Good Videos for Entrepreneurs

Was browsing a few youtube videos today and came across a couple of good ones that I thought had a bunch of good advice for early stage entrepreneurs.

Mark Zuckerberg at Startup School 2013 – good conversation with Paul Graham

Guy Kawasaki – The Top 10 Mistakes of Entrepreneurs @ the Berkeley-Haas school



Education Investments in India – 2013 (Part 1)

It is more than a year since we took a close look at the education investment landscape in India. In this blog post and a couple of subsequent ones, I would like to cover the following:

  • Quick update on investment landscape in education in India
  • How do we split up the education sector and market potential across sub-sectors
  • What are the challenges for each of these sub-sectors
  • How does this compare to what’s happening in the US

India investment landscape for Education

If we look across all VC and PE investments in India it has held more or less steady in the last few years with about 20 investments and about $200M being invested annually (data below courtesy Venture Intelligence)


If you leave out Private Equity investments (growth stage) and look at only Venture Capital and Angel investments the number for 2012 was about 15 investments (and $55M total invested).


Now, lets dive deeper into what’s happening across the various sub-sectors of Education. For the purpose of this discussion, let’s look at the following sub-sectors: Test Preparation, K12, Higher Education & corporate training and Skills/Certification training

In this blog, let’s take a closer look at Test Preparation and in subsequent blogs we can dive deeper into other sub-sectors.

Test Preparation

Test Preparation companies focus on helping students prepare for various entrance exams for engineering, medical, management and other professional streams.  This is probably one of the largest organized sub-sectors within education and has emerged strongly over the past decade. To set the context, there are about 1.2M students who take the engineering entrance exam and about 350K who take the medical entrance exam alone in India. The total addressable market for this sector is safely north of Rs 3500 Cr in revenue potential. Here is a good blog by education entrepreneur Jayadev Gopalakrishnan pegging the market conservatively at about Rs 4000 Cr.  There are two public companies in this space – Career Point and MT Educare and at least 5 other with revenue >Rs100Cr.

In the blog above, Jayadev points out three major trends – exams going online, exams consolidating (JEE Main as an example where there were multiple entrance exams earlier) and renewed importance of Board exams.

We believe that all three are important and hence companies that embrace technologies such as tablet and online practice systems and offer integrated test preparation have an edge. Integrated test prep refers to programs such as FITJEE and ACE-Deeksha that provide integrated board and entrance test preparation thereby using the students time more efficiently without having to shuttle between school and tuitions (for test prep) and using the extra time to effectively practice online or with tablets (full disclosure: ACE is an Accel Partner India’s portfolio company)

One of the pleasures of being an investor in education is that I get to meet entrepreneurs trying to disrupt test preparation using technology. A few companies that are doing outstanding work in this regard are Edutor (tablet learning), Vedantu (online and tablet), Embibe and Toppr (both provide online/tablet based test prep).  These are just a few off the top of my head – I have met at least a dozen other interesting startups in the space.

Challenges: A few challenges that startups that are taking the technology route need to think through:

  • Platform providers: If you are a technology platform provider to test preparation companies you would need to ensure that you are deeply embedded into the test prep companies ecosystem and that you will not be easily switched out.  A good measure of this  – most test prep companies charge >Rs25K per student/year, what fraction of that are  you able to retain?
  • Primary vs Supplementary: For startups that are aiming to go direct to students and selling their solution as a primary test preparation tool, based on numbers I have been able to gather 70-80% of the 1.2M test takers go to some kind of coaching for test preparation. These students are already bombarded with practice tests from their test prep institute and do not have time to use supplementary tools. And so, for your tool to be used by the student, it might be necessary to get it integrated into the test prep institutes curriculum.
  • Addressable market: You need to be able to command >Rs10,000 per student/year so that if 40% of students use your technology solution that is about a Rs500 Cr market (1.2M*40%*Rs10,000)
  • Distribution: And finally, how will you acquire your student customer? Will it be through coaching institutes or by directly marketing to them? If its direct marketing (online and offline) what will be the cost of customer acquisition and will your revenue per customer (over the two years of preparation) support that customer acquisition cost?

Through the Edustars program (applications open through end of November), we hope to discover that next great disruption in the Test Prep market using technology. The above questions are meant for you to think through the basics of building that business so that we can quickly get past these questions and onto building a company that touches millions of students over the coming decade.  Would love to hear your questions and get your feedback on the Test Prep topic.

Will touch upon the other three topics in the next blog post: K12, Higher Education & corporate training, Skills/Certification training

Note: published this blog here.

Accel @ Nasscom Product Conclave 2013

Wanted to briefly recap a couple of events in which Shekhar Kiran and I had the pleasure of participating at the recently concluded Nasscom Product Conclave 2013. Overall, we really enjoyed being at the event (this is my third year attending the event). Just like previous years, the 2013 event managed to get a great set of entrepreneurs to attend and really enjoyed interacting with them. Now to the recap.

Building fundable startups

Shekhar Kirani (my colleague at Accel) and Vijay Anand (from TheStartupCenter in Chennai) brought out the essence of how to build fundable startups in this 45 min panel. Topics where covered in a top-down fashion where they set the context that for Indian VC’s a good exit to shoot for is $200M+. And to achieve that the two essential components are – market and team. They went into great detail on how to pick the right markets and what are the essential components of building a team. If you are a first-time entrepreneur, would encourage you to spend 45 mins reviewing the following video.

Desi vs Pardesi Capital

I had the pleasure of moderating a short 30 min panel on raising capital from Indian investors vs. from investors outside India. More details about the context for the panel is here in this blog post. A quick summary of what we discussed:

  • If you are a startup going after the local Indian market, your best option might be to raise capital from India
  • On the other hand, if you are startup going after the global market, you might want to talk to investors from India as well as outside.
  • We also discussed nuances of fundraising outside India and then trying to raise capital in India (and vice versa).
  • And a shameless plug, there are funds such as our own ( that has global presence and so you have flexibility to raise capital and get help from our team in India as well as across the globe (US, Europe and China).

We are sure there are many questions we did not manage to cover in our short sessions. Please feel free to share those via our Accel India Facebook page.


I want to be VP of Engineering of Flipkart, can you help me?

I get this question from time to time from people who are looking to move to India from the US and other parts of the globe. These are very qualified people but the fact of the matter is. for more mature startups, most of these senior roles are already filled. As someone who moved back to India after more than a decade outside, I always try to encourage people on making this move and have  blogged about things to ponder while planning a  “Career Move to India”. For senior technologists and product folks who are looking to move back, I want to add a few more points here:

  • Stage: Figure out what stage company you want to join. Early stage (seed/Series A funded) vs growth stage (Series C or later) as it relates to the following points
  • What do you want to get out of the experience: This is something you need to be very clear about. Do you want to use this role as a transition to doing your own startup in a couple of years (might be better to go to a later stage startup or even an MNC)  or do you plan to grow with the company over a longer period through their exit (early stage startup)
  • Roles and responsibilities : Are you particular about a VP or CXO title – if so an early stage startup might be more appropriate. Tougher to find these in growth stage companies. As an example, a seed/early stage company probably will have a tech team of between 5-20 people and might want a VP of Engineering to lead the whole team and also wear the CTO hat to figure out tech strategy for the company over the next couple of years. A growth stage company might have a 50+ member tech team and might need a team lead for one particular product which could still be a 10 member team. What role is more suitable for you? 
  • Salary vs. options: How is your cash flow situation. If you have a good safety net and don’t mind lower salary and would like to take on more options, then an early stage startup is probably better for you. Alternately, if you need slightly higher income but don’t mind lower options – growth stage is for you. While doing this math, especially for people looking to move back from US, remember that if you adjust for Purchasing Power Parity, India is roughly at 1/3rd US. and so if you are making $200K in US and someone offers you $100K in India you are going to be saving a lot more in India from your salary. But, you are never going to save enough from your salary (US or here) to retire in 10 years, whereas the options will give you that upside (if the company clicks of course).
  • Age: Know this can get controversial, but if you are in your mid-late 30s  and  if you can split the next 20 years into 4-5 year chunks, you probably have 4-5 shots at goal in your working career. In most startups, within the first 2-3 years you will realize if the company is going to do well or not and most probably your options will be vesting over 4 years and so you will be 50-75% vested in 2-3 yrs. By this math, if you have 4-5 shots at goal left in your working career, this is the right time for you to take those bold bets and go earlier stage into a startup that you think has a higher chance of success and have a big impact as a leader in that company to ensure success. You could take two such shots at goal over the next 6+ years and if either of them clicks you are good to retire and don’t have to work for money. If not, you would have learnt enough across a breadth of responsibilities to be hired in a senior role at a growth stage startup or an MNC at a cushy salary and you go back to status quo in building your retirement kitty slowly over time.

One other point to note about the Indian startup ecosystem is that, over the past year or so, I have seen a few VC backed early stage startups not doing great (shutting down or being merged into other companies), but the good news is that talented senior people from these teams (particularly technologists) are being aggressively hired by other startups. This is good for a culture that is known not to tolerate failure in the past – we are learning that the startup game is bound to have failures but not all failures can be attributed to people. And that good people, irrespective of the startups outcome, deserve and will get good jobs.

Look forward to hearing from people planning to make such moves or looking to join startups. I know many startups in our portfolio and outside that are looking for good senior technology and product folks across multiple sectors. Feel free to ping me at if I can be helpful.

Upskilling 150 Million People


The Economist recently ran a special report on India which was highly informative. I particularly found “A Billion Brains” to be a great summary of the education scene in India. One aspect called out in the article was the humongous skill gap that we have in India.

Here is the gist of it. The current annual demand for skilled labor in India can employ 100% of the population entering employable age. But only 4 MM people (2.8 MM through higher education and 1.2 MM through vocational training) are getting any sort of formal training while 17 MM trained labor is required every year. Majority of graduates study humanities (2.5 MM) and hence have to be trained on the job. The following slides share more details on the demand for labor across sectors and the supply side issues.

Skill Gap In India

Given the above context, the efforts of the National Skill Development Corporation (NSDC) to upskill 150 MM people by 2022, is quite commendable. Here are some highlights from my conversation with NSDC on this topic.

  • Goals: They have 20 identified sectors (plus the unorganized sectors) on which they have tons of market information they have shared via this knowledge bank. They have approved 77 projects so far (61 in training/upskilling and 16 for sector skill council ventures)
  • Criteria for selection: a) Main focus is the ability of the funded project/company to upskill/train a minimum of 100K people in 10 years (this number could be across sectors – same company training IT, Hardware, etc.). b) 70% of the trained people should be gainfully employed. c) And the company should have a robust 10 year business plan
  • Structure of the funding: No specific cap on the funding. They will fund 75% of project cost (without land and buildings). Money is given out in tranches. Mostly as loans – 6% interest (could have an interest moratorium of 2-4 yrs)
  • Stage of the company: They are open to funding from early stage startups to mature companies (as shown in the table below. But, it helps to have some early proof points on how the model will work
  • Sectors: They are keen to fund projects across all 20 identified sectors but seem to have more of an appetite for non-IT projects to balance out their portfolio

The table below summarizes the list of projects they have listed on the website. As you can see, these listed projects aim to upskill about 70 MM people over 10 years and on an average each project upskills about 1.4 MM people at a cost of Rs 36 Crores over 10 years.

NSDC Projects

For startups out there in the training/skills development space (particularly non-IT), NSDC could be a great way for you to get non-dilutive funding for scaling up your operations. If you are a company that has gone through the NSDC process, it would be great if you can share your experiences/tips for other aspiring skills development startups.

Is it a good idea to ping an investor via LinkedIn?

I personally think it is worth a shot for an entrepreneur to try reaching a potential venture capital (VC) or angel investor via LinkedIn. Particularly if you can find a mutual contact to provide an introduction. The main benefits of this approach, over just cold calling or dropping a note on the investing firms website, are the following:

  • The investor can quickly browse through your profile to get a good sense of your professional background and relevance to the startup you are working on
  • Check for mutual connections to do a quick reference check

But, here are a few suggestions while trying this approach:

  • Do some research on the VC firm you are trying to reach and figure out the most appropriate person to reach out to, based on their profile. Most investor profiles list areas of investment interest (e.g. internet, mobile, education, etc.) and so this should not be tough to do
  • Reach out only to one or at most two people at that firm who are appropriate for your particular startup. It does not help if your ping everyone in the VC firm. Yes, this does happen often and if anything it’s counterproductive. What happens is one of the investing team members who receives this, will forward it to the other team member who is more suitable to look at your company (based on interest areas) and if they realize you pinged all the members indiscriminately, it shows that you have not done any research on which of the investors would be better suited for your startup
  • If you have a mutual connection with the investor, see if you can get an introduction by the mutual connection (especially if this person knows the investor well and is willing to refer you)
  • Avoid requesting to “add as connections” directly. Try sending a message via InMail or through mutual connections. Many investors are particular who they add as connections and so, if you directly try adding them, they might “ignore” your request
  • See if the VC is part of any group that indicates a mutual interest area and use that group to reach out to him/her
  • Keep the LinkedIn message short giving a 3-4 sentence summary on your teams background and what you are trying to do. Ask the VC if you could get 15 mins over the phone to give more background and see if mutual interest. Avoid very long messages.

While on the topic of reaching out via a social network, I would highly recommend reading the following article by Ried Hoofman on “The real way to build a social network“, if you haven’t already read it.

Note: published this blog here.



Introducing Edustars

Go to the EduStars website

Education continues to be an exciting sector for entrepreneurial ventures in India. The following chart shows the extent and frequency of the investments that were made in this sector by Private Equity investors (including Venture Capitalists) over the past few years.

Source: Venture Intelligence, Jan 2012

A recent poll conducted among various investors showed that education is one of the most favored sectors for investing.

Source: Venture Intelligence, Jan 2012

What makes education an exciting sector? Anything new?

In his comparison of India and China, Professor Yasheng Huang of MIT – an expert economist on India and China – calls out education (and thereby Human Capital) as one the top reasons why China is ahead.

Here is a link to Prof Huang’s recent presentation at TED. (Forward to 10:30 if you are pressed for time)

This presents a great opportunity for Indian entrepreneurs to have an impact on the Indian education ecosystem – be it K-12, Higher Education or Skills Development. The growing penetration of technology (mobile/tablet devices, internet, etc.) provides greater opportunity to reach out to millions of people and provide more personalized learning options (Khan Academy is pursuing a similar strategy in the US today). There are several opportunities to make the learning process an enjoyable experience. For example, social media tools can be leveraged to improve user interaction and promote group learning.

Why Edustars?

As of right now, in India there is no convenient platform for information sharing among the Education entrepreneurial community.

Edustars has been created to fill that particular need.

At a high level, Edustars aims to:

  • Provide an online platform for information sharing
  • Provide access to a world class mentoring team with deep domain expertise
  • Periodically recognize outstanding startups with an “Edustar” award, thereby providing nationwide visibility
  • Provide information from similar startups around the world with regard to their challenges and triumphs.

We welcome suggestions from education startups regarding any other venues wherein Edustars can add value and contribute towards your overall su