How are you going to get a local dosa joint in a little neighbourhood to advertise online?

By Ekalavya B • June 18, 2007

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Figure the answer to the above question and you might have a real successful online venture in India.

Came across this interview of Vineet Buch in today’s edition of Live Mint.
I would call it a must read for everyone interested the Online scene in India, especially guys from young start-ups.

Who is Vineet Buch?
An IIT Kanpure alum, Vineet Buch co-founded two Silicon Valley start-ups, Riya Inc. and Karient Inc. before signing up with Menlo Park-based VC BlueRun Ventures two years ago.

Here are my favourite parts of the interview:
(For the complete interview check out LiveMint.com)

What is different about being a venture capitalist (as compared to an entrepreneur)?
There is a fundamental difference. Entrepreneurs are in charge, they steer the ship. The VC is a kind of navigator. In the end, we can only give advice and suggestions. So, while we have a big-picture view and can offer connections, good VCs have to realize that they have to give control to the entrepreneur.

Is the start-up environment in India very different now from what it was two years ago?
Yes. And the difference is dramatic. I’ve been following this for almost three years. Earlier people weren’t ambitious and didn’t appreciate markets. Something has happened in the past year or so. The quality and drive you see in people today represents a quantum shift in mindset. Partly perhaps because people have become more accepting of the notion of entrepreneurship. It’s okay to take a risk.

What is hot in the US Internet market right now? Do you see successful parallels emerging here?
The hot thing right now is social media, people like MySpace and Facebook. There are people trying to copy that here. There are many people trying to become the MySpace of India. I think the problem is that, first of all Orkut already has a big presence here. It’s so hard in the social media world to make money, even in the US market which is huge. Given the very small size of the online advertising market here, I think what people are ignoring is that pure online models worked well in the US because of the sheer size of the cyber advertising market in that country. In India, given the very small size of the online market, a hybrid online-offline model will work better. The average Indian still isn’t very online savvy. People don’t go home and spend an hour surfing the Internet.

A lot of people are trying a localized version of search. You see it working the way it has in China?
Look at the Chinese market. Google and Yahoo! were not able to prevent Baidu from becoming the number one search engine in China. The dominant language was not English and Baidu had a great head start with the government’s support. By the time Google and Yahoo! woke up and started taking Baidu on, it was too late.

India is not like that. The government does not control anything. It is an open market. Google and Yahoo! have certainly heard of India. The predominant language of the Internet is English. In the horizontal search market, which is really the biggest market for search, so I don’t think there’s room for an upstart. There are several websites in Tamil and Hindi but the bulk are still in English. Google and Yahoo! have Hindi pages as well. There have been similarities in the US on local search. The big issue here is how do you scale that? How are you going to get a local dosa joint in a little neighbourhood to advertise? How do you reach out to that small business and get its ads cost effectively?

Entire interview is available here.

Credit: Snigdha Sengupta @ LiveMint

My Views:
An online-offline model is an excellent suggestion for all the Indian upcoming social networks. Get offline, get the users to come online primarily to use your service and also engage them offline regularly to make sure the overall engagement doesn’t wither away too soon.

As far as local search is concerned, unless you can penetrate the local market to the dosa waala in the gully, you are going to be killed by the established players. Though JuxtConsult revealed figures of an considerable amount of multi-lingual content consumption – I still have my doubts over the success of multi-lingual services in India, primarily because the chhote sheher ke log want to learn English and not stick to their mother tongues. Advertising revenue in English dailies and English content websites far out-number their multi-lingual counterparts.

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