New Delhi: Top venture capitalist Tim Draper has expressed apprehensions over the Narendra Modi government’s Citizenship (Amendment) Act (CAA), calling it an issue that may question his plans to fund businesses and start-ups here in India.
Draper, who is well known for his early investments in companies like Skype, Tesla and Baidu, recently re-entered India through a partnership with Blume Ventures after exiting the country almost six years ago.
The venture capital firm he founded, Draper Fisher Jurvetson (DFJ), first set up shop in India in late 2007 and invested $70 million in a number of companies including Cleartrip, Komli Media and iYogi. In 2013 though, DFJ shut its offices in the country here and later sold its entire India portfolio to NewQuest Capital Partners, citing a corrupt environment and issues with Indian entrepreneurs.
In deciding to come back in 2017, Draper notes that Modi’s demonetisation move sent a strong message that India’s history of corruption may be coming to an end. While he doesn’t have a significant presence in India at the moment, over the last two years, the Draper Venture Network’s partnership with Blume Ventures has moved slowly but steadily.
In an e-mail interview with The Wire, Draper says India needs to show fairness if it wants to compete for venture capital.
— Tim Draper (@TimDraper) December 19, 2019
Why are India’s new citizenship rules making you concerned about investing in more companies here?
Freedom is a big thing for me. More rules and restrictions create more corruption. Anytime one group of people get better treatment than another, the regulations are compounded with unfairness.
Unfairness permeates a society like a cancer. I don’t want to invest to support bad behaviour.
Is it fair to say that the essence of the new law – discriminating on the basis of religion – is not a principle endorsed by you and the Draper Venture Network?
We are a network of fairness, openness and transparency. We are guiding our invested companies toward free markets and other basic freedoms, religion, assembly and speech.
Critics would argue that more engagement with the Indian government – and not less – may be a better way of trying to change things for the better. Your thoughts?
Governments around the world are deciding how they want to manage today. How they treat people and the quality of services they provide to citizens will affect their success over the next 40 years.
Governments are in competition with each other for the citizens, the businesses, the money and the startups of the world. They need to show fairness to be able to compete.
Do you believe social harmony and secularism are important ingredients in ensuring economic growth?
I believe people are people no matter what they believe in.
How do you view the evolution of India’s policy environment in recent times? I know you have been critical of the government’s recent steps on the bitcoin front…
I liked the currency cleanup [demonetisation] a lot. That sent a message to the world of the end of corrupt in a very corrupt environment. It gave me hope so I started to invest again.
Governments that mess with currency advancements like bitcoin run the risk of being left behind. Imagine what would have happened to countries that didn’t allow the internet. Bitcoin promises to be 10 times as big as the internet. India doesn’t want to be left behind…yet again.
If you want a prosperous government, you loosen up the reigns and let 1000 flowers bloom. In the case of India, it is 1,000,000,000 flowers!