Reverse innovation or trickle-up innovation is an innovation seen or used first in the developing world, before spreading to the industrialized world. The term was popularized by Dartmouth professors Vijay Govindarajan and Chris Trimble and GE’s Jeffrey R. Immelt. Subsequently, Vijay Govindarajan and Chris Trimble published the book Reverse Innovation.
However, time has changed after reverse innovation was defined initially. I believe there is now a significant opportunity for reverse innovation in the area of digital transformation and saas solutions. Most of my experience in this space comes from living in the United States and working with startups, fortune 500 companies, angel investment groups and technology companies from India. In my observation, the following trends will accelerate reverse innovation and create opportunity for angel investors, VC’s , operator mentors and entrepreneurs in India.
• Promise of high quality tech talent still holds true for India. The tech talent is mature and now has global exposure and mentorship.
• India is becoming an inventor and startup friendly nation. The Indian government is running multiple initiatives to support innovation and develop a startup echo system. (https://www.startupindia.gov.in/index.php )
• India has become a big market for online platforms because of extremely low internet costs and wider adoption of smartphones. New business models in every sector are coming to leverage deep penetration of consumer connectivity. This is driving innovation of new online platform business models every day.
• It is relatively easy for enthusiastic technical people to take risks and start a new product idea in India as compared to the developed world due to: technical talent availability , generous support system, aggressive attitude of gen-Y startups and various other economic factors e.g. rising disposable income, low cost of living, access to capital.
All of these factors create the perfect timing and opportunity for reverse innovation for digital transformation solutions and online platforms. Availability of tech talent, a startup friendly environment , adoption of internet and smart phones at unprecedented scale with other economic factors for startup founders make the environment ripe for Reverse Innovation.