Entrepreneurship without Capital

A possible index of the evolution of any society can be the freedom that an individual has to do what he pleases without affecting the right of others to a peaceful existence.

India has some way to go; at least while we have khap panchayats who deign to decide whether your thoughts or actions are deemed fit and other organizations decide to ransack your office because of something you published.

The argument can be extended to how free one is to decide on his or her own source of livelihood. At one end, we had bonded labourers who had no right to choose to do anything but till the land of the zamindar because their parents were indebted to them. To give credit where it is due, the government has instituted laws to make bondage illegal. Add this to the power of literacy amongst the poorest classes, and bondage is on its way out except in the most lawless districts in the country. The situation has not been very different in the United Kingdom of the 20th century. The laws were of the aristocracy, by the aristocracy for the aristocracy and designed to keep the serfs bonded.

While England has taken perhaps centuries to overcome the old order, the Republic of India has a chance of getting there within a century of independence.

The IT boom has been a boon for India. The first reason, and I have discussed this in a previous post, is that IT has made work truly portable. A person in Gurgaon now does work that is used in Houston and the free hand of the market moves the work to the place that can do it at the lowest price.

The other thing about IT is that it enables entrepreneurship without capital. To start a textile mill, one needs most of all, the capital to invest in land, building, machinery and working capital. To start an IT based business, one could start with an idea and a laptop. The nature of the work allows the entrepreneur to work from home or from a loft in a low rent suburb. The idea of stock options allows the entrepreneur to hire the best talent with a bare survival package today backed by the allure of future riches. All other costs, server space, bandwidth, hosting, advertising can be had completely on variable terms. Take out the need for large capital from the equation and you have an entrepreneurial pool that is multiple orders of magnitude bigger.

This is the opportunity we sit on. Now all the government has to do is get out of the way. For as Gurucharan Das once said, India grows at night; when the government sleeps.