Indian Entrepreneurs are one of the most risk-averse in the world. Well not all, there are truly some fantastic exceptions, but most of the demographic is risk averse. Let me explain:
In the business plan of an entrepreneur they do the math, calculate “their” salaries in, the prototyping costs, marketing costs and will assume that “no revenue” is made, and ask for the entire amount from an investor, who has nothing more than an idea and a team (which still demands a salary) that she supposedly has to back. The best pitch for an investor remains the same, Get on the boat, start rowing, and tell them to come onboard or miss the chance.
A lot of the new breed of Indian entrepreneurs have no clue about cash flow management. Its another symptom of the “Bangalore Flu” (that we have caught from the valley). Here’s an example of cash flow management. Air Deccan was started with 5 Crores (1Mn) in the bank. The cost of a Plane is about 60Mn$. The company went on to build the biggest fleet of low cost carriers in the country.
If you are expecting salaries and bills to be paid to be covered by the investment that has to come from the Investors, you are already very very fucked up. You are going to have to bring the first gear in this locomotive, to move from zero to something, everyone can add momentum, not be the air that you breathe or die.
The Present day entrepreneur wants to plan for a fleet of 500, and the cash for it, upfront, at the best valuation, in the bank, funded by VCs. NOT. GOING. TO. HAPPEN.
Want to see who is driving the risk averseness in the market that Indians dont make bold bets? Look at the mirror. It starts with (most of) you.