After years of disciplined execution in building global products out of Chennai, a growing crop of Chennai’s tech product entrepreneurs crossed the seas in 2019 to prove their mettle in Silicon Valley.
From building teams and aligning to new cultures, it’s not an easy transition, but the new ‘Madras-Bay Area’ mafia has made it a point to help other Indian founders. They are acting as sounding boards for other founders with global ambitions and making their playbooks accessible to them to share common pitfalls.
Further, to formalise this support, a few Software as a Service (SaaS) entrepreneurs are working to launch a separate startups charter as part of the US-India Strategic Partnership Forum (USISPF), a non-profit for Indian-US bilateral ties since 2017.
With the US accounting for 70% of business for Indian SaaS, being closer to customers and outperforming American competitors are key reasons for making the move. It is also easier for startups to go public in the US markets — an inevitable next step for them to provide lucrative exits to global investors.
As customer support platform Freshworks gears up for an initial public offering, co-founder Girish Mathrubootham wanted to go beyond being a rock star entrepreneur in Indian startup circles, and moved permanently to Silicon Valley. “It has helped me interact with other CEOs who have gone through this journey to see growth,” he says.
Umesh Sachdev, co-founder of conversational AI startup Uniphore, shifted base to Palo Alto last year as almost half of the $350 billion customer support industry is in the US. With the US and Europe as its primary markets, founders of Chennai-based Chargebee are contemplating a move. “We spend three to four months in the US and I am considering moving this year to mainly build presence closer to customers and assist sales,” Krish Subramanian, co-founder and CEO, Chargebee, says.
Vinod Muthukrishnan, co-founder of Cloudcherry, moved to the US in 2017, and since then, has been acquired by global giant Cisco.
These startups hire a mix of sales and deep tech leaders along with frontline marketing staff in the Valley. While Cloudcherry hired 15-16 people locally, for Freshworks and Druva, the number of hires in the US is significantly higher.
Giving back to the ecosystem comes naturally to SaaS entrepreneurs, says Muthukrishnan. “Everyone hosts founders who visit the Valley, help with introductions, and help others avoid common mistakes.”
As more B2B SaaS startups adopt a dual headquarter structure between India and the US, the soon-to-be-launched USISPF Startup Connect aims to help CEOs make the transition smoothly and ensure steady pipeline of future moves. Uniphore’s Sachdev and CloudCherry’s Muthukrishnan are volunteering to lead the programme as co-chairs for now. “In its initial phase, USISPF Startup Connect wants to nurture and grow the wave of B2B startups from India and operating in the US-India corridor to drive value,” Sachdev says.
A standout feature of Chennai and Indian SaaS community is how close-knit they are, Arun Natarajan, founder, Venture Intelligence says. “We hear of such a culture in the Valley, but I don’t think a parallel exists in any other industry here,” he says.
A case in point is the SaaSBoomi conference (launched as SaaSX in 2014), which brings together the community to help peers. “The objective is to get as many companies into the Rs 25 crore [revenue] and above segment as quickly as possible by helping them avoid the same mistakes other founders made,” Suresh Sambandam, founder, Kissflow, says.
With 2019 breaking down fundraising barriers for SaaS, India is all set to emerge as the SaaS hub of the world, say industry trackers.
“SaaS companies based out of India can now go and win global enterprise deals,” Mathrubootham says.
“It is great to see products being developed out of India. We need more ventures that do deep R&D in the country,” says Zoho’s chief evangelist Raju Vegesna. However, he is quick to strike a note of caution. “We haven’t seen many SaaS companies in the West turn profitable yet and we shouldn’t expect different results if Indian companies here follow the same formula,” Vegesna adds.
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