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Entrepreneurship Motivation in India and China | The Entrepreneur School Blog

August 10th, 2010 9 Comments » Filed under Acknowledgement

Indian and Chinese Entrepreneurs

Monday, August 9, 2010 | Written by Erik Rostad
Posted under: Government, International, Total Entrepreneurial Activity  | Tags: , , , , , ,   | 1 Comment

In 2007, a group of Georgia State students traveled to India to answer one central question – “Was the Indian government assisting or halting entrepreneurship?”

Our findings were that there were plenty of opportunities to start a business in India, that the bureaucratic process often hindered the speed of a start up, and that the Indian Government’s best policy would be to get out of the way.

A recent study on Entrepreneurial levels in India and China confirm these findings and added some very interesting information:

  • Major motivation for Indian entrepreneurs is to be their own boss.
  • Major motivation for Chinese entrepreneurs is to make more money.
  • American entrepreneurs generally follow the Indian motivational factor of being their own boss.
  • 23% of Chinese entrepreneurs say they are using training obtained in school to start their business.
  • Only 9% of Indian entrepreneurs say the same about school.
  • Family expectations were stronger in India compared to China (21% to 9%, respectively) as a motivation to start a business.
  • Inspiration from entrepreneurial friends & family were cited as the reason 27% of Indians started their business and just 18% of Chinese.
  • For Financing, 49% of Indians rely on start-up funding from Friends, Family, and Fools (the 3 F’s).
  • Only 25% of Chinese entrepreneurs sought family funding.
  • 49% of Chinese entrepreneurs obtained funds from banks.
  • Only 27% of Indian entrepreneurs obtained funds from banks.
  • As for the reasons for success for a new start-up, 93% of Chinese say “Guanxi” is the main reason.  Guanxi is the personal relationships necessary to navigate China’s political, legal, and regulatory climate.
  • 81% of Indians say “jugaad” is the reason for entrepreneurial success.  Jugaad is the ability to be creative and innovative in getting around governmental regulations.

As we saw in our 2007 trip to India, entrepreneurs in India say getting around the government’s hefty bureaucracy is the is the main key to success.  For the Chinese, it appears that the ability to navigate within this bureaucracy is the key to success.

What will happen as China’s middle class demands more protection and less government?  How will this shift entrepreneurship in China?  And what happens if India’s government truly begins to get out of the way?  What successful traits will then be necessary to build a successful business in India?  These are questions we will continue to monitor in the rise of India & China.

Related posts:

  1. Chinese Entrepreneurship
  2. Entrepreneurship in India
  3. Google China and the Entrepreneur
  4. Microfinance, Ethics, and Diversification in India
  5. Going to India for a Start-up?


This entry was posted on Monday, August 9th, 2010 at 9:07 am and is filed under Government, International, Total Entrepreneurial Activity. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

1 Comment

  1. Comments  ashish gambhir   |  Tuesday, 10 August 2010 at 11:05 am

    getting around bureaucracy might be an important area in the case of indian start-ups but it should be seen as a challenge and not a bottleneck…..a challenge on the lines of finding solution to operational, marketing, strategic challenges……

    also the level of bureaucratic challenge varies for different startups….. services or manufacturing, online or offline, financially sound or weak etc.

    most successful entrepreneurs are mentally prepared of seeing this hurdle as part of the process and just concentrate on finding the nest means of navigating around it.

    in this context a Deloitte Review article (Necessity breeds opportunity) is helpful…….

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