THE STARTUP PHENOMENON

India is a country which boasts of its intellectual horsepower, huge proportions of a talented and stalwart youngsters and maturing market. However, despite of all the aforesaid claims, India is not able to meet the broader socio-economic targets. As per a recent report of Planning Commission, India needs to support almost 10,000 scalable start-ups by 2022 to effectively create jobs for 140 million job seekers. But currently only some off 450 start-ups have been launched and overall just 200 are funded by angel investors/VCs every year. There has definitely been a sudden surge in the aspiring student entrepreneurs who wish to become the Steve Jobs and Mark Zuckerbergs of India. But something has been holding us back. Some things are going wrong and we have not been able to put this act together.

I would not use this platform to avowal about my start-up venture or advertise it in any way, but given my personal experiences with SpringTide, an online flipbook magazine aimed at providing a platform to youngsters to express themselves, I would say that it is somewhat Herculean. May it be the cumbersome procedures of getting incorporated as a company under the Ministry of Corporate Affairs or complying with the legal formalities of VAT, Service Tax, Sales Tax, TDS, TCS, Income Tax, Wealth tax etc, it is really a task that can make you go “WTF”.

But I would not blame the system and the authorities for all the failures of the start-up system. There are mistakes made at both the ends. I, as an owner of a start-up venture, would speak for fellow entrepreneurs. Firstly, I would say that we, as Indians, are a scared race. We are not ready to take risks and make mistakes. We are too pessimistic and we give up too fast. We want to reach the top of the building without having to climb the stairs. We are hard working, dedicated, focussed and immensely intelligent but we lack patience.

For all those who feel that there is a dearth of capital in the start-up scene need to do some serious rethinking. We are not Silicon Valley, for sure, but undoubtedly the excitement regarding Indian start-ups is growing globally at a surprising rate. Just for examples, only in December 2012, Plivo, the cloud telephony start-up raised $1.75 million Andreessen Horowitz, Battery Ventures, Qualcomm Incorporated and SV Angel. WhistleTalk, a Bangalore based start-up aimed at making recruitments easier, has raised $400,000 from Hyderabad Angels. Mast Kalandar, a food chain, raised $6 million from Helion Venture Partners and Footprint Ventures in third round of funding. Gaming start-up MadRat games received investment of $500K from Blume Ventures and First Light Ventures. Sharedcab received angel investment of $1 million from Anupam Mittal, Sasha Mirchandani (Kae Capital), Blume Ventures and few others.

And trust me, these are very few examples. Moving ahead, another big mistake we do as entrepreneurs is not anticipating our customers’ potential needs. Say for example, we are starting a bakery in a neighbourhood. In such a case, we need to consider the fact some customers might want the products to be delivered to their houses. Also, many customers might want to return products. Hence, providing allied services, after sales satisfaction and services additional to your product is a necessity.

Every business needs to have a Unique Selling Point, i.e. USP. A business always gets born from a vague idea which strikes us during shower or a highway drive. But every idea needs to have a proper blueprint or a business plan. The age-old technique of solving this problem is to think of the top three problems that your product/ service solves. This will give clarity to the business idea and help you to converge upon using the limited resources in the right direction.

In the current set-up and situation, one of the biggest mistakes that an entrepreneur is committing is to start up without an online presence. This is something that hold true even for already established businesses looking to expand and for youngsters exploring into new dimensions of businesses. No matter what field you are going into, an online presence is very essential. For example, Tata Docomo is ruling the social media world with over 1 billion Facebook fans followed by the brand of Vodafone Zoozoos with around half of those.
It is a time where customers, clients and associates are found and made online. It’s time to realise that the eyeballs have shifted from Yellow Pages to Google Chrome!

One thing that every student entrepreneur or an aspiring start-up owner needs to learn by heart is that the term “Flexible working hours” is a myth! Let’s face the reality – if you are starting a business, it is your full time responsibility, your full time job and in fact you need to feed, sleep and drink on your business day and night. Think of it as a kid of yours... Can you really just restrict to 10 am to 6 pm to look after your kid?

Being a control freak is good, but sometimes it can backfire. It is true that holding the power to take decisions is very important, but some things should be delegated at the right time otherwise it just ends up in a mess. Bootstrapping is good until you can manage it. Personally, my co-founders in SpringTide wanted to opt for a VC and I have been against this always because of the major reason that the decision making power is diluted. Hold that power till the time you really can...

Again, the most important lesson remains that you got to take risks and you have to be ready to face some losses to. Minimum investment concept is cool, but there is nothing such as zero investment IF you are looking to earn. And here investment does include the investment of time...

Therefore go out, have some fun, play cool, play hard, have a nerve and take risks... You never know, you might be the Indian Mark Zuckerberg!

(A detailed write-up on what I spoke at the International event IGNITE on April 3, 2013 in my talk)