Vijay Anand | The Startup Guy.

Posts Tagged ‘startup

This is a wonderful time to be starting up. You will come across very few people who will give comparisons to all the benefits they get working for big corporates. Its one such time. Hiring will be slightly easier, and retaining them will be even more easier.

Even in the midst of all that, it does seem that a lot of the Startup Companies are hardpressed for resources here in India. Here’s a solution.

A few of us have been talking about putting together a centre that trains people (as blank slated as freshers) on the common technologies that people use while building products – the usual PHP, Python, AJAX, MySQL, etc etc and getting them upto speed on mashups, APIs, documentation, and moving forward. That is the level of skill that most of the startup community folks are looking for it seems. Or am I wrong here?

If I am right, then there is a simple way around it. Every chapter of OCC in the country is doing quite well. I heard from Santhosh that Pune is a 300 people group now (though I do suspect that the turn out ratio would be still less), but who knew Pune had 300 people who would be open to being part of a community right? And the same case has gone on with Bangalore, Kolkatta, Hyderabad, Chennai, Delhi, and even now and then with Mumbai.

Here’s the thought. What if in one of the OCCs a dozen of the startup companies, especially the folks who can code and code really well, commit that they will run a two month training program for people in these languages? It is going to take a bit of time and commitment, but there are a lot of resources already on the web, and with a couple of screencasts, and proper documentation, you could essentially also use it as training material for the next batch of people that you hire in your company later on.

What I am proposing is that a batch of technology entrepreneurs, each taking a week to cover different aspects of the course, could put their hands together to collaboratively solve an issue which is haunting a great many of them. Read the rest of this entry »

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What do Startups Need is the Question asked these days.

"What do Startups need" is the Question asked these days.

Seems like that’s the kind of question a lot of companies which are looking to support, nurture and grow alongside Startups are asking themselves these days.

I’m invited to be part of a fairly small panel that is to discuss on this very topic tomorrow in Bangalore in a short meetup that Sun Microsystems is putting together.

The more I think about it, I think the sheer number of pages where business opportunities, support systems, efficiencies can be made all seem to just go on and on and on.

I think the key element that it comes down to is not “selling”, but “enabling”. Really, if you think about it and put all the power law distribution to¬† a graph of economy (financial status and revenues) versus size of the company, it’d be quite easy to see the bigger corporates easily contributing to 80% of the economic wealth that is being garnered. That’s almost a no brainer.

I think the insight is this: An average startup entrepreneur is young, imaginative and full of ambitions and dreams. The key is to enable them. Not sell to them, but help them achieve their dreams. Its going to be pretty much the same way that you would want to support artists to come out with more creativity.

Someone wise once said that the role of a supporting organization to a startup should help startups make truck loads of money and make a small slice out of it. We need to tie in our success with that of the startup. Everyone wins in the end.

So now, most organizations are not gonna want this headache. Go after all the small companies, give them that additional support and handholding, just for 20% of the revenue. But isnt 20% quite a lot? I dont think it would ever make sense for a company to focus on just this 20%, but if they were already saturated with the market share in the corporate world, a 20% extra market share will give these companies a lot of footing, wouldnt it?

Now obviously, the number of companies very much increases. The queue of companies to support would almost be as long as the infinitely long tail itself. Thats when shared resources make a lot of sense. Technology helps to scale. Thats what it does beautifully. And if a technology company says that it cannot cater to this group,.. they woe.. something is truly terribly wrong.

Related Posts from Before:

Selling to the Unaffordable – Part I

Selling to the Unaffordable – Part II

There was sometime back when was doing a rough math on how many live camera streams there are. There are some that are pointed towards the “habitat” of the Loch Ness Monster, there are enough live traffic camera, and plenty of them pointed towards a birds nest or so. And if you take the example of Justin.tv (which seems to be inspired by The Truman Show), even people are willing to play their part in all this.

Ofcourse all of this is a one way broadcast. Apart from adult sites which are apparently making their niche through two way interaction, there is not much that is happening in this space.

Is there any of that, that can be adapted into the “green” scenario? A couple of light bulbs went on and off and here’s the thought (or Idea):

MMORPG
The forest department today plans thousands of saplings every year on barren lands to convert them into lush green forests, but the biggest problem with it has been the case of watering them. There is not enough manpower to do those menial tasks – at the salary that the govt is providing – and there is also the issue of accountability where all the saplings near the roadside stand straight and well watered, but the ones in the interior die away because laziness kicks in for most of these workers. They are not to be blamed either when the scorching sun is merciless on them and they are poorly prepped for all that.

The idea is to basically plant all the saplings as the forest department does and then have water drums which can be filled periodically with water from trucks (much simpler task). The pipes to the saplings will be set on drip irrigation and there will be a soil moisture sensor in the soil which measures if there is water or not. Set a Camera that overlooks this area, connect it to the Internet and create a frontend to a MMORPG (Massively Multi-user Online Role Playing Game). If that’s too much of an acronym, think Second Life. People can “adopt” grids of these fields and take care of them. All they have to do is, once the soil moisture turns a bit low, hit the buttons that will start the drip irrigation and stop them when the moisture level is optimal.

There are already countless number of such “events” that happen in Second Life, where if one plants a sapling in the virtual world, an organization instead plants one in the real world somewhere. This would just be an extension of that.

Now, technically you can take this to the next level. Think of all the Wild Life Sanctuaries. The biggest problem today is Poachers (I am still worried if I have to show stuffed toys of Tigers as our National Animal to my kids someday), and the forest officers are not nearly paid enough to scout the areas – and they are very ill armed to protect themselves from these animals as well. What if we could setup a range of Wifi cameras, stream the videos and let people monitor them. I’m sure there are enough animal activists around the world that some might even take it up while we sleep. All they would have to do is to hit a button which will alert the officer if a Poacher is spotted. And give the front end the control to click a snap if they want to document something and we might capture poachers and exotic wildlife as souvenirs.

I think finally, and its about time that the conscious of having to go green is kicking in. And we are gonna have to do everything – not just to sustain – but positively influence this planet to make it sustainable and even stay on the existential path. Maybe entrepreneurship, technology and the enthusiasm of the global audience can create a network of Global Watchers, to take care of the assets around us – All this while getting to “play” their roles.

Startup Entrepreneurs are oodles of Fun to work with. Perhaps its that drive within them to change things, and the paranoia of taking on a bigger industry which adds to all that. As hectic as it could be, its nothing short of exhilarating – I seem to be gasping for breathe during the slow times for sure.

So the point is speed. Its a crucial element. I think its the first criteria anyone looks at to evaluate and measure the strength of an entrepreneur. “Fire in the belly” “passion”, are all just variables of the same thing being described, I’d say.

I think the second most crucial aspect when it comes to that is the accuracy – The quality of implementation so to speak.

I wanted to briefly write about this, for a couple of reasons. There are quite a bit of early stage ventures out there – almost 2000 of them at any given point in time, and the truth of the matter is that less than 10% of them survive the first two years. That’s a lot of enterprises dying out. And if you really look at it, what stands as foremost in the list of reasons is the lack of guidance in terms of implementation and execution that counts towards it.

There are this couple of folks who are in the back of my mind (Who are part of the incubator) while I am writing this, and I am wondering if they would survive out there in the world, if not for day to day guidance. Probably not is what i’d say.

In a recent discussion with some investors, the enlightening moment was when someone made the statement that ‘investment is pretty much rocket fuel. It’ll help you go faster, dont know where though”. And I think there is more than an ounce of truth in that matter. Investments, especially money will accelerate the direction that you are aiming for – and God help you if you are aimed at the wrong direction looking at the wall, because the thud will just be that much louder. And as much as everyone claims that they will provide support, guidance and all that, ping me whenever that really does happen.

The truth of the matter is that early stage ventures require almost a weekly review meet. That’s essentially the time period when the company is accelerating and the strategy starts to fall in place. In three months (between board meetings), the company would have gone so off the tracks that it would take years before you can bring it back on track – and dont complain if that window of opportunity you were chasing, isnt there.

So if you are an early stage venture and someone promises you guidance, demand that the minimum guidance you require is one where he/she is available to you any time of the day, and will meet with you for atleast an hour once in a week or fortnight. Its crucial to be accurate when you are racing like a cheetah to take down the elephants.

If you are an advisor, I would suggest sitting with the team in the beginning and doing a brainstorm of all the possibilities in terms of directions, products, market trends and potential exits (its good to think of that distant tunnels). If a company has no scope of going IPO on its own, but will just create a whirlwind of an opportunity and spin to be part of another company, I dont think there is anything wrong with that – and having that clarity will make a lot of difference, because you start focusing on strategic partnerships much more intently.

So coming back to the advisor. Do one elaborate meeting – which you can continue to hold during every three months, and in the meantime meet every two weeks or so and talk about everything that goes towards that. Revenues, Morale, productivity, Team, partners – everything. Jot down all the questions, and start working out possible solutions. The percentage of solution creation is what should shift slowly – starting off with the mentor contributing the most, to a half and half to a point where the mentor just listens and corrects if something goes terribly wrong, and letting the entrepreneur take the helm. You gotta teach them to fish at somepoint Mister!

So Run, as fast as you could. Also make sure you are running in the right direction and doubly make sure that there is infact a door on that wall, and its open.

Question: I am interested in starting my own venture and have been doing the groundwork for it. I currently work for a company, but would like to do the pilot run while still holding my day job and as the venture stabilizes, take the plunge fulltime. What would you suggest?

Dear X,

There are a couple of ways to do this and a few things to keep in mind.

1. Usually all job offers have this clause that you have to solely focused on the job you are hired for at your primary workplace. Hence usually taking up another offer or even a consultancy (even if the employer may never find out) is done by getting a letter of permission allowing the employee to be involved with other things.

a) Though this is not required, it gets you a lot of brownie points with your employer, just for the sheer honesty. As much as Proto.in does not interfere with any of the activities of what I do here in the incubation centre – but only enhances it – I still wrote a mail asking for permission and to let folks know that i am involved in something. They go easy on me whenever proto.in is around the corner.

The point: Keep everyone informed so that they can give their support in whatever manner that they could.

2. If you are going to do this as a proprietary thing, then even step 1 wont help, cause its assumed that you are fulltime with the venture – when you are the 100% shareholder and the guy running operations. So what some folks do is register the company in the name of the spouse – if she is not employed, or if her employment contract is not so stringent.

3. One thing to keep in mind is something called the corporate veil. When a company becomes a ‘corporation’ it becomes an entity by itself, that even the founder is nothing more than an employee in it. Because of that structure, if the company goes down under, it still doesnt take the founders along with it – nor their assets, since they were just employees. But there are cases when they consider the corporate veil to be broken, which would be when the personal assets of the founder are mixed up with the assets of the company and in such cases, the founder can be sued – if in the future the venture gets funded and things go awry.

I don’t mean to scare you, but just giving you a heads up on all the things involved.

I would suggest:

1. Go ahead and register the company – if you are sure you want to do this venture.
2. This would be the time to bring onboard some advisors and get them involved in the venture – since there has to be a minimum of two directors to incorporate the firm
3. Get the permission from your current job to be involved.
4. Keep going with that setup, till you are comfortable making the flip – hopefully which wont be too far away.
5. During the process of step 4, at some point your venture will possibly take enough time out of you as your day job. Do talk to the management to perhaps transition into a part-time role if possible. Its good to stay clear with your conscience.

I hope that helps.

Vijay

I love the weekends. Especially the ones where you pretty much meet people after people, and get to see the world through a different set of eyes and perspectives. Always loved that.

So there goes the past weekend, which has just about been the most amazing weekend ever – after a really really long time, and partly thanks to meeting some of the folks from the startup scene in bangalore.

So here’s a thought that’s been on my mind. How many kinds of entrepreneurs are there? Well, it seems there are two kinds. The Incremental ones and the Iterative ones.

The incremental one is that guy who wants to be an entrepreneur, is very calculative, and goes on and takes up a job in that large firm, and after years of carefully planning his networks, funds and contigencies makes a leap to build one product, putting together a company with his colleagues. You could almost say that Mindtree was one such firm. The firm immediately attracts investors, because the experience of the founders talks volumes, the contacts are well established and the product/idea is usually something that is closely related to the domain that they have been working in.

This is pretty much your typical VC fundable business.

But there is this other kind. The kind that starts off young, comes up with an idea and grows the idea. The idea is usually nothing significant, but an improvement none the less. The grow the idea, and make an exit – small, okay or in most cases nothing at all, move on to the next idea, and with each new ideation and execution grow exponentially in terms of thinking, visions and execution style. These are your radical mavericks.

But you know what? In most cases the incremental ones, as great as they are, will only become what they are, if they are not funded. If they learn lessons the hard way. If they learn to bootstrap, learn to live in the trenches, and they grow from there.

I strongly believe, and there are quite a few others who agree, that we are destroying these genre of entrepreneurs by either cushioning them with hopes of investments, in the name of incubation centres (totally taking away their risk appetite)and by simply not letting that first idea fail.

If statistics are true, then its usually the third venture of an incremental entrepreneur that will or should get funded. Anything before that is all premature, and just part of the process.

So I am trying to validate this theory and it kinda starts to make sense. They say that for any product to be built, it takes roughly about 2.4 iterations before it can hit the market and scale. With an iterative entrepreneur, I really believe that the entrepreneur himself is the product – really think about it. Every icon that you can imagine is one of those. Do you really think they made it in their first shot?

The first step really doesn’t have to be that big idea. And i’ll repeat that over and over again. With Michael dell it was the idea of buying stamps for cheap and selling them. He writes in his book that he learnt things in that first venture which helped him put together Dell. It’s also the reason that I strongly believe that they should start as early as possible – right in High school or college if possible. It could be just about anything from running a local canteen to trying your hand with home made jewellery. What you understand about working and interacting with people will go a long way.

Trust me, it wont be easy. And as a audience in OCC Bangalore noted during discussions, it is a terrible experience when your first idea bombs when asked for feedback from peers. But you know what… its all part of building you as the product. It’s an excercise to shed that extra weight that you have in you – that air of confidence and assumptions sometimes. Really, for an iterative entrepreneur, its all about falling nine times and getting up ten times. It really is.

So if you are one that falls into the first category, well You probably wont be reading this cause you’ll be busy trying to keep those investors and partners in bay. As for the iterative kind, unless you are in your third or fourth venture, dont waste your time trying to raise money and all. Be smart, save some money here and there, be frugal and stick it out. See how far you can build and take a product without having to raise money – its very much like holding your breathe to see how far you can control yourself from now having to depend on oxygen. But when you do attain that balance – or even control in it, thats when you know you are ready for the olympics to show the world what you really got.

Everybody, just about everybody seems to be having this problem. The teams that I oversee in IIT, all the way to a lone team in Simla, everybody is having a talent crunch. It is said that the most important aspect of a startup is the team. Have we grossly overlooked something? Or do things just have to be looked at differently? I think there is an alternative, and thats probably how the future will evolve.

So according to one entity’s claim, there are 800 startups in Bangalore. I know that as part of tracking startups, we see an average of about 500 – 600 new startups coming up every year, and these are just in the Technology space, and product focused.

Do we really think that we have the manpower to fuel all these dreams? I am really starting to doubt that. Loads of Opportunities, shortage of talent, and high density of clusters – which is going to be mean more and more people are going to leave startups to probably freelance and make use of this opportunity. I wouldn’t blame them. They are just tapping into the opportunity.

nGenera an entity founded by the guy who wrote the book on Wikinomics, which helps larger organizations optimize their task forces has this to say about Workforces: “…Enterprises have shed pyramid-style organization structures and instead view talent as a “marketplace” where workgroups with the right skills and experience can be quickly assembled, put on a given task and rewarded for the value they provide.” Does that sound Familiar? Will the same make sense for a Startup?

One of the primary reasons why a startup is pushed to go hunt for an Investor much before the focus, solution and customer has been identified, has been primarily because of this reason – the need to hire. if you want to hire, and someone none other than the best, he/she also comes with her own charade of questions as to how the startup is funded, and what are the options that the individual will benefit from. None of which makes sense, nor has a concrete founding unless there is a bank statement which shows some balance with lots of zeros following it – or atleast a term sheet.

So really, the eye of the hurricane is the issue with attracting talent. If that is solved in anyway, then a whole lot of issues along with it, including that of funding will slow down a bit. And time, even borrowed time is godsend for a startup.

Here is a gist of the issues:

  • Attracting talent for a startup is really hard.
  • Even if you manage to find a really talented individual whom you are dreaming and envisioning of as your future CTO, chances are that he wont take a fulltime responsibility.
  • If you go the usual route, hire freshers and want to train them, you realize that a year later they put your name on their resume and become part of the “hard to get” group, demanding hefty packages.
  • I’ll repeat, there is common theory that any investor will back a good team. Perhaps we need a slight change of thinking on that regard. It is not the team size, the numbers, nor the profiles that should matter. If there is an individual at the helm who could ideate, plan, execute and deliver then it should suffice right?

    I’ll get to what I am trying to say.

    I am thinking outsourcing. Did you know that Digg was mostly build over elance? The most touted Kevin rose, was not one of those developers who went nuts, locked himself inside his bedroom and coded away. Perhaps there is wisdom in outsourcing.

    Let’s put Mr. Friedman’s words to test if the world is really flat, shall we? I mean, if we could get talent from anywhere, then all of a sudden the perk of being in Bangalore, Chennai, Mumbai, or being in Gorakpur does not make a difference. And I think that itself is an incentive to try.

    The more I think about it, the more it makes sense. Think about it. Employee productivity is at around 4% right now. I could put some ruppee figures on it and say, if you invest 100 Rs on an employee, you get a product which is enhanced with a value of Rs 4. That’s ridiculously inefficient. And this output is for mammoth corporates. Can a startup really afford such inefficiencies and spend most of its time acting like training agents, than companies that are building dazzling products?

    Lets look at the benefits of getting more involved with communities like elance, Limexchange or Odesk for that matter. In order to make it work, you are going to have to;

    1. Break your product into modules and have vivid clarity on what you want. That will force the startups to get some clarity on what they are building, rather than playing by ear.

    2. You need to be able to do some project planning, which you should have been forced to do anyways.

    3. You only pay for what you build, which means much greater productivity

    4. You do not have to move to any specific location. You could be sitting in your own hometown, or wherever you can save costs on, and still get your work done. If Instablogs could be based out of Shimla and build such fabulous UI, traction and a community around their offering, it certainly is an example. Not that I have anything against Shimla, but its not your everyday IT Hub as commonly perceived to be more efficient to startup.

    5. And the best part of all. If you are having a cash crunch month, you can delay your next task allocation. You control time lines as to when the next task should begin, which means you don’t have to worry about having to shell out monthly salaries with or without productive work happening.

    Most teams that I am aware of, still would want to hire people fulltime. Well, you probably can, if you can justify it and if you can afford them. But in most cases, I am wondering if its a case where the founder just isn’t willing to accept the fact that the role that he chose to play is a lonely path. At the end of the day, he/she is the only visionary and the sole knight protecting and nurturing the idea child (perhaps along with his co-founder), but surrounding yourself with people who are at your call and beckon is just a temporary comfort and solace. I know it can get lonely, and having to see three people, the same three people, in your officespace everyday can be pretty tiring, and boring and even might feel as if you are stuck in a rut. (One of the reasons why Incubation centres make for some comfort factor, being around with other teams)

    But instead of focusing on surrounding yourself with frail souls, why not keep yourself surrounded by those key guys who share your vision (might be just you and your co-founder), and build the prototype, product and your initial traction with a product that is built by a team which is miles away, yet close by you – just a skype call away, and take it from there?

    You are most probably going to tell me that since your product is constantly evolving, you wont be able to get a specifications document beforehand. Odesk, and most of the freelancing sites do offer the capability to hire a person on hourly rates. And with the progress of agile project management methodologies, all you need is a good tool [like what Silverstripe software has], and you are good to go. Ofcourse, there is still the issue with your mentors and investors having to agree to it,but if anyone can make it happen, I know an entrepreneur can. Why not show them it works? Heck, When NASA and the defense contracts across the world are outsourced, why not that mashup you are building?

    I was initially a bit skeptical that outsourcing my development work will also mean that someone has access to my code. But I think the NASA model is going to rescue us there too. That’s why I mentioned that you need a core team. Ideate. Figure out the requirements, the initial one. Break it into pieces and send them all to four corners of the world. When it comes back, be ready to put it together. Oh yeah, you need to know how to work with code inorder to be able to do this, but if you or your co-founder cant, you were dead in the water even before you started.

    I am hoping to give this a whirl for my own startups. Has anyone tried this option? If so, what has your experience been?

    Disclaimer: I am not sure if this is a longterm solution. But most of the hard work and crux is essentially built in the beginning of a startups product lifecycle and thats when all the constraints are there. If the prototype is built, you have a few elite customers, and investors are standing on all sides wooing you, perhaps you can think about getting some folks onboard fulltime, and building a team to build from there.

    Some Discussions from Before:

  • The Startup Lunch Initiative
  • A Conversation I had with Vishal Gondal, where he was talking about this issue. Working with an Army, vs. Optimizing
  • Hiring Strategies for Startups, to attract those core members.
  • Do You really want to work for a startup? Think it through.

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