vivek wadwa ink talk on indian entrepreneurship
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And how its entrepreneurs will transform India —and the world
VIVEK
WADHWA
Distinguished Fellow Singularity University
Fellow, Rock Center for Corporate Governance, Stanford University
Director of Research, CERC, Pratt School of Engineering, Duke University
Columnist Washington Post, Wall Street Journal, Forbes, ASEE Prism, LinkedIn
Twitter: @wadhwa
Increase from 800-2000 startups by 2020? —this is not “hyper growth”!
India shouldn’t be succeeding at all based on the data
China numbers are suspect – inconsistent data collection, unrelated degrees.
2006 data
© 2008 Vivek Wadhwa
China numbers are suspect – inconsistent data collection, unrelated degrees.
2006 data
2006 data
India is rapidly becoming next global center of research, design and innovation: Pharmaceutical
Drug discovery, specialty pharmaceuticals, biologics, high value, bulk manufacturing, advanced intermediate manufacturing
Aerospace In-flight entertainment, airline seat design, collision control/navigation control systems, fuel inverting controls, first-class cabin design
Consumer Appliances/Semiconductors, etc. Design of next-generation washing machines, dryers, refrigerators, digital TV, cell phones, automobiles, tractors, locomotive motors India racing ahead in R&D, despite its weak education system
and graduation rates
50% of engineering graduates not employable IIT’s graduate less than 5000 engineers Country has weak infrastructure and weak education Yet: Tip of the iceberg: In 2007, top 5 IT companies hired 120,000 engineers.
Accenture and IBM India added 14,000 each. India is racing ahead in becoming a global R&D hub
How? India adopted the best practices of its Guru (the U.S.) and perfected these
The disciple became the guru
Company 2004 2005 2006 2007 2008 2009P CAGR
Accenture (India only) 9,953 16,014 23,186 36,852 41,500 43%
HCL 16,358 24,090 32,626 42,017 51,038 62,435 33%
Infosys (including subsidiaries) 25,634 36,750 52,715 72,241 91,187 102,838 37%
Satyam (excluding subsidiaries) 14,032 19,164 26,511 35,670 45,969 53,878 35%
TCS (including subsidiaries) 33,774 45,714 66,480 89,419 111,407 133,837 35%
Wipro 28,502 41,857 53,742 67,818 82,122 98,092 30%
0%
5%
10%
15%
20%
25%
2004 2005 2006 2007 2008
HCL
Infosys
Satyam
TCS
WiproAttrition Rates
Accenture global attrition rate 2008 – 18%, U.S. It services industry norms – 15-30%
Now let’s go to America
Tech and engineering companies founded from 1995-2005:
• 25.3% nationwide had an immigrant as a key founder
• 52.4% of Silicon Valley startups founded by immigrants
• 2005 revenue -- $52 billion. Employed 450,000
• Indians founded 26% of these -- more than the next 4 groups (from U.K, China, Taiwan and Japan) combined
WIPO patents:
• 25.6% had foreign national authors in 2006. Increased from 7.6% in 1998
• 16.8% had a Chinese-name and 13.7% had and Indian-name authors in 2006. Increased from11.2% and 9.5% in 1998
Legal, educated, skilled workers currently waiting for green cards as of 2007—many more now
500,040 in main employment-based visa categories plus 555,044 family members 259,717 intl. grad students plus 38,096 in practical training (includes postdocs)
Permanent resident visas available yearly: 120,120 in the three main employment visa categories (EB-1, EB-2, and EB-3) Largest numbers in queue from India and China Max. number of visas per country – 8,400 (7% of pool)
1—1.5 million skilled immigrants waiting for yearly quota of 120,000 visas – with 8,400 max/country
Average age of Indians – 30, Chinese – 33 Indians – 65.6% masters, 12.1% PhD’s. Chinese 51% masters,
40.8% PhD’s…primarily in management/STEM 26.9% Indians, 34% Chinese were U.S. perm. residents/ citizens Indian senior management positions increased from 10.2% in
the U.S. to 44.1% in India and Chinese increased from 9.3% in the U.S. to 36.3% in China
More than half plan to start businesses in home countries
2.5%
10.5%
34.1%
37.5%
14.2%
1.2%
0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% 40.0%
60 - 69
50 - 59
40 - 49
30 - 39
20 - 29
0 - 19
Percentage of all Respondents
Fou
nd
er
Age
24.9%
69.9%
4.5%
0.7%
Single Married Divorced/Separated Widowed
40.3%
16.4%
28.0%
11.0%
3.4% 0.9%
0 1 2 3 4 5
Average Number of Children Marital Status
High School Diploma or
Lower, 5.9%
Bachelors, 44.0%
Masters, 31.0%
PhD, 10.0%
Associates Degree,
Certification, Some College,
2.3%
MD, 3.8%
JD, 3.5%
Highest Completed Degree
Applied Sciences*,
9.0%
Engineering 27.6%
Mathematics 1.5%
Computer Science,
Information Technology
9.0%
Business, Accounting,
Finance, 33.4%
Healthcare, 5.5%
Arts, Humanities and Social Sciences,
2.8%
Economics, 1.8%
Law, 4.2%
Other, 4.6%
Fields of Highest Degree
STEM Fields 46.5%
0
10
20
30
40
50
$0
$1
$2
$3
$4
$5
$6
$7
$8
All Startups Startups w/ an Ivy-Leauge Founder Startups w/ a High School Founder
Ave
rag
e 2
00
5 T
ota
l Em
plo
ye
es
Ave
rag
e 2
00
5 S
ale
s (M
illi
on
s o
f U
SD
)
Average 2005 Sales Average 2005 Employment
What makes the difference is higher education: not the degree or school
1.2
2.9
3.2
1.7
3.1
1.4
3.0
3.1
2.1
Couldn't find traditional employment
Working for someone else didn't appeal
Wanted to build wealth
Co-founder encouraged to start company
Wanted to capitalize on a business idea
Developed a technology in lab
Startup company culture appealing
Always wanted own company
Entepreneurial friend or family role model
1= Not important factor, 5 = Extremely important factor
7.8%
17.8%
64.4%
16.9%
14.2%
12.3%
14.6%
7.3%
Other
Friends and family
Personal savings
Business partner(s)
Venture capital
Private/angel investor(s)
Bank loan(s)
Corporate investment
1.3
1.7
2.2
2.5
3.0
3.2
3.2
3.3
3.3
3.8
4.0
4.1
4.4
Assistance provided by the state/region
University/alumni contacts/networks
Advice/assistance provided by company investors
Location
Personal/social networks
Your university education
Availability of financing/capital
Professional/business networks
Good fortune
Company's management team
Lessons you learned from your previous failures
Lessons you learned from your previous successes
Your prior industry/work experience
1= Not at all important, 5 = Extremely important
Now lets look forward
Take 30 steps…
LINEAR
01 02
03 04
05 06
07 08
09 10
11 12
13
30 meters
Source: Goodbye Linear Thinking by Peter Diamandis
Difference between linear and exponential
01 02 04 08 16 32 64 128 256 … 1,073,741,824 meters
26X around the Earth!
Take 30 steps…
EXPONENTIAL
Ca
lcu
lati
on
s/S
ec
pe
r $
100
0 c
om
pu
ter
Moore’s Law —5th paradigm of exponential growth
The exponential growth of
computing on a Logarithmic Plot
Ca
lcu
lation
s p
er
Se
co
nd p
er
$1
00
0
Year
2010
2023 2050
Calc./second for a $1000 laptop vs. time --Ray Kurzweil
Artificial Intelligence, Medicine, Robotics, 3D Printing, Synthetic Biology,…
As any technology becomes an information technology, it
starts advancing exponentially -- Ray Kurzweil
In other words, everything is becoming an I.T.
It is not just computing…also
1976 – 1st Digital Camera (Kodak) 0.01 MP / 3.75 lbs / $10,000
2014– Mobile Digital Camera >10 MP / 0.03 lbs / $10
1000x Resolution 1000x Lighter 1000x cheaper
1000,000,000 x better
1,000x Resolution & 1,000 lighter & 1,000 cheaper
Steven Sasson
Credit: Peter Diamandis
Early ICBM Navigation Inertial Measurement Unit 1960’s – $ Millions – 50 lbs Velocity/Orientation/Accel.
Accelerometer: $1
Gyroscope: $3
1st commercial GPS Receiver in 1981 Weight: 53 lbs; Cost: $119,900
Single Chip GPS Receiver 2010; <$5 each
2006 data
Micro-Electro-Mechanical Systems (MEMS): miniaturized mechanical and electro-mechanical elements made with microfabrication.
Source: MEMS and Nanotechnology exchange
2006 data
Would have cost hundreds of thousands of dollars and weighed 100 lbs+ just 30-40 years ago
What Santa promised What Santa delivered
Computing power required for voice and face recognition, sophisticated movements…and speech
Price, weight, limitations of sensors for 3D vision, motion…
Until now
Cheaper now to manufacture some goods in U.S. than China Source: The Everything Robotic blog by the Robot Report $32,000 Wall-Ye from Burgundy, France
Credit: Neil Jacobstein
Doctors can’t keep up, so IBM Watson is going to medical
school
Source: Eric Green, NHGRI, Current Topics in Genome Analysis 2012
Create uniqueness
design like nature
Create for the body
Increase complexit
y to reduce
cost Optimize for performance
Credit: Scott Summit
Sometime in the 2020s
Mary Meeker, KPCB Internet Trends 2013
—sub $50 smartphones
India has 875.48 M cell phone subscribers (10/13) Only 29 M land lines
Cisco estimates number of mobile-connected devices exceeds number of people on Earth
Cellphones revolutionized communications, changed
lives.
Imagine what Internet-enabled tablets will do
Credit: Statistica. Source: Apple, Google
www.wadhwa.com Twitter: @wadhwa
Tens of thousands entrepreneurs building health sensors, robots, drones, commerce, infrastructure tools
Hundreds of thousands app builders solving local problems
Millions of Internet businesses
Billions—world wide—benefiting from Indian innovation