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Showing posts from 2011

"Work-Life Balance" - Article by Sanjay Anandaram

“My wife walked out of the house last week. I’ve known her for 7 years and we’ve been married for 5years and now I feel our relationship is purely transactional. I’m consumed by my startup and think about it every waking minute. Am obsessed with it and want to make it a roaring success. My wife works in the financial services industry and she too works long hours. We moved to Bengaluru from Mumbai so that our quality of life would be better. She travels on work and so do I. I get back home late and she’s either in bed or on her laptop. There’s no time for anything else. I don’t or can’t talk to her about the pressures I’m under. Don’t think she’ll understand. I keep responding to emails and SMS messages  when I’m home. I don’t want to lose out on any business opportunity. She wants children and I am not sure I’m ready to be a dad till my startup is done. Am depressed and lonely. But I cannot give up on my startup dream. What should I do?”
So said the 31 year old CEO of a startup. And h…

"Develop Selling and Communication Skills" - Article by Sanjay Anandaram

The Math of How Dilution Affects Founders

Mark Suster has a Great InfoGraphic on the topic in his TechCruch post

Moral: (as Misha Sobolev · Harvard Business School sums it up in the comments):
- go with as few founders as possible.
- get to cash flow positive with fewer rounds.
- bootstrap till you get product/market fit and learn what your engine of growth will be before raising so that you pre- is higher... did I miss anything?

Arun Natarajan is the Founder & CEO of Venture Intelligence, the leading provider of data and analysis on private equity, venture capital and M&A deals in India. Click Here to learn about Venture Intelligence products that help entrepreneurs reach out effectively to the investing community.

"Mistakes to Avoid in PE Fund Raising"

Extract from an Economic Times article by Manish Kanchan, managing director of SAGE Capital.
Very often we see entrepreneurs consulting with well wishers, old-time chartered accountants or their loyal CFOs during the deal-making process. Usually this is the first time anybody is dealing with private equity transactions and are therefore completely out of their depths. Sometimes, they are also insecure about their own future position in the company.

...Investment bankers are your allies. Choose them based on their track record of having closed similar transactions Ask for references and speak with them. Do not appoint them based on the valuation they promise you. Investment bankers do not sign the cheque. Once appointed, trust them and encourage them to provide you with honest feedback directly. The same applies for lawyers as well.

...The business plan must be realistic with a slight optimistic bias. It should also be linked to past performance. If the business has grown at 15% over las…

"Entrepreneurs against Corruption?" - Article by Sanjay Anandaram

“I had to apply for a new passport booklet as I had run out of pages. Having applied online – an altogether different experience - under the tatkal scheme, I was hoping to receive the passport in under a week as I intended to travel for a conference soon. I then was confronted by this uniquely Indian phenomenon of a “police verification”. There was a change in my address since the last passport and my new address had to be verified by the police. I was therefore visited by a constable from the local thana. A few days later, upon enquiry, I was informed that the police verification process was still underway. Surprised, I visited the local thana. To cut a long story short, I was told by the constable that it would help if I paid some “speed money”. I refused and demanded to see the officer who, I was told, wasn’t available. I waited for some time and left. I returned much later in the evening and met the officer and complained. The officer immediately called for the constables and adm…

"Entrepreneurship By Design" - Article by Sanjay Anandaram

I recently had to renew my passport and learnt that “everything could be done online”. I then went to the web-site (passport.gov.in) and learnt that for a resident of Bangalore (and some other cities) one had to “refer” to the home page of the Bangalore passport office (rpobangalore.gov.in) and there was no way to get to this from the home page. Anyway. Filling in the application form is certainly a test of patience requiring intuition, guess work, luck and prayer. And to think that India’s largest IT services company designed this!

Anyone who has filled in forms (and there are more than plenty of those to fill in our great land) will certainly, more often than not have had experience in micro-calligraphy since the space allotted for entering names and addresses is miniscule, while that for entering say a 6 digit number will be an inch wide.

How many times have we stood in a queue not knowing information might be sought by the clerk on the other side, many times not knowing if one is i…

"Startup Financing in India: Then & Now" - Article by Sanjay Anadaram

A sound financial system is the bed rock on which entrepreneurial dreams can be built – within companies as well as without. Access to investment capital and credit financing are critical aspects for any business. Interestingly, in the 100th year of such access in India, it is worth looking back and realizing that it took the efforts of many entrepreneurial, philanthropic and visionary people to achieve all this.

Providing organized professional access to commercial finance in India is at least as old as 21st December 1911 when Sir Sorabji Pochkhanawala set up the Central Bank of India which claims to be the first commercial Indian bank completely owned and managed by Indians. The “Cradle of Indian Banking” - Dakshina Kannada and Udipi districts in Karnataka – saw the setting up of Canara Bank, Syndicate Bank, Corporation Bank, Vijaya Bank, Karnataka Bank, Vysya Bank, State Bank of Mysore among others, thanks in large part to the Swadeshi movement which aimed to cater to the needs of…

"The Entrepreneurial Journey from Goan Feni to Scotch Whisky" - Article by Sanjay Anandaram

India is the world’s largest whisky (in all its variants) market and it’s fast growing market for alcoholic products is worth in excess of $22billion. About 40 million bottles of Scotch whisky was imported into India from Scotland last year, up by 40% from 2009. Recently, India granted geographical indication of origin (GI) status to Scotch whisky, a legal protection that will help reinforce the authenticity of the product and enhance the market potential. This recognition is “good news for Scotland and great news for one of its most important exports” according to the Scotland Office Minister. Scotland’s whisky producers naturally see India as a priority market and the granting of the GI will ensure that Indian whiskies (99% of the consumption today) will not be able to use the term Scotch whisky on their products.

What was once an unorganized and illegal family activity of distilling is now a global recognized branded product. The Scotch whisky industry is over $6 billion in size (w…

"Startup Employees: The Heroes and Villains" - Article by Sanjay Anandaram

It takes a village to raise a child, says an old African proverb. It takes more than just the founder to raise a startup. It takes people of all types, some who join and stay, some who join and exit rapidly, others who join and after a while move on, and finally those who join, grow and become leaders.

It is the last category that needs to be nurtured by startups. Large companies have elaborate HR plans and policies for identifying, training, nurturing future leaders. In as much as it is a truism that it is more expensive to acquire a new customer than to keep and mine existing one, it is also true that growing talent in-house, especially in a startup, is crucial. VC backed startups splurge money on attracting and hiring the “best” and “most experienced” from larger companies but then apart from raising expectations all round (within and without the startup), it is hard to put one’s finger on the real value of such hires. The situation is particularly acute in India because of the over…

Challenges of Scaling Up

Pradeep Gupta of the Cybermedia Group has a nice article in Business Today on the topic:
Another bottleneck is absence of delegation. When a company starts, the entrepreneur behind it often performs multiple roles, from chairman to caretaker. He takes a wide range of decisions from technical ones to marketing, from production to administration. His team too depends on the entrepreneur for every kind of decision. At a later stage, this hampers growth. The entrepreneur soon finds his knowledge inadequate to tackle challenges, or faces time management problems, which hold back the company. To achieve genuine delegation of responsibility, a second rung of leadership has to be created and empowered. Till this is done, businesses cannot scale up. Entrepreneurs often feel that by delegating they are giving up control. In reality, they are helping the business to bloom.

...There is also the pitfall of execution. In entrepreneurial companies, much work gets done without being formally recorded. …

"Synthesised Communications" - Article by Sanjay Anandaram

With more and more communication taking place electronically, one would think that marketing folks would be looking into each leveraging every interaction as a means of building a brand relationship. However experience suggests that there are miles to go before e-communication gets integrated into the traditional marketing plans of even leading brands.

After checking mail in my “Inbox”, I usually review the mail in the “Junk” folder to ensure that no important message has inadvertently been routed to this folder. Upon a recent review, I came across a mail from “Webmaster” and had “Despatch of documents through electronic mode” in the subject line. Even though it seemed like this mail was in the right folder, wanting to be doubly sure, I clicked on it and was surprised to learn that it was a message from the Investor Services Division of a company where I am a tiny shareholder. The message contained an attachment – a circular informing me that all communication (including notices and c…

Narayanamurthy's farewell letter to Infosys shareholders

Great notes on people management and scalability.

Had received this scanned copy of the relevant pages by email.

Arun Natarajan is the Founder & CEO of Venture Intelligence, the leading provider of data and analysis on private equity, venture capital and M&A deals in India. Click Here to learn about Venture Intelligence products that help entrepreneurs reach out effectively to the investing community.

Beware of Corporate Duryodhans

From Devdutt Patnaik article in Economic Times:
Vivek wants to make sure that he gets 100% of the promised bonus.For that he to get 5/5 on appraisal,something that according to the bell curve of the company less than 10% of the organisation can get.So he has spent the past three months doing everything that the boss has asked him to do.He knows that obeying his boss and ensuring the boss feels like a boss guarantees him that score.He does his tasks exactly the way the boss tells him to,he makes fun all the people the boss makes fun of,he admires everyone the boss admires,he reads the same books his boss reads,he does everything to please his boss.

In his team,there are people who much better at work,and who are of greater value strategically for the organisation.But they do not invest as much time on the boss.And so while Vivek and others get an equal score on quantitative matters,only Vivek gets full score on qualitative matters.A week after Vivek gets his bonus and his raise,he submit…

Opening at Venture Intelligence: Head – Research Services

We are looking to hire a suitable candidate for the following position:

Designation: Head – Research Services

Location: Chennai

Reporting to: MD & CEO


Roles and Responsibilities
o High quality of research that enrich the Venture Intelligence product offerings
- Provide hands-on leadership for a team of analysts to create and update financial transaction and valuation information in user-friendly format.
o Assigns daily workload to analysts and follows through on all tasks assigned to the team. Contributes to production as needed.
o Ensures deliveries are on-time and conform to quality standards.
o Accountable for performance of the team and effectiveness of production processes. Responsible for intra-team policies, procedure, and workflow.
o Assist in recruiting new team members by evaluating candidates
o Implements training for new hires and existing team members as necessary
o Develop new features/products for existing customer segments
- Should be able to interface with programming (in…

ET NOW launches ‘Super Angels’ Series

Edited extracts from the Press Release:

24-hr English business news channel ET NOW has launched ‘Super Angels’, a path breaking series which will witness start-ups raising funds on national television, for the first time. The show will feature 20 of India’s most innovative start-ups and 4 of India’s most influential investors along with a national audience who will choose India’s next ‘Super Entrepreneur’.

The 4 Super Angels on the show are Mahesh Murthy, Managing partner; Seed Fund, Vishal Gondal, Founder; Indiagames, Harshal Shah, Founder; Reliance Ventures and Sanjay Parthasarthy; Entrepreneur and Angel investor. The show will be anchored by Sudhir Syal, Editor; ‘Starting Up’.

Every week one start-up will make a pitch to an investor; the TV audience will then be given a chance to vote for the pitch through SMS, email and Facebook. Five months, after the completion of 20 start-up pitches, the audience votes and the investor’s votes will be collated to choose the final 8 Start-Ups, whi…

Fund-raising options other than VC

Economic Times has an article on some of the lesser known funding options available for start-up ventures.
Govt grants and loans
The Small Industries Development Bank of India (SIDBI) has also formed the SIDBI Foundation for Risk Capital to develop and provide appropriate risk capital products for Micro, Small and Medium Enterprises (MSMEs) in different industry segments. Some of the products introduced are equity and equity-like instruments and mezzanine instruments like optionallyconvertible debt and subordinate debt for MSMEs.

With a corpus size of 2,000 crore, the fund will invest a minimum of 25 lakh and a maximum of 10 crore in the form of term loans or assistance. “Our products are easy to work around with. Risk capital has both the characteristic of equity and debt. It’s a very flexible product,” says SIDBI general manager R Dharmaji.

...Credit Guarantee Scheme
It is to bypass the issue of collateral that the government has come up with the Credit Guarantee Fund Trust for Micro…

Effectual Entrepreneurship

Extracts from a Mint interview with Stuart Read, professor of entrepreneurship at Switzerland's International Institute for Management and Development, and author of Effectual Entrepreneurship:
The first thing they do differently is they start with the stuff they have available. This is called starting with the means rather than the goal. An entrepreneur will, for example, set out saying he knows software and partner with someone who knows graphic design and get into making graphic skins for the iPad. But in talking to the customers, he may discover that a security service is what people really want and he will end up making this.

...The other thing they do differently is how they approach competition. In management, we teach how to look at competition using Porter’s five forces. Do you think the Freitag brothers bothered about competition? They cared more about working with partners, their bicycle messengers who would help them create a market. Looking at partnerships in the early …

"Which floor are you on?" - Article by Alok Kejriwal

Extracted from Alok's blog at http://rodinhood.com. (Emphasis mine)

I consciously notice the floors of the buildings that I visit and try to indentify the people who occupy these floors.

That’s where I see interesting patterns between management styles and the floors of buildings:

The Ground Floor

The people on the ground floor are ‘hands on’.

Mop in the hand, doing the dirty work. Sitting in an office that has no cabins. Talking to the people around them while trying to manage the crowds that come in. Quickly getting hot and tired. Blowing their fuse while trying to be civil. Just wanting to do everything themselves.

The challenge being on the ground floor is that it’s easy to lose perspective. You can’t elevate yourself and peep outside – to get a chance to view what’s new & happening in the big wide world outside or spot encroachments that appear dangerously near you. Your life begins and ends on the ground floor.

All the firms I work with and respect in my personal capacity – my …

Persevrance Pays: Profile of Privi Organics

From the Times of India profile of the company which recently raised capital from StanChart Private Equity:
Two years into the business and Privi had not yet created a sufficient client base, pushing it to the verge of shutting down. In 1994, its losses eroded its equity and the company's prime creditor, State Industrial & Investment Corporation Of Maharashtra (SICOM), served a notice to take over.

"We briefly thought of quitting and trying something else," Rao says. "But then we decided to fight it out rather than accept failure." Those days, the big players in aroma chemicals were Bush Boake Allen, Reckitt & Colman of India, Hindustan Lever, Hindustan Polyamides and Fibres, and Tata Oil Mills Company (Tomco).

The partners did their best to turn around the business. They brought down operational costs, switched to synthetic raw materials and negotiated for cost-effective order sizes. The firm also changed its strategy. "Rather than just catering to t…

Press Release: CCCL CEO R Sarbeswar to deliver Entrepreneurship lecture at IIT-Madras

Interactive lecture to feature as part of research firm Venture Intelligence’s “Entrevista” series

Venture Intelligence, India’s leading research service focused on Private Equity/Venture Capital and M&A deal activity, has partnered with IIT Madras’ C-TIDES, to produce multimedia recordings of interactions with successful Indian entrepreneurs from across sectors. Branded as ‘Entrevisa’, the interactions in this series will be available for free and downloadable in audio (mp3 “podcasts”) and streaming video formats from the Entrevista website at http://www.entrevista.in.

As part of the partnership, Venture Intelligence and IIT Madras propose to invite, on a regular basis, successful entrepreneurs from across the country to deliver interactive lectures at the IIT campus. Mr. R Sarabeswar, Chairman & CEO of leading construction services firm, Consolidated Construction Consortium Ltd., will deliver the first such lecture at the Department of Management Studies, IIT Madras on Frida…

"Forget biz plans & the competition"

From the Inc.com article titled "How Great Entrepreneurs Think" based on a in-depth survey of 45 US-based conducted by Saras Sarasvathy, a professor at the University of Virginia's Darden School of Business. The article also contrasts the entrepreneur way of thinking versus the corporate executive way of thinking.

Doing & Course Correcting
Brilliant improvisers, the entrepreneurs don't start out with concrete goals. Instead, they constantly assess how to use their personal strengths and whatever resources they have at hand to develop goals on the fly, while creatively reacting to contingencies....That is not to say entrepreneurs don't have goals, only that those goals are broad and—like luggage—may shift during flight. Rather than meticulously segment customers according to potential return, they itch to get to market as quickly and cheaply as possible, a principle Sarasvathy calls affordable loss. Repeatedly, the entrepreneurs in her study expressed impatience…