Should Indian Startups Move Towards A Distributed Model?

Posted on September 11, 2010 in Business and Economy

By Prateek Waghre via WatBlog.

Distributed operations are by no means a new concept. Everyday we see distribution systems in action.Right from your neighbourhood retail store to the postal service almost everything we interact with has an element of distribution to it. Why, even the software services companies are examples of distribution on a macro level. Few may know that twitter was largely an outcome of founder Jack Dorsey’s fascination with distribution systems. Since the idea has worked wonders wherever it’s been applied, Why don’t we take it to our offices? More importantly, Why don’t Indian Startups look at this more seriously. I’m not talking about 5-6 work from home positions, I’m talking about a completely distributed ecosystem.

Lets take a look at some of plus points of this style of operation.

Costs! The bane of every startup. How to keep that book in the black, or only a little red? Any founder, especially someone tight on capital can see the benefit of this. Even a tiny office, in a reasonably central location can set you back many many thousands – and if you are in Mumbai probably lakhs. This can have a impact on a startup’s burn through rate. Switching to a distributed system makes that same capital available for other things – investment, better benefits for employees or good old money in the bank. 2 – 4 person startups probably do this anyway, but I see no reason why a 20-30 person company cant do the same. In fact, the larger the office you are NOT renting, the more money you are saving. All that money spent on furniture, office supplies, electricity bills, maintenance, computers etc can be saved. People can use their own computers, if they don’t, there is at least capital available to buy them laptops. Anyone bootstrapping will be quick to spot the benefits.

Time is money goes the old adage. So if people are saving say, an average of two hours otherwise lost in the daily commute. Able to have reasonably flexible timings, they will probably get a lot more time to actually work. I don’t think I know a single person who doesn’t use a certain 4 letter expletive when describing traffic in various cities in India. Now factor in the time he/she will take to actually get into ‘working mode’ – more time saved. On the whole, a person would probably be a lot more relaxed with this sort of set up, and definitely more productive. Disclaimer : There is no room for slackers here.

The signs are there, it seems as if technology is conspiring to move us towards a distributed system. Look around – everything is going on the cloud. Clouds offer more advantages than just saving infrastructure costs. They make your systems present everywhere, and you can be present anywhere – anywhere with internet. Ok, no one on one discussions? From my experience, and that of many people I’ve spoken too. IMs and Video calls work just fine. In fact, in most IT companies you’ll find people sitting 2 feet away in an ‘intense’ discussion over IMs. Tools like Yammer can come in very handy too.

A huge advantage of a distributed setup is that your prospective talent pool balloons. Instead of restricting being forced to restrict yourself to a city, and in the case of some large cities – just a section of the city, the world or at least the country is within reach. The only thing that matters is that there a work related fitment and you’re good to go. No hassles of coaxing and relocating a person. The onshore – offshore model used by IT services companies is proof enough that this system can work. They do it for costs. Startups can do it for quality.

Some benefits of course cannot be measured – and for any person open to working in a distributed company – the return in terms of a much better quality of life is priceless. Aside from the money saved on transportation etc, the extra 2 – 3 hours can make a world of difference to happiness levels and finally to productivity. Yes it is called work – but does it really have to be ‘work’ in the Mark Twain sense of it?

Sure, this system may not work for everyone. Some people need the 9 – 6 routine, or the sense of purpose that comes with going to office, the water cooler gossip etc. If it’s the 9-6 thing, then such people would probably not be happy in a startup anyway. But for those gregarious souls – there’s always the option of forming a local group and going to nearby cafe or something..or not..and that’s the point. The choice is theirs.

No system is perfect, and this has its set of flaws too. As I’ve said, not everyone will be able to adjust to this new way of working. Even those that do, need to ensure that they have a place where they can work without any interruption/distraction. After reaching a certain scale it is not possible to operate without a office. Even then, it isn’t necessary to force all employees to report to one. A company can always grow with a hybrid culture.

Startups in Silicon Valley are already using this system effectively. Automattic, a 50 people(from all over the world) entity, organizes a bi annual weeklong meetup – like a retreat, but they get some work done too. GitHub too operates along the same line. And guess what, they love it!

The writer is a Correspondent of Youth Ki Awaaz. He is also a blogger @ and You can tweet him @prateekwaghre