Where Founders Flounder?!

With ‘Startup’ becoming a fad term, it is better to get your feet wet, before swimming

Founders are individuals who start new organizations to pursue opportunities without regard to the resources they currently control. They make the early decisions that shape the startup and its growth, an influence that begins even before the founding itself and that can extend through all stages of the startup’s development – Howard Stevenson: Sarofim-Rock Baker Foundation Professor Emeritus at Harvard University.

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When I look back over the past two and a half decades or so, I am surprised how the startup ecosystem in India has changed so dramatically. At that time, when we were about to set up India’s first private sector incubator inside of a university nobody was gung-ho about entrepreneurship (it was to compete with the best campus placement offers that students would get) and the closest that most people had heard about an’ incubator’ was the one used in hospitals for new born babies! That was around early 2000.

When we launched our first batch of ‘grooming’ at iCreate in 2013, the landscape had changed substantially. Several top IITs and IIMs as well a number of Tech and Management institutions in the private and government sector too had embarked into encouraging entrepreneurship. With both; the Central Government and several state governments dolling out schemes to encourage entrepreneurship through various arms/departments, there is a rush for institutions to apply for such schemes, and in turn, try and nudge their students to pursue the path of entrepreneurship.

Nothing wrong with that….it is a great sign of progress and aspiration to be an ‘employer’ rather than an ‘employee’. However, few within and outside the ‘system’ realize how hard the entrepreneurial journey is. Statistics are heavily stacked against the success ratio – 90% to 95% of Indian startups fail within the first five years!

The intention here is not to discourage both young and mature aspirants to pursue the entrepreneurial journey of their choice. However, I felt that as somebody who has watched the ecosystem evolve over the years and mentored several founders very intimately, it is obligatory on my part to share some bear truths. There is no harm in life to take well informed decisions rather than impulsive ones!

I have attempted to put together some key aspects that Founders need to be careful about both; before and after setting up their entrepreneurial venture. The list is not necessarily in order of hierarchy- although I have tried to follow some logic. Also, obviously, it is not exhaustive and even the ones that I have listed here may deserve an independent article to make that topic more profound!

Choosing to be any entrepreneur because you want to be your own ‘boss’ and do not wish to report into anybody else!

This is the worst of the reasons for becoming an entrepreneur and an extremely dangerous myth! When you are an employee, you have a 9 to 5 job (may be extended by a few hours once in a while) and you report into 1,2 or at most 3 bosses. As an entrepreneur, you have a 24×7 job and everybody is your boss – your customers, employees, suppliers, financers, bankers, government….and when you return home after an exhausting day, your spouse!

Not being real about your life and personal current and possible future circumstances

At the outset, one must plunge into entrepreneurship only if you have the following:

Favorable personal circumstances: entrepreneurial motivation and passion, family support, financial support – if you have a student loan to pay back or/and the family is dependent on your predictable income then it is advisable not to venture now, not close to marriage – unless you have taken into confidence the potential spouse and her/his family, you have positive role models to emulate, and reasonable cash cushion for say surviving 3 to 5 years of ambiguity and uncertainty.

Favorable career circumstances: you have some relevant experience and/or a mindset to grasp what is required at quick speed, low opportunity cost in trying out, the golden handcuff (high salary that only a large corporate can pay) has not caught you! and it fits into your future scheme of things as a career direction.

Favorable market circumstances: you have a big opportunity to solve a profound problem, there is favorable context, customers are having the ability AND willingness to pay and there is time enough to develop a solution and go-to-market with enough slice of the pie available for you.

In short, you need human capital, social capital, and financial capital – at all stages of an enterprise.

Starting with an idea instead of addressing a profound ‘pain-point’

This is very, very vital – especially if you are starting young with virtually no or very little work experience. Don’t latch on to an idea because you get a technical ‘kick’ out of it – it may have been ok for your final year project or a Ph.D. thesis but may not necessarily have enough market demand or/and may not be able to build at commercial scale. Ability to ‘sniff’ an appropriate pain-point is one that deserves most of the time before you embark into anything worthwhile. Surveys show that about 40 to 45 % startups fail because of no market need!

Copy – Paste

This is an unsustainable approach most of the times. Just as you may visit a trade fare in China or Taiwan, so will your compatriots….implying, if you can copy, they too can…may be cheaper and faster… and very soon you may disappear! If you try and imitate a product from the Western world then its adaptation for Indian context may be tough – of course in some cases, competitive cost of doing business may help, but the market has to be big enough and the competition fairly limited for you to succeed in the long run.

Latching on to the flavor of the season – opportunistic money making versus building a sustainable business model

This a dangerous mindset – a lot of this was visible during the Covid-19 times. Everybody trying to grab whatever opportunity that was available. However, once peak demand for various items tapered off, they were stacked with unsold stock and money pending to be collected from the market. If you want to be a serious entrepreneur, then please get yourself organized – invest enough time in planning and creating a robust business model. Else all your dreams will come crashing!

Planning for a quick exit and move on to the next versus having a ‘Built-to-Last’ mindset

The Western world particularly in the US, and that too in the Silicon Valley, the mindset of becoming a serial entrepreneur came into vogue. Some of this is visible in Israel tech startups too. They plan the venture to get a handsome exist for themselves and their investors. However, one must note that it not as easy as it may sound – a lot if it depends on Intellectual Property (IP) created and/or market penetration/customer acquisitions made or in some rare cases a fascinating team. As opposed to this, Indian entrepreneurs may be better-off having a built-to-last mindset. Of course, I am not suggesting that it need to be a generational thing but possibly 15 – 20 odd years may be a good bench mark to take a call. Not all Founding Teams today would think like an Infosys when it was conceived as a first generation tech startup!

Quick and big money being the sole motive

Again, terrible for starters! Money has to be a consequence of having done many things right and at the right time….first and foremost, solving a profound pain-point with a solution that is relevant, affordable and trustworthy in being able to deliver what it promises to.

The myth of ‘First mover’ advantage

This is one of those romanticized thoughts. First mover is a double-edged sword! It may or may not work in your specific case. Usually, it needs deep pockets and considerable effort to get early adopters and subsequent traction of enough customers who are consistently able and willing to pay. In fact, more often than not, it is the second mover who reaps all the benefits of the hard work and learnings of the first mover!

Confusing ‘Products’ with ‘Services’

Most aspiring entrepreneurs may draw inspiration from the successes of the software industry and think that the same can be emulated in hardware too. In doing so, they grossly undermine the time, effort, money and go-to-market challenges among other things. Even among software, there are SAS based solutions which have challenges similar to that of product companies. Complexities deepen depending on who the last mile consumer is – are you doing a B2B, B2C, B2B2C, or a B2E2C sale. Warranties, customer support and annual maintenance are other nuances that need to be built into the product costs. Products have an edge in terms of potential IP that could be capitalized – but it has to be very, very compelling and strongly ring-fenced for the entrepreneur to leverage and reap the benefits.

Lack of balance between functionality and aesthetics

This is an aspect very crucial for hardware products. Tech founders can often can get very biased to lean more in favor of the functionality and feature aspects. However, one needs to get into the last mile consumers’ shoes and understand why aesthetics is a vital aspect from their perspective. This implies that the venture factors in time, effort and budget for this. It also involves having the right set of people for this in the team or finding a good outsourced resource. Post design, there is cost of making dies and approaching the right manufacturing facility for producing enclosures for example. Choice of the right material that don’t negatively conflict with functionality is important and therefore this needs balanced thought at PoC or soon after PoC stage itself. It is heartbreaking to discover bad news at the fag end and going back to the drawing-board all over again!

Not taking the right judgments on Intellectual Property (IP)

While IP is a very powerful tool to leverage for tech ventures, one has to do it carefully and with the right timing in mind. Unless it is a very distinct and powerful opportunity one should weigh in the pros and cons between spending time and money for IP protection versus hitting the ground and going to market as quickly as possible. This needs a very careful and well informed judgment call and it is better to seek proper advice from relevant subject matter experts as well as IP experts before plunging one way or the other.

Making the wrong choices of DIY versus Outsource

In today’s world for almost all products and services it is imperative that they hit the market as soon as possible. If it has to fail, it better fail fast! One common dilemma in young startups when moving from idea stage to PoC with a small team and dependency on part time piece –meal work associates and/or interns is, what are the things they should be doing on their own versus what can get outsourced? There is really no rule of thumb for this. However, DIY if the core tech strengths lie within the team and in aspects where potential IP resides. If you choose to outsource, then make sure of what you want – get the specs crystal clear and keep a tab on the progress constantly. This is to avoid a situation where you have spent time and money and still not got what you wanted resulting into unnecessary heartburn among all stakeholders! This is not uncommon and I have witnessed this over and over again. It is therefore imperative that the team invests enough time in the ‘planning’ phase rather than rushing to execute.

Also, the technology animal is ever changing and difficult to get it right everywhere and every time. It is helpful for tech entrepreneurs to remember that “perfect is the enemy of good”. In the obsession of being a perfectionist, don’t miss the go-to-market window. It is quite possible that customers are happy with the ‘good’ version – which fully solves their problem at a price point acceptable to them. Perfection is what the entrepreneur and the development team may be aiming at from a technology perceptive. By saying so, I am in no way suggesting that at any point in time the team must take a short-cut and compromise on quality.

Lack of courage to quit and move on or pivot and take a new path

The dictum of the passion that one desires of an entrepreneur also ironically comes in the way when some hard decisions have to be made. Once an idea moves to a ‘Proof of Concept’ (PoC) stage, the challenges start emerging and often it could be from unimagined corners like a regulatory bottle neck (say in case of Medtech startups) or a new competitor from a completely unknown territory. Attachment or obsession to one’s original idea can often blind the entrepreneur from the worldly realities. It is good at such times to fall back on Sahir Ludhiyanvi’s famous lines: “Chalo ek baar fhir se ajnabi ban jayen hum dono”Ability to ‘let go’ is an important attribute that entrepreneurs must possess.

Dilemma of Solo versus team and……founding the team with wrong members on board

While it may be ok at very early stages when you are looking at worthy of solving pain-points and exploring ways of solving them all on your own, the solo route is not the one that is encouraged beyond that. It is very crucial that you have the right founding team and they are all in it for the right reasons – each one complementing or supplementing each other’s skill sets. It is OK if the team has been formed because you studied or worked together – but there has to be clarity on what value each member brings and there needs to be shared passion, vision, purpose, and mission. It is helpful to undertake a brainstorming exercise among the potential founding team members on “What is in it for me?” and ‘What is in it for us?” If the answers are vastly contrasting, then that is red flag. Also, it is very important to recognize the fact that in any team there will be a ‘first among equals’ and that must be respected by all co-founders. Again, surveys show that 23 to 25% startups have failed for want of a good founding team.

Confusing Family AND Business as Family Business!

This has particular implications in the Indian context (although it is true even in the West and the East). There is as such no harm of involving family members actively in the startup so long as they pass the test and undertake the exercise that I have suggested in the earlier point. There is a catch here though – that all the stakeholders must have enough maturity to recognize that family and business are distinct relationships. You cannot bring business disputes to the family dining table and you must not carry over family differences of opinion to the workplace. In the end, you would land up destroying both – thereby making a Hindi serial producer or an OTT platform to get a good storyline and make money at your cost!

Not investing enough on talent

Startups must set up right in the beginning a culture of delivering the best product or service. That implies that the talent pool that the venture has, needs to be the best (but not necessarily THE best and THE brightest). One has to look for the ‘Best Fit’talent – one that suits the culture, shares the vision, mission and passion of the Founding Team – especially the early core team that joins the venture. In almost all cases at early stages, the venture cannot compensate the staff at par with the industry standards (especially for those with work experience) and often times they would be willing to join at equal to or lesser salaries that they would most likely get in other companies. It is important therefore for the entrepreneur to remember the early sacrifices that such individuals have made. Failure to recognize key and/or early team members as important stakeholders, is not a good sign of a fair enterprise.

Not having put a cash pipeline in place

This is the bitter truth – that no venture is possible without capital at almost every stage. Initially, one could dip into personal savings, borrowing from family and friends, government grants, if you have an impressive PoC you may win some prize money, incubators may help you with funding of various types (project costs, sustenance, go-to-market funds by way of grants/loans/equity/convertibles). But all this may dry up at some point in time unless the venture does not start making its own money to sustain. It is imperative that at all points in time the enterprise has a healthy cash flow – this is something I have always encouraged entrepreneurs to be watchful about. No matter what funding you have, how much has business earned for itself to keep the wheels going, and for how long? Almost 30% of startups fail due to want of a steady cash pipeline.

Not understanding competition enough

Undermining competition is death knell for an enterprise. Even if you got the early breaks and managed to capture a substantial portion of the market, you cannot afford to take things for granted. In today’s world, monopolies hardly exist. There will be some competition always round the corner and you have to be very watchful. They are bound to nimble, energetic and stronger in terms of new resources and coupled with their hunger for success, their animal instincts is ready for the kill. Close to 20% of startups shut down for want of shrewd understanding of competition. There are of course a number of case studies and stories of all those upstarts that brought down well established giants.

Gross under-estimation of cost of doing business

If there is one worrying thing that I have noticed in several ventures at least in their initial pitches is their inability to grasp the need for estimating a reasonably realistic cost of doing business. Typically, they know the bill of materials at PoC stage and at best, will argue that the costs will only come down when “we procure inputs in bulk”….which is true. However, what they tend to ignore or lack experience in estimating, is all other associated costs. They also ignore covering for the Founding team’s opportunity cost or their replacement cost for part of the functions that they are handling currently. In ventures where marketing efforts need deep pockets, lack of judgment can be suicidal! How will you peg a price to customer if you don’t have a handle of cost of doing business?!

Not having a sound pricing model

Almost 18 to 20% ventures face failure on this count. Some of the cause is related to the earlier point, Add to that, lack of clarity on a sound and consistent pricing model, which is crucial. As an example, in the excitement of trying to offer too many features vis-a-vis competition (features which may be useful for less than 2% of customers) one might actually be under- pricing it! Possibly, one should have considered a model that builds up price to customer based on the features desired, including premium pricing for ‘customized features’. Again, one should be careful getting into the lure of customization if it involves considerable effort and that too at the expense of your running standard version.

Undermining marketing efforts

Even the best of content in any field today needs marketing. Unless you are in a very niche product/services segment where the value is high and typically it is a B2B business which you have cultivated with high quality delivery and timely customer care, the journey is tough. Marketing is necessary for most products and services today because customers are increasingly more aware, have a wide range of choices to make, and virtually no field is competition free. Even if there is none now, there will soon be one round the corner! There is a need to make one’s offerings visibly through various mediums and also establish a ‘brand recall’. Again, this is not a one off effort and needs to be ongoing and therefore needs consciously effort and budget.

Not listening to the voice of the customer

It is very imperative that all entrepreneurs no matter what stage and what pinnacle of success they may have achieved, must constantly listen to the voice of the customer. They are the ones who will constantly give honest feedback and help your offerings improve. I have already written an article on this topic earlier.

Looking for money rather than ‘smart money’

Right from the time you take the right slice of money in whatever form – grant through incubators, angels, early stage VCs – it is wise that you don’t get lured only by the quantum of money available on the table. Money along with some other attributes would be of much greater value e.g. if it comes with help in technical refinement, market connect, supply chain, team building, help in next round of fund raising , help in legal and statutory matters (particularly in very early stages). This is where at very initial stages and up to being fully geared to go full-hog into the market place, incubators may be a good option to consider. Among them, some will be specialized in certain focus areas and will offer particular strengths in holding your hand along the way – so make informed choices that are relevant and suitable to you.

Not enough attention to documentation, policies, and statutory matters

This is a common hurdle most tech founders face. More often than not, it is not deliberate but plain ignorance and lack of time for getting this on their priority list. While there are tall claims of ‘ease of doing business’, doing any business in India is not that easy! For one, it is may be easy to start a new venture, but a night mare to shut it down!! It is important that aspiring entrepreneurs seek right advice at the right time for legal and statutory matters impacting their area of business. It is not expected of the Founding team to be an expert on everything in this arena but plain ignorance is unpardonable! Also on the operational front, it is better to put in practice of documentation and some basic processes in place like HR policies to begin with. The more one defers these practices and operates in the environment of informality, the more difficult it will become to introduce them and make it acceptable – especially for the team that has been since the beginning – as they say, “Old habits die hard”.

Disharmony among founding team members

This is the most slippery one to handle and often times hard to resolve among the parties involved. It may need a mentor or any other person commonly acceptable to help resolve the issues. First and foremost, if there are difference they better surface loud and clear and quickly. Don’t brush it under the carpet and defer taking hard decisions. Delay in resolution will only make things difficult and de-motivate all other team members. It needs to be handled maturely and irrespective of the issues involved, one must part with grace. One of the most common troubles faced is equity distribution. Therefore, clarifying this right in the beginning quantum and method of equity distribution and also agreeing on how to part when a disagreement situation crops up, is sign of a mature founding team.

Souring relationship with investors

One must remember the Golden rule: ‘One who has the Gold, makes the rules!’ While money is important at all stages of the entrepreneurial journey – more so in the early stages, entrepreneurs must realize that irrespective of in what form it comes (grants/prize/equity/loan/convertibles) at the end of the day, it is somebody’s hard earned/tax payer’s money that is at risk and they are willing to let you take chances. If you hit a jackpot there are many gainers, but if the venture goes bust, there are few losers, mainly the funding agency (in hard cash) and the Founding team in terms of opportunity cost (but hopefully they would have learned some valuable lessons). Therefore, it is advisable that as far as possible don’t sour your relationships with your investors. Whatever negotiations you want to do, do it before signing the dotted line – and fully understand what you are undertaking. Ambiguity and unwritten trust actually lead to relationships going sour. Almost all investors recognize the fundamental truth: that only if you succeed, they succeed. So they will work in your best interest. There may be differing views – but there are amicable ways to sort them out. Their network and introductions are very valuable and you must be able to capitalize on it smartly.

Not having a competent and caring Advisory Board

When ventures go past the initial phase of proving their value position and beginning to ‘settle’ down it is good for them to gradually start putting in place a competent and caring Advisory Board. I use the word ‘caring’ deliberately – not to suggest pampering, but like good parents, pull up the Founders when they flounder and appreciate them when they deserve….and both; at the right time and place! To begin with, this may not be a jumbo Board – get experts as the need demands. At initial stages the venture may need people with sound relevant tech background, market connects and networks and later, one may need those who help build and manage talent pool, help in approaching VCs, international markets, help in deliberating about growth strategies and so on. Importantly, they are expected to be people with their ‘heart in the right place’ and do it for the joy they get rather than any materialistic returns.

Inability to create a leadership pipeline and a succession plan

If there is one thing that founders must accept as reality is that they are not going to be around forever and that there will always be a need for better people than themselves to run the show. Also, if they keep doing what they were doing in the initial years (read ‘micromanaging’), then neither they, nor the venture will ever grow. Firstly, they need to bring in professional people and build cohesive teams. Subsequently, identifying next line of leadership and grooming them is a key task of the Founding team. Also, succession plans should be transparently discussed firstly among the Founders and then with the next layer of management and made known to the organization at an appropriately time and manner. If a Founder or/.and the Founding Team hangs around for too long, then there is the danger of what the famous historian John Dalberg Acton said once in another context “Power tends to corrupt and absolute power corrupts absolutely”.

Not having a mentor or a life coach in the entire journey

Entrepreneurs young or old, are at some point in time likely to feel ‘lonely at the top’. It is always helpful to have somebody or more than one mentor to help you navigate the pitfalls. While most mentors would be able to guide in addressing several business challenges, few of them would have the competence and knack of being a very valuable ‘Life Coach’. That relationship is normally lasting for life and goes beyond the area of business – more counselling in nature – which is very essential given the stresses and strains of entrepreneurship. It is good to spot a life coach early in one’s entrepreneurial journey. Almost all of them would be willing to give time for free – because they do it for the joy of giving back to the next generation. To those who do it on professional terms, even they recognize your entrepreneurial / financial compulsions and would be willing to get engaged on a “payable when able” basis (a term that I borrow from a very close book vendor of mine- he would allow me to purchase books in this manner when I could not afford them!).

Hope this article is somewhat useful for beginners as well as the veterans. Intention was to point out some of the most common pitfalls that tech entrepreneurs face, and some clues on how to navigate through them. Wish you a journey that is enriching for I am sure that irrespective of the eventual outcome, there will be some valuable learning. As they often say “the journey is more important than the destination”.

DisclaimerThe views of the author are personal and does not reflect those of the institutions or organizations and their affiliates he is associated with.

Thyagrajan K
Founding Team Member and Board Director – International Centre for Entrepreneurship and Technology (iCreate)

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Separating signal from the noise

If the ‘Best-Fit’ people are part of your team, then magic is just round the corner!

It was a mild chilly Delhi afternoon and I was seated alongside the MD and CEO of a reasonably large sized Design and Manufacturing company focused on Chemical Industry plants. A family owned business, now being run by the third generation with a mandate to ‘professionalize’ the firm, I had been consulting them for a while and most of the key staff knew me well. They had a niche in the market place with limited competition and their key was in the design skills of making very efficient tailor-made equipment for this sector. In some ways, the knowledge and experience resided in the “heads of their engineers”.

We had just started sipping some warm tea when PK – the General Manager of Engineering – walked in with some fret and nervousness written on his forehead! I tried to calm him down, ordered for some tea and encouraged him to share his anxieties. He pulled out a piece of paper from his pocket and passed it on to his CEO – “This is the 5th resignation in as many months! I just can’t understand what is happening?” Some nudging revealed that those who had left were from different cadres and backgrounds and not all reporting into the same line manager (just to make sure the popular adage that “people leave their managers and not their company” – had not kicked in this case-as yet!).

When you don’t see a common pattern in the people churn, it is very difficult to separate the signal from the noise! Managers often get mislead by common hearsay or/and perception– we are not up to the mark in salaries, managers are insensitive to workers’ needs, top management is invisible, work is not interesting…and so on. However, while addressing this problem one needs to peal the onion layer by layer. No one solution can fix all problems in one go. One has to prioritize – implying that who are the ones that the company needs to desperately retain (and indeed they are deserving in their own right) and who are the ones, one can afford not to regret too much if they were to be let gone.

Finding and retaining top talent has always been a challenge ever since industrialization came into being. It is only that the nature was different then – there (particularly in manufacturing) was union activism, salaries mattered, and overall wellbeing of workers in factories (like health and safety as well as social security like Provident Fund and ESIC) was a determining factor. I am a product of that era – where many new entrants would ask the potential employer if they had a PF contribution available as part of salary ‘package’.

Cut to a few decades later (post liberalization) when new age tech and knowledge driven ventures came into being – these included IT, Pharma and Biotech, Management Consulting, Banking and Financial services, Retail and the likes – where the talent acquisition revolved around attracting the best from top engineering and B Schools. The demands from these aspirants were different – salary asks were (and are increasingly) almost incomparable with other traditional industries, ‘perks’ and stock options matter, designations and job titles seem to make or break societal perceptions (especially if you are a potential groom or bride!). PF and ESIC do not matter as significantly (“who will trust the government with your money until you turn 58 years?!”  – a common response of a new employee).

Today’s generational priorities are different – ‘settle’ down quickly – get a good car, buy a house with 20 years EMI, get married to a partner of choice (and willing to share household chores with career), build capital and cash at neck breaking speed so that one can afford to retire quickly and plan long vacations when one is fit and able to enjoy and pursue what they like to do instead of being forced to do! All legitimate asks from their perspective – surely, having seen their parents and grandparents struggle to earn, save and in many cases, forced to have a second career or an extended work life beyond retirement, they don’t want to see themselves repeating the same (mistakes??!!). By the way, when I mention of generation gaps, earlier 25 years was a generation gap. Now, one engineering batch is a generation gap! The incoming batches’ aspirations are different than the ones’ of the outgoing batch!

As aspirations in the potential talent market changes, so do the challenges of the hiring firms and their leadership and HR. In recent years, this has come to haunt a number of ‘Tech Startups’ – where one may be able to attract some select bright individuals initially based on the ‘kick’ they get out of being associated with a technologically challenging product – but very soon the romance crashes! For a number of reasons – too many tech challenges to overcome, product roll-out delay, go- to -market strategy not in place/delayed, funding challenges, boot-strapped money running out, founder team differences, blurry vision….and the list can be unending!

But in general, some very oft revealed reasons include:

  • Expectations versus actual work assigned at the work place not matching – very commonly observed in cases of fresh graduates and staff with 1-2 years’ experience
  • Several surveys by professional HR consulting companies and Institutions/Councils has found that although people join companies for rational reasons (better compensation, benefits, and career opportunities) they stay with the company for emotional ones. Sense of connection with the firm’s mission being prominent among them
  • Often what employees want for their career is not what the company wants for them!
  • Less than 25% departing employees express their dissatisfaction to the manager – and it is under the radar and often too late to intervene!
  • Immediate manager not competent enough at coaching and feedback
  • Career opportunities limited/not valued/not listened to/not paid well
  • Work-life balance has gone for a toss
  • Lack of trust or confidence in the senior leadership

From my experience of Management Consulting and Mentorship to senior professional managers/leaders and startup founders, I have tried to put together a list of things that organizations can attempt (especially the young ones which are in the process of setting up/scaling) with the hope that they will attempt to implement some of these and discover what needs to be tweaked for their specific needs.

  • First and foremost, Founders and top leadership must recognize that in today’s world it is talent / people who “make or break” organizations. People cannot be treated as “Plant and Machinery” that you can replace overnight and it will start producing results!
  • Look for the ‘Best-fit’ talent rather than ‘the brightest and best’ people. Like I often tell my colleagues, 11 Sachin Tendulkars in the team is sure recipe for failure! You need fair balance of various talent and competencies. And they must ‘fit’ into your organization’s Vision, Mission, and Culture
  • Make sure that the organization’s mission is crystal clear and widely understood
  • In ventures where creativity, innovation, and intellectual property/capital equal competitive advantage, the most effective leaders devote at least 40% to people coaching and mentoring the next layer of leadership and retaining top talent
  • Be clear of what talent you are looking for and retaining – one, is to get that clarity and next, is to be able to write out a very thorough Job Description (and it better be initially drafted by the hiring manager and not HR)
  • Emphasize on ‘skill based’ rather than just experienced based – this includes Mind set, Tool set and Skill set relevant for your organization. In tech startups, a problem solving mindset with entrepreneurial sensitivity is very valuable
  • Never hesitate to hire somebody better than yourself – don’t perceive them to be a threat to your position – they only help in making you a better leader!
  • It is advisable to put in place a robust and clear HR policies in place ASAP and in a manner that staff understands and is not ambiguously left to them to interpret
  • Craft an appropriate compensation plan. Not everybody works only for money. In young startups, it is good to be sensitive about what drives top talent to perform and deliver their best. Consider incentivizing them in a tailor-made fashion – it may seem difficult, but not impossible – worth experimenting
  • HR must build a roster of ‘top / valuable talent’. While HR is the custodian of talent, retention is largely the onus of the concerned line manager
  • Make senior managers and team leaders are accountable for attracting and retaining key talent. It must be part of their KPIs. And it must start from the top!
  • There needs to be great clarity of what ‘success’ means to the organization and how they will go about achieving it
  • Performance Management Systems must focus on both; business results and people management goals
  • Establish ‘early warning’ systems. This could include ‘listening tours’ in order to get the pulse of the people. Founders/top leadership must consider having shared lunches with different cohorts of colleagues
  • Have regular ‘open discussions’ with key employees – frequent 4 pm tea-chats. They must feel free to share about what bugs them. Such face-to-face meetings help pick up facial expression and body language
  • Consider having an ‘open door’ policy – a ‘grandfather’ approach where the junior most staff feels safe and free to share her concerns with the founders/top leadership. This would mean having a lean structure without many layers of bureaucracy. Also, there should be perceived notion that employee feedback is taken seriously
  • Make ‘Exit Interviews’ more purposeful and insightful – rather than treating it as a ‘process’ to be completed
  • Don’t panic and give knee jerk reactions like an instant promotion or/and out of turn monetary raise. These are dangerous precedence and will surely come to haunt the company in the future!
  • Constantly revisit ‘what is in it’ for employees’ vis-à-vis competition. Engage people intellectually, emotionally, and even through the physical environment and infrastructural settings at the work place
  • Leadership must stay connected with the staff and seek inputs and feedback
  • It is a good idea to consider ‘culture audits’ to measure employees’ connection and company’s work environment. Some insights may reveal differing views of old versus new employees as well as elder versus younger employees!

At trying times – like now – when there may be a wild hunt for talent and challenge to retain the existing ones, top leadership, team leads and HR in sectors like IT and related technology space are bound to face immense heat and stress. Important not to panic and take careful decisions; especially those which are difficult to retract and leave a precedence trail. It may also be a good time for companies to weed out the ordinary or below average performers from the star ones and look for more ‘best fit’ replacements. A season of talent churn may seem to be all noise and it is the smart leaders who will be put to test – while separating the signals from the noise! 

Thyagrajan K
Founding Team Member and Board Director – International Centre for Entrepreneurship and Technology (iCreate)

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Ethical Dilemma: “Right versus Right”​

While “right versus wrong” are easy decisions to take, it is the “right versus right” that are always a challenge for any leadership.

Some three decades ago when I was teaching a course as a visiting faculty for a part-time Management program, one close to midnight phone call woke all of us at home (given that there were no mobiles then, and landlines could not be put on silent mode!). When I answered the call, I was rather surprised about the caller and his pleading request. He was one of my students and had just seen the corrected final examination paper that evening and found that he was short by one mark to achieve an overall pass for the program – because he scored very low in two other subjects other than what I taught. His feverous appeal was that I consider adding just one more mark after reviewing the paper and that will enable him scrape through – else he may have to repeat a whole year! I asked why he had not approached the other teachers – he said he did, but they bluntly refused to oblige!

I found myself in an awkward dilemma – a spontaneous response would not have been fair – so I bought time for one day and said let me first consult the examination section and see if anything like this is possible and done in the past. Obviously, I was conscious of the fact that I must not land put setting a wrong precedence. When I checked – I got vague responses – all of them leading to saying that it was ultimately up to me as to what I choose to do!

I pondered – if I stuck to my original marks (like my other colleagues did for their respective subjects) then this person would have to repeat a year. I was not sure if he was company sponsored or spent his own savings and if this event will hamper his promotion?! If I just took a more magnanimous stand then this individual would thank me for life (I would of course lecture him as to why he needs to considerably improve at his workplace if needs to grow in his career, etc. and such lax attitude will not take him too far).

Eventually, I did review the paper and graciously gave that one saving grace mark and of course a much longer and stronger lecture than what I had originally planned! Thankfully, some years later when he met me, I was pleased to learn that he was with the same firm, earned a managerial position for himself, and doing decently well. Some ‘unburdening’ of guilt, I thought!

This was a classical “right versus right” decision. It would have been completely “right” for me to not budge at all, and stick to the marks that I had originally given. Also strangely, it would have been equally “right” on my part if I took a broader view of the context and impact on the future of the individual and if it was helping the larger cause – which is what I had eventually chosen to do.

In every sphere of our personal and professional lives we are often faced with the ethical dilemma of taking decisions where there is a “right versus right” situation. With top leaderships in business, politics, academia, and start-up founders – almost everywhere – this is indeed a tough one to handle. Making choices for people who work for you, your customers, suppliers, angels and VCs, and indeed all stakeholders is very hard on the Leadership. Therefore, often times despite all the competencies that a leader may possess, s/he finds herself/himself very lonely at the top.

At another point in time as a part-time academician, I was intimately involved in a debate on whether we ought to be formally teaching “Business Ethics” to aspiring entrepreneurs. Several of my colleagues felt very strongly that it is a difficult subject to do justice – because in the eyes of the participants, the teacher/facilitator ought to perceived highly ethical herself/himself! Others suggested that while we could expose them with the principles, it may be hard to put into practice in the real world. One entrepreneur commented “in this country just like oxygen, we breathe corruption!……businessmen just don’t have a choice but to just deal with such situations and move on…..”

I thought hard and chose to go ahead – with the hope that we will have some examples to cite from both; old and new generation companies where the leadership has often demonstrated making the hard choices in “right versus right” situations. Although not many, but we actually found some cases/narratives and anecdotal evidences.

I felt that even if it not possible every time, if the intent of the top leadership is pursued sincerely and by setting the right examples at the right time, it is likely to yield results. Also, one must remember that not all individuals in position of power are corrupt (and there may be equal or more corruption in private sector than as perceived in the Government!– which is unnoticed and rarely talked about).

Once you are perceived to be a no-nonsense and clean individual willing to make sacrifices but not fall prey to the wrong, then people are generally smart enough to recognize that they better not fiddle around with you. If you happen to be the Founder or part of the top leadership team, then that perception is equated with your organization too.

This aspect is very relevant to young start-ups who are in the process of defining their enterprise values and culture. If they choose to take decisions in the overall good of the organization and the various stakeholders, then the “right versus right” decisions are less difficult to make. But it has to be engrained in every member of staff of the venture – it is not only the onus of the Leadership – although the Leadership must demonstrate and lead by exemplary examples. And it better be done sooner rather than later!

K. Thyagrajan

Founding Team Member and Board Director – iCreate

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Over the years, iCreate has evolved as a “bridge” between “Startup Nation” Israel and India’s entrepreneurial ecosystem. Seeking to leverage innovative, technology-based solutions for the enduring challenges faced by India and the world, iCreate and the Israeli Innovation Authority are working together to support Israeli and Indian startups, entrepreneurs and companies in co-developing new technologies and developing mutually beneficial business ties. Together the parties also plan to assist Israeli innovators in adapting their technologies as per the requirements of the Indian market and partnering with Indian organizations to jointly exploit the resulting commercial opportunities.

Indo-Israel-winners

In September 2017, India and Israel joined forces in order to address some of the world’s most pressing social challenges. Startup India and the Israel Innovation Authority invited entrepreneurs, startups, research teams, and people with responsive ideas, to submit their solutions to challenges in the areas of agriculture, water and digital health.  This was the start of the Israel-India Innovation Bridge which is a tech platform to facilitate bilateral co-operation between Indian and Israeli Startups, tech hubs, corporations and other key innovation ecosystem players.

The Hon’ble Prime Ministers of India and Israel launched the India – Israel Innovation Bridge on 6th July 2017 at Dan Hotel, Tel Aviv, Israel. At the end of 2017, the Platform hosted a bilateral innovation challenge calling on Israeli and Indian Startups to combine forces to develop solutions for critical challenges in agriculture, water and digital health.

Within each of these areas, two problems statements have been identified.  Winners were announced in December and presented to the PMS of both India and Israel on 17 Feb.

The first agriculture challenge aimed to attract solutions to solve the problem of post-harvest losses. The winner was Amvicube who provide intelligent IT solutions for the proper determination of the quality of rice without dehusking it. Paddy Analyser, a product they developed, helps farmers segregate the rice produce with maximum precision.

The runners up in this category were Yuktix and Amber Solutions both of whom provide alternative solutions for warehouse monitoring in order to maximise storage time of harvested produce.

On the Israeli side the challenge was won by Amaizz, an agritech company developing and providing post-harvest solutions for reducing food losses due to inefficient drying, storage, and refrigeration.

Runners up were BotanoCap who make environmentally friendly agricultural products and Biofeed who have developed a pioneering control technology that, without harming human health and the environment, enables users to continuously control pests

The second agriculture question challenged start ups to improve farmers’ income.  The winning innovation by RF Wave Technologies is a soil moisture scanner that enables effective irrigation scheduling. The technology helps maintain the prescribed water height for the plants at each growth stage and the required soil moisture.

The runners up Jagadeesh Henjarappa and Vignesh Ravichandran developed solutions to increase the efficiency of photosynthesis and scan plants to determine what course of action is required respectively.

The Israeli winner is Saillog, offering an artificial intelligence-based solution that enables farmers to identify and treat plant diseases and pests.

SupPlant who provide real-time data from all crop sensors in one, easy-to- use application and Seed Tech Temed who developed and patented a novel technology for enhancing seed germination and growth are the runners up.

The water challenges required start ups to innovate the in areas of point-of-use clean drinking water and treatment of large scale waste water.

In the drinking water category Pure Paani are an NGO who deliver portable, hand-operated filtration devices that can be used repeatedly by a traveling service provider or a ‘microentrepreneur’. By providing single-serving filtration, they will cater to low-income families that do not have access to clean drinking water.

Runners up are wOceo Water who provide drinking water solutions at 1Rs per litre in monitored household filtration machines and Karthikumar who is developing a paper which can detect the amount of contamination in drinking water.

The Israeli winning company was SunDwater who have developed a standalone distillation unit that requires no infrastructure or external energy source, and is capable of converting unsafe water or saltwater into potable water for consumption or irrigation.

Runner up Lishtot developed a water quality monitoring machine and Aquallence whose water purification systems utilize low energy and ozone technology.

The wastewater solution was innovated by Innotech Technologies Ltd who have developed a unique treatment process for waste water using bio-electrochemical systems and recovery of value-added products.

Runners up in this category were Vanita Prasad with a process of making Anaerobic Granulated Sludge and Rinaldo John who aims to provide a constructed subsurface flow wetland system, using Heliconia angusta to treat greywater.

Maagan was the winning Israeli entry to this challenge.  Maagan is a global leader in the manufacture of innovative filters whose ground breaking double fibre filters present a new approach to fine fibre filtration.

AMS Technologies who develop and market chemical- and temperature-resistant ultrafiltration and nanofiltration membranes and Aqua HD whose closed system captures and removes suspended solids from flowing liquid in a continuous, hydraulic manner were the runners up.

In the medical category, the first challenge asked start ups to find new solutions for real-time health monitoring, home care, remote care, periodic counselling and advice on health management for Non-Communicable Diseases.

The Indian winner was iLove9Months, a start up who have developed an app that is a one-stop for pregnant women and helps them take the right choices during those 9 months.

The runners up were Innov4sight Health and Biomedical Systems and Zeolr Technologies.  Innov4sight have created an integrated digital health platform for fertility care.  Zeolr have developed a platform which helps manage asthma and COPD management.

The second challenge was to find innovative, inclusive, low cost diagnostics and predictive solutions in rural areas.  iCreate incubate Bioscan won this category with their innovation of a non-invasive, fully computerized, and battery-operated tool for instantaneous detection of intracranial bleeding onsite.

Runners up in the category are Mercuri Technologies who have developed novel technology for quantification differentiation of DNA and Ujjwaal Bhardwaj who has a patient monitoring app whose Tuberculosis Monitoring and Encouragement Adherence Drive is aimed at patients who stop their medication midway due to various reasons.

The co creation seminar for all of the winners began on Monday and Tuesday with a programme in Delhi led by Invest India.  After being felicitated by PM Modi and PM Netanyahu on Wednesday the winning participants for the agriculture and water challenges continued their cocreation at iCreate with field visits, panels and joint cooperation whereby some agreements were reached between Indian and Israeli companies to cooperate in the future.

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iCreate will be incubating the winners of the agriculture and water challenges at their business incubator and will be participating in the return trip to Israel in 6 months’ time where the results of the cooperation between the 2 nations and the start ups will begin to show fruition.

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Value, like beauty, lies in the eye of the beholder!

Why it is important to always keep listening to the ‘voice of the customer’

iCreate-customer

 Each time a young aspiring technology entrepreneur walks up to me and says “I have a brilliant idea that can change the world”, I start getting worried! Even a brief probe then, invariably reveals that the young aspirant wants to pursue this idea because s/he faced a certain problem and could not find a ready solution and now thinks that the solution (idea – yet to even arrive at a ‘proof-of-concept’ – PoC stage) is not only going to solve this problem but in fact, the whole world is dying for this incredible value position to arrive!

This is symptomatic of most technologists who get a ‘kick’ out of solving a technical problem and presume that there is a ready market waiting for their solution. The truth, unfortunately, is far from it! Starting out to solve a problem without listening to the ‘voice of the (potential) customer’ is a guaranteed recipe for failure. This, is in no way to undermine the brilliance and technical capabilities that the individual and the team may have in indeed building a very good product or service. However, most young entrepreneurs (especially those who start off without any work experience or exposure to the real world of business) come to discover the harsh truth after having staked considerable time, effort, and money – more importantly career opportunities – in the hope that they will become a unicorn very soon, the media will write exciting stories about them and they would have ‘arrived’ in the name and fame world.

Getting under the skin of the customer is the most crucial piece in any entrepreneurial venture -irrespective of whether it is a technology based one or not. The more the entrepreneur understands and lives through the ‘pain-point’ of the customer, the more s/he is likely to craft an appropriate value proposition for the customer. And mind you, the ‘customer’ here implies not just somebody who sees/experiences/uses the value of the solution but has both; the ability, as well as the willingness to pay for it.

Working with customers in the earlier phase of ideation and iterating to fulfilling what might be the bear minimum customer expectation, is the starting point. No product ever arrives at the ‘final version’ in one go. It is often a long, painstaking journey with multiple iterations and tweaks even before one can ‘pilot’ it on an alpha (early adapter) or a beta customer.

With ‘products’ more particularly (as opposed to services), there is an emerging concept of co-creating  – which means constantly engaging with the actual user all the time before one arrives at a reasonably acceptable PoC and probably have a few samples or mock-ups that can be ruggedly tried and tested under various user conditions. Productionising it and going-to-market is a completely different next big challenge and very complex as opposed to coming from idea-to-PoC.

My motivation to write this piece is that I increasingly find a number of bright young girls and boys wanting to ride the tech entrepreneur band wagon in haste and unrealistic hope. While it is certainly good to dream and aspire to become a successful entrepreneur someday, and make a difference to the world around us, one must tread the path with care and caution. Not every bright engineer or scientist is cut out to be an entrepreneur and neither does the ability to solve or crack a complex technical problem automatically guarantee that you turn out to be a successful entrepreneur. There is a lot more to entrepreneurship than merely being able to master technology. One must be careful not get romanticized with the idea of entrepreneurship simply because every morning newspaper carries a success story of a startup having raised millions of VC dollars or having won an award.

For now, I wish to stay with just this one message – start with the customer, and not with the technology that you think you are great at – your chances of success then, are likely to be so much better.

Written by Thyagrajan k

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The Entrepreneur in Each Child

Every child has the potential to be an entrepreneur. And, entrepreneurial skills are basically nothing bur life skills.
kids-entrepreneur

Contrary to popular thinking, entrepreneurial skills are not necessarily innate, but that they can be taught. The current educational system neither imparts life skills nor does it foster creativity. In fact, children are taught to focus on tasks in a set manner adhering to stipulated guidelines. Such kind of definite solution related learning does nothing but hamper enhancing life skills like independent thinking and creativity.

Young ones are blessed with the ability to dream and moreover believe in their dreams. Such strong is their belief that it enables them to push forward relentlessly, sometimes with a little motivation, to achieve their dreams. They have a solid confidence in their own abilities and a belief that anything is possible.

Exposing children to entrepreneurship enables them to develop skills like creative thinking, accountability, responsibility, networking, respecting money, fearlessness and problem-solving abilities to name a few.

When these traits are actively encouraged, it leads young children to develop their innate skills. This, in turn, helps them realize their personal potential and give them the grounding for a fulfilling career in later life. These life skills are a very important facet of an individual’s character whether they choose to become employers or employees.

The World over there are many successful kid entrepreneurs. And, parents played a very important part in their becoming successful.

Enroll your child’s name for program named “Entrepreneurial Peekabo launched by International Centre for Entrepreneurship and Technology  for more details, drop an email on info@icreate.org.in

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iCreate at U.S.- India Business Council

The U.S.- India Business Council (USIBC) had its West Coast Summit in San Francisco on 8th May, 2017 which had American and Indian entrepreneurs and businesses taking part in it. The Summit was intended to provide an opportunity to discuss current and pertinent issues in the US-India technology partnership such as IoT, smart city planning, India’s move towards a cashless economy and the future of the US-India technological relationship and had focused on fostering initiatives for a better India.

USIBC-ICREATE-1

The summit in Silicon Valley was attended by approximately 200 senior-level business leaders and investors including those from amazon, PayPal, Deloitte, facebook, iCreate, Nuveen, mastercard, Mobility Infrastructure Group, Varian Medical and Visa Inc

It also witnessed the presence of Leaders from government of India (Andhra Pradesh) Chief Minister Shri. Chandrababu Naidu, Ministry of Food Processing Industries, Minister Harsimrat Kaur Badal, and Ministry of Electronics and IT, Secretary Aruna Sundararjan who understand the urgency to bring about digital transformation of India. Shri. Naidu was awarded the ‘Transformative Chief Minister Award’, in recognition of his achievement in championing US- India ties in the areas of trade, politics and culture.

With a prestigious line up of speakers including government, prominent businessmen and entrepreneurial ecosystem innovators, the summit was a great success. International Centre for Entrepreneurship and Technology (iCreate) was proud to be the knowledge partner for the summit and was represented by CEO Anupam Jalote who spoke about the importance of continuing technological innovation and the potential for Indian and American entrepreneurs to collaborate.  Mr. Jalote said: “A new wave of “deliberate entrepreneurs” are leaving corporate careers, evaluating opportunities and starting up”.  He added that the next wave of non-IT innovators will “shatter price barriers and bring solutions to the reach of millions who could not dream of them before”.

iCreate and USIBC will now embark on a journey of collaboration which brings together the best of both the worlds:  USIBC members offer access to cutting-edge technology along with capital and iCreate brings the exciting entrepreneurial spirit of Gujarat.  The innovation centre will enable start-ups and entrepreneurs to build smart cities and IoT-based solutions to meet the Indian market requirements.

This journey started in December 2016 when CISCO began its partnership with iCreate building a state of art IoT Innovation hub to develop and customize solutions for digital technologies at iCreate’s Ahmedabad campus.  Mr. John Chambers, USIBC Chairman and Cisco Executive Chairman said: “An institution like iCreate taps into the entrepreneurial spirit of Gujarat, providing the younger generation with opportunities for employment and financial prosperity. Following Cisco’s partnership with iCreate, I am pleased to be part of the innovation and entrepreneurship dialogue between USIBC and iCreate”.

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With a unique, world class and brand-new facility in the heart of Gujarat, the heartland of Indian entrepreneurs, iCreate is perfectly positioned to be the ecosystem leader and spearheads the efforts to integrate American and Indian technologies to burst price points and produce en-masse the products required to bring socio-economic and environmental change to India.

USIBC-ICREATE-9

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INTRODUCTION TO THE TOPICS OF GRAND CHALLENGE

It is 2066. You are now old. Times have changed radically; technology has moved on, food is scarce, and water has nearly run out. Only the rich survive, there is pandemonium all around and what future we thought there was, … Continue reading

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Aligning Passion – Creating a ‘Win-Win’ for the Employer and the Employee in a Start-Up

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Start-Up Fair: Winter 2015 by icreate and Venture Studio on December 06, 2015 was officially rolled off with an excellent speech by Mr. Pavan Bakeri, Managing Director – Bakeri Group. Mr. Bakeri highlighted how Gujarat is emerging as an entrepreneurial … Continue reading

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Don’t Wait, Rush Now – Last 2 Days To Join The Excitement!!

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Are you still wondering what is Start-Up Fair: Winter 2015? We thought let us help you  know more about it. June 27th and 28th 2015 witnessed the 2 day Start-Up Fair for Students and Nascent Ventures organised by icreate. This … Continue reading

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