Really small business (achcharu), Galle Face Green
Entrepreneurship happens in Sri Lanka. Every morning women wake up, make rice and roti, go and sell them. Men stand in the streets selling lovely toys made of cut up biscuit tins or foam and PVC pipes. Beyond that subsistence level, however, it’s really hard to get investment. People save for years, or go to their families and they do get stuff done, but ideas aren’t really incentivized in an institutional way.
No Money No Honey
Halik says that interest rate are low, but I honestly don’t see it. When people start a business they get financing from family or selling jewelry, not banks, unless you’re a huge business with some derivative, market swamping idea. Funded, successful start-ups like, say, anything.lk are funded from abroad (AFAIK). Personally, I’m trying to go into business of sorts, and I haven’t even considered bank loans. The interest rates are insane and I might as well take the money out on a US credit card.
Almost all banks and other financial institutions do not consist of services and offerings in their portfolio that serves entrepreneurs and startups in Sri Lanka. This is mainly due to them not willing to take risks and expand their offerings towards this lucrative segment while they are missing out the fact that it consists of leaders and contributors of tomorrow’s generations. Many of them have only just started to furnish SMB’s and that too on a very rare basis but sadly it involves heavy documentation process.
As a sub-example, let’s take online payment gateways. Let’s say that you have actual cash-flow and you just want to process it. I’ve called Sampath Bank for a charity and they said, well, we only do things for a certain size of company. Well, really, how do you know how big a company will be? HSBC works with a company called Global Payments which charges at least a couple lakhs and supplements that with literally weeks of wasted time due to their bureaucratic retardation. And they don’t even ship a working payment gateway, they just give you half the code and you have to code the interface yourself.
Compare this to most countries in the world, where you can be like, I want to sell T-Shirts, stick a PayPal widget on your site and sell T-Shirts. PayPal doesn’t operate here, but as of yet, no Sri Lankan bank or mobile company has taken that as an opportunity.
I think awards are bullshit in general. It’s a sorting mechanism for people that can’t be assed to actually participate in the subjects or talk to people that do. Take the Superbrands thing that so many companies tout. It’s just a multi-lakh payment they make to some company to print their name in a book. The only real criteria is ‘can you afford to pay us?’ According to Thanzyl at itpro.lk, this is much the same for entrepreneurship awards.
Entrepreneurs are recognized by awards here in Sri Lanka that are further categorized into bronze, silver and gold categories both at provincial and national levels, along with a standalone award called Entrepreneur of the Year. The selections are purely based on the size of the annual revenue of the firm or organization and not by its value addition to the market through its activities and initiatives.
It is impossible to immigrate to Sri Lanka. If you’re Arthur C. Clarke or if you have like $100,000 you want to put into a government access bank account, but if you’re a young person that likes it here or just falls in love, not possible. Numerous Ministers have married foreigners, but even they get only a visa. If such a couple breaks up, the foreigner has no particular rights here and can quite easily get separated from their kids.
More oddly, I know kids born here but whose fathers are foreign who cannot get citizenship.
This is actually madness. As Anushka says via IPS:
Immigration policies have strengthened the innovation talent pool in America, attracting both the best minds from East Asia, and ample labour from South America. The Harvard political scientist, Joseph Nye, considered the father of the concept of ‘soft power’, points out in his book The Future of Power that Chinese- or Indian-born engineers run more than a quarter of all high-tech companies in Silicon Valley. By 2005, one in four technology start-ups had been launched by immigrants. According to Nye, America’s greatest long-term strategic asset is “its ability to attract the best and brightest from the rest of the world and meld them into a diverse culture of creativity”.
I’m not saying that Sri Lanka would attract the best and brightest, but we could attract some people. I know a few westerners who’ve settled down here started businesses and families, but they have nothing stable. Which is unfair I think, to those people, their employees, their families and the country at large.
Sri Lanka is also hostile to even dual-citizens, charging a ton of money (over 2 lakhs) and actually suspending the process to try to weed out bad apples. When I last left Sri Lanka I was hassled and asked where I worked down to what kade it was next to, as if to prove that I actually live here. If Sri Lanka wants to attract intelligent diaspora back, this also needs to be reformed.
As you can see, the private sector is woefully uninvolved with R&D
The traditional investment model is either some form of insider trading, or finding someone with the hook-ups and patience (and government connects) to make something happen. It doesn’t even have to be good, it just has to show up. There is precious little investment or support for entrepreneurs with ideas, the market just seems focused on people with connections. Again, Thanzyl:
There are many upcoming and potential young entrepreneurs in Sri Lanka that receives zero amount of support from the members in the economy. Despite the fact that they have very innovative visions coupled up with excellent business ideas and plans that promises sustainability in the long run, they tend to get de-motivated instantly due to the missing of an evolving support structure.
None of this is to say that entrepreneurship doesn’t happen, or that it absolutely requires certain support, but Sri Lanka is a place with a lot of bright young people and ideas that aren’t developed to full potential. With a bit of support in terms of financing, global human resources and the corporate sector, we could really go a long way.