10 key takeaways for entrepreneurs who have started and are looking to start up
1. It’s a marathon not a sprint
Sachin Bansal and Binny Bansal toiled it out for 10 long years - believe me it’s a marathon running a business and it nowhere is a sprint or a short term dash. Be prepared for the long haul, conserve your energy, deliver when it matters and most importantly don’t run out of steam. Don’t let short term failures or challenges overcome your long-term vision, inspire yourself to go the long distance. It is their resilience and persistence in their goals and years of hard work and toil that has created the Flipkart success. Sachin and Binny have run the marathon very well, we need to learn this quality from them.
2. It takes years of hard work to become an overnight success
Sachin and Binny had over the years bootstrapped the business, done deliveries, packing, handled customer calls and pulled up their sleeves and done all the dirty work to reach this position. Behind all the glamour and success is a lot of toil, persistence and hard work. Qualities that entrepreneurs need to pick up from the startup superstars.
3. What goes up, comes down and vice versa
Flipkart had raised funds at $14 billion valuation and post change in funding climate and investor confidence in India about a year-and-a-half year back, Morgan Stanley devalued them to $7 billion.
Now after one-and-a-half years they have exited at $17 billion valuation - all through this journey the business proposition of Flipkart has remained the same. Valuations go up or down due to various factors like market sentiment, your annual performance, sector perception by investors, liquidity, economic situation, etc but entrepreneurs need to believe in the underlying value they create in their businesses. Sachin and Binny no matter what circumstances were, stood by the value that Flipkart has created in building the leading ecommerce company in India. They were not swayed or disheartened by rise or drop in valuations. This is something entrepreneurs need to learn from.
4. Valuation is in the eye of the beholder
One of the criticisms from sceptics was that "how a loss making company is valued at $17 billion? Is it a Ponzi scheme? Who are they fooling?" Well, "valuations" are just like beauty - they are in the eye of the beholder.
What is value for one person might be worthless for another. Remember Louis Vuitton was a shutdown brand when Bernaud Arnault took it over, revived it and is now worth $28 billion and is one of the most valuable brands in the world.
Flipkart has sought Walmart who has found a value in what they have created. According to Walmart’s CEO - they acknowledged that they couldn’t have built what Flipkart did in India - this is value creation.
When value creation happens, valuation follows. As entrepreneurs, we need to be aware of what value we are creating but more importantly who will give us the value. The takeover by Walmart is an important learning for entrepreneurs on creating value and monetising it correctly.
5. Importance of being an early mover - and don’t forget to evolve as you go on
Sachin and Binny have been classic examples of entrepreneurs who took risks and got early into a segment “ecommerce” when people were still sceptic on whether consumers would shop online.
They were pioneers of change and this gave them a head start with competition. Although they started as an online bookstore they kept evolving to the needs of the consumers and market and became a full stack ecommerce company. You never startup to build a book store or a candy shop or a laundry - you should start up to build a successful company and constantly learn and evolve. This is one trait that has kept Flipkart as a market leader and something other entrepreneurs can learn from.
7. Focus on execution
No matter how great the idea, no matter how large the funding, no matter how talented the team and no matter how big the market - the Flipkart team has proved that the key to success is in relentless pursuit of excellence in Execution.
There can and will be goof ups but getting your basics right is the heart of execution. No execution is mistake or foolproof - but you need to constantly learn from mistakes and move ahead which is what Flipkart did. As they say Plan to execute and execute the plan is something that the team at Flipkart has managed reasonably well.
8. Let the world talk... let your work do the talking!
It’s a perception that the startup world normally involves a lot of glamour, PR, funding, and a whole lot of hot air. They say you need to make the world talk about you. Sachin and Binny, although being poster boys of the startup ecosystem - they were not always in the media, they were not there receiving all awards, they were not there giving only speeches - instead they silently let their work do all the talking. This is something we need to pick up from Sachin and Binny as entrepreneurs. Just focus on work – the rest will take care of itself.
9. Changing consumer behaviour is a long haul game and takes guts
It takes a Steve Jobs and a Henry Ford to change consumer behaviour. As Henry Ford once said, "If I had asked a customer what they want, they would have asked for faster horses." What’s awesome about the Flipkart team was that they had the guts to take risks and changed the entire behavioral pattern of the Indian consumer - and they were the first to bet on the change happening. This requires quite a bit of vision and foresight. Of course, naysayers will say that if Flipkart didn’t do it, Amazon would have done it. But the fact is Flipkart was at the forefront of this ecommerce revolution and showed guts to be an integral part of this change. This is something that we as entrepreneurs can learn from Sachin and Binny on the approach towards consumers, categories, and markets.
10. Power of letting go
It is important to know when to let go. Sachin beautifully worded it in his farewell tweet and said, “Sadly, my work here is over”. Recognising when to let go of something that you created and putting it on a trajectory for safer orbit is very important for entrepreneurs.
The analogy we can draw is how for a satellite to reach its destination the stage one, the rock propels it and then let’s go of it and departs and stage two of rocket takes over. This is the role we as founders need to understand. No matter even if it’s your vision and your dream, sometimes the dream becomes so large that it might need a larger canvas.
Flipkart now has the power of a Fortune Top 10 company like Walmart now to propel it into the next orbit. Stage 1 let’s go graciously. We need to learn this quality from Sachin who has parted with the baby albeit with a heavy heart but knows that the baby is in safe hands now. This trait needs us to be strong, unemotional and practical about the decision - thanks for showing the way Sachin.
Now that we have two people who have rightfully qualified to be called the "Legends of Startup ecosystem" - let us all get inspired and go build our own Flipkart.
(Disclaimer: The views and opinions expressed in this article are those of the author and do not necessarily reflect the views of YourStory.)