Diverse Perspectives, United Vision – A Day at Propero 2012 (Part1)

Propero, conducted jointly by The Indus Entrepreneurs (TiE), Hyderabad chapter and the Wadhwani Center of Entrepreneurship Development is a unique platform connecting entrepreneurs to angel investors and venture capitalists to raise seed capital for start-ups and growth capital for mature businesses. Conducted on the 24th and 25th of February, budding entrepreneurs and prospective investors got together at the tables to discuss business plans, monitor performances and chalk the future path.A notable characteristic the investors at Propero was that they were interested not merely inideas, but in ideas in motion. An entrepreneur’s journey begins when an idea germinates in his mind. He gradually, through preliminary efforts, builds upon it till the critical stage arrives – the stage of giving full-time commitment to his project or to continue with his daily routine. Once he takes the leap, it’s quite an effort to gain momentum. Once the initial traction is gained, the investors may be invited to jump onboard.Thus, it was very clear to everyone present at Propero that to be there, you needed traction. A start, however slow, would do.

Actively Encouraging the Spirit of Entrepreneurship

Murli Bukkapatnam, Chairman TiE Hyderabad and Director, Mandava Hotels and Resorts, said, “It is our vision to promote the spirit of entrepreneurship in Hyderabad. We actively encourage entrepreneurs to come forward and present their ideas. Even for the starters, they must come to TiE and discuss. We are constantly looking forward to mentor any person who wants to jump off the bandwagon and make his own path.” He was unequivocal about the difficulties faced by entrepreneurs in the country. “Unfortunately in India, entrepreneurs are not accorded the respect or recognition that their counterparts in the west get. We at Tie Hyderabad are doing our level best to change that perception and foster a culture of entrepreneurship in Hyderabad that would hopefully set an example for the rest of the nation. Entrepreneurs are the future of this nation and we will do our level best to mentor and support them,” he added.

The Prevailing Sentiment – What works, what doesn’t?

Good Team, Large Market and a Compelling Value Proposition

Chandrakiran of Hyderabad Angels would particularly look at the team of any pitch startup, the market size (preferably large) and a compelling value proposition. He said, “It is very easy to get carried away by the product. One cannot afford to become myopic. The competitive advantage has to be sustainable, not a one-time show of rock-bottom prices to edge the others out.”

On Product Types

“India is at a very early stage in strong IP (Intellectual Property) based companies. I would envision a future in which more companies serve global markets and constantly move up the value chain.” Thus it appears that Investors are looking towards companies with a strong IP based product portfolio as being the torchbearers of future growth. Indeed, those days are nearing when companies will have to rely more on R&D to create IP and sustain innovation.

In hindsight, scalability is certainly most important point of consideration for any investor who wants to fund a startup. Whether the business plan will work or not has been slightly relegated to a secondary position. This line of thought has come about in the post-dotcom boom era. Unlike the pre-2000 period, a mere abstract idea presented in a PPT will not get funding. Angel investors and seed funds actively seek ideas in motion. Any entrepreneur who has set up a small establishment, has obtained is first client, and has managed to achieve a decent flow, or even a trickle, of revenue can be definitely said to have reached that level where he can sit face to face with an investor at events like Propero.

A Mentor’s Perspective

Marutish, an active mentor of multiple startups in Hyderabad, was already done with 4 of the 5 meetings lined up for him. “Propero has been a great experience for us. Venture Capitalists are actively listening to pitches containing opportunity. The question on virtually everyone’s mind is how the company will scale from the present to the next level. Of equal importance is the nature of the business model adopted. If has been properly worked out and validated, getting investor support becomes a matter of time.”

Even Students can take the Leap

This is what Ramesh Loganathan of Progress Software and Hyderabad Angels, has to say. There is no age barrier for when an entrepreneur can start. He may start after a few years as an employee, as a retiree, a family man or even as a student. If you have the idea and the willingness to take the risk, go for it!

A Different Stand

Jaideep Bachcher, alumnus of NALSAR and founder of School Sports Program, takes a different stand on the. Having worked for 2 years in a law firm after graduating, Jaideep took the entrepreneurial plunge by offering systematic and organized physical activity programs for schools. With running operations in Pune, he is already executing his expansion plans. On the question of the ideal age for entrepreneurship, Jaideep is clear. “After graduating one must work for up to two years. This should be adequate enough to instill the work ethic in you. The age band of 24 to 26 is the ideal time to start your own venture. At this stage it is either now or never. There will again never be a time so favorable once you get married and start a family,” said Jaideep.

On the gestation period for an idea

According to Ramesh, there is no particular rule as such. Some ideas can take years whereas others may bloom in weeks. But yes, if there is no upturn in revenues and scale of operations after 3 or 4 years of operation, it would be high time the team revisit their ideas and consider viable alternatives.

A Brighter Future

There is now no doubt that the Entrepreneurship climate within India is considerably better than what it was at the turn of the millennium. Stake sharing is more or less standardized at 30 per cent for the investor. While investors actively lend an ear to running enterprises however small, persons with the occasional ‘bright idea’ need not worry. “We are willing to encourage ideas right from the stage of inception. A person with an idea can come to us for mentorship,” added Murli. Thus, even if the investor’s money may be reserved for a later stage, his time is not. As it is evident from the efforts of TiE Hyderabad, Hyderabad Angels and the Wadhwani Centre for Entrepreneurship Development, the path to be taken is about as fair and smooth as it could be. Investor funding may not be guaranteed but a fair hearing of one’s business plan and story of execution is never denied. The growth of participants at events at Propero is a clear indicator that the community is responding positively to such initiatives and people are getting more eager to try their hand at being the boss!

For further information, visit http://hyderabad.tie.org/

-Aditya Singh