FROM A BACK OFFICE TO A GLOBAL PRODUCT NATION
Smart Valleys chose Bangalore as the first destination of its entrepreneurship tour in South East Asia.
Through the insights of its key actors, discover how the ecosystem which first was the back office for multinationals turned into an innovative hub creating tomorrow’s products.
THE METEORIC RISE
Formerly known as the “Garden City”, India’s Silicon Valley is in full metamorphosis. The capital of the state of Karnataka hugely benefits from world’s digitalization. With an army of low-cost developers, considerable VC funding flows and a real rebellion spirit, Bangalore daily develops useful products for the country, and therefore, for the whole world. In fact in India, US giants now encounter a fierce competition in the local start-ups : Ola threatens Uber, Snapdeal and Flipkart jostle with Amazon, Helpchat outstrips Facebook-m.
How to explain this outbreak? Let’s use the three criteria mentioned by the Co-Founder & Partner of The Family, Nicolas Collin : Talents, Funding and Rebellion.
A low-cost talent pool
Bangalore has legions of developers ready to create the software that is “eating the world”. Unanimously, our interlocutors emphasize the availability of a massive low-cost labour. The average salary in Bangalore tech startups is around $25,000 against $120,000 in the Valley.
A rebellion against Indian traditional culture
A few years ago, the word “startup” didn’t even exist. The rebellion of the first startuppers against America’s supremacy allowed the emergence of a population of entrepreneurs whose social status only improves. Today, Flipkart founders Sachin and Binny Bansal, who resigned from Amazon, embody the new paragon of success for a generation.
An easy access to funding
VC financing rose by almost 2,000% in Bangalore between 2009-2014 against 280% in the Valley. Among other reasons, we can mention that Indian entrepreneurs who succeeded in the Valley or in India knowingly value the potential of this 1.2B people market. Besides, the success of e-commerce unicorns caught the attention of international investors.
At last, thanks to digitalization, the products developed to address local problems can be exported without spending a penny to open new offices, factories or franchises. Which is why, soon enough, many of the daily products and services we use may be Bangalore born.
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