Tag: Entrepreneurship

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Entrepreneurship

Vision and its role in achieving success

I travel a lot and I drive very often. I always try to reach the destination as fast as possible.

I use to think that the speed at which you drive is related to the width of the road. The wider road affords you a lot of room to make errors and therefore allowing you to drive faster.

As I drove on the narrow road to Hyderabad, I realise that speed has nothing to do with the width of the road, but is the function of how far you can see. The further you can see with certainty, the faster your able to proceed.

photo copy              photo

When you think of businesses, the same principle translates into an extremely clear vision behind which you are ready to put or commit all of your resources. If the vision for the business is extremely clear than, you have the ability to throw all your weight behind achieving the same. Not only that, you also have the added ability to push forward against all detractors, of which you may find many.

Apple did not come up with an idea of a tablet, but they were the first company who had a clear vision and the belief to commit to the vision. There were many other competitors who came up with the same form factor, but did not have the vision or the belief to pursue it. In fact the success of the iPad is just due to that belief, you can see the difference in the results achieved by Apple and a competitor like Microsoft, HP, Lenovo, et al.

Clarity of vision is by far the best gift that you can give to your business.

 

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Entrepreneurship

Secrets of a successful Bootstrapper

Use the resources that are at your disposal – Often we do not even realise all of the resources that are available to us. If you dig down hard, you would find that there are plenty of things that are available for free or at a cost that is almost close to nothing. If you are enterprising enough and constantly on a look out, you would definitely find it.

There area a variety of examples depending on the nature of business that you are looking to setup. Like your aunt’s garage that is not used at all. Your cousin’s soldering iron that he no longer uses. A vehicle in the family that is not used during the day or during the night. It is not the most convenient way to do things but it saves much needed capital in the early stages.

Use your home as office as long as possible – Any space of any sort will always come with some sort of obligation/cost along with it. It is important to make sure that you do not get enveloped in obligations initially. In India, especially, parents never charge their children for the house and the best solution is to use the house as the work base as long as possible. Teams are generally small, and they can fit into one room.

Try to reduce expenses on anything and everything – If you can get some favours out of certain people or get certain things sponsored, do so shamelessly. The favours can start from something as simple as a cup of coffee to hitching a ride to some place, to staying are someone’s house when travelling to a city for work. Initially these expenses can drain you slowly and steadily, it might seem unimportant but every rupee saved is a rupee more that you have to invest on yourself.

Don’t try too hard to get the perfect people – Once you start the development of a product or service, try to get as many good people as possible to work with you without blowing up too much cash. Ideally get people who are young and hungry to work and excel. If you wait to long seeking the perfect candidate, you might loose your window of opportunity. If you are making money the perfect candidates will seek you out, even if they don’t, it would be a lot easier to recruit them.

Don’t wait to perfect your product, good enough would do – A lot of the times teams spend just too much time trying to perfect the product before they send it out into the market. No matter how much you perfect a product there is always going to be something that would kick up. That is why companies launch beta versions. Once the product/ service is good enough ship it! You can go about doing the fine tuning as you progress.

Make sure that cash flow begins – If you are bootstrapping, there is no points for making the most popular product or service, which does not generate any cash. Figure out your revenue model and get the money rolling in. That does not mean that you are profitable, it just means that you have your cash flows to bank on and not all of the operational costs has to poured into the business.

Focus on forecasting the smaller part – Figure out the lowest common denominator of your revenue model. Who is going to pay you, how much and for what? One of the biggest mistakes that most startups make is looking at the size of the industry and trying to project 1% of it and so on. It rarely adds up like that. Go bottom up.

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Entrepreneurship

#StartupsClub #DemoDay2014

Last year around July: Startups Club was about 4 months into its journey and had reached two cities.

We thought that we needed to do a big event. Well what would be the purpose of such an event? Most startups fumble around to get proper validation, whether from prospective clients, from people with sufficient industry experience or investors. We thought we would address that through this event. Most other events look at companies that are already getting some traction we wished to be open to companies that we at early stages or even idea stages.

The event unfolded and at the end of the event; one of the well-known Angel whom we had invited to be a part of the guest panel said – “This event is like a breath of fresh air in the Startup Eco-system.”

One incubators or the other present at the event invited most of the companies that made a presentation at the Demo Day. In order to make this happen, we spent several hours mentoring each of the company that was going to be presenting at the Demo Day. We connected them to potential clients. We rehearsed presentations with them. And to date, we are in touch with all of the companies to track their progress and to help them in any way possible. From the perspective of the participant companies, it was like a mini-acceleration camp.

This year we wanted it to be still different. So, we will continue to do the things that have made us stand out; the things that encourage startups to want to be a part of our event. We have also decided to do something that will help them get some seed capital. As a part of this, we started a campaign called ‘Fund A Startup’ We are looking to raise money from our members, acquaintances, as well as people from the startup eco-system; the funds raised will be given to the one Startup the guest panel thinks really deserves the funds.

As has been the case from the beginning, Startups Club itself was a huge experiment and this is another in a long list of experiments that we are performing in order to see how we can contribute better to the startup eco-system.

The successes of the past are now a memory and with renewed vigour we set out to conquer new peaks and reach new milestones in our journey as Startups Club.

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Entrepreneurship

An Important lesson on managing Teams

I was wondering why it is, that we tend to have better meetings at Startups Club when the group tends to be smaller than when we have larger groups. I found the answer in a book called ‘The art of thinking clearly’.

In 1913 Maximilian Ringelmann, a French engineer, conducted an experiment on horses! After his experiment he concluded that the power of two animals pulling a coach did not equal twice the power of a single horse.

Obviously, he was mind-blown and he decided to test if the same applied in the case of humans. He had several men pull a rope and measured the force applied by each individual. He found that on average, if two men pulled together, each invested just 93% of their individual strength, when three pulled together, it was 85%, and with eight men, it was down to 49%.

This is explained using a phenomenon called Social loafing. When the effort of an individual is not as clearly evident, individuals do not tend to give a 100%.

Social loafing occurs in mental activities also! For example, in meetings, the larger the team the weaker their individual participation. Have you seen meetings where the speaker is goading people on, to be interactive, but barring a few, all the rest of them seem to be dead!

Once a certain number of participants are involved, their performance plateaus. Whether the group consists of 20 or 100 people is not important – maximum inertia has been achieved.

From the perspective of a startup this is a fact that just cannot be ignored, because it is imperative to achieve peak performance from all of the individuals who are a part of the team. This phenomenon makes it abundantly clear what an entrepreneur should be doing with his team; make them individually accountable!

Now do you understand why extremely large companies find it really hard to come up with path-breaking innovation?

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Entrepreneurship

Finding your Co-founder

Last week we had a great Startups Club meet at Chennai. The topic of the meeting was ‘Finding your Co-founder’. We had a discussions about the importance of a co-founder, after which, we arrived at the customary game. As a part of the game, all of the individuals who were present in the room were divided into two groups. Each was handed a slip which contained the name of an animal.
The participants were suppose to act like the animal mentioned on the slip and find their pair in the other team. As soon as the activity began, people started finding their pairs. It all happened really fast!
Once most of the members had found their pair, we got down to understand what we had learnt from the entire exercise:
Don’t be afraid to be who you are – In the context of the game, individuals were forced to act like a monkey, a dog, etc. Those who were not afraid of being what they were, were the first to find their counterpart. In life as well it is important to be who you are to find your right match. Pretending to be a person who you are not might get you a co-founder, but in the long run it will end in disaster.
Be around the kind of people who you are looking for – If you are seeking a technical person, there is no point in going to startup meets and looking for them. Go to places which such people frequent. Go to ‘Developers Conferences’ where you are certain to find people who have a technical background. hang out where you are certain they would!
When you find an opportunity don’t judge it and embrace it – We all have a view of ourselves. The way the world views us might not be the same as the way we view ourselves. Therefore, it is important to stop judging, when seeking a co-founder. You might be mighty surprised with what you find. Don’t stereotype people on the basis of how they look, talk, walk, etc. be open to everyone, you might be surprised how smart a ragged looking guy might turn out to be.
Keep moving forward – One of the member who did not find his corresponding partner, found out at the end of the game that the person next to him was the one! An entrepreneurs life is filled with challenges and difficulties. Just because a couple of attempts do not work out for you, does not mean nothing would. If you stop moving forward, you move backwards.
Perseverance
Never give up as an entrepreneurs, you might just be about to strike gold!
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General Thinking

Co-Founders

In India, when individuals set out to found companies, they rarely think about the need for a co-founder. They set out to do what they wish to do, without much thought about building their team. What is even more shocking is that most of them think that they would be able to hire people in the areas that they do not understand such as coding/programming!

It takes teams to build a successful business and it takes teams to bring complementary skill-sets to overcome the shortcomings of one person. This point is often lost on entrepreneurs. Not only this, we live in a society of such trust deficit, founders/people with ideas do not wish to share the business that they are in the process of creating with anybody. They want to own it all. The goal is not to own it all, but to maximise the value of what you own!

Team building is probably the first and the most important skill required to be an entrepreneur. It is important to have co-founder(s). The plurality brings greater perspective and a larger network, both of which are key for success.

If you wish to start a business, go find a co-founder!

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General Thinking

Reason to Start early with Entrepreneurship II

Fear is the biggest culprit that keeps people from chasing their dreams. Taking off and not bothering about consequences is not usually an adult thing to do.

If you wish to train a person to become a gymnast, normally you have to start early. This is due to the fact that learning gymnastics involves a lot of falling, young kids fall often anyhow and therefore do not fear falling. By the time a kid ages to 16 years (young adult) the fear of falling has made place in their heart. It becomes rather difficult to train them to be gymnasts.

Entrepreneurship is a road that is similarly laden with many obstacles. As you go through life, the fear of falling/failure makes a firm space in your heart after which it becomes rather hard to take the leap. You tend to think negatively about the consequences. So as they say…

“All the water in the sea cannot sink a ship,
unless the water gets inside the ship.
All the negativity in the world cannot bring you down,
until you do not allow the negativity to make space in your heart.”
~ Anonymous

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General Thinking

Reason to Start early with Entrepreneurship

Life is an evolutionary journey. As we go through life, we mature; and as we mature, our needs increase. Entrepreneurship is also a journey, a journey that few individuals feel motivated to embark on.

So, in life, as our needs increase, the resources that we require to meet these needs also increase. When it comes to entrepreneurship, commitment is paramount and an individual is in a position to provide a high level of commitment when their needs are low. This is the primary reason that one must embark on the entrepreneurial journey early in life.

It also allows room for making mistakes, falling and gathering yourself up again when things don’t work out. The later you attempt entrepreneurship, the higher the risks tend to be.

Further as I had mentioned in an earlier post, ignorance is important for success. Ignorance allows a person to take risks because they are unaware of the consequences of the risk. When risks pay off, we see great successes.

So, if you are going to take a risk, might as well, take it as soon as possible.

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General Thinking

Entrepreneurs and Investment

If I had a dime for every aspiring entrepreneur that I met, who told me that if only the investment was in place, they would start off!!

Entrepreneurship is a journey and not a destination. So my question to most entrepreneurs is; When would you have sufficient funds to run your startup? Its 7 years in and Flipkart is still raising money to meet their financial requirements.

One of the facts of being an entrepreneur is that you are never going to have enough money to meet all of your financial obligations. No matter how much you have, you could do with some more. Balancing financial resources is a fact of life for every entrepreneur and there is nothing, no amount of fundraising that would change that.

So my advise is; If you really believe that what you are about to do is going to create value, start building the enterprise. There has to be some degree of initial planning, but one cannot expect all of the pieces to be in place before starting out!

If you are building something and you are 65% of the way there, the chances of you finding someone (even your parents/relatives) who is willing to back you are much greater than if you have built 0% of it.

Entrepreneurship is a plunge much like quitting smoking. You jump into it and see how it plays out. You cannot know all eventualities and consequences and be prepared for every challenge (including the financial ones) right at the outset.

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General Thinking

Entrepreneurship: Desperation Vs. Passion

I was recently engaged in a conversation with a relatively old gentleman who had given up work after having spent 30 years in various corporation. He had a fair number of accomplishments, but most importantly, he was at a point in his life where he was financially stable and could go the rest of his life without working a day. Normally, such a position should lend itself very well as a launchpad to begin from. To the contrary, this man was finding that the business that he wanted to pursue was not really taking off. He had a few customers, his operations were profitable but things were not taking the kind of direction that he had hoped!

On further digging I found that he was not really burning with the need to grow this business. He wanted it to grow, but he was not desperate for it to grow.

It was then that the thought occurred to me; was he not desperate enough or was it that he was not passionate about his business?

In my experience, Desperation; though a great driver, causes poor judgement. Desperation causes people to make poor decisions. In most cases the root cause of desperation tends to be financial and when that is true, one tends to make poor decisions seeking only financial goals.

This brings us to passion.

Passion is a very powerful driver. In the entrepreneurial journey, the biggest asset that any entrepreneur can provide a venture is their time. If there is passion, providing this time comes as second nature. There is no special effort that need be extended and this passion will take the venture the whole nine yards. A passionate person wants the best for their business and does not settle for second best and therefore the possibility of making poor decision is greatly reduced.

Being passionate about a business is not everybody’s cup of tea. But passion will trump desperation on any given day.

So the gentleman that this post began with, is probably just not passionate enough about what he is doing and needs to pursue something that arouses his passion further or probably, he is not cut out to be an entrepreneur.