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Much like riding a bicycle or swimming, with entrepreneurship too, no amount of study or theory can take the place of plunging right in. Yes, some scraped knees, water swallowed and spat out and wounded egos are likely to result, but nothing helps you learn like real-world experience.

Over the past several months, I have tried to walk through a typical, if there is any such thing, life cycle of an entrepreneur. From when the thought to start something first lodges itself in your mind through all the way to exiting your business, the entrepreneurial journey is a roller-coaster ride on steroids. As happened with me, and every parent prior to me, you are clueless when people tell you, “Your life will change once you have children.” They could just as well be talking about being an entrepreneur. All the reading, talking and thinking does not prepare you for it — it’s messy, sleep-depriving, unpredictable and will make you want to cry! Yet, it is is exhilarating, scary and fun all at the same time.

Better men and women than I have written oodles about entrepreneurship and start-ups — the how-to, why and wherefore and the blogosphere is a cacophony of advice givers. So is there anything left to say? My two cents is that it is certainly worth repeating the basics, the foundation on which all endeavours entrepreneurial and otherwise rest and build on. And this is what I shall strive to do in this article.

What: It’s the Journey

My accountant used to tell the tale of how, when a youngish man passed away, his brother standing by the funeral pyre had a flash, a rare moment of insight about how ephemeral life is and how trivial most concerns that dog all of us are. Yet, an hour later when he returned home, he chided his wife on how cold the coffee she served was! It is hard enough to be receptive to the flash of insight and nearly impossible to stay in it every moment.

Yet, as an entrepreneur (or as a parent or spouse), it’s worth reminding ourselves that we should accept, internalise and live the truth, that ‘It’s the journey that counts’.

Many of us fall into the trap of posing most issues as an ‘either-or’ situation. If you are not striving, you are complacent (not content); if you aren’t successful, you have failed; if you aren’t paranoid, you will be dead!

Reality, however, tends to be a lot more nuanced, filled with shades of grey rather than just black and white. If we succumb to it, there are endless ways to pull ourselves down even without competitors or sometimes customers doing it. To what most people would say such as “Keep an eye on your goal at all times” (which you should), “Stay focused” (which you should), “Persevere (beyond reason),” my recommendation is to remind yourself each day that “It’s the journey that matters.”

For even if you get where you (think you) want to be, if you don’t enjoy your trip there or worse yet, you don’t get there, it would all have been a waste.

So, write it down, post it on your desk; better yet, make it your screensaver!

Who: It’s the People

No journey is much fun if you have to do it all alone. Of course, having obnoxious, inconsiderate or downright horrible travel companions is probably the only thing that is worse than travelling alone. Entrepreneurs by nature like getting things done and if you are like me, many times, you’ll have the feeling that no one else can do as good a job as you can (not true). So taking on a partner or hiring and training employees will all, at times, seem far more trouble than it is worth, but no enterprise worth its salt has been built by one person, however heroic — even Superman needed Jimmy Olsen ever so often.

The trouble, of course, with people is that they are people, with all their foibles and baggage, social and emotional. Peter Drucker in his book The Effective Executive speaks of making strength productive by not hiring to minimise weaknesses but to maximise strength. He narrates how: ‘President Lincoln when told that General Grant, his new commander-in-chief, was fond of the bottle said: “If I knew his brand, I’d send a barrel or so to some other generals.” Lincoln assuredly knew all about the bottle and its dangers. Lincoln (however) chose his general for his tested ability to win battles and not for his sobriety, that is for the absence of weakness.’

Paul Hawken, entrepreneur, raconteur and teacher, speaking about the people you want on your team, says “… it makes no sense whatsoever to hire any but the best people you can possibly find. Your employees shouldn’t admire you. That is kid stuff. You should admire your employees.” So make sure you don’t travel alone and that you pick your travel companions carefully for their strengths.

How: Don’t forget to have fun

At least three thesauruses that I consulted report the words fun, joy and playful as synonyms. And who am I to disagree with them? Neither should you!

Business, commerce, entrepreneurship — all sound like serious stuff and all too often we treat them that way, but high cholesterol, hypertension and stomach ulcers are a lot more serious. So having fun, being joyful and keeping work playful is important. The real world in the form of payroll, accounts payable, demanding customers and disgruntled employees make it hard. It is the rare business that manages to accomplish this without ceaseless vigil and trying hard. While we may take our business seriously, we had better not take ourselves too seriously. I will be the first to admit that this, like most good advice, is easier said than done.

Nevertheless, the baristas at Starbucks, the concierge at the Windsor Manor hotel in Bangalore and my local barber all live the maxim that work can be fun! There will be enough folks telling you how to do or not do stuff or why you will fail. The easiest way to have fun is to prove the naysayers, who will be coming out of the woodwork daily, wrong. The best revenge at all times, I believe, is having a good time.

So focus on making sure that the journey for the folks travelling with you and for yourself is fruitful, fun and fulfilling today, and other things will take care of themselves.

This article was published in the Business Line print edition dated June 2008

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Whenever I read of a prenuptial agreement, I react viscerally. Not that I am particularly romantic, nevertheless there is a sense of foreboding. Putting in place an agreement should the relationship fall apart, even before the marriage, seems unsettling to say the least. In the Indian context, where marriages are still largely arranged and families actively contribute to heal rifts (and in some instances serve as the source), there is no major downside to a pre-nuptial lack of preparation. However, in the case of entrepreneurial businesses, even those that plan well before starting up, often give little thought to how it might end.

As an entrepreneur, you conceived a business idea and shaped it to meet a large market need. With love and, at times, feelings bordering on hate or insanity you have nursed, nurtured and grown it to a stage where you now have a reasonably stable business. Along the way, you have brought on board employees, partners and other owners who have ridden the enterprise’s roller-coaster ride with you. You are just getting accustomed to the growing pains (which only seem to change and never cease) and look ahead to what’s next. Of course, even if you are not there yet personally, your employees, investors and likely, your spouse are pushing you to figure out what’s next.

I use the term ‘exiting your business’ for this phase of your business. It may involve an actual exit, such as selling your company or even shutting it down or a major change in shareholding (which I deem a virtual exit) such as going public or a significant dilution of equity, ideally with some financial upside for the present shareholders. If you are not hyperventilating by the end of the previous sentence, you are ready to consider what the best manner to exit your business is.

Are there alternatives to exiting your business? Indeed, there are. You could choose — as many of the companies described in Bo Burlingham’s book Small Giants have — to stay privately held and of finite size. This has its share of challenges including the growth path for your senior team members, monetisation of people’s equity and succession planning. As Bo Burlingham puts it “(You will face) the same choice that all successful entrepreneurs are faced with sooner or later, although most don’t realise that there even is a choice until it’s too late.” So how do you ensure that your exit is smooth?

Know thyself

As with starting a business, exiting a business begins with understanding yourself. The good news is that you are no longer the person who started your business. Therefore, what you want today is likely to have changed. Even if you feel it hasn’t, it’s well worth being certain.

Begin by asking yourself: “What is it I want?” Do you want to grow the business to many times the size it is? Do you merely want to cut back on the hours you are working? Do you want to hand the company over to someone else and not be the person with whom the buck stops? Are you capable of letting go? Would you drive your spouse and family batty if you were no longer an entrepreneur here? These questions are all valid regardless of whether you intend to go public, sell the company, shut it down or raise another round of capital.

A recent example of not being clear is when Bill Gates stepped aside to let Steve Ballmer, his college buddy and confidant of decades, take over the number 1 spot at Microsoft. An article in The Wall Street Journal reports that there were shouting matches and even a dramatic walkout by Gates after an argument. According to the paper, these run-ins “paralysed business strategy decisions that the company still wrestles with today.” Eventually, as another commentator observed, “Mr Gates had an epiphany about his own role and stepped back.”

Before you make plans to exit your business, it is important to recognise that most exits are beginnings rather than endings. For instance, if it involves selling your company and you are no longer going to be involved, you’d have to figure out what you would want to do; more importantly, you would have to be clear about what would happen to your employees with you out of the picture. If the buyer wants you to stay, what will your role be and how happy are you going to be in it? How long should you stay? If you are taking the company public or taking in equity, how will having a formal board of directors impact your business or you? And if you are going to shut down your company, what is the fair thing to do by your employees? Most importantly, when do you walk away from any transaction? In other words, what are you not prepared to give up? Ideally, you run through this exercise annually rather than the night after you receive a call about a possible merger or acquisition.

Exit is a project

In the early days of your business, you probably prided yourself on the speed with which you made decisions. And as an entrepreneur, you still have a disdain for all things that seem to slow you down. If so, be warned that exiting your company is a Project with a capital P! It requires serious chunks of your time and 100 per cent of your mindshare at such times. You should run it as you’d run any major project — it may turn out to be the most critical one in your professional career.

In crunch times, most of us revert, almost atavistically, to our native comfort zone. Leaders who come from a sales background view this as a sales deal, technical folk as a test of their technological capability — in other words as a specific challenge from outside that needs to be dealt with aggressively. Usually, the biggest and most non-trivial challenges of an exit lie inside the company.

The communications and people aspects of an exit — from company intent, “Why are we raising money?” or “Are we in trouble?” to the personal, “Will I keep my job? Should I be buying those vested options?” to a possibly critical “Do I want to bother my boss with this minor issue in the midst of all this?” are critical. Your team may not only have a lot of questions but may also be quite distracted, which is not good for the business or the exit. Therefore, having a clear plan, that includes entry and exit criteria (such as when will this project be killed, if at all), objective targets (“What do I consider a fair share price?”), milestones (“By when do we intend to conclude this, either way?”), roles and responsibilities (“Who does what and how?”) and continual tracking (weekly meetings, daily or alternate day calls) is vital.

Regardless of how hard you think the exit project will be, it will be harder still! So get professional help. It is useful to have the buffer of a professional intermediary, who’ll be objective and ensure that the process does not get derailed and keeps you honest. And be prepared to pay them — they’ll earn every dime if you pick them well.

Business as usual

All of us have been in situations when, even as a key customer meeting is running late, we get a page saying that a top technical guy has resigned and our alarm reminds us of a promise made to the little one not to miss her school play again. As we race madly from the meeting, the fuel indicator glows red and the accountant calls to say that the wire transfer has not come in and tomorrow’s payroll is at risk. Now imagine doing all of this while your spouse is not in town, you have a head cold and a twisted ankle. Trying to manage an exit even as you run your business is all of the above and then getting pulled over for speeding by a surly cop.

It is easy to lose sight of the fact that you have a business to run, especially if you find the exit project exciting and exhilarating. But it is important to keep in mind that by the time the day of the IPO or the selling agreement arrives , you had better still have a viable, vibrant business. And this will not happen by itself. When you are sitting across the table from your institutional investors or prospective buyers, it is this healthy business, running as a well-oiled machine, which is going to allow you to be a cool yet formidable negotiator. It is useful to keep in mind that the exit project is just that — one of several in your business and not necessarily one that will be successful.

So keep your eye on the ball and remember your core objective — sustaining and running your business as though you intend to do it for the rest of your professional life!

This article was published in the Business Line print edition in June 2008.

From my tenth article in the Start-up Logic entrepreneurship series in the Hindu BusinessLine

Most people seem to have a reasonable idea of what engineering (design and build stuff), finance (manage the money) or sales (make money by selling stuff) do in a business. Marketing is another story altogether, being confused with sales in the best case or perceived as a money-sucking black hole in the worst. It is likely the most misunderstood part of doing business.

Read the rest here.