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Startup ecosystem and the fate of non-IT startups

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Indian startups off late are in a boom kind of thing which was witnessed in Silicon Valley in the 90’s. I know boom is a dangerous word, but that is the best word I could use. Venture capitalists abroad are willing to invest in India. Most of them are expats who wanted to give something back to the country which educated them.

Sometimes more than anything else a little exposure is all a startup looks for. It is not just the venture capitalists which are giving startups exposure. Events like Proto.in and Tata NEN are designed to do just that.

Recently concluded proto.in event has selected 12 startups. 10 out of 12 startups are IT or telecom related. The only 2 startups which are non-IT are Lords Automotives and Kadambari Consultants Pvt Ltd.

Tata NEN was a little different for non-IT. It saw a huge participation. Initial nominations were around 588 which was largely dominated by IT. The contest is in its last stage with the final list of 30 startups. I was worried that the final list will be swamped by all the IT startups but Tata NEN did a good job with the final list.

The final list is a lot more diversified than the initial list but is dominated by IT/Internet/Telecom. Few startups like DailyDump, and GoSports are non-It related startups which made it to the final 30.

Typically, the investments or the events like these are heavily skewed towards IT startups. Non-IT startups does not get much attention. Their ideas might be noble but funding them is not a viable option for the VC’s. This makes me think that if you have to start something up it should be in the IT space.

Before I make any hasty decisions I would like to open this up for discussion.

Are we heavily inclined towards IT related startups? Or there aren’t any non-IT startups which are worth paying attention?

  1. Sriram Vadlamani says

    @Rahul : I agree with your 1&2. For number 3, the investment might be smaller in non-IT. In IT the investment is not tangible. It could be software, people, training and other stuff. Non-IT the investment is more tangible. So you know where the money is going into.

  2. rahul says

    According to me the reasons for this attitude of VC’s are.
    1. They are more comfortable with IT.
    2. The whole concept of Venture funding is new to our country and the early adopters are the tech savvy and traditional businessmen are reluctant to invest their money on investment firms.
    3. The investment required is much smaller.

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