His village in Himachal Pradesh got electricity when he was 13. Running water came two years later. It wasn’t an easy childhood, but that didn’t stop Jay Chaudhry from earning an engineering degree from IIT BHU and going to the US for higher studies. He then worked there in many large technology companies. In 1995 he got to know the Internet browser Netscape and was fascinated by the World Wide Web. He wanted to start a company that would provide cybersecurity solutions.
Chaudhry and his wife Jyoti quit their jobs and founded SecureIT in 1996. He led sales and marketing and she managed finance, human resources and operations. SecureIT was later acquired by Verisign. His second company, AirDefense, was acquired by Motorola and the third, CipherTrust, was bought by Secure Computing. The fourth, CoreHarbor, was acquired by AT&T. Chaudhry currently operates Zscaler, which offers cloud-based cybersecurity solutions. He founded the company in 2007 and went public in 2018. According to Forbes, he has a net worth of $8.1 billion.
In 2000, far from the American coast, in a small apartment in the Mumbai suburb of Andheri, Pranay Agrawal, Srikanth Velamakanni, Nirmal Palaparthi, Pradeep Suryanarayan and Ramakrishna Reddy founded a data analytics company called Fractal Analytics. That was the beginnings of AI and analytics in India and they eventually moved to the US where there was already a big AI market. Today, the New York-based company generates 70 percent of its sales in the United States and became a unicorn this year after raising $360 million from TPG Capital Asia.
Chaudhry and the founders of Fractal Analytics took different paths to the promised land, but they are all part of the long list of Indian-origin US startup founders. Ilya Strebulaev, a professor at the Stanford Graduate School of Business, and his team studied 500 US unicorns and their 1,078 founders and found that 474 of them, or 44 percent, were born outside the US. “Many Unicorn founders are first-generation immigrants. Internationally, 10 countries were the birthplaces of more than 10 founders, with India, Israel and Canada being the top three, followed by the UK, China and Germany,” Strebulaev said. India topped the list of 90 startup founders.
Some of them are pretty big names there. Baiju Bhatt, for example, co-founded commission-free stock trading app Robinhood, which made waves during the pandemic. Or Rohan Seth, a former Google employee who co-founded the popular social audio app Clubhouse.
What is behind so many Indians gaining a foothold in the US startup scene?
In America, Indians are now accepted as CEOs, which wasn’t the case a decade ago, said Deepak Sekar, who went to the US in 2003 to do his PhD. He then worked with data storage company SanDisk, but soon decided to pursue his own dreams. In 2014 he founded Chowbotics, a food robotics company.
“When you look different, speak with a different accent and come from a different culture, it’s not easy,” he said. “I had to learn a whole range of skills to be considered CEO material by investors. The emergence of high-profile Indian CEOs at Google, Microsoft, IBM, Pepsi and Twitter has made things easier,” he said.
Chowbotics’ first commercial product, Sally, made salads. At that time there were not many companies in the area. In 2020, just as the Covid-19 pandemic was beginning to shake markets worldwide, food delivery company DoorDash acquired Chowbotics. Sekar now runs the artificial intelligence-based e-learning company Prof. Jim together with Pranav Mehta.
The robust growth of India’s startup ecosystem has helped boost confidence in Indian entrepreneurs in the US, Chaudhry said. But the journey was a steep climb that required a lot of hard work and effort. For example, when Fractal Analytics moved its headquarters to the US in 2005, one of its orders from FMCG giant P&G was only a week long and was only worth $2,000. “The first five years were very difficult,” said Agrawal. “It took us a while to get there.”
One of the biggest challenges was funding. Chaudhry said when he approached a venture capital firm, his business plan was rejected because he “lacked the experience of creating startups.” His company Zscaler has customers from all over the world, including Siemens, MAN Energy Solutions and AutoNation.
Most of these companies maintain a strong connection with India. For example, a third of Zscaler’s offices are in India. Prof. Jim’s entire R&D team is also based in India. Fractal Analytics has around 3,000 employees in India. It doubled its workforce last year and will hire 40 to 50 percent more people over the next five years. The company also works with several multinational companies that have their global innovation centers in India. It plans to go public via an IPO in the Indian stock markets.
Thousands of Indians go to the US every year for higher education and work. According to the annual report of US Citizenship and Immigration Services, the number of Indian students in the US increased by 12 percent to 2,32,851 in 2021. And most of them dream of a future there.
“I didn’t have an entrepreneurial background, but I saw an opportunity to do something in cybersecurity and I jumped at it,” Chaudhry said. “It wasn’t easy by any means, but taking those risks made me reap the rewards.”
