PRAKASH BHALERAO: I was born into a financially comfortable and traditional extended family in Indore. My maternal uncle was quite the patriarch. My parents used to pay heed to what he had to say — that nearly cost me my higher education. He didn’t think it was a good idea to send me to IIT Bombay, even though I had got through. His argument was that students picked up “habits” (read: smoking) if they stayed in hostels. I fought and lost, and settled for a college degree. Like my peers, I was interested in computers. So, I enrolled in an engineering course. Though I have been living in the US for the past 30-odd years and respect the country’s idea of the ‘American Dream’ (nothing is impossible), my graduation days in India taught me valuable lessons as well. One of them was to make do with little: what is called the jugaad principle nowadays. At college we resorted to jugaad a lot — for instance, early digital computers used punch cards, often prepared using keypunch machines, as the primary data point. Students would prepare punch cards as a part of the curriculum. But our college, having only one computer, had to send off the cards to IIT Bombay which had the expertise (and computers) to decipher them. We had little exposure, but great professors who made sure that we had a strong grasp of theory. I am really grateful to one such teacher — Professor Iyer. He had just come back from a stint in the US and here he taught a large class of 120 students. He would divide the class into 60 groups and give each group a problem. After the problems were solved, solutions were swapped around. He would let us decide whether a solution worked or not. This exercise stayed with me through my entrepreneurial days — it helped me think out of the box, be open to several ideas at the same time and not get too engrossed in the ‘immediate’ or ‘me’. It was Professor Iyer who egged me on to do more with my life. I applied and got through the Worcester Polytechnic Institute, Massachusetts, for a Masters’ degree in Electrical Engineering. In the US, my reality changed so much: as a student I had access to several of the latest computers and the best libraries. After completing my Masters’, I applied and was employed by Digital Equipment Corporation (DEC) in Palo Alto, California, in the year 1975. It was already a successful company. DEC focussed on new-line, low-cost computers (minicomputers) especially to be used in labs and research institutions. Kenneth Olsen and Harlan Anderson, both electronics engineers from the Massachusetts Institute of Technology, founded the company in 1957 to build low-cost computers that could receive and analyse data from a wide array of scientific instruments. I joined them as a small fish: a CPU designer. But this was an instance when the success stories that people imagine actually happened to me. When I quit, I was the general manager of its semiconducter business. I had started with a small team of 50 and when I left, I had 2,000 people working for me. The company employed more than 120,000 people worldwide at its peak in 1990 and earned more than $14 bn in revenue, till Compaq Computer Corporation bought it in 1998. My lessons in entrepreneurship began in DEC. When entrepreneurs say that they “immediately know” when an idea works, they are deluding themselves. One can never be sure if an idea will work. As an entrepreneur, I take a workable idea and toil on it. If it doesn’t work, then I tweak it. I believe that there is a difference between a founder and an entrepreneur. An entrepreneur is one who fights till an idea takes shape. It doesn’t matter to him (or her) if the idea is his. But he is responsible for spinning and positioning the value of the idea. On the other hand, I see a founder as the main visionary. A successful entrepreneur is a better administrator than visionary. Take Steve Jobs, for instance. His best move was to put in place a team of great managers and ideators, and then oversee the whole operation. The best possible compliment to any entrepreneur would be that he’s tenacious. The founding directors of DEC were great administrators and tenacious as well. The company encouraged workers to constantly think innovatively: pitch an idea and make it work. I helped DEC build four businesses. As I grew, my comfort level in the company, and in the position, also grew. Finally, I was rather too comfortable. All I was doing was picking up the phone and calling people (by then I had a quite a network) and asking them for favours. People say that Indians hit a glass ceiling at Silicon Valley. I would not agree. The only reason that I called it quits was because the work was getting predictable. One of my friends suggested that I “detox” myself for a while, and I took his advice. But I am an Indian after all, and couldn't stay away from work for too long. I soon joined C-Cube Systems, a smaller set-up. A life lesson from my time there was to look at the company’s vision. I became a venture capitalist and an angel investor because of selfish reasons. I am an entrepreneur; I get excited when I am introduced to a new idea and love to see it to its end. Or tweak it till it becomes perfect. And I believe that Indians have what it takes to be successful entrepreneurs — intelligence and tenacity. When I compare them to Americans, I see a difference. I have understood we are sometimes resistant to diversification. The young newlywealthy entrepreneurs need to learn what to do with their money a bit better. Because stock markets crash. Paper or money can disappear overnight. I have watched too many Silicon Valley ventures razed to the ground pre and post the 2001 market crash. Though we have a tendency to scoff at people who buy vineyards, luxury cars, yachts or islands when they make a lot of money, I believe these are assets. Even if the price of the Ferrari drops tomorrow, there’s a certain price tag that it will carry. Selling it off would get some money, instead of putting all of it in the share market. I have always tried to dissuade people who come to me for financial advice from putting all their eggs in one basket. It is a mistake — make sure that if you are a business owner and especially a smart first-generation one, you diversify, whether in your business or in assets. I learnt this the hard way when, overnight, I lost $9 mn in stocks and shares. My wife Sujata, a doctor, panicked. She literally forced me to consult what was known as a ‘financial technician’. I remember that the meeting lasted two hours. By the time he was done with me, I was sweating and my list of savings was nearly non-existent. He made us keep aside a portion of our earnings in municipal bonds and treasury bills. Though the returns on these are really very low, conversely they are the safest options available to a VC or angel investor. I have always stuck by his expenditure diet since then. As an Indian investor in the US, I thought that it was imperative that I hold out a helping hand to my fellow countrymen. Have I been partial to Indian entrepreneurs? No. But I have been partial to interesting ideas that managed to excite me. I will admit that. Our problem is that usually most IT people still don’t hail from business families. They don’t have the background, expertise or mentors who could help them out. That’s where people like me have to step in. As an angel investor, there are four questions that I try to work out in my mind when I am looking at an entity. Let’s say the entity is an automobile manufacturer looking for investors. Is its market confused? Does it have a massive opportunity? Is the product differentiating? Does the entity have a strong team? Mostly in this order. If there is no demand, there’s no need for a product. If you can’t create sufficient differentiation between your product and someone else’s, then there would be a confused market. Finally, dysfunctional teams don’t make any wonderful, original idea work. People often ask me when I will retire — I can’t. My wife has long retired and she’s enjoying herself. My children are doing well for themselves. Honestly, there’s no sane reason that I should be working. But I am addicted to work and entrepreneurship. Recently, I was introduced to an entertainment distribution company focussed on interactive information and saw tremendous potential in it. Thus, my interest in avaniTV Solutions Pvt Ltd began. The company wants to provide passengers branded, live television and movies on demand, along with internet music and video service in the comfort of their cars. The idea was developed by a Verisimo Networks team in a Bengaluru lab. There’s potential in the concept and for now it’s set my blood rushing. This is the high that defines my work as an entrepreneur. So here I go again.