The Startup Hype That’s Literally Killing Entrepreneurship in Kerala

There was a saying once in Kerala – You throw a stone and 90% of the time it’ll hit an engineer. Fast forward to today and you hear a modified version of the same – You throw a stone and 90% of the time it’ll hit a startup entrepreneur.

Kerala has seen a huge boost in the number of startups being formed and the number of entrepreneurs taking reins of their self-made career. While it is definitely a positive sign, the increased frequency of students turning to entrepreneurs is alarming. So much so that, the extra sweetness is rotting the teeth.

Here is what I mean.

When me and most of my entrepreneur friends started off with our respective startups, entrepreneurship was seen as voodoo and a career choice for people who “couldn’t secure another job”. Not to blow our own horn, but it did require balls of steel and nerves of iron to go ahead with the decision. While some of us were written off as failures by the extended family, some others like myself were thrown out of home for “being a rebel“. And even few others had to break-up with their girlfriends because they didn’t have a “secure future”.

From there, came a time mainly around 2012-2013, where entrepreneurship started getting the respect it deserved and entrepreneurs were no longer looked upon with as much contempt as compared to the years before – thanks to initiatives likes the Startup Village and other policies by the State Government. People started accepting the “heroism” associated with entrepreneurship and it became the new hype.

Every single college student (especially engineering students), started dreaming of being the next Jobs or the next Zuckerberg.

the startup hype in kerala

And the hype continued. Fuelled by various factors and various institutions/organizations, the hype grew. The spark, which was meant to ignite the right flames, started getting out of control and turned into a raging wildfire, engulfing various wrong mindsets along the way. Owing to the hype created, instead of wanting to turn a solution or a product into an organized structure in the form of a firm, entrepreneurship came to be interpreted as starting a company first and then finding the answer to what it is we have to do. Kerala started seeing it’s first bunch of Business Card CEOs.

This is not to say that the right people weren’t getting into entrepreneurship! The support provided by the incubation centers and the mentoring by various esteemed organizations like TiE, did help build a few good ones – ones who sustained, ones who grew, ones who were more focused on solving the business problem rather than focused on updating their FB Profile as the CXO of XYZ Pvt Ltd.

In my interactions with various CXOs and industry experts, majority of whom I met via IEEE and KMA, over the past 12-18 months, I have seen a common trend in their responses when I ask them about the Startup Community in Kerala. The most common response can be summed up as –

It’s definitely good to see the startup culture grow in the state. But what we are instead seeing is a bunch of wannabes who want to flaunt a CXO Business Card in their pocket and boast about their startup, without as much knowing how to generate a sustained revenue model. These wannabes break our faith in the startup community, which in turn affects the rest 10-20% who are in it with all passion and seriousness. It’s better to have 10 successful sustainable startups than have 1000 ones who start off with no aim for the future. That is what the policy makers should focus upon.

And I totally agree to that. From personal experience, ever since these so called wannabes have come up, it has become difficult (to a certain extent) for startups to pitch to clients. Almost every second person is of the mentality that these are a bunch of college kids running a startup for the hype sake and they’d just shut town in a few months. So why bother.

On talking about this mentality with couple of my clients, I came to know that they can’t be blamed for this thought. Many of them have had their hands burned when they trusted some work of theirs with a startup company only to know that they had shut down in a couple of months time. In some cases the work remains incomplete whereas in some cases one of the founders of the so called “startup company” works freelance and completes the work for namesake. By then, the client is famished with the experience and they decide never to trust work with these minuscule startups again.

Yes, you see in the news that all is rosy and red for the startup community with VC Funding, mentoring, assistance, Govt. Funding and what not. Medias shine with the glimmer of each new startup on their Page 3 everyday, only to never ask the question of “What Happened to them?”, in a couple of months time. The startup entrepreneurs are also happy to see their smiling faces on the sheets of the newspaper, whereas a revenue model for their firm would be the least of their worries. Parents and neighbours are happy to say “Mera beta TV main aaya!“, but they do not care to ask whether the beta has a clear vision in mind about his startup.

startup community kerala

And to put it frankly, though the steps taken by the government in promoting entrepreneurship are applaudable, the implementation cuts a sorry figure. Crores are being rolled out. To whom and where, heaven knows.

Just pause for a moment here and take a look at the benefits rolled out to promote entrepreneurship in the state, in the recently presented Kerala Financial Budget 2015-16That is more than Rs. 150 Crores for entrepreneurship development related activities alone!!

Where will all this go, I guess we all know the answer.

I still remember the announcement made at YES Kerala last year where Shri P K Kunhalikutty, Hon. Minister (Industries and IT), launched the KSIDC Angel Fund of Rs 20 Crores for development of startups in the state, which saw Mr Yusuf Ali, MD, Emke Group, adding his contribution of Rs 2 Crores seed fund. Well, no one heard about what happened to those 22 Crores, except the recently launched KSIDC Business Incubation Centre in Kochi (If you did, please let me know, and forgive me for my ignorance in that case then).

If given a choice, I’d rather go to the previous scenario where Entrepreneurship was looked upon as voodoo, rather than the present scenario where it’s seen as child’s play. The issue is that in the process of trying to get the numbers going high, the policy makers and the incubation centers have rather diluted the concept of entrepreneurship to a good extent. As people in-charge of the implementation, I’d say it’s their duty to ensure that the spirit of entrepreneurship is showcased in the right way.

Stop glorifying it with gold and glitter. That phase comes much later on.

Stop showcasing entrepreneurs as gods. They are humans who survived shit and still kept going.

Stop focusing on highlighting only the positives when you very well know that the initial years can be hell in a frying pan for a startup.

Most of all, STOP sending the wrong vibes to the student community. They are easily influenced by the pomp and glamour you put in front of them – It’s not their fault per se. It’s how their psychology is!

If this trend keeps going forward, what Kerala will see in 2-3 years time is a whole bunch of unemployed youth, who only hold the experience of designing Powerpoint Presentations and explaining imaginary bar graphs. God forbid that happens, but if it does, that just might be the end of the entrepreneurship mindset amongst the youth in the state.

 

Disclaimer : I do not claim to be a successful startup entrepreneur, nor a wise mentor. All thoughts are personal and based on the common sense with which I have analysed the things happening around me. The pointers shared here are my views, formed as a result of a series of cumulative discussions I have had with various startup entrepreneurs, senior personnel from the industry – including Startup Mentors, HR Managers, Tech Leads and CXO Level Executives. You are free to agree or disagree.

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  • Jery Althaf

    Why do we focus on student entrepreneurs so much ? Are they the right target group. Reminds me of this http://paulgraham.com/before.html

    • Have read that post long back. Absolutely beautiful it is!

      As to your question, I’d say the focus on student startups is so much because it makes good headlines in the newspaper and is apt material for publicity for all involved. Which media would be interested in a 45 year old, with 20 years of experience, starting a new company which solves world hunger? 😀

  • nithin

    In my opinion most of the startups don’t have a clue as where to start or how to develop the business, the main reason I saw is that most of them wants the fame and money, they do not get be much thought in to what’s next or the company’s future.
    So where do you think the change needs to happen, how can we make it a favorable trend for the country as well as businesses?

    • As mentioned, the focus of the policy makers and the incubation centres should not be on getting X number of startups initiated in N Years, but rather analysing each and every business proposal that comes their way and advising on whats wrong and whats right and what changes are needed to make the business profitable and sustainable on the longer run.

      Mentoring doesn’t mean showing them PPTs of how Steve Jobs lived and how Zuckerberg made money. It’s about sitting down with them and giving them your attention. It has to be one-on-one and specific for each startup. No one-fit-for-all solution.

  • paul

    “A bunch of business card CEOs”, what a usage man, the most apt one I would say. A much needed article.

    What we need is, need based products with sustainable business models.

    • True. And well the usage I owe to Vivek Raghavan of Wowmakers, from whose blog post I got the term. Link also attached.

      Thanks for reading through the article and sharing your thoughts. Cheers!

  • The hype aint gonna die any soon, but as responsible #entrepreneurs the question is what are we willing to do ? Arent we also going the path of all words but no play ? I had a different take on this :http://www.slideshare.net/FryingPanAcademy/why-startups-fail-in-kerala-a-call-for-startup-policy

    Well written and it has a sense of reality but what should be the action/solution. What can i or you do here ?

    • Very valid points you have shared in the presentation. As to what we can do, the first thing would be to atleast voice out that what’s happening is wrong. Then based on each one’s individual capacity, the way we respond can be determined. I for one, am taking the support of IEEE to reach out to students, Engg College Incubators and the Industry to see how a difference can be made.
      Everyone cannot move a mountain, but if you can atleast move the boulder for a greater good, it’s a start.

      Thanks for sharing your thoughts Andrine. Cheers!

  • Richy D Alexander

    Dear Vijay, appreciating your effort to publish this article, well said. We hear a lot of startups coming and no follow ups. To me, our youth lack vision & mission, and they have to come out from the dream world, really a dangerous situation. Expecting more from the horse’s mouth. 🙂 Cheers

    • Let’s just pray all turns out well. Some of us do speak out when we can, do try passing the right info to the target community. But since it has no pomp and glamour, at times it gets drowned by the “hype”.

  • Robin Alex Panicker

    പണ്ട് കേരളത്തിലെ കുടുംബങ്ങളിൽ 8 ഉം 10 ഉം ചിലപ്പോൾ 12 ഉം 15 ഉം കുട്ടികൾ ഉണ്ടായിരുന്നു. അതിൽ 2 – 3 പേർ എങ്കിലും പല അസുഖങ്ങൾ കാരണം ബാല്യത്തിൽ തന്നെ മരണമടയുക ആയിരുന്നു പതിവ്. ശരാശരി ആയുസ് 30 വയസ് ആയിരുന്നു 1910ൽ. 100 വർഷങ്ങൾക്കിപ്പുറം മലയാളിയുടെ ശരാശരി ആയുസ് 74 ആണ്. ഈ നേട്ടത്തിന് ഒരു പ്രധാന കാരണം കുട്ടികളെ സൃഷ്ടിക്കുക എന്നതിന് അപ്പുറം കുട്ടികളെ പരിപാലിക്കുക എന്നതിലേക്ക് നാം ശ്രദ്ധിച്ചത് കൊണ്ടാണ്. അപ്പോൾ 10 ഉം 12 ഉം കുട്ടികൾക്ക് പകരം 3 ഉം 2 ഉം കുട്ടികൾ എന്നായി കുടുംബങ്ങളിലെ രീതി.

    കേരളത്തിലെ സ്റ്റാർട്ട്‌ അപ്പ് രംഗത്തും ഈ മാറ്റം വരണം. സ്റ്റാർട്ട്‌ അപ്പുകളെ സൃഷ്ടിക്കുക എന്നതിൽ നിന്ന് അവയെ പരിപാലിക്കുക എന്നതിലേക്ക് ഈ രംഗത്തെ പ്രവർത്തനങ്ങളുടെ ഫോക്കസ് മാറേണ്ടിയിരിക്കുന്നു.

  • Hemanth Kumar

    Start-up Village itself is another “puka mara”.

  • Hemanth Kumar

    The crappy theory oriented education and poorly organized collages and universities serves as dropout factories, thereby creating a fertile ground for wannabe entrepreneurs.

  • Tony Paul

    Excellent post and at the right time. student startups in the state = Product idea + Co-founders + register a company + incubate to SV + PR stunts + A business plan + Chase investors

  • Speaking of startups, have you read Zero to One yet?

  • Mohamed Shabeeb

    Dear vijay

    Your article is one of the best ones I have reas in a long time. A lot of wannabes are ruining the careers of a lot of people. Me and my friends started a startup in 2003, long before the startup era. In those days only experienced domain experts working on overseas projects bought back outsourced work to Kerala. Our company no longer exists but it’s safe to say that the experience has made us richer and all the the of us are doing well now in different parts of the world.

    The biggest issue is that the kids nowadays don’t have any sense in financial planning. They just do it for the fun.

    Let’s hope your articles sets off a train of positive actions to resolve these issues.

    Regards

    • Thanks for the supportive words Shabeeb. I also hope to bring in a change for the better. This is just a start.

      Cheers and thanks for sharing your thoughts.

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  • Joe A Scaria

    Good to hear the ground realities in the start-up arena from someone who knows that community closely. So, what’s thriving isn’t a start-up mantra, but a lot of tantras?

  • Vivek Raghavan

    Dear Vijay, this article is spot on, accurate and it is good actually, though you are pessimistic about it. Since you’ve mentioned my blog in this article, I’ve written my perspective about the situation here: https://medium.com/@imvivk/why-hype-is-good-for-kerala-startups-e60829276b10