“Entrepreneurs are creators of ideas and if executed right, creators of a little bit of magic,” begins Shereen Bhan, managing editor of CNBC-TV18, in the book, ‘Young Turks: Inspiring Stories of Tech Entrepreneurs.’
The 285-page book is packed with anecdotes and insights from first-generation entrepreneurs like Naveen Tewari of InMobi; Sachin Bansal and Binny Bansal of Flipkart; Kunal Bahl and Rohit Bansal of Snapdeal; V.S.S. Mani of Just Dial; and Murugavel Janakiraman of BharatMatrimony.
Based on the profiles and interviews by co-authors Shereen Bhan and Syna Dehnugara, here are my key takeaways from the tips and case stories. (See also my reviews of the books ‘Dream with Your Eyes Open: An Entrepreneurial Journey’ by Ronnie Screwvala and ‘How They Started Digital’ by David Lester.)
1. Purpose to profits: Clarity of purpose is the first step towards building a successful, profitable business. It is about defining your core values, priorities and business chakras, based on understanding your vulnerabilities and strengths. “The clearer your purpose, the higher the chances of success will be,” says Bhan.
2. It is not lonely at the top; it is lonely at the start: The excitement of starting up is all-consuming in the first few months, but then reality strikes. “It is not easy to be around friends and peers who are climbing up the corporate ladder, while as the founder, CEO, you are probably making your 25th visit to the MCD office to get an NOC of some sort,” observes Bhan. Founders need mighty hearts, dogged determination and tough guts.
3. ‘In God we trust; all others must bring data:’ This quote is attributed to US engineer and statistician W. Edwards Deming. It is fine to listen to one’s guts and instincts, but founders must back this up with logic and data.
4. Carve a niche, or create a category: If you are not first to the market, then create a market. “Businesses obsess too much about being better than the competition but perhaps what they should be obsessing about is being different,” advises Bhan.
5. Inside Out – Outside In: An organisation must be receptive and responsive, it should adapt to the market and articulate a single goal. Necessity may be the mother of invention but adaptation is the father of innovation.
These principles are drawn from profiles and interviews of the following 13 startups in the book: FusionCharts, Capillary Tech, Druva, BharatMatrimony, iYogi, redBus, InMobi, PubMatic, Vizury, Eka, Snapdeal, Flipkart and Just Dial.
FusionCharts, founded in 2005, is based in Kolkata and Bangalore. Founder Pallav Nadhani started off in Bhagalpur with a computer training centre, and then a web design company in Kolkata. Writing articles for ASPToday magazine led him to the line of data visualisation products. Indian customers are the toughest to sell to, jokes Nadhani; the company’s early breaks came from customers in the US, China and Korea.
Lessons learnt from the journey include: do not settle for lower prices of your product if it offers quality; go beyond transactions to customer engagement, allow time for new hires to adjust to your company culture; raising money is better suited for scale and growth than creating IP; brutal honesty helps in internal communication; and companies should focus on the broader ecosystem to drive value.
Capillary Tech, founded in 2008, provides solutions for marketing and customer relationships. The co-founders quit their professional jobs and raised a seed loan from their alma mater, IIT Kharagpur. Their first offering of SMS traffic alerts in Kolkata got lots of traction but no clear revenue model, and the next attempt at mobile loyalty programmes did not take off either. Today, they combine CRM with Big Data capabilities to local and overseas customers, and have received investment from American Express Ventures and Sequoia.
Lessons learnt from their journey include: good customers will become your sales evangelists; Indian business customers are very RoI-oriented; hiring a mix of generalists and specialists helps; learn how to say ‘no’ to deals with only short-term value; be an angel to entrepreneurs in your company; and learn from peers (eg. product management practices from companies like Druva and MuSigma).
Druva, founded in 2008, has offices in Sunnyvale, Pune, London and Singapore. Being a student president at IIT Guwahati and an intern at Fraunhofer Institute in Germany provided valuable early learnings to founder Jaspreet Singh. He teamed up with two seniors at Veritas to found their startup, now a leader in data governance.
Lessons learnt from their experience include: hire based on skills as well as personality match; founders must get used to compressed cycles of learning and experience; master emotional discipline; build strong differentiation; and understand the importance of cultural variations in a global workforce.
BharatMatrimony was founded in 2001 by Murugavel Janakiraman, whose father was a labourer at Madras Port Trust. After his MCA degree, his overseas visits exposed him to the power of the Internet, and he started a news portal with a matrimonial section for the Tamil community. This has now expanded to a paid service in multiple languages and communities – including DefenseMatrimony (for the armed forces), AbilityMatrimony (for differently-abled people), PakistanMatrimony and ArabMatrimony! Next steps have included apps, a marketplace for marriage ceremony services, and offline outreach centres.
Lessons learnt by Murugavel from his startup journey include: be careful in dealing with franchisees who may not understand your brand; consciously cultivate a learning attitude and move on to new things; learn from industry peers; learn how to manage costs; be wedded to a higher cause; and lead by example (his own marriage was fixed by BharatMatrimony!).
iYogi was founded in Delhi in 2007 by Uday Challu (Quaddro Digital Systems, Concordia Consulting) and Vishal Dhar (Text100, Friday Corporation). They offer online tech support for consumers in countries like the US, UK, Canada, Australia and Middle East, and have developed a cloud-based digital service platform.
Lessons learnt from their journey include: ride the mobile device boom; hired based on attitude and not just skills or qualifications; tie compensation to performance; leverage and mine customer data; and blend free content and paid service models.
redBus was founded in 2006, and was positioned as India’s largest bus ticketing company. The ‘incidental entrepreneurs’ sold their company in eight years to Ibibo Group. They benefited from mentors via TiE Bangalore such as Sanjay Anandram, who advised them to focus first on the consumer and then on bus operators, and to build a solid foundation of values and culture for the growing startup.
Lessons learnt during their journey include: don’t pay bribes to get business customers or avoid fines; have faith that hard work will be rewarded; excel in your offerings and customer service; discounting is not a long-term success strategy; watch, track and stay ahead of customers’ media habits; and be ‘unreasonably generous’ with employees.
InMobi, founded in 2007, is one of the largest independent mobile ad networks in the world. The co-founders’ first early venture, VoIP and mobile deals application mKhoj, was probably ahead of its time, and they moved on to the mobile ad model (also ahead of the iOS and Android waves). It was ranked as one of the hottest pre-IPO ad-tech startups in 2014 by ‘Business Insider,’ and there were even rumours of a Google acquisition.
Lessons learnt from their journey include: the startup phase is lonely and hardens you with the toughest of scenarios, professionally and personally; mobile is an even more important medium for users in emerging economies than in developed ones; world-class products can certainly be built out of India, though large Indian businesses are not as open to product startups; and attracting good talent is key for global success.
PubMatic, founded in 2006, helps publishers realise the full potential of their digital assets. The co-founders first began in e-commerce with golf equipment portal Chip Shot in the US, and then moved on to management consulting. They designed PubMatic to mass-personalise digital ads on news sites and mine analytics.
Lessons learnt from their journey include: get the industry vision and company vision aligned; operate with a healthy dose of paranoia; get customer feedback quickly on early versions of your product; acquire companies for their IP but beware of too much M&A; change tack from ‘do it for me’ to ‘do it with me’ in the case of customer engagement; and standards and open platforms can advance the whole industry.
Vizury was founded in 2008 and offers life-time customer engagement solutions for digital marketers. The co-founders made no money for a whole year after starting up, but then an angel investment was raised in the nick of time. Their first customer was ClearTrip in India followed by CTrip in China, and then there was no looking back; the company has successfully raised funds from investors such as Intel Capital.
Lessons learnt from their journey include: be humble and frugal; make your solution as easy as possible to understand for your customer; balance product customisation with scale; different markets call for different levels of patience and speed of learning; technology scaling issues are very different for 10 million impressions a day as compared to 100 million; and growth will come from automation and processes.
Eka, founded in 2004, offers an online commodity management platform for billion-dollar global corporates. Founder Manav Garg graduated from REC Jalandhar and IIFT Delhi, then worked in Singapore for commodity trading house GP Group. He raised $1 million from the chairman and launched Eka Software Solutions in Bangalore.
Lessons learnt from the journey include: overcome the negativity of naysayers all too prevalent in India; judiciously spend the capital you raise; let the clarity of your thought processes win over big customers; learn how product companies can create larger impact with smaller teams as compared to generic software services firms; and global talent is costly but vital.
Snapdeal was founded in Kunal Bahl and Rohit Bansal in 2010. They began in the print coupon business, then dabbled with mobile coupons and discount cards before launching Web-based coupons. A visit to China convinced them of the power of the marketplace model as compared to the inventory model, to which they pivoted (the decision was made right at the Beijing airport).
Lessons learnt from their journey include: customers look at value not your degrees; belief in your ideas and abilities is key to win over customers and employees; always deliver a seamless experience for your customer based on convenience and assortment; use technology to match, choose and rate services; and have a mix of internal and external focus otherwise you will end up operating in a bubble.
Flipkart was founded in 2007 by Binny Bansal and Sachin Bansal, and has become the poster boy of e-commerce in India. They began as a book shopping site bootstrapped with Rs 4 lakh, and then scaled to eventually draw $1 billion in one of their fundraising rounds, valuing the company at over $5 billion. E-commerce has now been transformed from ‘it works’ to ‘it’s a very good experience,’ but one of their experiments with online music sales, Flyte, was probably ahead of its time and had to be closed.
Lessons learnt from their journey include: horizontal e-commerce is different from domains like fashion (which is why they bought Myntra); understanding and serving customers is core for success; the pressurised atmosphere of startups may not be conducive for hiring some kinds of senior professionals; and shopping satisfaction is about much more than discounts.
JustDial was founded in 1993 by V.S.S. Mani, and successfully launched its IPO in 2013. Mani first worked for yellow pages company United Database in Delhi in 1987, and then launched Ask Me, a call-in directory service. He tried the same model in Dubai, and then moved to Mumbai, from where Just Dial was launched in a garage in Malad. It expanded from voice to Web to mobile, and added transactional capabilities, ranking services and rich media as well.
Lessons learnt along the journey include: focus on user’s changing needs and don’t get attached to your old ideas if they become out of date; experiment with multiple pricing and bundling plans; use technology right down to the level of the traveling salesman; watch out for app fatigue among users; don’t obsess on your stock price; sustain an entrepreneurial culture even as your company scales; and disrupt your own business model before the competition does.
About the authors:
Shereen Bhan is the managing editor of CNBC-TV18, and anchor-editor of the entrepreneur show ‘Young Turks.’ She won the FICCI Woman of the Year award for her contribution to the Media in 2005, and was named a Young Global Leader by the World Economic Forum. Syna Dehnugara is a journalist and television producer based in Delhi, and co-produces ‘Young Turks.’