March 31, 2007

Start-up cliches - By Sanjay Anandaram

Clichés involving the game of cricket are been repeated ad nauseum by commentators and given that the world cup is on, several clichés are being re-cycled over and over again (“glorious uncertainties”, “game is never over till its over” and so on…)

Inspired by the situation, I thought it would be instructive for all, more so for entrepreneurs, to keep a few non-cricketing ones in mind.

a) Genius is 1% inspiration, 99% perspiration: Initially described by Edison, the quintessential entrepreneur, this statement is still very applicable to all entrepreneurs. Many an entrepreneur will tell you that he has a terrific idea, an idea that will change the world and that VCs just don’t seem to want to invest. What the entrepreneur doesn’t realise is that investors don’t fund ideas, they fund businesses that have a real value proposition and are executed by a team that’s willing to invest not just 99% but 100+% of perspiration in making that idea deliver. The execution has to be relentless and continuous. Sixers hit once in a while are less useful than a run a ball played consistently. All of us have ideas. All of us have dreams. But without execution, an idea or a dream remains just an idea or a dream.

b) Don’t drink your own Kool-Aid: This is an American cliché. Just look at the hype and hyper-ventilating media and you would think that the world cup really never had any other destination but India. Unfortunately, the current statistics and data suggest that India are not serious contenders for the cup. The loss to Bangladesh only reinforced this view. When entrepreneurs start believing their own marketing hype, start internalizing messages put out by their own PR about how great they are, start blurring the lines between rhetoric and reality, they are drinking their own Kool-Aid. Many an entrepreneur has come tumbling down just because they couldn’t or didn’t want to look at reality in the face. The dream was more comfortable!

c) You only see the view when you are at the top. The company’s vision and direction can only be set from the top. Of course it is expected that the team at the top has the ability to see the view, to distinguish the forest for the trees, to communicate the vision to all below.
Incidentally, the flip version of this is also important to bear in mind: bottlenecks are usually at the top of bottles! In other words, the success or failure of a venture can almost always be traced to the performance of the team at the top.

d) When the going gets tough, the tough get going. Only when the chips are down do you know the worth of the entrepreneur. Does he/she give up easily? Does he/she believe passionately in the vision of the venture and is willing to sacrifice? Is the entrepreneur listening to signals from the market? Is the entrepreneur pulling out all the stops to make the venture successful?

e) A tortoise only makes progress when it sticks its head out of its shell. An entrepreneur cannot play safe and stay ensconced in a comfort zone. You have to take the risks, make the big bets, and step out into the outside world fearlessly. A comfortably placed corporate executive concerned about protecting his income isn’t quite entrepreneurial material.

f) A good sailor knows he cannot control the direction of the wind so he adjusts his sails to catch the wind. There’s no point complaining about things you cannot control. Focus on the stuff you can control and leverage them to your advantage. If customers aren’t buying your product what can you do to change or modify the product to make it interesting to customers?

g) If the chemistry isn’t right, the arithmetic never works. In other words, make sure that the team you work with, the investors you seek, the customers, partners and employees you interact with are people with whom you can share a bond. Relationships of all types driven entirely by the arithmetic of valuations without any other redeeming feature don’t stand the test of time. On the other hand, relationships built on trust, integrity and competence generate sustained value. Just look around at companies like Infosys.

What do you think?

Sanjay Anandaram is a passionate advocate of entrepreneurship in India; He brings close to two decades of experience as an entrepreneur, corporate executive, venture investor, faculty member, advisor and mentor. He’s involved with Nasscom, TiE, IIM-Bangalore, and INSEAD business school in driving entrepreneurship. He can be reached at sanjay@jumpstartup.net. The views expressed here are his own.