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Showing posts from February, 2007

The Subhiksha Story

Rediff.com has an interview with R.Subramanian, an IIT and IIM grad who is the Founder & CEO of discount retail chain Subhiksha which is today India's largest organized retail chain with over 500 stores. We allocated a Rs 5 crore (Rs 50 million) corpus to it and entered the retail business. There was a lot of thought process behind it. We wanted to attract not the top end customer but the aam aadmi.

From our research of three months, we found that consumers prefer buying groceries from closer home. So, we decided to set up 1,000 sq ft shops all across the city and not a 10,000 sq ft big store at one location in Chennai.

The next question was why would he come to our store abandoning the existing store? It had to be the price, because ultimately there is no difference between the branded products like say Boost or Surf or such things. So, we decided to sell branded products at a lower price.
Arun Natarajan is the Founder & CEO of Venture Intelligence, the leading provider of …

Discussion on a VC's "betrayal" of a start-up

Interesting discussion at TechCrunch on "drag along" and other rights that enabled an US firm to forcibly merge (according to TechCrunch) two of its portfolio companies.

Hat tip Sramana Mitra

Arun Natarajan is the Founder & CEO of Venture Intelligence, the leading provider of information and networking services to the Private Equity and Venture Capital ecosystem in India. View sample issues of Venture Intelligence India newsletters and reports.

Marketing Lessons from the Spiritual World - By Sanjay Anandaram

India has been known for its spirituality, swamis and sadhus for as long as anyone can care to remember. Spirituality has been one of India’s most successful exports (Bollywood’s “soft power” notwithstanding). It would be most unusual to refer to the purveyors of spirituality as entrepreneurs but then that is what they, in a sense, are. They are on their own, they undertake their work with a great deal of passion and energy, and actually head organizations that generate serious revenues. Given the vast spirituality “market” it is not surprising to find a bewilderingly large array of spirited entrepreneurs of spirituality. Yet there are only a few that have acquired a pan-Indian or global following. The success of these few therefore offers many interesting marketing lessons to entrepreneurs from the temporal world.

Lesson 1: Unique well defined customer segment
Each guru has a well defined set of followers. There are hardly any overlaps and fewer instances of cannibalization where one …

Event on VC investing in Internet-based Services and Mobile VAS

Venture Intelligence, the leading provider of research and networking services to the Private Equity and Venture Capital ecosystem in India, is organizing Internet & Mobile Connect, a roundtable event on Venture Capital investing in the Internet-based Services and Mobile Value Added Services sectors. The event will be held on March 15 in Mumbai.

The Online Services and Mobile VAS sectors have emerged as among the favorite sectors among Venture Capitalists, accounting for almost 50% of all VC investments in the IT & ITES industry. However, there are several significant challenges facing these sectors – including business models, valuations, quality of management, etc. In this context, leading VC investors and top executives from Online Services and Mobile VAS companies will come together at Venture Intelligence Internet & Mobile Connect to network, discuss and share best practices.

The key themes to be addressed include “Internet Businesses: Is the boom for real this time?”,…

Is the market ready - or does it exist - for your product?

Will Price has a interesting post on how, when a company is behind plan, it is important to identify whether the problem is with the market or the company.
If it is the market, there is little chance that more money or new management will change the outcome. If it is the company, additional resources (both capital and human) may indeed impact the outcome and be reasonable.

I have seen some of the smartest people work the longest hours, code round the clock, make the most sales calls, and reap no reward. When the market does not care about your solution, or, worse yet, does not exist, no amount of management talent, hard work, or capital can remedy the situation.
Price goes on to provide a list of key indicators that help identify market failure.

Arun Natarajan is the Founder & CEO of Venture Intelligence, the leading provider of information and networking services to the Private Equity and Venture Capital ecosystem in India. View sample issues of Venture Intelligence India newsletter…

"What valuation do you expect?"

Don't answer that question says Florida VC Dan Rua. And forget bringing it up yourself in a conversation with VCs.
Don't say a dollar figure and don't say a percentage. I repeat, don't say a dollar figure and don't say a percentage.

..You'll probably get one of the following responses:
a) That's great to hear, because we're all about partnering; or
b) That's a load of crap, tell me the valuation you're really thinking.

Even if you get response b), I'd suggest reiterating your primary goal is finding the right partners to build your world-changing company. If you can't leave investors happy with that answer, then, and only then, reference other specific company comparables (not "my friend got X") and how your research uncovered a range of attractive X to acceptable Y values (reiterating that it's about partnership first).

...If you give yourself and your investors time to learn each other a couple things happen. First, you get a b…