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WANT TO STAY AT HOME AND MAKE MONEY?
30 kick-ass businesses you can start from your backyard
Building a dealer network: The Hero Honda way Get free mobile applications for your business Safety tips for online banking Assess your company’s income for tax
table of contents
BUSINESS @ HOME
Turn your home into your entrepreneurial haven. MAKE MONEY @ HOME 28 THE BASICS OF STARTING A HOME-BASED BUSINESS 60 IS YOUR SIDE BIZ READY FOR A FULL-TIME FOCUS? 62 10 ESSENTIAL HOME OFFICE TOOLS 64
6 Entrepreneur + June 2010
WOMEN ENTREPRENEUR 76 UNDER THE ARCLIGHTS We raise the curtains on Arundhati Nag, the woman behind Bengaluru’s Rangashankara drama theater. By Shonali Advani
SOCIAL ENTREPRENEUR 78 FOR YOUR EYES ONLY Aravind Eye Hospital epitomizes successful social entrepreneurship in India. By Pranbihanga Borpuzari
80 A SECURE OPTION Zicom Electronic Security Systems is ‘safeguarding’ its position in the highly sought-after private security domain. By Pranbihanga Borpuzari
Astute advice from experts and industry veterans.
20 WISE GUY
Insights from Guy Kawasaki
Business tips from Bharat Banka
22 WOMEN IN CONTROL
Nandini Vaidyanathan on the importance of investing in yourself
23 VC INSIDER Brad Feld takes you inside a VC’s mind 82
24 IDEA DECK IAN’s Joe Fernandes on what makes a business idea exciting 26 SANU SAYS
Perspectives from Silicon Valley
27 SOLUTIONS FOR SUCCESS
Vijay Anand on the art of finding profitable solutions
Face to face with those who matter.
82 CHIEF ECONOMIC ADVISOR TO THE GOVERNMENT, KAUSHIK BASU India’s governmental problems and possible solutions pour out of this advisor to the Ministry of Finance and C. Marks Professor of Economics at Cornell University By Pranbihanga Borpuzari
To read more, grab the June issue of Entrepreneur Entrepreneur + June 2010 7 To Subscribe, visit www.entrepreneurindia.in
table of contents 90
90 GOOGLEâ€™S GOOGLY Googleâ€™s dedicated SME division in Gurgaon has been dealing with some curveballs, thanks to the Indian SME market. By Pranbihanga Borpuzari
SUCCESS STRATEGIES How to play your cards right.
85 WHEN SECOND IS REALLY THE BEST By Mark Henricks 88 HERO HONDA: â€œOUR GROWTH IS DUE TO OUR DEALERSâ€? By Anil Dua
Where to get it, how to make it, how to keep it coming in.
93 THE COST OF FOUND MONEY 94 DIP INTO THE DEBT MARKET 96 FINE ART OF INVESTMENT 97 TOWARD GREENER, SAFER ROADS 98 IS ONLINE BANKING SAFE?
Cool ways that tech can help you grow.
99 TRAP THIS APP 101 FIGHT THE POWER CORD 102 KNOWLEDGEWEBB IS POWER
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12 NEWS IMPACT COVER DESIGN
14 SME DOCTOR
If you want to do business, do it here.
126 AHMEDABAD: VIBRANT HUES
Gears and gadgets to rev up your business.
128 CAN CHEVY BEAT FORD FIGO?
BACKSTAGE 130 TEN REASONS TO RUN A BUSINESS FROM HOME
8 Entrepreneur + June 2010
start ups [Contents]
HOT STARTUP OF THE MONTH
106 Dark No More
Inderpreet Wadhwa is attempting to solve India’s power problems—and is cashing in on the sun! By Ankush Chibber
109 Circle of Business
If you can’t beat them, join the smaller fish! That’s what is working wonders for the fast-growing social networking site, Apnacircle. By Pranbihanga Borpuzari 109
Home Safe’s drivers will get you home, no matter how late it is or how drunk you are! By Pranbihanga Borpuzari 110
112 Hang ’Em Up!
Premium brands are getting hung up on a unique form of advertising—on environment-friendly hangers— courtesy Hangvertiser! By Ankush Chibber
114 The Loan Rangers
BankBazaar.com is simplifying life for loan seekers. By Shonali Advani
THE HOW-TO GUIDE 116 Get VC Funding – Part V 117 Set Up and Run a Home-based Business 120
118 Use LinkedIn for Business 119 Get Free Publicity 120 Assess Your Company’s Income for Tax 123 Write a Business Plan – Part V 124 Set Up a Medical College
To read more, grab the June issue of Entrepreneur Entrepreneur + June 2010 105 To Subscribe, visit www.entrepreneurindia.in
28 Entrepreneur + June 2010
Home Make Money @
By Ankush Chibber, Pranbihanga Borpuzari, Shonali Advani & Shobha Mathur Styling by Ruchi Shah, Chaitanya Surpur & Neha Mithbawkar Photographs by Neha Mithbawkar.
You donâ€™t need fancy offices to start up.
Use your home and start making money.
When it comes to selling products and services, the best home business is one that fits your interests and abilities. Read on to know about 30 sure-shot businesses you can start from home and make money.
Entrepreneur + June 2010 29
cover story TRAVEL-WISE SEED CAPITAL Rs.25 lakh
ROI PERIOD Over three years
Specialty Travel Services Operators organize special package tours for international and domestic tourists. Similarly, they create tailor-made holiday packages for Indians who wish to travel abroad. Travel and tourism has been a big Forex earner for India and its tour operators. SCOPE It is believed that the sky is the limit for enterprising travel operators who are fully conversant with IT and are quick to block hotel rooms anywhere in the world before the onset of the peak season. VIABILITY Foreign tourists book entire holiday packages in foreign currency, which when converted into Indian rupees rakes in a bounty for package tour operators. However, foreign tour packages are not as lucrative as they lead to slimmer margins being shared across foreign agents and being paid for in Indian currency. START UP Tour operators should possess a personal knowledge of the food, local sightseeing
spots and lodging options at holiday spots. Also vital to this business is accessing travel literature from relevant departments, to easily draw travel schedules. PITFALLS TO AVOID The tour operator has to be careful while hiring a guide or tour manager, so that customers are not misguided or cheated on tour schedules. THE INDUSTRY According to industry estimates, export earnings from international visitors and tourism goods are expected to generate $51.4 billion by 2019. This year, for example, over 2.5 million foreign tourists and 4.5 million domestic tourists are likely to arrive in Delhi for the Commonwealth Games. The foreign tourists coming to India will depend on local travel agents for tour itineraries, hotel bookings, flight reservations and visas.
Bachelors degree in Tourism and Travel Management, Madras University; PG Diploma in Tourism Management, Indian Institute of Tourism and Travel Management, Gwalior; IATA Diploma Course in Air Ticketing; National Institute of Tourism & Hospitality Management, Hyderabad; ITDC organizes travel agents meet every six months to one year to discuss holiday destinations
EXPECTED REVENUE Rs.1 crore per month between 5-10 years. Proﬁt margin from incoming foreign tourists: 25-30 percent; Proﬁt margin from foreign package tours: 7-12 percent
OFFICE REQUIREMENTS 1,000 sq. ft. office with IT support and eight employees, including tour manager for drafting tour itinerary, coordinator for liaising with clients, two employees for air ticketing, one for looking into passport and visas, one for handling Forex issues and one for marketing. Air ticketing staff must complete correspondence course of IATA. Four MUVs with drivers are also needed. Tourist guides can be sourced from Tourist Guides Federation of India
LICENSING & PERMISSIONS IATO recognition, TAAI recognition, license for tour operator from Government of India Tourism Office (to be renewed every ﬁve years), recognition from IATA
SMOOTH OPERATOR Mohammed Afzal A zoology graduate from Loyola College, Chennai, Mohammed Afzal was interested in the tourism business from his early days as his father was a lorry transporter. Afzal began in a humble way in 1980 while studying, with a single taxi and Rs.15,000. His agency, Parveen Travels, rented taxis for tour packages arranged by travel agents. A decade ago, he started as a tour operator. Today Afzal, MD, Parveen Travel and Holidays Pvt. Ltd., possesses a ﬂeet of 150 taxis and tempo travelers, besides 750 tourist coaches and has on board a network of 50 travel agents and 43 branches in South India. Parveen Holidays Pvt. Ltd. has so far clocked Rs.12 crore while Parveen Travels Pvt. Ltd. is nudging Rs.110 crore. 52 Entrepreneur + June 2010
Photo© Sivaraman Kitta
POT SHOT AT SUCCESS SEED CAPITAL Rs.10,000 for delivering 200 tiffin boxes daily
ROI PERIOD Immediate (it’s a cash/carry industry)
RESOURCES 2-4 year diploma courses are run by the Oberoi Centre of Learning and Development, New Delhi, Taj Institute of Hotel Management, Aurangabad and Welcomegroup Graduate School of Hotel Management, Manipal. Most reputed hotels run catering institutes. Courses are available at National Council of Hotel Management and Catering Technology, Delhi and Institute of Hotel Management and Catering Technology, Chennai
EXPECTED REVENUE Bottomline ranges from 10 to 15 percent
OFFICE REQUIREMENTS A small kitchen unit run from home will require a space of about 100 sq. ft. with two helpers
LICENSING & PERMISSIONS No permissions or licenses are required for home dabba services. For a commercial catering service, you will need registration from the Directorate of Commerce and Industry, state government, service tax registration under the Central Board of Excise and Customs, food handling license by the Municipal Corporation
Catering Services This could involve simple lunch box drop-offs or a full-blown food catering service at speciﬁc locales or events. The food could be prepared on site by the caterer or, alternatively, cooked food could be supplied after adding ﬁnishing touches to it before serving. SCOPE This business has tremendous potential and can graduate from the level of a small dabbawalla (lunch-box) service to operating a seven-star hotel. VIABILITY Catering is a viable industry pan-India, especially in towns with a cosmopolitan crowd, as people love food! To be successful, you could prepare cuisines of different parts of the country. For instance, in South India, Bengali, Gujarati or Rajasthani specialty food would be an instant hit. This works on the premise that people prefer a change in their traditional food styles. START UP In the requirements list, for a small-scale catering service restricted to packed
lunch boxes, a small home kitchen with a couple of supporting staff would be ideal. As the business expands, a larger kitchen fitted with gadgets like commercial gas stoves will be required. A staff of 10 members, including cooks, dish-washers and an office assistant, will be useful. PITFALLS TO AVOID You have to work with single-minded dedication until you gain recognition in the market. Any compromise on food quality will not be forgiven by clients. Similarly, food wastages while cooking or meal-delivery will cause financial losses. THE INDUSTRY Unorganized players dominate a large chunk but slowly organized players like restaurant chains are acquiring or merging with catering industry members.
COOKED TO PERFECTION Pradeep and Madhulika Mathur Husband-wife duo Pradeep and Madhulika Mathur were both fond of dabbling in the kitchen. Madhulika, a post-graduate from Rajasthan University and a radio singer, took the plunge in catering in 2002. A year later her husband, who was a management graduate and corporate professional, joined her. A service that began with delivering ﬁve lunch boxes per day to Frost & Sullivan has today morphed into corporate catering, primarily of North Indian food. Their catering company, Maruti Foods, runs two cafeterias for Mahindra Satyam at Chennai. The duo also organizes food festivals of Rajasthani and Hyderabadi food and delicacies from Uttar Pradesh and Punjab. Photo© Sivaraman Kitta
To read more, grab the June issue of Entrepreneur Entrepreneur + June 2010 53 To Subscribe, visit www.entrepreneurindia.in
â€œOur entrepreneurs will get a leg-up if we energize our bond marketâ€? 82 Entrepreneur + June 2010
ENTREPRENEUR (E): Our smaller homegrown industries have been hammered by cheaper Chinese products, while countries like Bangladesh are competing with our textile sector. What is the issue here and what do we do about it? KAUSHIK BASU (KB): The most important ingredient for success in the sectors where we face competition from Bangladesh, Vietnam and China is infrastructure—both hard and soft. By hard infrastructure I mean the usual— ports, roads, rails and steady power supply. By soft infrastructure I mean the efficacy of the bureaucratic machinery—the customs work and the various permits one needs to send goods abroad. Delays in these can destroy the prospects of exports. Export, as a sector, is very punctuality-dependent; this is especially true for textiles and apparel. The other factor that has hurt our manufacturing exports sector is our labor laws and, more importantly, the culture and norms they have spawned. They have disadvantaged our manufacturing sector and prevented it from reaping the full advantages of the economies of scale. Actually it is the small to mid-sized firms that have been most adversely affected by these laws. Many of them do not apply to very small firms, so they are not affected by them; and the really big corporations have the money power to iron out the hurdles. Ironically, it is the workers—in both the informal and formal sectors—who have lost out the most because of these laws. The laws have contributed to keeping the demand for labor low and, as a consequence, wages have remained low. It is trade unions that should be demanding more flexible labor laws. The rupee exchange rate also has played a role in restraining our exports sector.
He is the Chief Economic Advisor to the Government of India, Ministry of Finance, and C. Marks Professor of Economics at Cornell University. An outsider to the government machinery, Kaushik Basu talks about his frustrations, the changes needed to labor laws and the lessons to learn from our neighbors. By Pranbihanga Borpuzari
Photo© Shamik Banerjee
E: Is the cluster development program really working? KB: Cluster development is important to get some of the advantages of returns of scale. When you have several operations taking place in one area and infrastructure can be shared between different units, there can be large dividends. I do not think we have done well in this regard and I cannot give a one-line answer as to why we have not done well. Bangladesh should be a good lesson for us since we have inherited similar histories. We have come out of similar colonial pasts and certainly sectors like textiles
To read more, grab the June issue of Entrepreneur Entrepreneur + June 2010 83 To Subscribe, visit www.entrepreneurindia.in
tech department [Web Sight]
MEMBERS ONLY “One of the things that bugs me about other training sites is that you’re laid off or you’re desperate to learn stuff and you join for some initial fee, but then all of the good stuff comes at an a la carte fee, so it’s $10 here and $20 there,” Webb says. She made all of her site’s content and services available for one $129 annual fee. Current memberships are in the multiple thousands, she says.
SMART ROOMS The site features a discussion board for members to communicate and network with one another. Live chats provide information quickly and on-point to members seeking help. Members can check the site’s calendar for the next scheduled chat and join in.
CUSTOM CURRICULUM For those struggling with the “what next?” aspect of starting a business or re-creating a career, the site offers access to coaches who can help members identify opportunities as well as the skills and training they’ll need to take advantage of those opportunities.
KNOWLEDGEWEBB LIVE Webb and her team are planning regional meet-ups and conferences to allow members to network face-to-face. “We’d like our members to be able to connect in person and meet some movers and shakers at our events,” she says.
Knowledgewebb is Power A site that teaches people new to the job front not to sweat the tech. By Gwen Moran
IN 2008, AMY WEBB watched as many of her former journalism colleagues, including those who had been employed by the shuttered Rocky Mountain News, lost their jobs. Many had worked in newsrooms for most of their careers and weren’t confident in mastering the technology necessary for them to change careers, or even become successful freelancers. Webb, a former reporter and the CEO of Webbmedia Group, a Baltimore, Md., company that creates marketing and media programs, created a free webinar to help teach jobless journalists everything from how to set up a home office to using the social networks. More 102 Entrepreneur + June 2010
than 100 people have participated in the first free webinar. Continuing demand led Webb to launch Knowledgewebb.net, an online learning center where freelancers and small-business owners of all stripes can learn the technology for their businesses. With more than 150 hands-on lessons, the website has recently undergone a relaunch to serve more customers more effectively. To date, the site has trained tens of thousands of people. ©Entrepreneur May 2010 by Entrepreneur Media, Inc. All rights reserved.
tech department [Cool ways tech can help you grow]
TRAP THIS APP
iPhone, Android or BlackBerry? Whatever you use, we have one free app each your small business cannot do without. By Ankush Chibber
DROPBOX FOR IPHONE CASHBOOK FOR ANDROID How bad are you keeping track of your expenses? How do you manage them on the road? Do you still call your office assistant and update her on what you have spent and what you haven’t spent? Enter the simply-named Cashbook–an app that makes it easy for a small business owner to keep track of earnings, daily expenses, bank and credit card statements and other regular small business expenses. This app will let you keep a record of all your expenses so that you may keep them handy for tax and reimbursement reasons. You can even categorize your expenses and income and delete or add as per convenience. The best thing about this app is that it lets you save and then export your records by e-mail in CSV format that can then be opened in Excel. And you know how the taxman loves Excel.
That Dropbox was one of the most awaited iPhone apps would be an understatement. What is it? It is a cool service that lets you store and sync files online and makes it accessible from multiple computers. And about half a year ago, you could access them on the go on your iPhone, thanks to the Dropbox app. If you haven’t ever used Dropbox, this is how it works–a Dropbox folder sits on your desktop and you can upload files to this folder up to 2GB free. And when you are connected to the Internet, it will sync these files automatically to other computers you may have Dropbox installed as well as the iPhone app. What all can it hold? Word, PowerPoint, Excel, images, pages and numbers docs, PDFs, HTML pages, Keynote presentations, txt files and vcards. It can even stream music and movies directly off the app. As a bonus, you can upload photos from your iPhone’s photos or upload a new one. This one, ladies and gentlemen, is a winner.
REQALL FOR BLACKBERRY The BlackBerry as a phone does as much for the small business owner as perhaps any app. My guess is most business owners keep a BlackBerry even if they have another handset. But even the BlackBerry can do with some primping. I am a big fan of any app that can help you do lists. My only problem is that you mostly have to key them in and that does not work well for the lazies amongst us. ReQall solves that issue well. Essentially, ReQall helps to remind you of things you need to do. The difference lies in the entry method. You could type in “Smack Ankush at 5” and ReQall will recognize who Ankush is off your contact list and turn that entry into an appointment. But if you are on of the lazies, you can also add items by calling ReQall using the phone following the voice prompts. You could also use the voice recognition from your phone that will help you make an entry without making a call. The best bit about ReQall is it recognizes the difference between certain keywords and categorizes accordingly. No way will you get a “Shopping with VC” entry unless you do go shopping with your VC.
To read more, grab the June issue of Entrepreneur Entrepreneur + June 2010 99 To Subscribe, visit www.entrepreneurindia.in
Dark No More The sun has thrown up the mother of all opportunities in Indiaâ€™s power sector. Wake up to it like Inderpreet Wadhwa has with Azure Power. By Ankush Chibber
106 Entrepreneur + June 2010
id you know that Germany has an installed capacity of almost 9,000 MW when it comes to solar power? In comparison, India has less than 12 MW of installed capacity. This when Germany has 250 days of sunshine compared to India’s 320 days and a drastically lower land mass exposed to sunshine. Notice the imbalance? Solar power has for some time been mentioned as the source which will solve India’s constant battle with its power needs— set to double from the current annual need of 600 TWh by the year 2020, according to a KPMG estimate. But while the mumblings have been there, solar power generation has always been looked upon with an air of cautiousness due to a number of reasons like the high cost of photovoltaic cells, land support etc. Thankfully, there are a few brave souls who believe enough in the potential solar power holds in India to take a few concrete steps. This includes souls like former Silicon Valley techie Inderpreet Wadhwa, whose firm Azure Power Pvt Ltd set up what can be called India’s first private utility scale power plant in India in December 2009. The 1 MW plant, located in Awan, 40 km from Amritsar, today caters to 32 surrounding villages and the 20,000 people who reside there by pumping power into the Punjab Electricity Board’s local grid. In effect, Wadhwa is a pioneer of sorts as he is the first entrepreneur to build a solar power plant of MW-scale in India’s private sector. And he took the long way round to get there. Born and raised in Punjab, Wadhwa was already running a startup when he was in engineering college in the early 90s. “I was part of a software startup that was into training,” he says. “We made a lot of money when the going was good for such companies.” Once his engineering education finished, Wadhwa sold his part of the business and went off to the U.S. where he worked for Oracle for more than a decade. “It was there that I sharpened my startup skills in building businesses,” he says. “I was part of the operation where we were acquiring and building a lot of businesses from scratch.” Photo© Shamik Banerjee
Confident by now of his abilSUNNY SIDE ity to build and nurture companies, Wadhwa got out to set up a business in >cY^V\Zih(!%%%]djghd[ the Loyalty programs space. But even hjch]^cZZkZgnnZVg I]Vi^hZfj^kVaZciiddkZg*!%%% as things were going good, Wadhwa ig^aa^dc`L]d[hdaVgZcZg\neZg longed to do something more. nZVg “It was at my evening MBA program L]^X]igVchaViZhidVediZci^Vad[ that I began thinking about what '%BLeZghf#`b#ZkZgnnZVg my last company would look like,” 6&"BL\g^YhdaVgedlZgeaVci he recalls. “I had a desire to build a l^aa]ZaebZZiZaZXig^X^incZZYhd[ socially-conscious business in India.” VWdji*!%%%[Vb^a^Zh :kZgnBLd[hdaVgedlZg The business of solar power was, \ZcZgVi^dcXgZViZhVb^c^bjbd[ Wadhwa thought, in a sector of direct &%Y^gZXi_dWh social impact. And the need for power 6XXdgY^c\idBX@^chZn!>cY^VÈh was a problem that presented a viable edlZgcZZYhl^aahdVgid((*<L and immediate business opportunity Wni]ZnZVg'%&, given that almost 500 million Indians >cY^VÈhXjggZciXVeVX^inhiVcYhVi aZhhi]Vc&+%<L still live without electricity. IdWg^Y\Zi]Z\Ve!BX@^chZn In 2008, Wadhwa returned to India Zhi^bViZhi]ViViaZVhi&,<Ll^aa to set up Azure Power and began the XdbZ[gdbhdaVgedlZg hard grind that is typical of the power sector. He approached the nodal agencies, the Ministry of New and Renewable Energy (MNRE), the utilities etc. And he was pleasantly surprised at the favorable response. “It was around the time the MNRE had launched its pilot 50 MW program that offered incentives for grid-connected projects,” he explains. “So there was some sort of understanding of solar power being able to electrify households.” Unlike other “solar entrepreneurs” in India who have focused their efforts towards small home and street lighting, Wadhwa was keen on setting up medium-scale power plants, the size of 1-5 MW, that could achieve economies of scale. The next few months went in what he calls education; that is, educating people at the ministries, nodal agencies and utilities why his idea of private solar power generation had merit. Here, Wadhwa had to fight the traditional thought process that solar power was too expensive to bet on. “My contention was that solar power had to be looked at with a long-term view,” he adds. “Even if the capital cost of setting up a power plant is high, there were long-term advantages that offset this initial expenditure.” He explains that while it costs around Rs.15 crore-Rs.16 crore a MW for setting up a solar power plant, mainly thanks to the
To read more, grab the June issue of Entrepreneur Entrepreneur + June 2010 107 To Subscribe, visit www.entrepreneurindia.in
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130 Entrepreneur + June 2010
Photo© Neha Mithbawkar Styling© Ruchi Shah & Chaitanya Surpur