Selling Software Products in India

After 5 months of marketing a product, I realized how difficult is the proliferation of a new product in India. Now I understand why the Indian market is so stubborn. The companies that have succeeded have all had connections, engaged in cronyism or not sold in India.

I am not saying those entrepreneurs have not been visionary and masters at execution, but they I don't think that they had to break the Indian mindset.

Here is the list of the recent entrepreneurial successes of India:

1. Infosys / Wipro / other - They don't sell in India
2. Airtel - Political connections got them valuable licenses
3. Air Deccan - Captain Gopi's army / political connections were helpful

I really have to rack my brains to find out one new business that grew from India solely on the basis of what value it delivered and without some crutch. I must say FabIndia is one of those exceptions - But they too started by exporting to the West! Info Edge and Naukri.com is another exception.

For the kind of products that we sell, its not that people are lining up to find out ways to make their small businesses more efficient.

Part of the reason is historical and cultural.

More than 75% of small business in the Mumbai area are owned by Gujaratis and Marwaris (full disclosure: I am a Gujarati too). Traditionally they have prospered due to their ability to migrate and form strong trade links across regions. They are still of a traditional mindset where investment in status and lifestyle comes before investment in their business. When they do business, they do it with a trader mindset. Because a trader always negotiates and keeps variable margins, they expect software also to be a tradable item or service. Also a trader does not invest in anything but inventory at the most.

Businesses in the West usually prosper because they invest in technology and hence they understand the value of technology. In India its a different story. I never thought this would hit me so hard so late in my startup process.

So I have two options if I want to break-even faster:

1. Sell to the West

2. Massage egos of larger companies. Sell to the West

Lets see how this process goes!