In 2006, as part of a 6-month Indian trip, I spent a few days in Bangalore, or Bengaluru, as it’s known since 2014. It immediately struck me as an Indian city with a more western feel. Compared to the average Indian metro area, it had more restaurants and bars that catered for western tastes, and a less cacophonous city centre. At the time I knew of it being the “call-centre capital of the world” but I didn’t know about its history and how it came to be India’s tech centre.
Evolution as a Tech Centre
Bangalore has had many labels – from being India’s garden city to a pensioner’s paradise. Before World War 2 it used to be a hub of the aeronautical industry and after independence began its industrialization with many government-supported projects. People travelled from all over India to work there and it became a middle-class city. These factors and good education infrastructure meant Bangalore became a centre for IT. It has since been welcoming to people from all over the world making it India’s first global city.
Fast forward to today and Bangalore has the youngest entrepreneurs in the world with the average age being 28 and a half. The sub-continent creates 1200 new startups every month, of which 30% are from Bangalore. The startup scene has led to many coworking spaces, bars and cafes opening. There’s lots of successful young people with money to spend and that’s bringing in investors from all over the world.
Just as young entrepreneurs are taking risks, sometimes by postponing their education, venture capital firms are willing to reciprocate. As the Economic Times reports “nearly all of India’s startups with billion dollar valuations were founded by people while still in their 20s, a factor encouraging investors to bet on 20-somethings “.
A notable example of this is Ritesh Agarwal, the 25-year-old founder of India’s largest hospitality company. He was only 18 when he founded OYO Rooms. Since founding he has raised “more than $25 million from Sequoia Capital, DSG Consumer Partners, Greenoaks Capital and Lightspeed”.
Could Bangalore Rival Silicon Valley?
The world’s best talent still flocks to California, however Bangalore increasingly attracts quality talent, and most important of all, keeps homegrown talent.
A generation ago, parents saw making it in the US as the dream and thus encouraged their children to chase that. However, now parents of today see opportunities at home that can rival what they get in the US. 30 years ago 60-70% of the best students graduating from IITs would travel abroad, that number has now shrunk to 10%. And most of these, begin work on startups while in college. So the young are staying to do business and that entrepreneurial energy, which was not there earlier, is now.
A perception has also changed where, in the past, having a salaried job was the goal. Bangalore’s startup youth not only want to do something different they know how to do it, therefore, they don’t fear risk or failure. If your first startup fails – start a second one, and so on. There is pride now in being a serial entrepreneur.
As impressive as Bangalore’s rise has been, it may become constrained by the city’s infrastructure and, ultimately, become a victim of its own success. When I visited, its population was 5 million, it now stands at 11 million and is expected to surpass 20 million by the century’s end.
Unprecedented growth adds to traffic, pollution and housing shortages. This may stymie its long-term prospect as a tech centre and will have to be addressed by the city. Satellite towns, which have a better quality of life, will also have a role to play in providing for incoming talent. However, Bangalore may not be able to nurture this burst of startup energy into the long term.