Some Indian start-ups shun funding in bid to retain independence
livemint.com
livemint.com
One more company that comes to my mind is HasGeek(http://hasgeek.com/). HasGeek is definitely the best thing to have happened to the entire scenario. And they are based on pretty much the same lines, which is they are totally self sufficient.
For all those people with MegaCorp day jobs. You can do a lot of low bandwidth side projects to start up. If you are interested and persist enough then much can be achieved in spare time, both learning and money wise.
I do however think that when startups have proven themselves, and have a steady cash flow, but want to race to the top, VC funding may be the way to go.
I personally experienced this with a startup with a very healthy balance sheet. The reason for VC funding was pretty straightforward "We need money to expand internationally".
Local market dominance is usually quite possible with bootstrapping however international expansion poses a totally different challenge (first challenge: hire an experienced management team for it..).
VC funding plays a big role when it comes to the big guns. If you want to be the next Mc Donalds or the next Hyatt, it may be important.
Local market dominance is also great while being bootstrapped, if you want to play acquire-me, but that could just as easily be stomp all over me.
I guess that's what makes this business so exciting ;)
I regret giving them a page view.
Many sites have played the "dozens of links inward" game for some time. Almost every business site will provide links for every business or stock mentioned, all heading inward into their site further.
Here's an example: the first article I clicked on on the first page I knew behaved similarly: http://www.cnbc.com/id/100644923
Looks pretty similar.
What I've observed is that friends in India are very tight -- they'll do almost anything for each other. And if you have a friend with a startup, you'd certainly lend them some money.
So, they may not need VC money, and may not need angels, but they do potentially have a lot of "micro-angels" to raise funds through.
Deleted comment
I attended a talk given by the Hyderabad Angels some time ago and found their outlook to be very strange. "We only fund companies with a proven and existing source of revenue. We don't fund ideas. We are here to sponsor growth of an established idea."
For angels level investors to take this line was very strange for me. It is likely due to this that mostly clones are getting funded in India.
A while back the Karnataka state government had set up a fund to help start up's grow. It turns out most of the money was taken by NGO's, and the answers for justifying that was given as charity work. Not only did the money go into the wrong hands. It turns out most NGO's who took the money were not even actual NGO's. Most were simply trusts set up to park money for tax evasion.
Such things are very common.
There is a degree of risk involved in funding such ventures in India. Unfortunately that risk is not that businesses may fail. But that some one might be taking money from you without even having a business. It might just be a phoney venture set up to take investor money and run.
Therefore investors wish to do some check on how serious you are before funding you.
> Therefore investors wish to do some check on how serious you are before funding you.
My skype: carl.theteuton
I'm just annoyed by how every other story is about "startups" when the name is Hacker News... Meh, I don't know, just saying.