MR Rangaswami is an entrepreneur, investor, corporate eco-strategy expert, community builder and philanthropist. As the Founder of Indiaspora and Co-Founder of Sand Hill Group, he shares his thoughts on the recent developments in the tech industry and the importance of the Indian diaspora in countries like the US.
What are some of the most exciting software developments coming out of Silicon Valley today ?
These are exciting times in Silicon Valley and the Bay Area. There is a confluence of different technologies. The foundation was laid with the Cloud. Technologies like IoT are providing a new space that connects businesses and consumers with all kinds of devices. Then there's autonomous driving. The ability to not only have driverless passenger cars but also transportation such as trucks, ships, and drones.
Artificial Intelligence (Ai) is another area - the ability to analyse massive amounts from consumers, devices, cars and make meaningful decisions. And, of course, you can′t forget smartphones. Put all these together, and you have so many new applications, solutions. Another area of interest is Genomics. Gene sequencing is now in the next stage of analysing how to use data to improve health and prevent diseases. This is also a very exciting area for the Indian community because it stands at the intersection of tech - where we are very dominant - and healthcare, as 7 per cent of doctors in the US are Indian. Genomics provides an incredible opportunity for the diaspora to participate in this revolution.
Quantum computing is a little further away but the recent results from Google show extraordinary speeds. Once we get to the production of computers using that style of computing, we will see a lot of new software being developed for applications we haven't even thought about. The key with all these developments is to be able to deliver them in a vertical - each industry is going to require its own flavour, its own set of solutions and products.
Has India harnessed its IT expertise to the fullest extent; what are the areas it should focus on more ?
India hasn't even reached the halfway point of its potential. The reason for this is that we have basically been working with foreign enterprises to redo or maintain their systems for the past couple of decades. It is only now with the advent of the start-up community that India will reach its potential. AI will see a big leap in how government, corporations and citizens can use it to make more meaningful decisions, to optimise systems and so forth. It is also the area in which India can make its mark because it has so much data available.
What are your top tips for new investors eyeing the software sector ?
Be cautious in investing because the amount of money that is chasing new investments is at an all-time high right now.
Another reason to be cautious is that the valuations of these companies are also extremely high as evidenced by the number of unicorns. With recent setbacks in companies that were supposed to go public but were not able to have had their valuations dramatically coming down. I would urge a little bit of caution as investors look at these big opportunities.
Investors have to look at companies with higher scrutiny and do their due diligence in a more comprehensive way. When paying a high price for these investments, regardless of the type of technology, companies have to be sure to get a good return on investment.
How is the Indian American diaspora making its presence felt, in the US and around the world ?
Silicon Valley has a lot of venture capitalists of Indian origin and almost one out of every three new start-ups getting funded in the Bay Area has an Indian founder. It′s safe to say the diaspora is starting companies and it is investing in them. The other unique thing they have is that they can bridge both the US and Indian markets with a unique perspective, having a knowledge of both countries.
Two years ago, when PM Modi visited to attend the 25th anniversary of the Israel-India partnership, Indiaspora took a delegation of Indian Americans to Israel. Given that there was an Indian delegation as well, we could form a US-India-Israel tech triangle. We then took a delegation from the US the following year when PM Netanyahu visited India. With the collective meet in New Delhi, all three sides were able to find in new opportunities, invest in new firms, acquire new companies. The role the diaspora can play is not just bilateral, but also trilateral. This is something unique that, moving forward, we will see a lot with the Indian diaspora connecting in ways not seen before.
What are the areas of India-US collaboration that you feel deserve more attention ?
The ability to look for good opportunities whether in the US or India is the key. A tremendous capital is flowing both ways. I work with NASSCOM and we have a huge event with them in Bangalore called NASSCOM Product Conclave taking place this month. This includes a contingent from the US as well. There are lots of bridges that can be built between the two nations. Tech remains the biggest area of focus. People are looking for opportunities where there is a lot of intellectual property involved as opposed to companies that are based on a unique business model. When looking for new companies to invest in, it's important to dig deep into the technology that they are creating and see if it′s defensible, as opposed to being enamoured with unique business models. Because people can duplicate those models easier than they can duplicate technology.
On a personal note, what in your view makes Global Indians powerful ambassadors?
The tech sector in the US has created the most successful Indian entrepreneurs. The CEOs of major companies like Microsoft, Adobe and Google and Chief Technology Officers and Chief Information Officers of Fortune 500 companies all are part of the Indian diaspora. What we are doing at Indiaspora is creating roles for the diaspora to give back. These prominent people are also becoming big givers. A lot of the diaspora in the tech community is giving to NGOs, becoming angel investors, mentors, joining advisory boards to share their expertise and knowledge. I think to give time is as important as writing a cheque. Organisations like Indiaspora can provide the necessary platform for these people as they become ambassadors.