Umair Khan on Entrepreneurship

This is the long promised second part of my post on the OPEN Seminar at MIT.

In my first post, I told you guys that Umair Khan (Founder of Chowk.com, Clickmarks, Folio3) had some counterintuitive things to say. It was counterintuitive enough for Ken Morse to disagree with him on a few points. So what do you need to be a successful startup in the 2.0 world?

Let’s start with our assumptions.

1: The pinnacle of success is a Nasdaq IPO
2: US should be the first target market, Asia can wait
3: Keep the high-level design and architecture work in the US, offshore mindless operations

Guilty, on all three counts.

The truth is that a Nasdaq IPO is not the only exit option. There are a number of venture-public market pairs coming up like Tel Aviv-London and Bangalore-Bombay. Karachi-Dubai may also be a near-term possibility. But why even worry about going public. In the world of serial entrepreneurs with quick turn around times, getting acquired by a bigger player is the new utopia.

The tools available to an entrepreneur today lower the financial barriers to record lows. Offshore teams are sophisticated enough to design, architect and develop solutions allowing for rapid prototyping. In fact, Umair’s company, Folio3 does just that. They specialize in providing product development services to US-based startups. With operations almost entirely offshored to Pakistan, they have managed to retain a talented team that helps customers develop next generation software products for the US-market. High quality, low cost, rapid development. Welcome to the new venture world.

As Umair puts it, “The Game is Asia”. Asad Jamal, a prominent Pakistani VC knows that well. Asad is the Managing Direct of ePlanet Venture, a fund focused on global venture opportunities. He foresaw the technology trend in Asia and Central Europe and made investments in companies like Skype and Baidu (China). Ofcourse, each company has a multi-billion dollar valuation now. Do the numbers.

If you’re an entrepreneur sitting in Pakistan, scratching your head for ideas, then get a hint from Baidu or Naukri. It’s really about transplanting successful business models and executing. Baidu just did for China, what Google is doing for the world. They maintained a singular focus on the Chinese market, a finger on the pulse of the user and fought-off the largest dot-com in the world. Similarly, Naukri.com simply developed a Hotjobs.com for India. And for those who think dot-coms don’t make money, take this: Naukri posted $18m in revenue and $3m in profit in 2005. They filed for a public offering last year in India to raise another $30m.

Bottom line: If China and India are “Pre-IPO”, MENA/Pakistan are in the “bootstrap phase”

Go start a business!

-Adnan

ps. A special thanks to Mo Aidrus for sharing the presentations from the event.

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