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Why IITs Have Edge over IIM on Start-up Business!
When the startups business is flouring in India naturally the question comes to one’s mind why are most startups from IITians and not from IIMs when the actual business and leadership skills are taught at IIMs?
IITs, which teach students to become engineers and scientists, end up becoming the breeding ground for fledging start-ups in a stark contrast to IIMs where students learn how to manage a business. A recent study indicates that around 200 IIM graduates take up entrepreneurship every year, while around 1,600 IIT students annually becomes entrepreneurs. An analysis of the situation of the both sides reveals things in transparent. • Usually the IIM graduates have had prior work experience before joining the college, and that passion to do something extraordinary is finished and they want a stable career.
However, IIT graduates are young and passionate. • Since IITians are more in number, they have a much larger support system from fellow entrepreneurs to others in entrepreneurial ecosystem. As per report annually around five lakhs graduates compete for around 9,600 seats in 16 IITs while nearly two lakh entrants strive for less than 3,500 seats in 13 IIMs. So the number of IIT graduates and post graduates are turning entrepreneurs is also more than their IIM peers.
Fees in IIT are highly subsidized by the government so most of the students don't have to take any education loan while the fees at IIMs is roughly 20 lac rupees, even the few who could pay the entire fees by their own means, prefer not to do so because of the tax benefits associated with an education loan. •
The opportunity cost of an IIM pass out is on an average substantially higher than that of an IIT graduate. • By the time one get done with the loan and some of the family obligations, one become too complacent in plush lifestyle. •
Most of the startups coming up nowadays are basically offering an online platform to do the conventional things in an easier and quicker way. Now the basic need there is that one should be good at programming which a lot of IITians are, and since the model is mostly marketplace, so the initial investment is negligible. Even if the venture doesn't work out, the founders don't lose much. • Large number of IIM students go to IITs first for their graduation, so the sets of IIT students and IIM students are not mutually exclusive, there is a big overlap and those are counted in both the categories.
• The curriculum of management institutes are for managing businesses not for generating businesses. Whereas engineers are supposed to innovate and make products. They know how to take risks. IIM graduates not keen of taking risk, they are only taught how to analyse and then take a calculated risk- said Sikha Sharma, a student from IIT Guwahati.
• Students who join IITs come from different parts of India, which is hardly seen in regional colleges because of reservations. The cultural mix of people who come to a college is much more diverse in an IIT as it is a national exam. This mixture of cultural and language of people opens up many possibilities for start of start-up business.
• In IITs, students do not need a large amount like in IIMs to pay the fees. Students graduate from IITs at a fairly young age of around 22 and they get enough time to experiment in life,”- said Ritika Bansal, a student from IIT Delhi.
• There is great demand of the IIM students in the job market as they get high salary job even before leaving the campus formally. While working in cool and comfortable environment of corporate world the idea of starting a start -up dies down soon. “Once absorbed in a big organization, he starts thinking about more money, power, luxury and promotion, wife, children and home etc. so where is the zeal to start a new venture?” questions Latika Narayan from IIM Rohtak.
• Most of the IIT graduates plan to go to the US for higher studies, where they are exposed to a better entrepreneurial environment, get the opportunity to work in western competitive culture while IIMs is a post- graduation institute, many graduates end up taking jobs as he start aging by the time he leave the institute, - said J Thomas from IIM Shillong • Student choosing IIM become a manager in most cases. Whereas in IIT, a budding engineer who has the passion to create a product will look at the possibility of monetising it. So, a lot of innovation comes out of IITs than IIMs resulting in more companies from IITs than IIMs.
• The role of technology lots of share in the start-up business as maximum business opportunities have emerged at the technology front. IITians, who already have competitive edge in technology, can solve the problems related to technology, and hence have turned entrepreneurs in large number. • Most venture backed start-ups are tech (or at-least tech enabled) start-ups. Which means that having a tech co-founder is always helpful. In-fact one can see both in India and abroad that many investors won't invest in a tech start-up without a technical co-founder. • Venture Capitalist who invest in growing businesses, have themselves been mostly from IITs. If not, the money, entrepreneurs believe that having an IIT tag will at least fetch them one round of meeting with investors. Besides most of the Venture Capitalist are foreign return people who had studied at IIT.
Hence, they prefer them over IIM ones.
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