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Entrepreneurship, finance, technology and innovation, general management.

This case is suitable for students in finance, entrepreneurship and general management. The case seeks to understand the challenges of funding in technology startups and how they vary from product to service areas.

Availability of capital, short term and long term, is a major constraint faced by entrepreneurs. In India, in the technology sector, services companies have been able to innovate and grow whereas product-based companies that survived the challenges of funding have been scarce. Aluru Karthik Prasanth is presented in the case as a young entrepreneur with passion and drive to pursue the commercialization of an idea he developed during his undergraduate studies in engineering. Leaving behind the beaten paths ofMTech and employment, he decides to pursue MS entrepreneurship at IIT Madras. As he starts with his program, he analyses the challenges faced by previous technology start ups, Karthik has a dilemma – deciding whether to follow a product idea or change his plans to a technology service.

A detailed analysis of the case would help students address the following questions in entrepreneurial decision making: should an entrepreneur in technology in India pursue a product idea or service idea?. What are the pros and cons of each choice in financing? How can an entrepreneur pursue a product idea and minimize his/her risks? How does an entrepreneur's personal attributes influence his/her course? (e.g. family background, need for control) What are the challenges and opportunities in each kind of funding: debt, venture, angel, etc. in the Indian context?

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The purpose of this paper is to estimate long-term currency exchange rate and also identify the key factors for decision makers in the currency exchange market. The study is expected to aid decision makers to take positions in the dynamic Forex market.

This study is based on quantitative and fundamental analysis of statistically oriented regression models. The trend of quarterly exchange rates is investigated using 110 variables including economic elements, interest rate and other currencies. This research is based on the same information that banks’ dealers use for the analysis. Ordinary least squares linear regression also known as “least squared errors regression” was used to estimate the value of the dependent variable.

The study concludes that “only Australian economic data” or “only the US economic data” cannot fully reflect the trend of AUD/USD. EUR influences AUD relatively larger than the other main market currencies. Six-month Australian interest rate itself affects AUD/USD trend much more than the six-month interest difference between AUD and USD.

The results indicate that the economic autoregressive moving average model can be used to predict future exchange rate using primary factors identified and not from the generic market or economic view. This helps adjust to the general, common (and possibly wrong) views when making a buy or sell decision.

This is one of the first studies in the context using the information of bank dealers for AUD/USD. This study is highly relevant in the current context, given the significant growth in Forex trade.

This paper aims to identify the dimensions of a firm’s service innovation competence. This paper also aims to establish the relationship between a firm’s service innovation competence dimensions and customer-oriented service innovation configurations and customer adoption. This study probes the supply side of service innovation to assess the key drivers or capabilities that influence the service innovation process at the firm level.

This study uses the triangulation method using existing theoretical concept supplemented by 18 in-depth interviews of senior level managers from service firms from three sectors – hospitality, mobile telecommunication services and financial services. The interview findings were supplemented by 12 service innovation case studies (four from each sector). Content analysis of in-depth interviews was performed using three raters, and inter-rater reliability was tested. Case studies were categorized in terms of the strength of the innovation competence dimension observed.

Based on the content analysis of the interviews and categorization of case study observations, six distinct dimensions of the firm’s service innovation competence were identified. Four attributes of each dimension were also identified. Based on the interview insights and case observations, seven propositions are suggested, and a conceptual framework is presented to establish the relationship between the firm’s service innovation competence dimensions and service innovation configurations and customer adoption.

This study was conducted in the Indian context and remains to be tested using quantitative research. Therefore, researchers are encouraged to test the proposed framework in a different geographical context to ascertain its validity.

The conceptual framework presented in the paper may help managers of service firms in building innovation capabilities that are relevant to development of customer-oriented innovations. This would lead to better customer adoption of their new services.

This paper fills an important knowledge gap regarding the dimensions of a critical supply-side component of service innovation, that is, innovation competence. Clear identification of competence dimensions and their relationship with customer adoption extends the current knowledge on service innovation.

This paper aims to analyse the effect of the investment duration, the overall market condition and the industry to which the investee firm belongs on exit returns realised by venture capital (VC) firms invested in Indian market, using hierarchical regression models.

The study examines the relationship that exist among the variables of interest by analysing all the 210 exits that happened in the Indian VC market over the period 2004–2017 by using analytical tools such as moving averages, hierarchical regressions and pooled ordinary least squares regression.

Exit return has an approximate U-shaped relationship with investment duration, and the turning point in the convex relationship happens around seven to eight years after investment. Returns are weakly related to the market condition, discarding the market timing hypothesis. Relationship patterns are found to be generally unvarying during the time period under study.

The results indicate VC funds in the Indian market tend to exit in a brief time span and gain substantial returns from the immediate exits beyond, which returns start dipping. This points to the illiquidity of the Indian VC market wherein the exits from “lemons” are quite tricky, which make them remain invested for longer durations and eroding the value substantially in the process. VC funds may make rational investment/exit decisions in the Indian market capitalising this knowledge.

This study empirically connects the value creating factors in a VC process to the established theories about the early stage investments and analyse the applicability and relevance of those theories in a market with high growth potential like India.

Staged financing is a prominent feature of the venture capital investment process. With staged financing, venture capitalists (VCs) may choose to either make an investment or delay it at each round. The purpose of this paper is to investigate the influence of market uncertainty, project-specific uncertainty and agency problems on these decisions.

The study uses data from Indian firms that received venture capital funding between 2000 and 2017. The duration between funding rounds is analysed using survival analysis. An accelerated failure time model is used to estimate the influence of market uncertainty, project-specific uncertainty and agency problems on the length of time between funding rounds.

VCs delay investment when there are high levels of uncertainty in the market; if market uncertainty increases by 1%, delay in funding increases by more than 6% (almost a month) on average. There is no statistically significant relationship found between the funding duration and project-specific uncertainty. Agency problems motivate VCs to invest sooner. An increase in agency problems results in a reduction of 55% (almost five months) in the length of time before the next funding round.

This study has useful business policy implications. It provides VCs with real option value drivers such as market uncertainty, agency problems, which influence the timing of decisions in staged investment processes. It will help to make the choice between investing and delaying at each round of financing more robust. Further, it is useful for VCs to differentiate between market uncertainty and agency problems against the backdrop of their different implications for staging decisions.

Few studies have examined staging decisions from a real options perspective in the context of a developed economy and very few from a developing economy perspective. This study increases understanding of staging decisions in the Indian context.

There is a substantial lack of the need for adopting interface between accounting systems of companies and banks in Vietnam. The purpose of this paper is to bring out the benefits and lacunas in the adoption of interface for companies as well identify the factors that possibly could be crucial in making the interface adoption a success or failure.

The study is set in the context of case analysis and has adopted a mixed method approach. In this study, a contrast between successful adopters of interface and non-adopters of interface is discussed to identify the motivating factors for interface as well as the factors which form the barriers for non-adopters.

By conducting a case study-based analysis for intensive data comparison of two companies as interface adopters and two as non-adopters in Vietnam, it is found that the success of the interface adoption is influenced by inter-related factors such as the manager characteristics, industrial environment, company characteristic and innovation characteristics. Particularly, the effectiveness of the interface can be well demonstrated by cost saving, manpower reduction, data consistency, accuracy, and speed of the process.

The impact on the banker is not analyzed. Furthermore, this research only focuses on the effects of interface on the electronic banking system and accounting modules in the form of electronic payment, while in reality, banks provide a variety of services which can also be explored by other researchers.

This is one of the first studies in the context of Vietnam. This study is highly relevant in the current context, given the significant growth in the number of industries and export markets in Vietnam.

The purpose of this paper is to examine the short‐term stock market interactions between US and six major Asian markets – China, India, Hong Kong, Singapore, South Korea and Taiwan. These six economies along with Japan and Australia have the largest stock exchanges in the Asia‐Pacific region. The importance of the US market to the Asian economies is the prime motivation for a quantitative assessment of its role in this region. The objective of this study is to measure the dynamic stock market interdependence of US and Asian newly industrialized economies (NIEs) (Hong Kong, Singapore, South Korea and Taiwan) and emerging market economies (EMEs) (China and India) post Asian crisis of 1997 and also to capture the market interactions during the sub‐prime crisis.

The study has employed Granger causality tests and generalized forecast error variance decomposition (FEVD) analysis to analyze the fluctuations in and the extent of short‐term interdependence between the US and Asian economies. VAR model was estimated to run the simulations for FEVD analysis.

The empirical results from FEVD analysis revealed the dominance of US stock market on Asian markets; the USA being a large economy of the world, an important trading partner and major supplier of capital to Asian region. Stock markets of Asia are not immune to the shocks originating in the USA although the effects of shocks vary considerably across markets. Further, an important implication is that major crisis events can influence the relationship among stock markets.

This is one of the first papers in the Asian context examining the interdependence with the US markets. Hence, even though most of the Asian economies went through liberalization, the macroeconomic and financial circumstances were very different before, after and during the process. This motivated the examination of the interactions between US and other Asian markets.

The purpose of this paper is to test a discrete time asset pricing model where a non‐marketable asset (human capital), along with other factors predicting stock returns, explain risk return relationship. The paper will add to the literature on risk return relationship with human capital by investigating the hypothesis that human capital is a significant factor affecting stock prices.

The dynamic inter‐linkages of factors representing financial and human components of wealth in predicting stock returns is tested in the Indian market for the period of 1996:04 to 2005:06. The procedures employed include Granger causality tests, impulse response functions and seemingly unrelated regression estimates.

Empirical findings validate the model that including human capital as a proxy for aggregate wealth in the economy can better predict stock prices than the standard empirical capital asset pricing model. There is a Granger cause relationship between security prices and labor income and it is further concluded that labor and dividend are significant factors affecting security prices.

This is one of the first papers to study the human capital aspect in predicting stock returns in the Indian market. In addition, the paper provides important insights into the causal relationship of human capital and market return in explaining the risk return relationship.

Purpose: The purpose of this paper is to investigate empirically the difference in long run post issue performance of initial public offerings (IPOs) that tapped the Indian primary market through a fixed price offer and book building offer; also to assess the persistence of underperformance between these two routes of offering. Design/methodology/approach: The after market performance of the IPOs is empirically assessed based on their market prices and also taking into consideration the other factors associated with the after market performance such as the period of issue (boom/slump), sector in which the industry is operating, etc. Findings: The results suggest that there is no difference in the direction of performance of the issues post listing in the short run, however in the long run the issues that tapped the market through the book building route seemed to perform far better than the ones that raised money through a fixed price offer. The results also suggested that the average return irrespective of the route of issue remains the same and this is because of the high initial return of issues that tapped the market with fixed price offers. Originality/value: The paper provides useful information about the IPO markets of India and abroad, related literature and theories or hypotheses concerning methods of issue.

The purpose of this paper is to investigate the stability of the long‐run relationships between emerging (India, China, South Korea, and Taiwan) and developed stock markets (USA and Japan). The study aims at adding to the literature on market integration by investigating the hypothesis that the Asian emerging stock markets are increasingly converging with the US stock market over time.

The authors use time varying cointegration tests (rolling and recursive cointegration) which allow for time variation in the underlying data generating process (possible structural breaks in the long‐run relationships). Ten year index data from mid 1998 to 2008 of the respective stock markets have been used for this study.

Empirical findings support the presence of one long‐run relationship (cointegration vector) between emerging and developed stock markets. Both domestic and external forces affect stock market behavior, leading to long‐run equilibrium but the individual Asian emerging stock markets tend to display stronger linkages with the USA (developed counterpart) rather than with their neighbors. The degree of convergence among Asian emerging markets has increased over the last few years.

This is the first paper to study cointegration among Asian emerging stock markets namely India, China, South Korea, and Taiwan, as well as their cointegration with the developed stock markets of the USA and Japan.