Rashmi was quoted in a recent New York Times article on how collaboration technology is revolutionizing small businesses. The “micro-multinational” (buzzword for startups with offices in two or more companies) simply wouldn’t exist without the internet, VOIP, and collaboration tools (skype, basecamp, webex/gotomeeting, etc).
I particularly like the article’s emphasis on how entrepreneurs are better positioned to work with foreign labor, because they are willing to put up with the headaches (staying up all night talking on skype) and have connections in the country where the work is taking place (something that is crucial to hiring the right people and having the trust necessary to operate remotely).
When we think about the economic impact of information technology, the first companies to spring to mind are the industry giants like Amazon, eBay, Google and Yahoo. But the biggest impact on the economy may well show up in small and medium-size enterprises.
The reason is that information technology is a great leveler. As computers get cheaper, more powerful and more connected, technologies that were only available to the Wal-Marts of the world become available to the small fry. […]
I met recently with two Silicon Valley entrepreneurs. One, Rashmi Sinha, told me her software company had six employees: two in the United States and four in New Delhi. The other, Cosimo Spera, started a company to develop applications and services for mobile phones; his company has five employees in the United States, eight in Spain and two in Italy.
Both of these micro-multinational companies work pretty much the same way, using e-mail, Web pages, voice-over-Internet phone services and other Internet technology to coordinate their far-flung operations. “Just think,” said Ms. Sinha, “my little six-person operation is now a global business.”
It is no surprise that many of these small, high-tech, international entrepreneurs are foreign-born. They have the contacts, the connections and that most critical ingredient, the ambition, to assemble the pieces needed to start a business.
It is almost impossible for an entrepreneur to put a foreign development team together without some strong connections on the ground. Even large multinationals have found out that outsourcing is not the panacea it was proclaimed to be. Paradoxically, it is easier for the micro-multinationals to deal with the inconvenience of outsourcing than it is for the big international corporations. Entrepreneurs are willing to do things that big international corporations will not do – like staying up until 11 p.m. and using cheap voice-over-Internet technology rather than expensive international telephone service.
Constant supervision, constant communication and constant coordination are necessary to make small business grow. But it is just these things – the ability to supervise, communicate, and coordinate at a distance – that have become so much cheaper in the last 20 years. Big enterprises were the first to reap the benefits of this technological progress. But the impact of information technology on small and medium-size enterprises may yet turn out to have the most impact on the economy.