By seeing the landslide victory of the Aam Aadmi Party in the recent Delhi elections, one can only imagine how good it feels after achieving such wonderful results barely after two years of existence in Indian politics. In comparison, its adversary, BJP, which came into existence in 1977, had only two Lok Sabha seats in 1984 General Elections and never won any major seats anywhere else before that when it was starting up.
So AAP’s journey seems very similar to that of a startup, which initiates with an idea, develops into a concrete form, creates hype and then stabilizes itself into a well-oiled machine delivering high quality end results for its clients.
Purpose: The epiphany occurs and the founder, along with the team, tries to validate whether anybody would be interested in her solution.
Events: Founding team is formed, team debates the value proposition, MVP is created and the team joins an accelerator or incubator, friends and family financing round occurs, mentors and advisors come on board.
Time: Five to seven months (average for all types).
AAP’s Discovery: Arvind Kejriwal had this epiphany that a political party can only fight dirty politics at that time. They identified corruption and public safety as prime issues of the common people of Delhi. They held street meetings and had offices set up in Arvind Kejriwal’s house and other volunteers’ houses. They never organized big rallies or tried assuring public with great speeches, but delivered a MVP of a corruption-free and safe-for-women state.
Purpose: Startups need a validation from their customers so that they know whether the audience likes their product or not. The validation can be in terms of customer’s interest in their product or through exchange of money.
Events: Refinement of core features, initial user growth, metrics and analytics implementation, seed funding, first key hires, first paying customers, and product market fit.
Time: Three to five months (average for all types).
AAP’s Validation: Who can forget the Delhi elections of 2013? AAP did their first validation in this election. They came close to winning with 28 seats and their initial user growth was validated. People liked them and their product market fit was almost perfect, but unfortunately it did not last very long. Let’s see why.
Purpose: Startups constantly refine their business strategies and business model to improve the efficiency of their customer acquisition processes. A startup should always be able to efficiently acquire new customers in order to avoid faulty scaling where they lose existing ones in an attempt to gain new customers.
Events: Customer value proposition refined and curated, user experience overhaul, conversion funnel optimization, viral growth achieved, repeatable sales process and scalable customer acquisition channels formed.
AAP’s Efficiency: Though the party could not sustain in the first Delhi victory and even failed to gain traction in the General Elections of 2014 (lack of focus and un-realistic ambitions without strong focus on core competencies can be blamed for that), they did not lose hope and covered the ‘valley of death’ with patience and calm. At one point, the party was the butt of all jokes and no one even wanted to be associated with them.
They landed in the ‘valley of death’ because of the poor understanding of their voters all over India. Their strategy was not fully ripe to cater to national audience and most of the people couldn’t understand their value proposition and agenda. Still they kept going on and slowly started working from ground up, learnt from their mistakes, and repeated the previously successful strategies to win the lost ground. The voter base was streamlined and new strategies were drawn to educate the voters. The success is in front of our eyes with the landslide victory of Feb 9.
Purpose: At this point startups step on the pedal and try to drive growth very aggressively.
Events: Large A Round, massive customer acquisition, back-end scalability improvements, first executive hires, process implementation, and establishment of departments.
Time: Seven to nine months (average for all types).
AAPs Scale: They did quiet well in this front and gained a lot of ground in the past eight months since the General Elections of 2014. All the volunteers worked day and night to familiarize the voters with the party’s strategies and goals. Massive overseas reach and huge donations poured in for the party and they are on the way to set up office in the Delhi Assembly.
Purpose: This covers future growth and ends up with a successful IPO or huge profits to the shareholders.
Events: IPO, mergers, expansion to other locations, and multiple business channels
APP’s Sustenance: This is the part which we need to look at, after a couple of years down the line, and at that point we would be able to asses the party better whether its on track to take up the bigger roles or its dying a painful death. But as claimed by AAP recently, the party has national ambitions and we wish them all the best.
These qualities in any startup are common, and one who lives through all these only deserves a standing ovation and rights to gain a suitable customer base that is appropriate for its products.
About the Authors:
Surajit and Ashis are entrepreneurs and technologists, and are avidly curious about the human psychology. While they are not breaking the code or designing business cases in their Toronto office, they devote their time towards “Nexhop”, their entrepreneurial brainchild scheduled to be launched in India in mid 2015.
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- Arvind Kejriwal
- Mergers and acquisitions
- Value proposition
- Aam Aadmi Party
- Product Issues
- Delhi Assembly