God is in the details and other lessons from a mentor

Don’t tell me how our customers love us. Tell me when we’ll have the purchase order!

DSC05104Every Wednesday morning, we’d have an Ops meetings at Impulsesoft, my first startup. M. Chandrasekaran (aka Shekar) our Chairman, who functioned as de facto COO and at times CEO when I was overseas, presided over the meeting. As a boot-strapped startup which relied on customer payments to pay the bills, these meetings were critical to get a sense of when we’d ship, when we could bill customers and when we’d get paid. The fact that Shekar was approaching 50 while the rest of the leadership team (excluding yours truly) was approaching their late 20s made for interesting dynamics all by itself. . We were shipping a wireless protocol stack (a piece of software that would allow Bluetooth to work) to some of the world’s largest technology firms – Acer, Panasonic, Siemens and trying to sell to Ericsson, IBM, Logitech. This meant long selling cycles often involving technical evaluations and demos. The fact that 100% of our target customers were overseas added its own challenges to both marketing and sales process. So all too often the discussion would come down to where things were at in an evaluation, when we think the customer might make a decision, then issue a PO, against which we could raise an invoice (for the advance payment) and even more importantly borrow from our bank!

So every so often Shekar had to remind us to get our heads out of how well things were going in an eval and to get us to focus on the outcome – the ruddy Purchase Order (or PO). As a business there were several critical lessons Shekar taught us, despite many of us dreading or alternately resenting the Wednesday morning meetings. In hindsight some of these seem self-evident, but its well worth remembering as well occasionally being reminded.

Actions speak louder than words Whether it’s a customer telling you he loves your product, or your company or even you, does he show that by buying your product, referring others to it or caring enough to give feedback that makes your business, product or you better. By the way this was a lesson he taught us not just about business or customers but in our own lives. Shekar was never late to a meeting and amply demonstrated through his actions how he valued punctuality and the worth of his word.

Keep the end in mind We were a business first – not that you’d have guessed this easily in our early days! We were far too busy having fun building cool tech (we demonstrated a working prototype of a Bluetooth-enabled watch as a phone accessory – what today Samsung and Apple ship as a smart Watch, back in 2004!). Businesses that make profits tend to survive and keeping in mind that’s what we were doing required frequent reminding. This too applied well beyond customers and revenues, whether in hiring folks or in personal lives, be it choosing a career path, making an investment or finding a life partner.

God (or the devil) is in the details This is the single biggest lesson Shekar taught me and I find myself in turn, with far less success, trying to teach young entrepreneurs. Know your business, know your people, know yourself and pay attention to the devilish details that demonstrates that you know these well. In these Wednesday meetings Shekar, would always start with a blank piece of A5 paper (a letter-size paper folded in half) and list the top 5 items – despite our having these on emails, Excel sheets and elsewhere. Similarly the top 5 or 10 outstanding deals, be they invoicing, billing or collection would be written from scratch on this piece of paper. What initially seemed archaic or quaint at times, was a real lesson in having the details of our business, at his fingertips. Regardless of how complex our businesses are, there are usually not 4-5 critical things that need our attention – and we’d better know what these are at all times. What did we bill last quarter/month/week or how many users/customers downloaded our application to what our attrition rate last month was – there’s a variety of metrics that govern our business. While the advent of SaaS businesses has introduced a whole slew of metrics to young entrepreneurs, far too few entrepreneurs and founders seem to know the details as well as they should.

All these lessons were invaluable in my own personal life – whether its’ remembering an anniversary or spouse’s birthday (devilish detail), articulating or demonstrating our love or gratitude (actions louder than words) or holding your tongue or retort with a child or customer (keeping the end in mind). Thank you Shekar, for being a patient and perseverant mentor and teaching all of us so much. I’m grateful for having you in my life.


This is the first entry in my 30 days of gratitude series.

30 Days of Gratitude

As yet another NaNoWriMo opened on November 1st, my thoughts turned to what other things could be done in the next thirty days. Om Malik’s resolution in October to do 30 days of blogging was also lurking in my mind. For some time now I’ve planned to write about all the mentors who’ve helped me – not just with business but with life as a whole. The posts are intended to say thanks as well as share what it is I learnt from each of them.

So starting Monday Nov 3, I’ll be writing a short post – featuring one mentor – I’ll try to alternate recent mentors with some of my earliest. You can catch all the posts under the tag gratitude. Join me in expressing gratitude by sharing stories of your mentors or folks who’s helped you.


You can read all the posts in my 30 days of gratitude series here.

1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 |

Should I start my own business?

Should I start my own business?” If you have ever found yourself asking this question, you are not alone. And rarely does this question arise by itself — on its heels, many more rush in. “How do I know it’s the right thing? What’s the first thing I should do?” A simple search on Amazon or Google with the words “Starting your own business” provides 738 books and over a million hits respectively — in a sense, this choice of plenty only seems to add more questions beginning with, ‘Where do I start?’ The best answer to this question is the simple one — start with yourself!

Before you try to figure out, “How do I raise money, or should I get a patent first or do I need partners?” the first step to answer the question should you even start your own business, is to better understand yourself. While some reflection is needed, this is not so much a philosophical or metaphysical exercise as much as answering three simple questions about yourself. You may have never taken the time to think about it and even if you have asked yourself one or more of these questions, never had the opportunity to step back and answer them. Certainly, once you start your own business, you will not have the luxury of time to answer these in any detail.

N.S. Raghavan, former joint managing director and one of the founders of Infosys, narrates a story about a young man who approached him seeking advice. “I have a job offer from Infosys and an option to start my own business — what do you think I should do?” When Raghavan responded, “Take the job with Infosys,” the youngster was taken aback. In Raghavan’s words, “If you are an entrepreneur, starting a business is not an option that you consider alongside taking a job — you’d just do it!” To dive in, or to ‘Just do it!’, as the ad exhorts us, is easy — staying the course, not drowning and not ruing it along the way — is the hard part. Let’s ask ourselves those three simple questions.

Passion

Ask yourself, “Do I feel passionate about this? Will I feel as passionate about this a week from now? A year or five years from now?” If the answer is anything other than yes, you might want to keep that resume polished. When you ask yourself, “Do I feel passionate about this?” — ‘this’ could be a product — a low maintenance, low-cost, yet effective water purifier that four-fifths of the world needs; it could be a service — ball room dancing instruction for high-schoolers; it could be a concept — helping farmers in your hometown reach customers worldwide directly — or nearly evangelical — fresh water to every village in your state/country — it could be anything, as long as the fire of passion within you burns undiminished for long periods with little or no kindling. This is a good question to ask first and have answered in the affirmative before starting your own business. Do not confuse passion with being right or knowing something — passion is primarily believing and wanting. Once you start your business, you will learn more ways of being wrong than you’d thought possible.

Risk-taking

Being an entrepreneur, which is what you’d be if you start a business, is a risky proposition — probably not as risky as skydiving or crossing a busy road in Bangalore during the evening commute. Most businesses last longer than a skydive and are fraught with challenges. So the next question to ask yourself is how risk averse you are.

Risk means many things to many people. Most people think primarily of financial risk — this, while certainly measurable, may be the least important. Often there will be others to bear the financial risk with you.

However, the time you personally invest, the emotional energy that would be required of you individually and most importantly, your self-worth, will be the bigger risks you will be taking.

These will be largely immeasurable but have far greater import on the rest of your life. So if you have never taken off for the weekend on a whim, usually get to the airport three hours ahead of schedule and have never run a yellow light, it is worth figuring out what your risk appetite is.

Perseverance

Call it whatever you want — doggedness, perseverance or relentlessness — to be an entrepreneur means continuing in the face of constant discouragement by the world around you.

Often it would seem as though everyone but you feels it makes no sense to continue and yet you persist. Investment bankers who have yet to begin shaving will offer you advice. Your spouse, your engineering manager (and her spouse), that cheeky long-haired fellow in customer support not to mention your suppliers and even customers will question, critique and challenge you.

So if you haven’t been called pig-headed more than once in your life or find you cannot last through one session of working through the “simple” income-tax form or are discouraged by having to make the same presentation for the 17th time, some work may be needed in this area.

If you answered in the affirmative to the passion and perseverance questions, you are ready to start a business.

Should you actually start one, your chances of being successful at it or even enjoying the journey, will be determined by your answer to the risk-taking question. Luckily, for us, unlike the Prince of Denmark, it’s a little easier to answer the question, “To begin or not to begin?”

This article first appeared in The Hindu BusinessLine in Dec 2007.

Startup Founder Secret #2

StopwatchOne of the challenges in getting advice – even when we agree with it – is figuring out how in the heck are we going to find time to follow it. As an entrepreneur or founder, you’ve got enough and more on your plate – so while it’s great to hear you should meditate, how do you squeeze it into your insane calendar (you do have one don’t you?)

This is a secret that I learned from Stephanie Winston, organizing guru from her book The Organized Executive.  In three words it is

Meetings with yourself

Notice, when you have a meeting with a customer or prospect, a candidate you are trying to hire (or in some cases when a critical person is threatening to leave) you drop everything else to take that meeting. Look around you – your day is probably filled with meetings – product reviews, vendor negotiations. In fact if your day is anything like a typical founder’s day – meetings are the only thing that seem non-negotiable and you have to fit in your other tasks in to little time chunks between meetings. So rather than let this get you down, start by marking meetings on your calendar, with just one attendee – YOU!

This is a great way to get that blog post written, contract reviewed or to even meditate. It most importantly prevents you from using this time to take other meetings. So start now, and mark your calendar up for the next two weeks – or if you want to be bolder for two months – with a daily 20 minute meeting with yourself to meditate, or twice weekly to blog or fortnightly for date night with your significant other. Let me know how it works.


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5 Lessons from 40 Years of Entrepreneurship

Romesh Wadhwani, founder and Chairman of the Symphony Technology group, shared five lessons about entrepreneurship that he’s garnered from his 40 years of being one at the recent TiECon 2014 Conference.

His five lessons were:

  1. Creativity Entrepreneurship is about creativity – whether in products, business models, companies. And entrepreneurs need to be creative, passionate and tenacious.
  2. Learning particularly from failures. As he puts it “inside every failure, there are the seeds of future success”
  3. Renewal Even when successful, its important to constant renew and reinvent, to grow and to succeed personally & professionally
  4. Building great companies – entrepreneurship is not (only) about exits. As he puts it “When you build great companies, great outcomes will happen.”
  5. Celebrating success particularly – can be done in a number of ways. Some focused on yourself – whether in things you acquire or do but a better way is to help others – impact the world positively, in whatever manner, big or small. Your legacy is the impact you have on others.

Enjoy the video Romesh’s speech begins at 17m50s !

 

3 Things To Look for in a Co-founder

Co-founders

Photo: MyTudut

Almost soon as I made the case why you need a co-founder, a friend responded with the question “What should I look for in a co-founder?” While we’ve asked this question of both entrepreneurs and angels, here’s my take on what you need to look for in a co-founder.

Vision Match Building a business is often a long hard journey, and you want to make your that your partner or co-founder shares your vision. As setbacks occur (which they will) or when money seems hard to come by, customers leave, milestones slip or worse yet when things work, and especially when you seem to be making more money than you can keep track of, having a shared vision will ensure that things stay on even keel. If there isn’t a shared vision of why you are running your business and what it is you seek, as a company and as individuals, it will be difficult to survive every fork in the road that you’ll encounter. And you will encounter far more than you can imagine. So make sure your visions match.

Complementary Skills All too often we end up hiring or connecting with people who are just like us. While that’s nice, its far more important to find someone who has complementary skills – someone who’s comfortable talking to prospective customers or selling, if you are building a product. Someone who can manage projects or money, if you are out there focused on selling; someone who’s comfortable writing or documenting while you are out there hustling or building. Usually startups require everyone to be as hands on as they can, especially co-founders and it can really help, if they can do things you can’t or do them better than you can. So make sure that they not only have shared vision but can do things you can’t!

Honest & Open Communication The nature of startups is such that you will screw up. Heck so will your co-founder and more than once. So it’s important that your co-founder and you share a healthy interpersonal relationship – one not just based on mutual trust and but on honest and open communication. If you walk around each other, either too polite to raise uncomfortable topics or avoid conflict or confrontation at all costs, lots of important issues will not get sorted out in a timely manner and that’s something no startup can afford. So it’s really important that you feel comfortable around you co-founder that either one of you can raise issues that bother you and can be talked through to resolution. Only with honest and open communication can you keep one another honest, not to mention your business out of trouble.

Here is Sanjay Anandram’s take on what to look for in a co-founder

Meanwhile to make sure that  your prospective co-founder & you are aligned on

  • a shared vision of the company and its raison d’etre
  • what complementary value each of you bring to the table
  • talking openly and resolving matters through timely and effective communication

So go out there and find that co-founder. Good luck!

Keep your needs simple – Lessons from my dad

Bench

Photo Credit: visualpanic via Compfight

“Why do you take the bus? Couldn’t you at least take an auto (3-wheeler cab)?”

My father never stopped asking his friend, a Gujarati Jain gentleman, this question each time he visited. Even the times he did come to our doorstep in an auto, my father whispered to me conspiratorially, “He probably took the bus to Adyar and took the auto for the last kilometer.

The said gentleman, had like my dad, landed in Chennai as a teen with less than Rs. 10 in his pocket. He’d then gone on to amass a considerable fortune in the plastics business. Yet, he maintained a disarmingly simple, nearly spartan, lifestyle. While my father pulled his friend’s leg about his frugality, his own actions were not all that different.

As kids we were always embarrassed, when my father would order idlisambar – steamed rice cakes with spicy lentil – at even the fanciest of restaurants. Likewise we were flummoxed that he’d check in at the 5-Star Taj hotel with his boss, but choose to spend the night at his sister’s duplex in Karol Bagh. It took us more than twenty years to try and get him to wear anything other than the white shirt and pant that he wore every day to work – even then we only managed to get him try solid pastel color shirts!

My dad lived and breathed his belief to keeping his needs simple. Without my realizing it he’d trained me from day one to be an entrepreneur. Not that I was a good student. In my first foray at being an entrepreneur, I blew nearly $250 (yep, dollars) on business cards. Let’s just say I was a slow learner. But luckily I returned to my roots – when we bootstrapped our first startup. We didn’t buy a computer, we didn’t hire a coder – we began pitching customers. We kept it simple – emails and presentations. We operated out of my co-founder’s apartment and held day jobs while we tried to land our first paying customer.

The lesson I learned was not just frugality but to keep every element of life (and business) simple.

Keep your 

  • business simple, so others understand it. Stay focused
  • offerings simple, so customers just get it
  • pricing simple so buying what you sell is easy
  • cash tracking simple – know where it goes, what you need and have
  • organization simple – so your team is clear about their roles & what’s expected of them
  • life simple – early to bed, early to rise, love, affection & exercise

Thanks dad!

Simple Sales Tracker for Startups

This last quarter, I met several interesting startups, that had a clutch of good customers. When I asked them “How can I help you?” at least three of them asked for help with sales. Not what you’d think, as in find me customers or introduce me to prospects but how do I manage my sales pipeline. In fact two of them specifically had the question “How do I track my sales pipeline?”

Over the last several years, while I’ve used a variety of  tools from mere contact managers through sophisticated deal trackers to full-fledged CRM suites, I’ve found myself returning each time to a simple spreadsheet-based sales tracker, at least in the early days. The tracker has not only evolved as I’ve learned but stayed surprisingly simple and has worked just as well in a fund-raising function at non-profits as it has in a for-profit startup.

As I promised these founders, I’m open sourcing the sample tracker as an Microsoft Excel spreadsheet as well as Google docs template. The tracker can be used for selling products or services or combinations thereof. You can download it here.

The tracker has three parts.

1. Setup – your business basics

Based on the nature of your business (product or service), actual sales offerings and the sales process your business may have to follow, you can tweak the setup. All this is done in a single worksheet (the last one, titled “Stages, Categories, etc.” of the online sales tracker). This one time set up of your product or service offerings, your sales persons (or deal owners), and stages of your selling process, makes maintaining your sales tracker easy and minimizes human or data entry errors.

Sales Stages

Figure 1 – Typical Sales Stages

Sales stage this is simply the series of steps you have to go through from start to finish to close a sale. It begins with you first identifying a potential target customer for your product or service and runs all the way through receiving payment from the customer (never forget collecting the money is a critical part of making a sale).  Figure 1 shows one such typical sales cycle.

sales_stages demo

Figure 2 – Sales stages for a demo-based sale

Sales stages obviously can vary for your particular business – one common variant that I encounter is when a demo installation or trial period needs to be offered to a customer (something you ideally want to get away from, but unavoidable particularly at tech startups in the B2B space). In this case there may be more interim steps (or stages) in your sales tracker.

Similarly you can set up your product or service offerings, as in actual names or code names that tell you what product or service you are talking about.

Tip: Typically I’ve found it useful to precede the offering name with a numeral such as 1-Bluetooth Stack or 2-SEO Consulting, as this makes sorting and other types of numeral based operations easier. For instance variants could all be numbered within say 100-200 so reports can be easily generated.

2. Sales Tracker
The sales tracker is a straightforward spreadsheet, with each prospective sale or deal on a separate row. For each deal, the row (or record) spells out, who the customer is, what is it that’s being sold (opportunity or offering), what revenue (or selling price) you expect, what sales stage is the specific deal at, who owns the deal and what the target close date is. You can of course have additional fields such as comments, or next steps, key customer contact. Figure 3 below shows a sample tracker for product sales.

Sales-tracker

Figure 3 Sales Tracker

The tracker also has variants of the sales tracker, if you need to track number of units (N) and have a unit price (P) and therefore compute deal size based on NxP (tab, Sales_Tracker_B_Units). Similarly there’s a tracker variant for service or project selling, (tab, Sales_Tracker_C_Project) where you can add descriptors for a project in addition to any opportunity or offering name you provide. Of course your business may require yet another variant, but you can simply by adding columns make the tracker your own.

By using the Filter function in Excel, you can look up deals

  • of a particular size or greater
  • expect to close prior to a specific date
  • belonging to a particular sales owner or product (or both)
  • at or before a certain sales stage
  • that have closed but you’ve not gotten payment

In other words, an individual sales guy (that’s you) can see which of his deals he should focus on this week to close, what is the value of deals you intend to close this month (or week or quarter), which deals have NOT moved for more than a month – you get the idea, you can pretty much filter it any way you need.

3. Summary Report

Master Report

Figure 4 Report Master

The first tab Report_Master, is a quick overview report of your sales pipeline. It presently has both #deals and deal value by sales stage. I’ve set these up as formulas – these could just as easily be set up as pivot tables if you so desire. You could do without this master report sheet, by merely filtering the sales tracker sheet itself. Alternately if you find that you are running some searches often, you can just have them set up as reports. Its also useful to have a report if you multiple folks are using the tracker and you want a big picture view.

Good luck with your sales – as and when you make improvements do share and spread the love and knowledge. If you have any questions please feel free to ask questions in the comments below. Spread the word. Happy selling!

2 Ways Growth Can Kill Your Startup

A popular Frank Sinatra song speaks of love and marriage going together like horse and carriage. The words startups and growth seem to be used much the same way. Recently I moderated a panel on “Why some startups grow and others don’t” at the TATA First Dot powered by NEN student startup showcase.

One of the questions that came up during the discussion was

Is growth always good? Are there instances when growth can be bad?”

The panelists all agreed that NOT all growth is good growth. Specifically,

Non-focused growth Naga Prakasam, angel investor and mentor, brought up the point, that growth unless directed and focused can easily derail a startup. So growth in revenue, even when profitable, could turn out to be bad in some situations.

One of two things most commonly happen

Revenue consideration – as a cash-strapped entity many startups chase any and all revenue – so you have product companies taking on services or service firms taking on non-core functions – pretty soon the organization is pulled in many directions with people stretched either too thin or into areas that are not their strengths

Customer retention – you have a major or important customer for whom you provide specific products or services. They want you to support them doing something that another vendor is doing – for instance in my first startup we did only Bluetooth software. However our customer, one of the largest accessory makers in the world, wanted us to help them with IT support too. Luckily we turned them down even though the risk of losing our core business to their IT vendor loomed. (Of course their IT vendor claimed that they could do Bluetooth software as well – but that’s a whole another story 🙂 Such growth, unless planned as part of a larger strategy, will eventually end up hurting the customer and your business, as you take on things for which you either don’t have competence or distracts you from your core business.

Non-profitable growth In the semiconductor business, we’d always joke about “making it up in volume!As airlines, magazines and mobile phone companies learned the hard way, growing non-profitably, especially when you lose money on each sale is not a good thing. In  fact, the more growth you have the more money you’ll lose (or burn through) and rarely is the outcome pretty. Sure, there are times you have to get your foot in the door, enter a new market, test a new product when you will lose money – but hopefully that’s well planned and the downside is contained. Either it allows more profitable products to be sold or customers to be acquired and cross over from loss to profit making, when some volumes are attained (or fixed costs or amortized).

Growth, when focused and profitable is good. But when neither can easily hurt your startup and possibly kill it too!