Preethi J.

Unchartered territory beckons the entrepreneur. - K. RAMESH BABU

Entrepreneurs are the adventurers of the century, advancing on their own into the beckoning ocean of business. Tides and sharks come in the form of inadequate infrastructure and wary venture capitalists. They toil to make their dream happen, sustaining themselves on job satisfaction. And when their company is set up and functioning, rolling along well, they still have to labour to ensure the deck is clean and their crew fed. Here an entrepreneur shares his experiences and discusses what must change in India to help leaders rise.

AllGo Embedded Systems was founded by former Motorola employees: Darshak Vasavada, a visiting faculty at IISc, Bangalore; K. Srinivasan, and Arun Hiregange, who were among the pioneers in the DSP group. Together they developed the consumer audio program in Motorola India. The company is just a little more than a year old and employs 30 DSP (digital signal processing) engineers.

Its focus is on creating technology that enables "Seamless" multimedia. Not only does it develop cool technology such as 3D audio, but also delivers full firmware solutions for the networking enabled entertainment device of the future. One of its solutions, showcased recently at a Freescale expo, is a prototype for a music player that can play all formats — MP3, AAC, WMA and OGG. The company is now actively collaborating with IISc to come up with a WiFi Internet Radio prototype.

It plans to hire 25-30 more engineers by March next year, and will be 150-strong in three years.

Says Srinivasan, the Director & CEO, "I clearly remember the many evening and weekend "roof-top" meetings. Darshak's small office was on the second floor with an open roof next to it and we used to sit on the roof and talk for hours. We discussed what to name the company, and how we would get our first customers. It was decided in the beginning itself that we would focus on devices and technologies that enable "entertainment-on-the-go". And the name of our company reinforces this theme. AllGo was born on Oct ober 7, 2004."

Beginning small

"We started operating from one floor of a house in Indiranagar, we did not have a flashy facility, nor the experience. However, we wanted to do everything ourselves rather than outsourcing it. We began by getting everything in place: the company's registration, a chartered accountant, infrastructure and people. There was a lot of running around in the offices of chartered accountants and streets of Shivajinagar.

"Funding was not an issue as we were lucky to have angel investors who had confidence in us. Unless there is a need for a large investment, a company can manage with just a small bunch of angel investors. Companies should select their angels with care, as the right type of investor can be invaluable in bringing business through his contacts. I believe that if one has a good idea and the necessary skills to execute it, getting the funding should not really be a problem.

"One hurdle we encountered early on was when we had to get an Errors & Omissions insurance. Since AllGo was a start-up, there were not many insurance companies who were ready to insure it. After a long search, we found that United India and Cholamandalam MS insurance would insure AllGo. Darshak signed our first contract in February 2005."

Growing up

"When we began, we had very little to show prospective employees. So we were surprised and thrilled to see so many of them dauntlessly taking our offers. It may be frightening for a fresher out of college to join a no-name company, yet this set, fresh out of campus, were energetic and quite eager to work on embedded DSP. They saw a lot of potential to grow and learn. We found that there are many talented and energetic youth. Some of them don't have a perfect skill-set match, but with a little coaching and training, they can be very productive in as little as one month. I also learnt that there is a lot of enterprising and risk-taking crowd out there, which bodes well for India.

"Honestly, we found the atmosphere quite encouraging. Most people we met were encouraging and kind of felt a sense of pride that we were starting on this path. From Motorola big brass, friends, the teashop on the corner (who extended us our first credit line!), the house-owner where our first office was set up, customers, ex-customers and colleagues everyone was very supportive of the new venture."

VCs and banks

"The attitude of banks needs to be changed in India. Even after we started operations and had a revenue stream, many were quite unwilling to lend. They are very risk-averse and don't want to touch companies which are less than three years old. Most venture capitalists are on the lookout for a "killer app" and also not that willing to invest small amounts of money. To start a company in India, a capital of just $100,000-$250,000 may be enough, which is typically too small for a VC. Hence they might be averse to start-ups here."

Experience

"There is the fire within you to do things better in a product company. You own the intellectual property, and the fruits of your labour are yours, unlike service companies, where you serve someone else. That is the impediment to innovation. A product company is more energetic as it is creating things for itself and thinking up ideas and chasing them itself. We wanted to create a "Made In India" technology and IP focused company. The experience of starting and running a company has been invaluable."

preethij@thehindu.co.in

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