How can the Indian IT entrepreneurs get through the current crisis?

Abstract

India has become in a few decades one of the first country for IT industry, with the thriving of giant companies, such as Wipro, Infosys, Tata Consultancy Services. In a globalized world, those companies, along with a string of small and medium size companies and start-ups, have contributed to India’s economic development. Suddenly, in 2007, a crisis hit the world. The American economy suffers a recession and the first markets for Indian IT companies, the USA and UK, are strongly hit. This does not go without consequences for Indian champions such as Wipro and Infosys. But if it is easy to get an idea of how the crisis has affected those huge enterprises, it is much more difficult to assess the difficulties faced by start-ups and entrepreneurs, often described as the most fragile companies, run by charismatic men and women. Those companies are often said to be the ones that can pull a country out of a crisis : they play a major role in the economic development. Yet, they have not been the object of many studies since the crisis burst, despite their importance. The reason why we chose to focus on IT entrepreneurship is that IT is one of the major driver of venture creation in India, and also the first image that comes to mind when it comes to Indian economy. In the crisis, IT in India is even more interesting because it accounts for USD90 billion of exports, and it is highly globalized: the stakes and the risks are high. A comprehensive quantitative study is not the goal if this CCS : it would be too ambitious. We will rather try to conduct an empirical study, driven by interviews of entrepreneurs and specialists, with a global perspective regarding the situation of startups. We also hope to come up with a string of recommendations for IT entrepreneurs.