Roshan Karki
Roshan Karki
9:08 am on Apr 19, 2013

Roshan Karki is a cancer researcher and one of the scientist advocates of Science Exchange Inc, an online marketplace for scientific services. He is passionate about disseminating the importance of science, technology, and innovation in developing nations. Roshan currently lives and works in Connecticut, USA. You can follow him on Twitter: @Roshancarkey

Everest

Mount Everest, the highest peak on earth, lies in Nepal. (Image credit: Wikipedia)

Paul Graham, co-founder of Y-combinator, a premier seed capital firm in Silicon Valley, notes in his essay, “The way to get startup ideas is not to try to think of startup ideas. It’s to look for problems.”

In this context, developing nations like Nepal offer innumerable opportunities. Flanked between two burgeoning economies, India and China, Nepal is a country with about 27 million in population, in transition with myriad political, social, economic challenges. The capital, Kathmandu (KTM), a major cultural and tourist hub, is marred by daily strikes, traffic disruptions, and scant supply of electricity and water.

Entrepreneurship here is not only a difficult proposition but also a novelty, garnering little public support and barely visible in any discourse. Culturally, starting your own enterprise, which isn’t risk-averse, is strongly discouraged and it’s implicitly understood that new ventures are best executed by already-successful businessmen.

Moreover, aspiring entrepreneurs may be viewed with suspicion, their ideas mocked, and their potential enterprise crushed long before its inception. Families can be particularly unforgiving of failures and unsupportive of ventures that require investment, incur financial loss, or face logistical issues during infancy.

The lack of organized venture capital firms, the reluctance of banks to issue loans to startup companies (unless putting up property as collateral), and apathy from the government are among the main challenges. These culminating dilemmas often compel aspiring entrepreneurs to give up on their ventures and seek safer working routes in banks or NGOs – deemed the most respectable avenues of business by Nepalese society.

Needing business oxygen

Despite all the aforementioned challenges, entrepreneurial spirit has been brewing steadily in Kathmandu, with a recent surge of online enterprises. This can be attributed to several factors: an increased literacy rate and a growing young population in the country; unprecedented access to faster internet, communication tools, and information technology; increased presence of returnees from abroad with creative ideas and risk-bearing attitudes; and the ease of remote collaboration among like-minded individuals around the world.

A quick review of recent startup companies in Kathmandu suggests that young entrepreneurs are either implementing ideas that are seemingly saturated in western markets but with a growth potential in Nepal, or simply coming up with innovative solutions in response to daily inefficiencies they encounter. While these companies are resilient to adverse technical and social challenges, the primary concern of long-term financial security remains, with the majority of companies run on personal or family funding.

To this end, the recent formation of Business Oxygen (BO2), a $14 million small and medium enterprise (SME) venture fund, initiated by the International Finance Corporation (IFC) and managed by the Bank of Kathmandu (BOK) and Beed Management Firm, is an encouraging step – although the fund is directed at growing businesses that are at least two years old.

Nevertheless, the fund aims to provide equity investment, risk capital, and advisory services to SMEs alleviating the financial burden of startups while channeling the focus of entrepreneurs to strategize on the company’s growth. The venture has identified key sectors in Nepal like agriculture, health, information technology, and renewable energy that will play vital roles in the country’s immediate development.

Certainly, the change of attitude towards entrepreneurship in a traditional society like Nepal will not occur overnight, but it is critical that government, educational institutions, and the civil society encourage entrepreneurship among youngsters, improve financial and investment regulations, and educate the public on the importance of innovation to impact progress of any society, a lesson also to be learned from our burgeoning neighbors. And as young entrepreneurs grow and address small inefficiencies today, it is inevitable, sooner than later; they will be able to take on the country’s bigger political, social, and economic challenges.

Kathmandu_Nepal

Kathmandu is the capital and largest urban agglomerate of Nepal. (Source: Wikipedia)

5 Nepali startups to watch

Here are five companies in Kathmandu I’ve read about recently and who are ones to look out for:

1. Biruwa Ventures

This aims to help startups – both for-profit and non-profit – by providing a nurturing atmosphere to cultivate ideas into sustainable and profitable companies. Currently, Biruwa Ventures provides modern office space equipped with essential amenities like 24-hour electricity, a faster Internet connection, clean drinking water, and the use of projectors, printers, scanners, etc., at affordable rates and often discounted in exchange for equity.

Serving like an accelerator, they also provide mentorship, regular networking with seasoned executives, and advice on logistic as well as providing legal support. Most importantly, Biruwa Ventures is in the process of securing relationships with banks to provide zero collateral loans, funding from local angel investors, as well as forming relationships with venture capital funds abroad to support entrepreneurs in Nepal.

2. MeroCampus

MeroCampus aims to disrupt the traditional method of college admissions by creating an online marketplace of of colleges and campuses (grades 11 and 12) in Nepal categorized according to popular courses and subjects. By bringing transparency to the admission process, fee structure, and the available amenities of the institutions, the students and their parents can follow and compare these institutions in real-time in their social networks, interact with other students, and make objective decisions about higher education plans.

This transparency will also help to stem unethical practices of charging exorbitant application fees and asking for ‘donations’ by some institutions. The site takes in a small commission for any student enrolled in the registered institution via their platform. More recently, MeroCampus has been continually providing valuable information on opportunities for higher education abroad along with relevant information about scholarship, fellowships, and stipends for many deserving Nepali students. And as co-founder Prabin told TechinAsia last year, the startup could expand its marketplace to other developing nations in future.

3. FoodMandu

Kathmandu’s food lovers adore street food and snacks, including the local favorite, momos (a kind of dumplings). However, access to these eateries can often be disrupted by traffic jams in the city, unavailability of parking in the vicinity, or inefficient lunch hours for working individuals. Foodmandu tackles this problem as a delivery service by liaising with a wide range of restaurants and eateries in the city, a service that is a surprising novelty, even in a metropolis like Kathmandu.

This mouthwatering service caters to working individuals, families and offices. With 75 member restaurants to choose from, users select food from the menu priced exactly the same as at the restaurants then order online, and pay cash upon delivery for the food, usually within an hour. The delivery is free of charge but a nominal delivery fee is charged according to the order size and distance from the restaurant. It is certain that such a service will appeal to office workers, small businesses, and private firms operating in the city where eating out leisurely during lunch is not an option.

4. CloudFactory

Started up in 2008 by Mark Sears, this is a web-based outsourcing platform that draws on Nepal’s citizens who need work. It puts them to paid tasks on the web, such as flagging bad content, inputting data, transcribing audio, tagging images – whatever a client needs. The Kathmandu-based startup employs over 90 people directly, but employs many thousands more via its platform.

CloudFactory even acquired two American firms, SpeakerText and Humanoid, in October of 2012 so that it could expand its services at the start of this year.

5. KTMcouriers

Another first of its kind in the city is recently launched KTMcouriers, a logistic company that specializes in reliable pickup and delivery of small goods and packages within Kathmandu. Just like a postal service, you place an order online or by phone, schedule a pick up, and track the package in real-time until it is delivered. The service comes with a guaranteed delivery time depending on customers’ needs.

To negate many inefficiencies of such a service and to ensure delivery on time, KTMcouriers came up with an innovative solution apt to Kathmandu – by deploying bicycle couriers for package delivery. They are tracked using GPS to help them navigate through the narrow roads and busy traffic of KTM and the service is therefore generally insulated from unexpected strikes or disruptions that are daily occurrences in the capital. KTMcouriers also offers services like paying your utility bills, picking up grocery items, or even delivering wedding cards. The company aims to expand outside the city in the near future.


Replies
  • Min Zhang

    Good article. in nepal Internet population is just 10%, quick check on google stats. Too little for Nepal to have local internet maket. Curious why no ecommerce, tots?

  • http://www.birthdayforest.org rosnk

    Entrepreneurship programs, hackathon is kinda viral in Nepal at the moment. And every one seems to be in the race to create next big thing that can change the world from Nepal. I can hear at least one program in a week, related to entrepreneurship / hackathon.  And i do agree with the writer (By coincident our name happens to be the same) that may be due to increase in literacy rate or may be due to returning of people from abroad or may be due to internet making the world flat, it has some how created a spark of entrepreneurship in Nepal which might produce next big thing from Nepal.

    I am also trying to be a part of this new culture in Kathmandu and was trying to start my new venture. Fortunately, i got opportunity to be a co-founder of “Birthday forest” (link: http://www.birthdayforest.org) which is in the sector of social entrepreneurship. Its basically a non-profit and it allows user to plant trees on their birthday using mobile and web technology.

    We believe it has a potential to be a self sustainable and has a very wide social impact. Our vision is to address climate change, distraction of natural habitat… and also to create employment for micro-worker. On top of planting trees on community forest we also intend to plant trees on street on behalf of our users.

    We believe entrepreneur will help to drive our country to prosperous and i am optimistic on the future.  Challenges are there for Startup like us and the culture of venture capitalist has not yet started. But  looking at the pace on how the culture is building up in Nepal, i believe we can be known in the world to bring new innovative products similar to India which is known for outsourcing work.

    Please do let us know your critical comments on our venture. And if you like our idea do back us by liking us in fb (search for: Birthday Forest), G+(search for: Birthday Forest), twitter(@birthdayforest).

  • http://sparrowsms.com Amit Agrawal

    Nice Writeup ! Yes IT Startup Industry is picking up in Nepal. Some of the companies to watch, besides the ones mentioned above are as follows

    1. Picovico.com
    2. Sparrow SMS
    3. grepsr.com
    4. Incessant Rain Animation Studios
    5. f1soft.com
    6. harilo.com
    7. thamel.com
    8. muncha.com

    and many more similar companies.

    We are also hosting WORLD STARTUP REPORT Event in Nepal, the details could be found at the links below.

    blog.sparrowsms.com/2013/04/WorldStartupReport.html

    wsr-nepal.eventbrite.com

    blog.sparrowsms.com/2013/04/tech-mashupcome-celebrate-talk.html

  • Donali

    It’d be good to see some real startup activities but most seem like me-toos and hypes. How many startup has Biruwa so far invested in or incubated? Zero?! Cloudfactory is not there to help foster entrepreneurship, they have their own agenda of religious evangelism. Their recent funding came from conservative Christian fund who openly says they invest for spiritual return. So indeed, despite all the excitement, sad state of affairs … fix the education, infrastructure, power supply, legal structure, security, and then real investment/incubator/startups may arrive.

  • Matt Taylor

    When i was in Nepal last December for a week in Kathmandhu and Lumbini I had no issues with electricity. Web access from mobile was a different story.

    The part of this story I loved the most was reading about CloudFactory buying US companies. So wonderful to hear of companies from developing nations buying companies in 1st world countries – its heartwarming and motivates others to try hard. If a company in Nepal can buy a company in US why should one NOT try !!

    Startups are the future, and are especially important to developing nations who can bypass the normal decades of slow development by leaping straight into digital fields, and those forms of work not dependent on bricks and suits.

  • Jasmin

    @Matt Taylor I am astonished that you did not have problem with electricity in Kathmandu in December. During winter months, power cuts (load-shedding) in Kathmandu can be as long as 16 hours a day for the general public. For businesses and hotels that can afford generators, it could be a different story. Here’s a recent power-cut schedule published in one of the nation’s dailies:
    http://www.myrepublica.com/portal/index.php?action=pages&page_id=8

  • http://www.biruwa.net Ankit Rana

    First of all, this is a great article showing hope, development and potential of private companies leading to Nepal’s overall growth.

    @Donali:
    I work at Biruwa and we have invested in two companies as of right now through a non-profit sharing company registered as Udhyami Impact Fund (UIF)
    Here is a little brief description on the two companies that we have invested in:

    1. Karkhana, meaning ‘factory’ in Nepali, is a hacker/makerspace that seeks to engender a culture of experimentation in Nepal and build local solutions for global problems. It was started by four engineers and has expanded its team to 12. In a short span of six months, Karkhana’s team has run over 25 workshops at various engineering schools to encourage local talent to use their education to solve everyday technological problems. They are currently making an educational curriculum that will help students learn programming and logical thinking. Karkhana recently built Nepal’s first ever vending machine that utilizes SMS technology to dispense products in collaboration with a local phone payment gateway. In addition, they are prototyping low cost technology for common problems such as an automatic water pump, electronic lock etc. Although seed capital from Udhyami Impact Fund (UIF) helped the team get started, it is, in fact, the passion of the founders that will define success of such startup companies. Biruwa has provided coaching and strategic advice on how to build their team, discussed potential business models, and built linkages with experts to help Karkhana overcome hurdles in their entrepreneurial journey. Karkhana recently held talks with an established business conglomerate in Nepal for potential round of funding. It is quite an achievement for local investors to show an interest in a startup, and speaks to the stepping stone that UIF provides for entrepreneurship in Nepal.

    2. DND equipments (http://dndequipment.com.np/):
    They manufacture and fabricate kitchen equipments in Nepal. Initially started as a trading business, they slowly hired technicians and engineers to design and develop their own line of products for Nepali market. Their pastry display case have been selling like hot cake, moreover they have already made prototype coffee roasters which is currently being tested and has been getting some serious attention from local coffee houses.

    On the Incubation side, we currently have more than 10 businesses housed at Biruwa Baluwatar and Biruwa Gyaneshwore. One of the best example of our business incubation side working is EasyKhaana (http://easykhaana.com/). EasyKhaana has been housed at Biruwa from early stage of their business cycle. They have utilized our network, brainstormed and tested out ideas in-house at Biruwa and then implemented their findings in the market. The interactive, idea sharing and closely-knit ecosystem has benefitted our clients in different ways. Although the results are not immediate, progress is still happening.

    On a personal note, fixing up the above mentioned infrastructures will take time and resources. Everyone knows education, infrastructure, power supply, legal structure, security.. etc needs to be fixed. But, what is being done about it, is what matters the most. I know the above mentioned companies are doing something instead of waiting for everything to pan out. That is where true entrepreneurship and startups thrive, when there are real problems.

    If you are in Kathmandu, please call us 014414414 (Biruwa Ventures), I will happily give you a tour of Biruwa and actually show you what is going on to clear your assumptions and confusions.

  • IT Companies in Nepal

    I am very amazed by the information of this blog and i am glad i had a look over the blog. thank you so much for sharing such great information.it really helped me alot.

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