Encourage upstarts, dispel rumours
The team of mostly ex-Google execs which is running Upstart. Photo: Courtesy Upstart Google+ account

Encourage upstarts, dispel rumours

Mumbai, August 15, 2012

In all the news that was reported from the digital world in the last few days, one stood out from the rest. Well, actually, two. I shall talk of the second one a little later.
Some of you may have not heard of this startup called Upstart  and so I have decided to talk about it here (besides reporting on it on my website (www.whatsnewonthenet.com). Not because it’s a new company and needs to be talked about, but because it is a fund-raising platform for none other than college graduates, or soon to be grads.
That’s the first reason why the US-based Upstart caught my eye. Let me clarify one point here before I go on – funding from Upstart-registered investors is not limited to any sector. So, though the Internet is my world, I am still talking of a "real world’ startup. Why? Because of what it proposes to do. If it succeeds, its impact will also be felt to a very large extent on life in the digital world.
To begin with, Upstart does not fund ideas or business or plans. It funds you, the wanna-be
entrepreneur. Unlike other VC or private equity funds, its chief motivation seems not to make money from its investments but to create an entire new class of entrepreneurs. It only lends money to students. Wow! That was enough to catch my eye. I mean, how many investors out there do we know of who are willing to put their money on students?
I am rather taken up by the investor eco-system that Upstart is out to create. If you are an
entrepreneur or even a successful businessman reading this, just think of those days when you were trying to raise funds. The business plans you made, the elevator pitches you constantly re-wrote, the apprehension you faced while approaching VCs….Till you finally managed to convince somebody to repose trust in your plan.
So, when someone talks of not only turning students into entrepreneurs (or “upstarts” as they put it), but of putting money in their hands, you tend to sit up and take note. How many of us have been told that most of the world’s successful businessmen, in any sector, are college dropouts?
It has been proven scientifically that the only time a human being thinks and comes up with original ideas is when he is a teenager. The rest of his life he only regurgitates.
We also know that most of us average guys have brilliant ideas while in college but prefer to take up “safe” 9-5 jobs because of financial security. In all this now, try and find out how many fund-raising platforms are available only to teenagers? Practically none. Do I sense a disconnect here?
Upstart has another USP – it recovers its investment on you not on an annualized rate of return or any other such “fixed return” schemes based on your startup’s annual financials, but from your own income, spread over 10 years. There’s a formula involved which I shall not spend time explaining here, but the re-payment terms do tend to favour the student more than the investor. Suffice to say here that there is no fixed amount you have to return every year to your VC, irrespective of whether your business is working or failing. Students can use the funding not only to start up but also to pay off their student loans, among other things.
Upstart, formed by a team of ex-Googlers, is pitching to colleges and universities in the US, and is open to US citizens only, as of now.
But that’s not the point. I feel the idea can be, must be, duplicated in other countries. World over, there’s a need to create similar fund-raising eco-systems that specifically address students. Yes, we do need funds for the junior to middle-level professionals who have now turned entrepreneur; yes, we also need to fund plans put forth by semi-retired professionals. 
But most of all, we need to fund ideas put forth by the young across the world, if we want change. With 16-year-olds becoming CEOs in the digital world, this has become all the more imperative. For those of you who want to read up on the Upstart, please go to www.upstart.com.
India’s VCs in bullock cart age
Just as an aside – do you know after the US, which are the countries high on the startups’ list? Israel and Brazil. Both host great startup climates. India, on the other hand, is way down somewhere. Compared to these countries, India’s seed funding and VC funding communities live in the bullock cart age. 
There are no kickstarter funds of note, many funders still do not even know the meaning of the word. And worse - try selling an Online idea to an Indian VC, his eyes glaze over from the time you mention the word, “Internet”.
India’s VCs do not want to take any risks whatsoever to back new ideas. One thing I know as an Internet entrepreneur and adviser to some Online startups is that playing safe will get you nowhere.
Obviously, not all ideas will ever be financially successful. Yet, of the 12 you back, two will prove to be hugely successful and get back the returns on your investments not only in them but in the other 10 startups as well, and then some. Plus, of the other 10 startups you backed and lost, probably five will go on to prop up new startups, which may or may not be successful. 
In the end, it all works out to the betterment of everyone involved – the entrepreneur, the technologist, the investor and the consumer or user. The world thus becomes a better place to live in.
An Apple iPhone 5 rumour a day, keeps….everyone guessing!
The second story that kept the Internet news wires buzzing were the “leaks” around the launch of the Apple iPhone 5. By jove, if I were to give away a rupee for every email that landed in my In-box last week revolving around such leaks, I would turn pauper. But I can understand the craze around a brand whose phone has sold over 250 million units (previous versions) in just five years.
Rumours around the “imminent” launch of the iPhone 5 have been floating around since 2011. Of course, they gathered speed when many felt that Apple, sticking to its traditional time for new releases, would announce the iPhone 5 in 2012, late spring. That did not happen, and the rumours lost steam. Till now. It is being rumoured (of course) that September is the new launch month. Apple, on its part, has kept mum throughout.
1) Release on Sept 12, 2012.
2) Smaller SIM card (How much smaller can they get?)
3) Bigger battery (Strange, when everything else is getting micro-sized)
4) Longer touch screen (Needed, if you were to ask me)
5) Only a 9 pin connector instead of the usual 30 pins
6) Glass + titanium case
7) 8 pin connector (Yup, the rumour lost one pin in the interceding days)
9) iPhone 5 already in production
10) You can swap camera lenses
You know, it has just been reported that Samsung remained the world leader in the sale of
smartphones in the second quarter of 2012, beating Apple and Nokia. But let me tell you from experience, where the pre-launch buzz is concerned, the iPhone beats the competition hands down.
No launch of any other smartphone has so many rumours doing the rounds.
Before I sign off, a friend of mine told me the other day that his friend had bought an “iPhone
5S” from Bangalore, last week. When he saw my nonplussed look, he laughed it off by
adding, “Obviously, a fake. It had a ‘Made in China’ tag.”
Previous columns by Sorab Ghaswalla
Sorab Ghaswalla, is a journalist with near three decades of experience, and has worked in some well-known Indian and international print and television media organizations such as  The Times of India, The Hindustan Times, The Economic Times, The Indian Express, United News of India (UNI), The Gulf Today and India TV.
He has founded a Knowledge Services firm called New Age Content Services LLP, that leverages on the inherent strengths of the digital world. He also edits the website, www.whatsnewonthenet.com.
You can write to him at newagecontent@gmail.com
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