What’s the difference between Indian and US startups (Q4 2012)

We finished collecting applications at the Microsoft Accelerator last week. Since I did not see the applicants from the previous batch I was extremely pleased with the high quality of applications overall. By most measures we exceeded the quality of applicants that we had internally hoped for.

Since there are 4 Microsoft accelerators worldwide – Israel, Beijing, Seattle and Bangalore we get to see trends across a fairly diverse set of companies.

I wanted to focus on 3 metrics that I noticed from our Seattle accelerator compared to the Indian one. I dont want to focus on the entrepreneurs or their background and quality but more on the ideas and markets themselves.

First where we got the applicants from was different. Our US accelerator got a lot more applicants from Australia and Europe than the Indian accelerator did. That’s to be expected since the US is a big draw, but even to an accelerator that’s not in the Valley was a surprise to me. That was not the “big aha”, though. The fact that we in India got quality applicants from Barcelona, Australia and London, besides a few from the US was a good sign. Many were not Indians who applied from those countries, but locals.

The biggest differences were in the sector / category of applicants. The US saw a lot more cloud infrastructure than we did. Nearly 25% more. The US also saw a lot more consumer Internet applications, specifically in web consumer, whereas mobile applications both in number and % were comparable.

The industries they were trying to disrupt were also a lot more diverse with some startups applying to the Seattle accelerator focusing on printing, automobile and even aerospace. Indian applicants were mostly focused on telecommunications, travel (a lot of companies this batch were travel 2.0 apps) and social networking.

The other metric that I was very surprised with was the % of bootstrapped companies was comparable. So those folks that suggest that companies outside India raise money quicker or faster now have a counter point.

Some other interesting metrics, albeit obvious to most folks.

• Fresh out of college applicants were at least 18% of applicants in the US compared to 2% in India.
• US had a lot more applicants with 2 or more founders, whereas in India solo founders dominated the applicants.
• US applicants overall had far fewer employees than Indian companies at comparable stage. In fact very few were more than 5 people. Indian startups bulk up early.

What do you guys have to say about these trends? Do you agree?

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