIECON event in Santa Clara, California discussing various aspects of the entrepreneurial journey – from bootstrapping to identifying great opportunities to building great teams to raising capital and to creating shareholder value. A number of tracks will discuss opportunities in social good and challenges facing the world economy, thereby presenting opportunities for the current generation of bold entrepreneurs.
On the eve of TIECON, I would like to share my thoughts on where I see the opportunities in the coming years for entrepreneurs who are ready to venture out on their own. These are unprecedented times for entrepreneurs and investors who are willing to address the challenges and opportunities in the future.
Opportunity 1: Delivering Intelligent Services
The next decade is going to see the rise of intelligent knowledge-driven services, which bring deep domain and market understandings coupled with technology excellence. Companies and entrepreneurs who combine domains and markets with technical strength and leverage global organizational models from India, China, and the U.S. to bring the best talent together will rise to the top. Traditional IT services and BPO services will give way to more advanced KPO (knowledge process outsourcing) services. Entrepreneurs should look at these services in the areas where there is deep domain and market understanding requirement, yet the companies internally are not able to do a good job by themselves. A great example would be, for example, to create a company focused on delivering market research services through facebooks, linkedin, and other popular social networks. Market research is a well-understood concept; we now have new platforms where large number of consumers are aggregating. How do we create the next generation market research services company? This kind of intelligent services presents real business opportunities for next generation entrepreneurs.
Opportunity #2: Building Knowledge Networks
First generation social and professional networks (like Facebook, LinkedIn) have created large platforms for individuals and businesses to aggregate on the Web. As we look ahead, one would see the formation of a new class of professional and social networks, which would be very targeted knowledge networks, bringing together knowledge holders and knowledge seekers to exchange ideas, innovations, and advise in ways that create true value for all participants. SiliconIndia.com is trying to build such a knowledge network; there will be many more of these networks rising up in different verticals and niche domains. I do not envision that the horizontal platform networks like Facebook and LinkedIn will be able to do a good job addressing the niche areas of these knowledge networks.
Opportunity 3: Towards Clean and Green consumers and enterprises
Consumers in the future will live self regulated lifestyles to reduce their carbon footprint. The per capita carbon emission per year in the U.S. is 6.8 tons, in China 1.1 tons, and in India 0.5 tons. There will be opportunities in creating technologies for alternative energy, but there will be equally significant opportunities for entrepreneurs who aspire to build IT and software systems and Web services to help consumers or businesses to better manage their carbon footprint. This new class of applications will provide true opportunities for education, management, and self regulation around carbon footprint management, emission controls, environmental social responsibilities, and much more. So, those entrepreneurs who are keen to participate in the clean and green revolution, but do not want to give up their software or Web focus, can definitely investigate this kind of compelling applications for the future.
Of course, if you happen to have the technical or business background to fundamentally create new technologies for green house gas reduction or alternative fuels, you are surely in good timing, as VCs and investors are keen to place significant bets in this arena. I would also urge entrepreneurs to learn from the clean and green innovation happening in a number of Chinese companies (especially on the solar energy side) that are now beginning to create significant scale through their strong manufacturing advantages. We cannot limit ourselves to merely looking at developments in the U.S. or India alone. China is a big player in clean and green technology and a number of great companies are emerging from china. Climate change and energy crisis are global issues; hence, entrepreneurs who plan to venture in this area must research and study the opportunity from a global perspective.
Opportunity 4: Finding Opportunities in Social Good
A lot has been discussed lately on opportunities at the bottom of the pyramid. A recent announcement from the Tatas about the ‘Tata Nano’ car at Rs 1 Lakh has put the 100 year old Tata group on the world map, for building an affordable car for the masses. Similarly, microfinance companies are spawning new opportunities to serve the poor and the underserved. In a recent announcement at the World Economic Forum in Davos, Bill Gates highlighted the notion of ‘creative capitalism’ to address the needs of the underserved. Budding entrepreneurs can target social entrepreneurial causes like Bill Gates, with hybrid models of for-profit and non-profit models, creating a double profit line of social good and economic profits. Immense opportunities exist for the bold and the brave who look under the hood, looking beyond the high growth, high paying consumers or enterprises to discover new markets and needs which can be sustainably addressed through entrepreneurial energy. Microfinance (lending capital) for accelerating rural entrepreneurship has now opened up a range of new entrepreneurial ideas, some of which are clear and merit deeper investigation. For example, in India, micro insurance might be ripe for the taking, or helping improve the ‘food supplies’ for the road-side ‘dhabas’ and turning them into ‘subway’ style branded cooperative might be worth studying, or if you are looking for bolder thoughts, how to leverage village Internet kiosks into a game changing economic growth engine for the rural economy. At this time of the evolution of India, and other such developing nations, we need far more entrepreneurs and students of rural economy to help us unearth these hidden gems of creative capitalism. A number of promising Internet ventures like Kiva.org are leading the path to transform the lives of the poor. Skoll foundation and Omidyaar foundation (founders of eBay) are also doing a great work in this area. Organizations like Unitus () are also supporting many social ventures with hybrid models of profits and social good. Ideas galore, we need more entrepreneurs to take up the challenge.
Opportunity #5: Leading the Web 3.0 wave
Moving forward, Web 3.0 will be about ‘platform as a service’ enabling killer apps, which will bring 3D, video and broadband, virtual networks, and mobile Web into a seamless Web. Web 3.0 will be about creating semantic linkages between Web pages and information. It will be about intelligently personalizing the Web experience in ways that we have not seen before. Thousands of ‘applets’ or widgets from across the Web can come together to present you content and applications through a very personal Web experience. Web user interfaces in the past were being stitched together by developers. Moving forward, the user experience will be automatically and dynamically stitched together for the users, based on their profile and preferences. For example, if I happen to be passing through Hong Kong, my news will automatically get customized to share more articles from that region; my iGoogle page will start to carry more interesting articles on Chinese food and culture. Or, if I am using a service for online shopping, it will automatically know my social or professional profile (from facebook) and customize the offerings to my preferences.
In the next seven years, by 2015, we will have more than 3 billion people on the Internet; up from today’s 1 billion. By such time, Internet will be always on, wireless, and pervasively connecting 3 billion consumers, all manufactured products, and all media forms with full ‘personal awareness’ of location and preferences. Enterprises and governments will also learn from the consumer Web the way to embrace the Web to operate as fluid and agile teams. Web 3.0 will fuel an innovation economy, a new convergence of economics, democracy, trade, and technology; it will determine the future leadership of nations, productivity of businesses, and wealth of individuals. Internet will better enable cross-cultural understanding than it has ever done before by collapsing the language and cultural barriers. We need English, Hindi, Chinese, and German speakers to seamlessly communicate with each other in the Web 3.0 world. The bottom of the pyramid will embrace Web 3.0 through compelling applications for people living under $ 2 per day incomes, fundamentally leading to more prosperity and diffusion of information, knowledge, and wealth.
As I mentioned earlier, we are living in an era of unprecedented changes brought together by the Web itself, by the opportunities of the global economy, by the rising energy and resource crisis, and by the desire to impact billions of people from the bottom of the pyramid who are currently being excluded from the wealth explosion. Hope, these trends and opportunities will spur your entrepreneurial thinking as we prepare ourselves for the TIECON later this month.