Thread by @therealjpk

1/ India’s early stage ecosystem is set to explode. Thanks to 'fuck you'​ money

“A people too must live before it can philosophize,” philosopher and author Will Durant concludes in his book The Story of Philosophy.

2/ Lebanese-American essayist Nassim Nicholas Taleb takes that concept a bit further when he says that to be free to do what you want the way you want to, you need something called “fuck you” money. At family dinners, it's referred to as financial independence.

3/ Like philosophy, and other risky endeavors that need chutzpah, fuck you money is an important ingredient for an entrepreneurial ecosystem to thrive. Several Indian tech companies, including the likes of Zomato, Nykaa, and Paytm, are likely to go public in the coming weeks.

4/ And that money is all set to flow into the system — freeing up experienced and talented employees to start their own companies.

But that’s not all. Anticipating the creation of nearly 100 unicorns in the next 3-4 years, early stage investing is also starting to heat up.

5/ We already have close to 40 unicorns in the country. Many of these companies have also created liquidity events for their employees through share buy backs. This means more employees can now get off salary cycles and make longer bets in line with their experience.

6/ For many future entrepreneurs, this money will become their Plan Z — a term coined by investor and entrepreneur Reid Hoffman as the backstop which comes with a certainty that frees you up to pursue your Plan A (the original idea) or Plan B (the pivot) more aggressively.

7/ “With Plan Z, you’ll at least know you can tolerate failure. Without it, you could be frozen in fear contemplating the worst case scenarios,” Hoffman and Ben Casnocha wrote in their best selling book The Startup of You.

8/ There’s another positive development that has taken shape in India. Nearly a decade ago, a handful of early stage players including Microsoft Accelerator and 500 Startups had started in India. But with strategic changes at the headquarters, these players had shifted focus.

9/ But the early stage startup ecosystem is being revitalized with the entry of new players such as Antler, which has a mission to invest in nearly 100 startups over the next four years.

10/ Sequoia Capital’s Surge, which looks to back early stage entrepreneurs is also on its fifth cohort with prolific angel investor Rajan Anandan at its helm.

11/ Early stage funds such as Speciale Invest, Pi Ventures and several others have also raised new funds to continue betting on startups.

For young entrepreneurs, Plan Z might look like moving back into your parents' apartment and starting over.

12/ But for more seasoned employees, with higher living expenses, that may not be an option. The upcoming tech IPOs will do is free them from the fear of losing everything.

13/ Their stock options, which were valuable on paper, will soon have value in the real world and give them a viable Plan Z if things don’t work out when they startup.

14/ Instead of becoming financially independent at the age of 60 with a retirement corpus, these employees will now get to financial independence in their prime with many more years of work in them.

15/ Having tasted success once as employees, they’ll now want to do something bigger as founders.