The Startup Journey

Last week I had two very different experiences while visiting two well known global companies. Experiences that made an impact on me and experiences that every startup company can learn from. I arrived at the fist company a little before my 10am appointment and walked into the reception area. There was pandemonium there with a large number of visitors huddled around the reception desk. The long desk in turn was “manned” by about 6 or 7 smartly dressed men and women and had 3-4 computers on it. I mentioned the name of the person I’d come to visit to one of these persons and I received a blank stare. I repeated the name and was asked if I had the extension number of the person. I did not. I repeated the name again as well as the designation of the person. Finally, the name and a mobile number was located. The mobile number turned out to be an old one. The staff were running around without any clue as to who my host was. The cell phone number I had for the person didn’t work either. I was...

It is often said that in India, as in some other Asian countries, entrepreneurs tend to be extremely control oriented, tend to be very focused on retaining generational ownership of the company, and view investors as necessary evils and not as partners in creating value. Investors usually tend to be viewed as lenders or project financiers and generally receive the same callous treatment as did banks of yore. However, as more and more private equity capital (including venture capital) flows into companies to satisfy the entrepreneurial aspirations of globalization, scale, and market value, the realization that good governance, transparency, investing in business growth and professional management lead to value creation has gained strong currency. For startups therefore it is important to appreciate the role of investors as stakeholders and partners in the creation of a successful and valuable business. And part of the appreciation should manifest itself in the realization that investo...

Early last year, I met a startup team that was building the next great mobile application. They had built a system that could offer mobile social networking to end consumers. The team had great technologists including a few successful entrepreneurs among them. They were convinced that their system would be the next great thing for consumers; they were supremely confident (bordering on overconfidence) about the uniqueness of their offering. This company was trying to build a company focused on the end-consumer as their customer. This meant that they had to build a brand, build a system that would be ridiculously easy for consumers to use, have a mechanism that would keep attracting people back to them, and figure out a way to make money. Of course, companies like Google and MySpace were their role models. The team had enormous expertise in building and running systems for businesses, selling and marketing to businesses and supporting business customers. They however had no experience in...

All too often hopeful entrepreneurs approach venture capitalists (VCs) and then keep approaching them with the same set of slides. After a while, disappointment sets in. ‘VCs in India are risk averse’, ‘They do not understand my business plan’, ‘None of them have operating backgrounds so they cannot appreciate the position’ are some of the common refrains. It is, therefore, worth understanding the language used by VCs during the meetings. “Interesting but…..” The word ‘interesting’ has many meanings but almost certainly never means that the VC is excited. The meaning of the word varies from ‘OK, nice’ to ‘intriguing’. It is also used as a place-holder or a punctuation mark. The ‘but’ that follows is dangerous. Means the VC is not positively inclined. “Who else have you talked to?” This is not a general innocent question. This is a way for the VC to know who else is looking at the deal and therefore, how he or she should pace the decision-making process. If a lot of VCs have been approa...