From an entrepreneur to his peers, it is important to understand that there are things you simply must keep in mind when setting out on your startup journey. Here’s what I learned after 7 years in the ecosystem.
As we bid farewell to the year 2016, I want to take the opportunity to have a heart to heart talk with you before we get ready for our New Year’s parties.
I would like to share my mantra on how to manage the things around you. In the last seven-odd years, I have built two successful businesses, and I am currently working my ass off on a third. These are the things that helped me along the way, and they will surely help you too.
Outdo yourself each day
As a founder of a startup, if you do not feel that you are working with scarce resources (that can be anything - time, money, people), then there is surely a problem. As a leader, you should always feel that you are under pressure to perform. With whatever resources are at your disposal, you are on the field to win the game.
Don’t get disturbed if your competitor is funded and you are not. I very much believe that when you work in scarcity, you and your team outdo yourselves, and that’s when innovation happens. It was in 2010 that I started Taxmantra, with two funded startups already occupying the space. Now it’s 2016 - we have survived and grown substantially, and no one remembers them. Don’t let scarcity be a mental block to your path to innovation and growth.
Don’t go for instant gratification
Today, we have more startup events happening than we have startups with solid business metrics. On an average, I get five startup speaking opportunities in a week from all across India. There is no harm in getting excited about being there at these events, but you must remember that it’s the hard work in the background that takes you there. Thus, enjoy the glory, but be like a duck - calm on the surface but always paddling like the dickens underneath.
Focus on real value creation
You raise funds to do business, not the other way around. I see so many startups doing so well till the time they raise funding. I do not understand why many startup founders think that they need to do NASA after raising funds.
The focus on the core business should actually increase once you raise funds. I do not even believe in the debate of bootstrapped vs funded. I feel that capital is one of the raw materials that you need to grow your business, and it’s up to you to decide what your source of funds is going to be. It can be mom and dad, banks, VCs, angels or even your spouse. The point I am making is that the quality of decision making on the usage of capital matters most. In 7 out 10 funded startups, I have personally experienced the fact that the quality of financial decision making goes down post funding.
Funded or not, the focus should be on creating value for your customers, employees, stakeholders and yourself, with the objective of creating the right impact on the ecosystem and building a business that can sustain itself, growing on its own for decades.
Have passion, but have patience too
One quality that helps an entrepreneur is perseverance, and with patience comes perseverance. The challenge is that patience is under severe risk of becoming endangered; if you do not believe in the marathon, then do not get into entrepreneurship - business ideas do very often fail, but an entrepreneur should not.
Do not mistake passion for speed and patience for the lack of it, and understand that steroids are not to be given to children.
Understand the business side of things
This really infuriates me. I get to interact with so many entrepreneurs, and one thing that is very common is, “I am not a finance guy, I do not understand these things.” My advice has always been that if you do not understand the finances of your business, you can’t go long. You do not have to be a geek in finance, but you have to have basic knowledge about working capital needs, burn rate and revenue projections, which in turn would give you enough to have the right interaction with an expert.
Train your brain so that it does not get distracted. Do not burnt out easily. Understand that setting up and running a business is a long-haul game. Take care of your health and look after your family, since you are running a marathon. Be yourself, follow your heart, and everything will be fine.