Ireland woos Indian startups eying European market

IDA Ireland's head of technology says they can help Indian ventures grow with sops like good labour laws, low corporation tax rates and good regulatory environment

Diksha Gupta, TechGig.com

If you are a startup looking to crack in the US and European markets, heres some help from Ireland. The country is inviting Indian startups looking to go global with their products. As sops, Ireland is offering low tax rates and easy regulatory environment. TechGig.com caught up with Leo Clancy, head of technology, IDA (Investment and Development Agency) Ireland, and explored how Indian IT industry and startups can benefit from the ecosystem created in Ireland.

Excerpts from the interview:

Startups are hot in India and everywhere else as well. How do you see the ecosystem here?

We met two startups in the last 24 hours. We have met a couple of leaders in startup domain and I find them impressive. I like the Indian governments strategy to improve in the space. The quality of people employed in startups in India is such that they could work anywhere in the world, but they have chosen to stay here. This speaks a lot about the governments commitment and the local environment.

How do you see IDA helping Indian startups?

IDA would help Indian startups in the same way we help other companies. But I think the best model we have is how we help the companies coming from the US. Companies like Intuit.com and AirBNB came to Ireland when they were small. In Intuits case, they would have been less than 200 employees, and AirBNB was slightly bigger. Intuit has just announced plans of adding 300 more people. So Ireland provides great comfort to such companies. We help companies understand how to impress European markets and what Ireland has to offer.

Can you highlight things present in Irelands ecosystem but missing in India?

In Ireland, one gets an opportunity to access the European markets. If you want to do business in a jurisdiction like Europe and the US, you need to have a presence there. In addition, we have good labour laws, which are closer to those of the US. We have low corporation tax rates of 12.5 per cent of corporate profits, which is the lowest in the developed world. We have good regulatory environment and experience to run that environment. So the overall business environment is good. Ireland has good talent that comes from all over the world. Europe has just seen recession from the past 7-8 years and due to that Ireland has seen a lot of inward migration. About 70,000 people have come to Ireland each year from the past five years for work, over the period of recession.

If you are looking at it from the Indian perspective, Ireland can be a suitable location for doing business as we are a majorly English-spoken country. It is easy to do business cross-culturally between Ireland and India. The only place where you get such advantage is the UK. But Ireland gives a big cost advantage as compared to the UK, both in terms of the basic cost, which is much lower than London, which is our key competitor and also the Euro currency versus the British pound. British pound is a strong currency these days and these things, collectively, are important for companies looking for good business opportunities.

What are the top issues you see with Indian startups vis-a-vis startups you work with?

I wouldnt discriminate Indian startups from other startups. Indian start-ups are a little bit more like the European startups in terms of addressing new markets. US-based startups are impressive in this regard. They enter the European markets and set-up at scale in the early stage of their growth. Thats probably the primary difference. I think market conditions coming from India are different in the way people consume services.
Adapting a product for European market is a big challenge, and companies in India are well aware of those aspects. The cautiousness about the markets and adapting the products accordingly would be the two issues that the Indian startups face, according to me. Another weakness that I see is related to the awareness of the opportunity. However, I would like to reiterate that I see more strengths than weaknesses.

Can you sum-up some of the strengths of Indian startups?

When it comes to the culture here, it is very US style. The people here are trained with US companies and they come with that ethos of not being afraid to fail. They are smart technologists. They are good cross-culturally. Indians create well-built products. India is a great test market too. So, people test their products in this market before they enter any other geography.

Do you see a slowdown in the IT industry?

Certain things and sectors will see a slowdown, like on-premises hardware and traditional IT services. What will increase, however, will include software-as-a-service and cloud, that will replace the on-premises hardware. You will see new areas and services that will emerge. Artificial Intelligence will seep in. The customer care services will most certainly be replaced by automation services in businesses. If you can be the one making that change happen, you are in control of the situation, but the change will certainly happen. That doesnt mean that the overall IT industry will slow down. It will see a shift in the investment from one place to another.

Has the IT industry reached its stagnation point in India?

No, I think with Indian companies created locally and acting globally, it is just the starting point that we are in. In terms of multinational investments, some of our biggest clients in the world say that they will continue to have their Indian base at a big scale. The real opportunity for India is in taking the Indian companies created locally to a global level.

This article first appeared in techgig.com