Startup culture: India vs. US (Guest article)
Guest post by Ms. Neha Kesarwani.
Neha was co-founder of Vertoe, a startup in the US and has worked in startups in India and the US.
Recently an old friend and a mentor, Rahul Deans contacted me to write an article on the key differences between the startup culture in India vs. the US. I have had the experience of building an on-demand short-term storage startup called Vertoe in the US that went on to expand to 65+ cities across 5 countries across the world and raised $3.85 million before COVID-19 hit the travel situation. Vertoe is an on-demand short-term storage app that allows anyone to drop off their bags/belongings at nearby shops within 5 minutes of wherever they are. The app simply enables the users to search for a location close to wherever they are in real-time. Apart from creating my own company from the ground up with my then co-founder, I also had the privilege to work as a Brand Manager at Cocoberry in its early stages where the seeds of problem-solving while navigating through ambiguity started to plant themselves. In recent times, I have associated myself with StartupIndia as an International Mentor, which allowed me to speak to young entrepreneurs who are building businesses in India.
In order to draw a comparison between the startup culture in India and the US, I decided to draw inspiration from my own experience and observation from all these years which hopefully will resonate with many of the readers.
Clarity on what problem are you solving and why?
According to Entrepreneur magazine, Narayan Murthy recently quoted that India lacks quality market research firms which is a testimony to the importance of backing problem-solving with data. Building a startup or any business for the right reasons is what makes a business sustainable in the long run. It starts with asking the right questions and validating those with the primary and secondary research. In India, we require that and while the infrastructure is still missing, research may be done on a smaller sample size with friends, family, and communities that would closely represent the target customer.
Abiding by the same school of thought, one of the most important questions that my cofounder and I answered while building Vertoe was ‘Why are we solving the problem of on-demand storage in the US’ - Is it really that big a problem that needs a solution? Intuitively, we said ‘No’, even though we faced frustration and inconvenience during our own vacation. So we decided to validate our hypothesis through direct market research. To our astonishment, out of 1.2 billion trips taken that year in the US alone, approximately 30% of users experienced a need for short-term storage of their luggage as tourists. This research laid the foundation for our business and instilled confidence in the value we wanted to create no matter how small the problem was. The validation of the product-market fit and consumer feedback is what allowed us to grow the business in the early stages.
A network of mentorship and a strong support system need to be nurtured for creators to flourish.
In my humble opinion, the startup ecosystem in India is still much younger than in the US. Due to that, the startup community in the US enjoys and promotes a solid culture of mentorship programs and the right kind of networking to nurture the growth of businesses. In his book, Never Eat Alone - Keith Ferrazi discusses the importance of building the right network for personal and professional growth.
While building Vertoe in the New York Startup community and getting trained by the mentors at Techstars NYC, we finally learned the power of networking with the right mentors. With personal experience and consistent feedback from the community, it became very clear that it was about finding the right mentor for the specific needs of the business instead of laying all the eggs in one basket. Knowing our own business needs became extremely important for the right matchmaking with investors and mentors. I firmly believe that India has brilliance and a pool of investors but the lack of matchmaking and support system is what makes it hard for the entrepreneurs to set the solid foundation. However, there is hope that the organizations like Startup India and Techstars Bangalore that are steering efforts to create such communities.
India is a bigger opportunity to invest in compared to any developed nation
India is a developing market and that opens up several opportunities to solve problems compared to developed nations like the US. If entrepreneurs create to solve problems in a country like India where there is an abundance of consumers, it is a no-brainer that it should be considered a much bigger opportunity for investors to invest in. In developed countries, most basic human needs are already addressed and therefore creators are creating from a higher level of hierarchy as per Maslow’s hierarchy theory. However, in India there are still basic needs that are yet to be fulfilled and solving a problem from that perspective can enable relevance for the consumers and will certainly attract more investors not just within India but from international markets. One of the things to keep in mind for entrepreneurs is to evaluate the product market fit and back it up with data before they start expecting investors to put in their money. Indians need to stop looking at other countries to replicate business models and instead deep dive into our day-to-day problems to get inspiration from.
In the end, I would like to add that building a startup needs a lot of resilience and courage to keep moving despite rejections. Entrepreneurs, whether in the US or in India require all kinds of support and a strong foundation from their families, friends, and stakeholders to fuel the growth of a business they are building in any market. With the right support, success becomes a little more accessible for the entire ecosystem.
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