The Startup Journey

I received a letter by courier yet again last week from a well known financial institution. It took me a while to reach the letter since the envelope in which the letter was enclosed had been fortified by no less than 9 staple pins. In addition, the envelope was tightly sealed with gum and two strips of sticky tape. I finally retrieved the letter but not after some cursing and a bruised finger. This was the nth such letter I had received from the company, complaints notwithstanding! Why did this company deem it fit to send me a letter that was so cumbersome (not to speak of, painful!) to retrieve? Clearly, security for their letter was a high priority but was it necessary? Did they pause and think about their customer’s experience at all? Am not sure they did because then they might have considered emailing me the letter. Or were they simply following an age-old practice mandated in response to a case where someone’s letter was pilfered? In all probability, a ritual that had come into ...

We are delighted to announce a stellar list of speakers for APEX '10, the annual conclave of the Indian Private Equity / Venture Capital industry, scheduled for February 4 at Mumbai. This edition of APEX will have a special focus on Education, Healthcare & Life Sciences, Telecom and Financial Services (especially financial inclusion). Speakers at the Summit include: Varun Sood, Capvent Ashish Dhawan, ChrysCapital* Raja Kumar, UTI Ventures* Vani Kola, NEA-IndoUS Ventures Manik Arora, IDG Ventures India Anand Sudarshan, Manipal Education K. Ganaesh, TutorVista Rajesh Bhatia, Tree House Education Sunil Kanoria, Quippo Telecom Mahesh Choudhary, Microqual Techno Dr. Bala Manian, ReaMetrix Swapan Bhattacharya, TCG Lifesciences Chetan Tamhankar, SIRO Clinpharm S. Nandakumar, Perfint Healthcare Padmaja Reddy, Spandana India V.P Nandakumar, Manappuram General Finance Madhusudan Menon, Micro Housing Finance For Participation details, email info@ventureintelligence.in or c...

1991 was when India achieved its second independence – that of economic liberalization. But, in retrospect, one has to say that it has been far more than just economic liberalization. It also liberated the mind of the baggage of self-doubt, low confidence and ignorance. It has therefore been my belief that those born around or after 1991 would be the change agents of India. Entrepreneurship and entrepreneurial thinking would be the vehicles of change. In the first column of Indipreneur published August 25th, 2006, I wrote: “For the first time, an entire generation of young people cutting across class lines is acutely aware of the opportunity ahead of them. They also recognize the inscription on the other side of the coin: RISK. And it’s not a four letter word anymore. While earlier generations were defensive and inward looking, this generation is aggressive, outward looking and not given to the self-doubts of the past. This is the “why not?” generation. This generation has the potentia...

A CEO’s job, like any leader’s, is a lonely one. The CEO of a startup is especially lonely. He’s expected to manage finances and investors, the board, motivate employees while dealing with recalcitrant ones, engage with, influence and grow relationships with key customers, partners, suppliers and industry players. The CEO needs to be emotionally strong to deal with all the pulls and pushes. And has to always present a sunny disposition even when times are difficult. It is a job that requires enormous confidence and humility. Confidence to keep executing towards the goals of the company and humility to keep learning and unlearning. Not surprisingly, these are uncommon traits that only the more successful CEOs have. Rarer too is the desire to know one’s weaknesses and the willingness to work on improving oneself. I was therefore delighted when I recently received an email from a CEO saying he wanted an honest appraisal from me of his leadership. He had commissioned a 360degree appraisa...

Forbes India has an interesting profile of Vikram Bakshi, the JV partner of McDonald’s in India. 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. Click here to learn about Venture Intelligence's products and services for entrepreneurs.

DARE magazine has an article on the various government-related agencies that provide funding for technology start-ups. 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. Click here to learn about Venture Intelligence's products and services for entrepreneurs.

The TV channel had headlined the story “Education or Business?” The story was about how students had been taken for a ride by the administrators of a couple of educational institutes that had taken large sums of money as fees and then not provided admission to the students. The police, the students’ families and even the local MLA were all interviewed. The administrators of the institute were not available for comment. The headline “Education or Business?” was troubling. Was it implying that education and business were mutually exclusive? Or, was it, even more so, implying that cheating students with false promises was unacceptable behaviour in education but, and here’s the rub, understandable and even acceptable if it were yet another business? Is business assumed to be corrupt and unethical? And therefore is it perfectly legitimate to indulge in practices that might not be considered ethical as long as it benefits the company? What then does it mean for entrepreneurs starting out to ...

It was the first presentation the CEO was making to the recently constituted board of directors on the company’s performance till date and the business outlook for the next 12 months. It was well laid out with a series of numbers detailing revenues, margins, headcount, growth rates and so on. The CEO was well acquainted with the numbers and was aware of the operational details. But there was one troubling issue. There was no data on customers, competition and market dynamics. None of the analysis focused on the revenues, margins and opportunities in different market segments or with different customers. Information was lacking on how the headcount of the company was distributed across customers and geographies. Were customers satisfied or not? Which customers were showing the most promise from a growth standpoint, which ones were giving the company higher margins and which ones were a drag on the company? How many new customers were being added every month and how many customers were...

The board meeting at the startup was underway and the CEO proudly highlighted what he considered to be the most successful initiative of the company. The initiative had been embraced by customers and partners whole-heartedly and the signs of continued growth were very visible. The head of business development, present in the meeting and responsible for that initiative was understandably delighted at the acknowledgement by the board. He subsequently made an unusually peppy presentation on his department to the pleasant surprise of all. Later on, the CEO explained about business development and its head: “He’s full of ideas all the time. We tried several of his ideas earlier and they all bombed. When he came up with this latest one, I told him that this would be the last one we’d try. I also asked him to think through the idea and take full responsibility for its implementation. The results are visible. In addition, the business development head was so thrilled with the success that he t...

“I hired him as President thinking he would transform my company. He was experienced, had worked for Indian and MNCs and we got along well. He was the highest paid executive in my company at Rs 45L plus incentives. Unfortunately, I didn’t see any impact on sales or margins and I had to ask him to leave”, said the founder-CEO of the startup. “How long did he stay in your company?” I asked the founder-CEO. The COO was asked to go after 4 months. On further probing, the founder CEO explained, “I think 3-4 months is sufficient time to see results in sales. I want to see execution and quickly, not ideas and plans. He just spent time meeting customers, spent money hiring a company to train employees, wanted clearance to hire some more people and wanted to build a plan that he would then execute. Arrey bhai, what’s there to plan about when we know our customers and market and know exactly how much we can do.Instead of “doing”, he was wasting time and money in planning! Apparently, he couldn’t...

IIMA is organizing a Business Plan Showcase as part of its Finance Conclave 2010. Entrepreneurs from following sectors are invited to submit their entries: Clean Tech & Renewable Energy Telecommunications and Mobile Services E-commerce & Web Portals Electronics IT/ITES Services IT Software Power Registrations for the Showcase Registrations start on the 10th November 2009. To register your team, please send a mail to leverage@iimahd.ernet.in with the following details: Name of Team Members Contact Details Category of the Business Plan Please use the following as the subject line: "Showcase 2010: Registration for ". On registration, you would receive a mail confirming your registration within 24 hours. Important Timelines Registration Begins : 10th November, 2009 Submission of Round 1 Executive Summary : 25th November, 2009 Result of Round 1: 30th November, 2009 Submission of Round 2 Business Plans : 7th December, 2009 Final Shortlist for Presen...

From an Knowledge@Wharton interview with Atul Jain, the founder and CEO of TEOCO: ..people sometimes “tell me, ‘I want to be my own boss.’ I tell them that when you become an entrepreneur, nothing could be further from the truth. Every single employee is your boss because if they leave, you have nobody to do your work. Every single client is your boss because they tell you what to do. When you work for a company, you typically have one, maybe two bosses. When you're an entrepreneur, everybody wants to tell you what to do. Your employees will tell you what to do, your clients will tell you what to do, even your vendors will tell you what to do.” ...Part of business success is cost management. We never let expenses get out of line with revenue. The way I explains this is: think of your revenue as an 18-wheeler truck on a highway. It's like a large truck. Then there is another truck right behind it, another 18-wheeler called expenses. Sandwiched between the two 18-wheelers -- rev...

Alexander Pope’s 1709 “Essay on Criticism” had these immortal lines “…for fools rush in where angels fear to tread”. He was of course referring to the literary critics of his time and, in his time, implied some one who behaved foolishly rather than referring to a simpleton or someone lacking in intelligence as it does now. Every entrepreneur, observer, VC, analyst and even bureaucrat will tell you that there’s a severe shortage of true boot-strapping capital. The money required to really start off on the entrepreneurial journey. Friends, family and fools (collectively FFF, rather unfairly but with tongue firmly in cheek) provide the initial emotional and perhaps some monetary support for the budding entrepreneur. It invariably takes more than that to demonstrate the venture is capable of taking off. Ours is a capital starved country. There’s a huge shortage of investment funds in the country. The shortage is on account of regulation and partly in fact as well. Almost all the money inve...

I attended a presentation on entrepreneurship by Satya Prabhakar, Founder & CEO of Sulekha.com, on August 31 at an event organized by TiE-Chennai and the Loyola Institute of Business Administration (LIBA). I found the points he made on hiring and retention quite interesting. He suggested entrepreneurs look out for "5Is" for hiring and 'three 4-letter words" for retention. The "5 Is" 1. Intellect 2. Initiative 3. Industry (ie, Hard work) 4. Integrity 5. Interpersonal Skills The 3 4-letter words: 1. Work (i.e., its content) 2. Love ("Am I valued and appreciated here?") 3. Hope ("Is this place enroute to something great?") Entrepreneurs should not allow an employee to settle into a comfort zone and keep setting the bar higher. 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. Click here to learn abou...

“Here’s a NDA (Non-Disclosure Agreement) – please sign it”, said the entrepreneur. His face fell and he looked almost hurt when I told him that I don’t sign NDAs. It is simply impossible to keep track of the business ideas and plans that get discussed with various entrepreneurs. There are also many ideas and plans that sound and indeed are similar in concept if not in all details. One would open oneself to needless and avoidable complaints about plagiarism and favouritism if NDAs are signed. So, how does an entrepreneur “protect” his business plan or “idea”? Every entrepreneur actually believes that his/her business plan is singularly unique and that it will change the world if only capital were made available. While it is important for every entrepreneur to believe in his/her plan, it would be arrogant to assume that no body else has thought about it either. Most businesses are the types that could be classified as “better, faster, cheaper.” In other words, they take an existing mode ...

I came across this interesting trivia about the late King of Pop from the “IP Marketing Advisor”: “In the 1988 video of the song Smooth Criminal, the pop star and his dancers leaned forward dramatically, seemingly defying gravity. It turns out Jackson didn’t just invent the move — he eventually patented it. To do what became a signature move in live performances without the help of harnesses and wires, Jackson created a shoe “system” called “Method and Means for Creating Anti-Gravity Illusion.” Granted in 1993 to Jackson and two partners by the U.S. Patent and Trade Office, patent No. 5,255,452 covers a “system for allowing a shoe wearer to lean forwardly beyond his center of gravity by virtue of wearing a specially designed pair of shoes.” A heel slot in the shoes gets hitched to retractable pegs in a stage floor. Wearing the shoes, Jackson (or anyone) could seem to lean past his center of gravity without toppling. “I’ve used (Jackson’s) patent for years in classes to teach students w...

Extract from Sunil Mittal's interview to Forbes India: When we started out, we were an entrepreneur-led, entrepreneur-promoted company. We did a great job. In some companies, this phase lasts forever. Nothing wrong. But in my view, if you do that, you remain small. You can’t manage a large company using this model. So we moved to the next stage — entrepreneur-led and professional-supported. Over the last four years, we’ve moved to professional-managed and entrepreneur-supported. And that’s where we want to keep it. There is one more stage — professional-led and professional-supported. Vodafone is in this mould...No single shareholder is dominant...Parts of our organisation were moving to the professional-led and professional-supported model. I had to pull it back because I figured they were becoming too bureaucratic. Things didn’t move; too many approvals were needed; too many emails. That is something we want to avoid...You must feel like the deer in a forest, which is always afr...

“How much will my stocks be worth in 5 years?” was the question the senior corporate executive asked the CEO of a startup. “I don’t think my stocks are worth anything now, so I want a big salary raise considering the fact that I’ll be spending the next few very productive years of my working life with you” was the refrain from a senior manager of a young startup. “What will your exit valuation be” asked the junior VC partner to the entrepreneur as if anyone had the answer! All too often such scenarios play out in young companies. These questions are not easy to answer with any certainty given the state of the company. Yet, these questions need to be addressed. The trouble occurs when these perfectly legitimate questions consume the startup team such that enormous energy is expended in explanations and negotiations with employees and investors leaving the startup shaky before take-off. It is important to keep some basics in mind. First, in young early stage startups, valuation is almost...

Qualcomm Ventures, a division of Qualcomm, has announced a global business plan competition called QPrize, with the aim of help the winners with funding to translate their business plans into reality. The competition invites entries from India, China, Europe and North America for business plans that accelerate wireless technology development in any of the following business sectors: * Consumer/enterprise applications and services * Communication devices * Semiconductor and component technologies * Mobile platforms * Digital media and content * Healthcare technologies and services * CleanTech The deadline for submissions is July 31, 2009 . A winner will be selected from each region. These 4 winners will each receive US $100,000 of convertible note funding and will be invited to the Qualcomm Ventures CEO Summit in San Diego, California to compete for the Grand Prize in November. The Grand Prize winner will receive an additional US$150,000 of convertible note f...

The CEO was a highly qualified and experienced person. He had returned to India over 3 years ago to start a company with his own funds. For family reasons, he had set up his company in a town about 100 miles from Bangalore. He was now struggling to grow beyond the initial customer or two. Customers weren’t comfortable with doing business with a company located in that town; Payments from customers took more time than usual; it was hard to recruit talented people in the smaller town; Communication infrastructure wasn’t the best resulting in loss of efficiency and productivity. It was hard to find people in his town who were aware and knowledgeable about how things worked in national and international business. And that there was no PR firm in his city to help generate visibility for his company. In short, according to him, the reason he was struggling had everything to do with the location of his company. In the course of the conversation, he also mentioned that his company had built a ...