Outlook for VC Funding in India for 2008

The National Venture Capital Association (NVCA) has come out with their projections for the year 2008. Much of the predictions are in line with what is already known, that tech spending is going to significantly reduce in 2008, leading to reduced opportunities that will trickle down in as fewer exits and even fewer IPOs.

According to NVCA, a vast majority of their members estimate that the investments for 2008 will be to the tune of $27 billion, which is pretty close to the number that was for the year 2007. In 2007, according to studies, India had accounted for $4.2 billion of that figure and considering the state of the US economy, the logical conclusion would be that the investors would be looking at markets outside the US for better returns, thus leading to at least that number being matched or easily crossed in 2008.

In 2008 the slowdown is expected to hit IT spending by a wide margin:

“In January, we predicted IT spending growth of 6.1 percent for 2007. It now looks like growth will be 3.5 percent at year end.” – Jim Hale, Founding Partner, FTVentures

This is a sentiment that is widely seen on Wall Street with analysts scampering to fill their portfolio with safe stocks (companies that have a limited impact in terms of exposure to the US economy by having wider exposure to emerging markets and companies that do mission-critical installations and service contracts like Cisco or Oracle, who will have limited impact). Strangely, all of the analysts seem to consider semiconductors as a safe bet since there are major cost and capacity cuts planned for 2008 to shore up margins and increased demand to due to artificially constrained supply.

So, what does it mean for India? Well, not much. The segments that the VCs are looking to invest are the following: CleanTech, Media and entertainment, Biotech and Internet specific companies. Currently, other than carbon credits, there is not much worth investing in country yet that is in the domain of cleantech. Biotech is a bit of an enigma for me and honestly, other than a barebones knowledge that the segment is doing really well, I have no clue about how much is being taken onboard in terms of venture capital in the segment. there is though a fleeting mention somewhere that the segment attracted about $125 m funding in 2006. Maybe, this will be our rock star segment for 2008?

That leaves us with the obvious and usual suspects of media and entertainment and Internet specific companies. The latter is quite an interesting segment since it is exploding in India. At the same time, it is not a cheap segment to be in. Initial capital requirements are insanely high and the cost of securing decent carriage is even higher. And I can’t really see any existing players who are looking to do an IPO in 2008, though there is the rumor of Reuters exiting the Times Now venture (I know, I know, single sourced anonymous comment means nothing!), leaving a nice chunk of equity available for being picked up. Of course, there is the much bigger rumor of BCCL itself looking to offload some equity, even as it still won’t get itself listed.

Internet-specific companies. Oh well. Which and where, are two rather interesting questions in the segment. Most of the established players already have varying degrees of of exposure to venture capital and others are already public. Even if there is intent, like in the case of Infoedge, of raising capital, the question remains where are you going t put that money into? With even IAMAI scaling down its projections for growth and usage of internet in India, the chances of a surprise segment that will manifest itself in 2008 is going to be highly unlikely.

Other obvious ones like travel have already been done to death (with established number 1, 2 and 3 players), leaving us with the rather obvious option of consolidation via M&As. Other segments like matrimony and email have the same issues and even if were to talk in terms of the potential that is present in the market, we’d end up with the usual chicken-and-egg problem of penetration stifling reach all too easily.

All said and done, this is mostly guesswork, informed and uninformed, so what actually happens remains to be seen in 2008.

Burning Brijjes?

It has been a while since we went over the entire social networking fracas vis-a-vis Brijj, which is Infoedge’s social networking product. At that point in time the contention was that it will pick up traction either organically or through Naukri, but the available metrics (I know that Techtribe.com is a bad one to compare it with, but there is really no other player out there) says something else altogether.

On a related note, a search for “Infoedge” on Brijj returns me about 43 results, while the same query on Linkedin with the filter for current employees set to on gives me 66 users. I guess that says a story by itself.

Now, I am not trying to jump all over Brijj when it is not doing all that great, but at the same time we have to start questioning the logic of pushing out “me-too” products out into the Indian market, after looking at what has worked in the west.

I can understand that at some point you need to do all of this to show some action on the investor front, but, eventually, the question remains: is it worthwhile to launch a product just for those reasons?

p.s: I am using the Alexa grab since WordPress.com does not allow me to embed Javascript within posts.

Opinion: Kafka on the shore

The first feeling you get after finishing Haruki Murakami’s Kafka on the shore is akin to stepping out of being in a deep and delicious trance. Beyond the intricate detailing of events and characters, when you step out of the often-crazy world that Murakami sets up, you feel wrung inside-out, having been dragged along with the characters on their respective amazing journeys.

The most distinct thing about Kafka on the shore is that judgment is flung firmly out of the window from the first page. If you are the types who work overtime to make moral or any other type of judgments, this book is certainly not for you. On the other hand, if you love your fiction like if it were the best Tiramisu you have ever had in your life — multi-layered and mutli-flavoured — this is certainly the book for you.

The story has a pace that is quite unexpected and does not let off till the end and it covers grounds and cultures that is very obviously beyond what the Japanese isles — where the story is set — can account for. At the same time, it does not shut you out, even if you are not the average ‘intellectual’ and keeps you firmly interested and involved till the end.

The best thing about the book is that there are so many different ways in which it can be interpreted, but the overbearing theme is of a constant search for the self, which is the thread that joins together everyone involved in the book.

I guess that is what makes the book so special, that there is a little bit of yourself in every character, without it being entirely about you. The work stands equally tall, even when you don’t identify with it.

The only question that remains is if anyone would dare to make a movie. Rest assured, it will never be a commercial hit, but writing a screenplay for it and later translating it with a camera should be an adventure that very few would dare to start on.

You know that you live in interesting times when:

1. A bunch of cats and dogs speaking silly English gets more traction on a regular basis than the political blog of a mainstream television network on WordPress.com
2. The most read story on latimes.com is about a transsexual sportswriter coming out in the publication that he she writes for.
3. OJR’s “Five lessons from 2007” amount to pretty much no lesson at all. Seriously, if getting a breaking news blog, copying sports style and trying to dig the facts out is all that it would take to ‘fix’ media in 2008, I am at a loss for what can be said about the situation.

Installing Apache, PHP, MySQL, Postgresql on Mac OSX Leopard from source

Update: Updated post (on December 11, 2008) here.

Notes

1. We won’t be running any binary installations, all software will be compiled from source.
2. The installation won’t make use of Fink or Darwinports either.
3. These are instructions for the Intel Macs.
4. Using this approach would mean that you will need to maintain the stack by hand.
5. Use this information at your own risk.
6. If you don’t want to go through all the trouble and use a binary installation, read this post.

The software stack we are going to install will be as follows:

Apache HTTP Server 2.2.6

Modules
core
mod_authn_file
mod_authn_dbm
mod_authn_default
mod_authz_host
mod_authz_groupfile
mod_authz_user
mod_authz_default
mod_auth_basic
mod_include
mod_filter
mod_log_config
mod_env
mod_setenvif
mod_ssl
prefork
http_core
mod_mime
mod_dav
mod_status
mod_autoindex
mod_asis
mod_info
mod_cgi
mod_dav_fs
mod_negotiation
mod_dir
mod_actions
mod_speling
mod_alias
mod_rewrite
mod_so
mod_php5

PHP 5.2.5

Modules
bz2
calendar
ctype
curl
date
dom
exif
filter
gd
hash
iconv
json
ldap
libxml
mbstring
mysql
mysqli
pcre
PDO
pdo_mysql
pdo_pgsql
pdo_sqlite
pgsql
posix
session
SimpleXML
snmp
SPL
SQLite
standard
tidy
tokenizer
xml
xmlreader
xmlrpc
xmlwriter
xsl
zlib

MySQL 5.1.22 RC

Stock install

Postgresql 8.2.5

Stock install

We will also need to install the following software dependencies:

1. Xcode (from the Leopard DVD or Apple Developer connection )
2. Readline (
   http://tiswww.case.edu/php/chet/readline/rltop.html
   )
3. Tidy (
   http://tidy.sourceforge.net
   )

This installation would not have been possible without help from the following websites:

1. Installing Readline on OSX without using Fink or Darwinports
2. Workaround for Tidy’s platform.h problem
3. Installing the GD library on OSX Leopard

Now to the installation:

Install Xcode

Install MySQL

Download mysql-5.1.22-rc.tar.gz from the http://dev.mysql.com website
Uncompress
$/configure --prefix=/usr/local/mysql
$make
$sudo make install

Update: The steps did help me in getting to install the server, but on start up it did give certain location-specific errors.

As Hill has pointed out in the comments, MySQL.com has not released a version of their software for Leopard, but I got 5.1.22 RC to install, run and connect from PHP without any hassles following the instructions in one of the links he had kindly posted.

Install Readline

Download the source from ftp://ftp.cwru.edu/pub/bash/readline-5.2.tar.gz
Uncompress
$./configure
There are bugs with the installation as elaborated in this link with workarounds:
$make static
$sudo make install static

Install Postgresql

Download the source from
http://www.postgresql.org

Uncompress
$./configure --with-prefix=/usr/local/postgresql
$make
$sudo make install

Install GD

Follow the instructions at Veola.net

Install Tidy

Download Tidy source
Uncompress
$./configure
$make
This will throw up errors that can be fixed by following these instructions
$sudo make install

Install Apache

$CFLAGS="-arch i386 -isysroot /Developer/SDKs/MacOSX10.5.sdk"
$./configure \
--prefix=/usr/local/apache2 \
--enable-authn-dbm \
--enable-ssl \
--enable-dav \
--enable-info \
--enable-speling \
--disable-userdir \
--enable-rewrite \
--enable-so \
--with-ssl=/usr/bin

if you get an apr.h error regarding sendfile, edit the apr.h file in srclib/ext/includes and change APR_HAS_SENDFILE to ’0′

$make
$sudo make install

Install PHP

$./configure \
--with-apxs2=/usr/local/apache2/bin/apxs \
--prefix=/usr/local/php \
--with-pgsql=/usr/local/postgresql \
--with-mysql=/usr/local/mysql \
--with-mysqli=/usr/local/mysql/bin/mysql_config \
--with-tidy=/usr \
--with-curl=/usr/bin \
--with-curlwrappers \
--with-openssl-dir=/usr/bin \
--with-gd \
--with-jpeg-dir=/usr/local/lib \
--with-png-dir=/usr/X11R6 \
--with-zlib-dir=/usr \
--with-freetype-dir=/usr/X11R6 \
--enable-mbstring \
--with-xpm-dir=/usr/X11R6 \
--with-pdo-pgsql=/usr/local/postgresql \
--with-pdo-mysql=/usr/local/mysql \
--with-xsl=/usr/bin \
--with-ldap \
--with-xmlrpc \
--with-iconv-dir=/usr \
--with-snmp=/usr --enable-exif \
--enable-calendar \
--with-bz2=/usr \
--enable-debug

$make
$sudo make install

And that’s all folks!