Giving details on Little Eye Labs' journey from starting up to being acquired by Facebook, to starting up again, Co-founder Kumar Rangarajan inspires a new batch of entrepreneurs.
What makes a successful startup?
A simple question, but one which can elicit a lot of diverse answers. Is it a good idea, funding, a strong team or just plain luck?
To talk about all these and more, TechSparks on Day 2 had on stage Kumar Rangarajan, who built a successful startup, Little Eye Labs, which was acquired by Facebook. In fact, Little Eye Labs got its early recognition at Tech Sparks 2012.
After five years, Kumar returned to the same stage to inspire a new batch of entrepreneurs.
Kumar started Little Eye Labs in 2012. The company created a performance analysis tool for developers to help measure, analyse, and optimise Android apps. He began his session with a presentation about his journey to the “paradise island” called Facebook; Little Eye Labs was acquired by the Silicon Valley giant in 2014.
Fast forward to 2017, the entrepreneurial bug bit him again and in his own words, he made his “escape” back to his home country to start up again. His new tech venture is Slang Labs, a mobile SDK that can enable apps to understand and react to human voice.
Being an entrepreneur is not easy. But understanding the journey can help one make the right choices and decisions. Kumar put across this point very simply in a 15-minute talk laced with personal anecdotes and experiences that highlighted the points he was trying to make.
The three key pointers he offered budding entrepreneurs as they embark on their startup mission are:
- Co-founders first, ideas next“Please don’t start with an idea,” Kumar said. He stressed the importance of having a strong team for “ideas change, team members are constant”. He spoke at length about the importance of having a like-minded team. His own team was formed in 2010, while their idea materialised in 2012. They went through a series of different ideas, even attempting to make India’s Netflix, before co-founding Little Eye Labs. The team focused on their strengths (they were developers) and looked to build a product useful to the new generation. “Our ideas kept changing and evolving, but the team remained constant, it was a natural process,” Kumar said.
- Raise funds because you need, not because you want“People think asking for big money is cool,” said Kumar tackling the subject of funding. Startups have the tendency to quote big amounts when they approach VCs for investment, which is something they must avoid, he said. Startups need to plan their finances and not blindly approach investors. When a startup is funded they are giving a commitment in exchange to their investor and that is of utmost importance. If a startup were to demand $1 million, the company should be valued at at least $50 million, only then would he be able to repay his investor $10 million, Kumar explained. “Investors expect 10 times in return.” Kumar’s advice to startups was to scale down and find their bare minimum requirement.
- Acquisitions do not happen by chanceNot one to sugarcoat things, Kumar was quick to speak the bitter truth. He elaborated on the importance of commitment, “People treat acquisitions as lucky. But you need to understand that the moment you take money from someone, you are effectively committing to return the money.” One of the ways to do so is by having a successful exit; to do so, he emphasised the importance of networking. “Acquisitions happen because people know people,” he said. Just like a company researches their customer base, it is equally important to research potential buyers. It is essential to interact with the right people in the company one is approaching for investment. Debunking myths around acquisitions, Kumar ended with a simple but powerful statement, “While luck is a factor, at some level you need to manufacture your own luck.”
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