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From Ideas to Wealth thru Entrepreneurship U. B. Desai SPANN Lab Dept. of Electrical Engineering IIT-Bombay www.ee.iitb.ac.in/~ubdesai.

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Presentation on theme: "From Ideas to Wealth thru Entrepreneurship U. B. Desai SPANN Lab Dept. of Electrical Engineering IIT-Bombay www.ee.iitb.ac.in/~ubdesai."— Presentation transcript:

1 From Ideas to Wealth thru Entrepreneurship U. B. Desai SPANN Lab Dept. of Electrical Engineering IIT-Bombay

2 Ideas to Wealth thru Entrepreneurship Entrepreneurship and Wealth Generation General belief that for economic growth General belief that for economic growth Need to generate wealth Need to generate wealth You can think of this in terms of You can think of this in terms of increase GDP increase GDP increase in ease (comfort) in personal life increase in ease (comfort) in personal life Whatever the measure: Whatever the measure: Money plays an important role Money plays an important role Entrepreneurship is business of making money Entrepreneurship is business of making money To some, this may sound crass To some, this may sound crass But this is the bottom line But this is the bottom line

3 Ideas to Wealth thru Entrepreneurship Magic Wand? What is involved in becoming an entrepreneur? OR What is involved in becoming an entrepreneur? OR What is involved in generating wealth? What is involved in generating wealth? No formula No formula Guidelines thru Guidelines thru Case studies Case studies Experience Experience Burning ones fingers Burning ones fingers In short: It is tough In short: It is tough You have to be at the right place at the right time with the right idea a marathon runner (perseverance) Adaptable (may need to change things mid course) Never fall in love with your idea – be open to change

4 Ideas to Wealth thru Entrepreneurship Modern Day Entrepreneurship Complete faith in technology Complete faith in technology Innovation as the key driver Innovation as the key driver You have to be on the lookout for a void, for example: You have to be on the lookout for a void, for example: iPOD iPOD 1 lakh rupee car by Tata 1 lakh rupee car by Tata Always keep looking at your environ for a problem; euphemistically called opportunity Always keep looking at your environ for a problem; euphemistically called opportunity A good understanding of what different segments of the populace can afford is important A good understanding of what different segments of the populace can afford is important simply understanding wants is not enough simply understanding wants is not enough

5 Ideas to Wealth thru Entrepreneurship You take on a giant Different approaches … In the 70s researchers at Fairchild (a giant in semiconductor tech.) came up with CMOS (complementary metal oxide semiconductor) technology In the 70s researchers at Fairchild (a giant in semiconductor tech.) came up with CMOS (complementary metal oxide semiconductor) technology Upper Management at Fairchild refused to accept it as future prospect; were happy with PNP (bi-polar junction) technology Upper Management at Fairchild refused to accept it as future prospect; were happy with PNP (bi-polar junction) technology Researchers with CMOS technology separated and started Intel; as they say rest is history Researchers with CMOS technology separated and started Intel; as they say rest is history Fairchild today is almost non-existent Fairchild today is almost non-existent Juniper took on Cisco and is giving tough competition in the core router segment Juniper took on Cisco and is giving tough competition in the core router segment

6 Ideas to Wealth thru Entrepreneurship Disruptive Technology What is disruptive technology? What is disruptive technology? Working Definition: Working Definition: Technology which creates a major (positive) disruption in the way society functions Technology which creates a major (positive) disruption in the way society functions Best explicated thru examples Best explicated thru examples

7 Ideas to Wealth thru Entrepreneurship Examples of Disruptive Tech. Sun Microsystems Workstations: disrupted the market for main frame computers. Sun Microsystems Workstations: disrupted the market for main frame computers. PCs disrupted the market for workstations PCs disrupted the market for workstations Wireless telephony (GSM, CDMA): disrupted the market for wire-line telephony. Wireless telephony (GSM, CDMA): disrupted the market for wire-line telephony. Xerox plain paper copier: disrupted the market for offset printing. Xerox plain paper copier: disrupted the market for offset printing. Cannon’s desktop photocopiers: disrupted Xerox’s high speed photo copying market. Cannon’s desktop photocopiers: disrupted Xerox’s high speed photo copying market.

8 Ideas to Wealth thru Entrepreneurship Disruptive Technology … Honda motorcycle of 60s Honda motorcycle of 60s Japanese cars of 70s Japanese cars of 70s Korean Cars of late 80s Korean Cars of late 80s Smart Phones will disrupt the market occupied by desktops / laptops Smart Phones will disrupt the market occupied by desktops / laptops…

9 Ideas to Wealth thru Entrepreneurship Impacting Technologies Impacting technologies are disruptive Impacting technologies are disruptive Disruptive innovations are products and services that initially aren't as good as those that historically have been used by customers in mainstream markets, and therefore can take root only in new or less-demanding applications, amongst non-traditional customers Disruptive innovations are products and services that initially aren't as good as those that historically have been used by customers in mainstream markets, and therefore can take root only in new or less-demanding applications, amongst non-traditional customers Stuart Hart and Clayton Christensen Watch out for China Watch out for China

10 Ideas to Wealth thru Entrepreneurship Almost always.. Major waves of growth thru forays at the bottom of the developed markets (DM) Very rarely you can attack a “Mercedes” directly DM

11 Ideas to Wealth thru Entrepreneurship Knowledge Economy Economic growth and wealth generation are driven by the acquisition and use of knowledge Knowledge: research skills information assessment skills ability to innovate ability to implement capacity to continuously learn Knowledge Economy is different than the Industrial Economy This is the great edge that India has We have small window of opportunity and a chance to become world leaders in this domain

12 Ideas to Wealth thru Entrepreneurship Service Industry Service industry is a corner stone of knowledge economy Service industry is a corner stone of knowledge economy Service industry is a corner stone of knowledge economy Service industry is a corner stone of knowledge economy Do not scorn at service industry Do not scorn at service industry In India service industry can be the driver for other industries In India service industry can be the driver for other industries Service Industry Sectors: Banking, insurance, education, finance, marketing, entertainment, leisure and so on. Today ITES (IT enabled services) is a multibillion dollar industry

13 Ideas to Wealth thru Entrepreneurship Indian GDP 56% 22% GDP: $650 billion Rural GDP $160 billlion GDP from IT industry is $20 billion Per Capita income: $534 India’s economy ranked 120 w.r.t. per capita GDP But ranked 4 if one considers PPP (purchasing power parity); after US, China and Japan

14 Ideas to Wealth thru Entrepreneurship Product Industry Very vital for the growth of Indian economy Very vital for the growth of Indian economy Govt. policies are not favorable for product industries Govt. policies are not favorable for product industries Example of China: you can buy latest Example of China: you can buy latest FPGAs, DSPs, LCD display screens like chocolates FPGAs, DSPs, LCD display screens like chocolates Oscilloscopes like TVs Oscilloscopes like TVs … …

15 Ideas to Wealth thru Entrepreneurship Entrepreneurship is Interdisciplinary Take the case of iPOD Take the case of iPOD Audio encoders-decoders Audio encoders-decoders User interface User interface File management File management Search engine Search engine Data base management Data base management Display screen technology Display screen technology Microphones and small footprint HiFi audio amplifier Microphones and small footprint HiFi audio amplifier Sever management, including security, for downloading songs (from millions of songs) Sever management, including security, for downloading songs (from millions of songs) … Could a startup have developed an iPOD? Could a startup have developed an iPOD?

16 Ideas to Wealth thru Entrepreneurship En-ship in Electrical Engineering?? Semiconductor technology Semiconductor technology Wireless technology Wireless technology Innovative Applications of Wireless and Semiconductor technologies Innovative Applications of Wireless and Semiconductor technologies At the end, VCs want a chip At the end, VCs want a chip Software is typically not considered a product by VCs Software is typically not considered a product by VCs Low cost PCs VIA chipset (Taiwan) Given a new meaning to embedded systems New handheld devices Smart homes: Wirelessly controlled homes In general: smart devices …

17 Ideas to Wealth thru Entrepreneurship Need Money to Make Money This is Catch 22 This is Catch 22 During the boom time (~ ) During the boom time (~ ) Get funding based on ppts Get funding based on ppts Today one needs a prototype (bare minimum) Today one needs a prototype (bare minimum) Endorsement from potential buyer Endorsement from potential buyer Preferably a first sale Preferably a first sale Where do you get money for this Where do you get money for this Angles, friends, family, soft loan, ?? Angles, friends, family, soft loan, ?? What today’s VCs wants Biz unit in US R and D unit in India American CEO American Marketing personnel You can be a CTO Indian market is too small for VCs They want a product which can take on giants in the US

18 Ideas to Wealth thru Entrepreneurship Business models and all that Innovations in Biz model is a must Innovations in Biz model is a must iPOD is a case in point iPOD is a case in point Down load a song for 99 cents Down load a song for 99 cents This can add up to billions This can add up to billions Recall, ring tone market is a billion dollar industry Recall, ring tone market is a billion dollar industry Innovative marketing approach Innovative marketing approach Innovative supply chain Innovative supply chain Dell computers Dell computers Very little inventory Very little inventory Technology contributes 15% to 20% in a business; rest all is the other stuff which engineers ignore Technology contributes 15% to 20% in a business; rest all is the other stuff which engineers ignore

19 Ideas to Wealth thru Entrepreneurship How many agree? Entrepreneurship can be a driver for social change Entrepreneurship can be a driver for social change Ethical entrepreneurship is important Ethical entrepreneurship is important Environmentally caring entrepreneurship is important Environmentally caring entrepreneurship is important ??? ???

20 Ideas to Wealth thru Entrepreneurship “It is not our abilities that tell us what we truly are.… it is our choices.” Dumbledore – Harry Potter and the Chamber of Secrets Would you refer to Bunty and Babli as entrepreneurs? Finally …


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