Richard Branson: Two Gems

The typical commute in Mumbai is harsh, to say the least. And, listening to insightful podcasts is a great way to make the most of your drive time.

One such talk I really enjoyed was a conversation with Richard Branson, founder of the international conglomerate the Virgin Group. Stephen J. Dubner of Freakonomics fame, spoke with Branson as a part of the series: “The Secret Life of a C.E.O.

While the entire series – including this episode – is worth its weight in gold, here are two takeaways that really made me stop and take notice.

1. When asked if he is actually the CEO of any of his companies, Branson had this to say:

… I’ve delegated pretty well all the C.E.O. roles. And I actually believe that people should delegate early on in their businesses, so they can start thinking about the bigger picture.

 

If I’m ever giving a talk to a group of young businesspeople, I will tell them, you know, go and take a week out to find somebody as good or better than yourself. Put yourself out of business, and let them get on and run your business day to day, and then you can start dealing with the bigger issues, and you can take the company forward into bigger areas, and you can — maybe if you’re an entrepreneur, you can start your second business or your third business.

 

And so I think too many young entrepreneurs want to cling on to everything, and they’re not good delegators.

I can’t tell you the number of people I know – personally – who need to hear this and truly internalize it. An “entrepreneur” and a “CEO” are two distinctly different mindsets. Some folks may be able to traverse the two worlds – fleetingly. But doing both simultaneously, and over a sustained period of time, is nearly impossible. The sooner an entrepreneur makes peace with that fact, the sooner he/she will be on the path to growth and success.

2. When asked about his famed approach to motivating people via employee-friendly policies across the Virgin group of companies, Branson replied:

… Let’s just look at this business of forcing people to come to an office.

 

First of all, you’ve got maybe an hour or an hour and a half of travel time in the morning, another hour and a half of travel time in the evening. And, you know, when you’re at the office, it’s important that you say hello to everybody and that you’re friendly with everybody, so you use up another hour or two, you know, socializing with people. Then, because you’re not at home, you need to communicate with your family. So you spend another bit of time communicating with your family. And so the day carries on and you might get a couple hours of work done.

 

If you’re at home, you know, you wake up. You can spend a bit of time with your family. And be a proper father, which is perhaps the most important — or mother — most important things that we can do in our life. But you can also find the time to get whatever your job is done, because you’ve got another four or five hours free to do it. And you know, we’ve never been let down by people that we’ve given that trust to.

Think about that. How many CEOs or business leaders do we know who are sensitive to the realities of day to day Life, the way the average employee perceives them? And, how many organizations can we speak about that actually “trust” their people to this degree? Work-from-home is just one dimension of this thinking; Branson also talks about a ‘prisoner program’ that Virgin runs to employ current and ex prisoners across roles, including in Security!

In my view, there has never been a better time to access the world’s riches. Insights are all around us, and conversations with folks who have done it all, are just a few clicks away. Some of us will make the most of it and learn from these experiences, while some of us will spend our time watching cute cat videos.

Change Is The Only Constant

The idea of ThinkShop was born way back in 1999, when I first started a web-design studio called UncommonWisdom to work on Internet-based Communication Design. My boutique consulting firm was way ahead of its time, but we were able to deliver some interesting work in the digital space, including digital strategy, website design and UX for enterprise-grade applications.

In its second avatar, ThinkShop began life in 2013, helping its clientele bridge the gap between Idea and Execution, until the end of 2017.

As an independent consultant at the helm of ThinkShop, I was fortunate to work with some of the leading players in Financial Services, Insurance and Education, on projects that included developing Customer Engagement strategy and Marketing Communication frameworks, User Experience Design across multiple platforms, and architecture for a 100,000+ page web presence.

With the beginning of 2018, I have decided to take up an assignment that, once again, offers me the opportunity to apply my skills to problems of scale. With it, I commence a new chapter in my professional life, as ‘Group Head – Customer Experience’ at the Edelweiss Group – one of India’s leading Financial Services conglomerates.

A big Thank You for all the support you’ve shown to ThinkShop and me.

Startup India: Taking Stock

Last month, Mint did a feature on Hits and Misses in the Indian Startup universe. It was a great opportunity to take stock of reality, since most of what we read about in the mainstream media is a function of “survivorship bias”. Here are some interesting statistics from that story…

  • The E-commerce sector alone has raised over $11 billion over the past decade – roughly 75% of the funds that have been raised by Indian start-ups during that period
  • Of the $11 billion, Flipkart Internet Pvt. Ltd has raised more than $4.5 billion, and is now India’s most valuable Internet company at $11.6 billion
  • The top five most-funded start-ups in E-commerce to have shut down had raised $51.1 million in total, which doesn’t include the distress sales of companies such as Letsbuy and SherSingh
  • $3.1 billion (including debt) was raised by Digital Payment startups, making Paytm – now valued at $7 billion – India’s second-most valuable Internet company
  • Of the 192 companies founded in the Cab Hailing category since 2007, 76 have shut shop; Ola is currently valued at $3.5 billion
  • Nearly 310 start-ups in Healthcare, of 2,678 founded since 2007, have shut shop; Practo, 1MG, Portea are the top startups in this segment
  • As many as 2,460 ventures in the Edu-tech / Education space incorporated since 2007; about 224 have shut down
  • Of the 2,420 start-ups founded in Hyperlocal (home services+food tech+delivery) since 2007, 780 have shut shop
  • As many as 514 ventures tried group buying model one way or the other, but at least 221 shut shop

Think about those statistics for a moment; There are plenty of lessons to learn from. Here are some of my personal takeaways…

  1. A healthy dose of funding was available to those who ventured out and attempted to create an organization of value
  2. The best known in each segment typically finds it a bit easier to gain preferred access to investors, markets and customers, simply by virtue of their size and brand salience
  3. Path-breaking, innovative ideas executed well are not the only recipe for success; Addressing a customer gap with great execution at a profitable price point can work wonders too!
  4. Despite significant resources at their disposal, and addressing a real customer need, countless startups did not survive the past decade

For some of you dreaming of launching a startup, posts like these may signify doom and gloom. For others, it will probably provide the inspiration to soldier through.

The fact is, not every venture is meant to succeed and not every startup will fail. “There is nothing in a caterpillar that tells you it’s going to be a butterfly“, said R. Buckminster Fuller. For me, the biggest lesson buried in these statistics is that building a successful organization takes decades, not years. There is simply no shortcut to it.

Just The Beginning

ThinkShop completed 3 eventful years, last month. In that time, we have been fortunate to work with a number of clients on a variety of interesting projects, through solutions that spanned Technology, Business and Marketing.

We helped design the User Experience of a multi-device Trading Platform, and developed a Career Portal for a Life Insurance major that integrates with their Recruitment Engine and call-centres. We performed a Need Gap analysis for a Sales Mobility tool in Health Insurance, and helped define the Project Scope for an Online Securities platform. We conducted a Boot Camp on Understanding Social Media for the senior executives of a leading pharmaceutical firm, and helped develop Marketing Strategy for a startup in Education services.

If there was a common theme running through them, it was that every solution was focused on improving Customer Engagement, with Technology serving the role of an enabler.

These past three years, we have also seen many of you face some common challenges while trying to make sense of an ever-changing world. The Think! blog was meant, in part, to help you gain relevant insights into the Digital world, understand key trends, and figure out viable ways to meet your business needs.

Yes, Mobile has gained significant ground, and Machine Learning is all the rage, but RoI on Digital initiatives continues to elude many, while Business tries to figure out what is the best way to engage in a multi-screen, multi-format, always-on world.

So, what can you do? How can you make sense of an ever changing dynamic and engage with customers despite their ever-decreasing attention span?

If you are new to the Online world, and are looking for the essentials involved in creating a digital footprint for your product or service, the Digital RoadMap offers a quick guide to get you off the ground. In it, you will learn about what constitutes success in the Digital arena, how you can be more customer-centric, and how much is too much. While you’re at it, if you would also like to improve your chances of success when working with external vendors and service providers, here are some good insights on How To Be A Great Client!

All the Technology in world can only help you do a few key things well: Amplify the reach of your message, reduce the Response times involved, improve the Relevance of a product/service fitment or achieve exponential Scale. What’s important to keep in mind is that business is, and has always been, about defining a target Customer, understanding their specific need, and meeting it in a profitable way. If you are able to provide exceptional value to your customer, at a sustainable cost, you will succeed in your objectives. No two ways about it.

As you go about your own journey of leveraging the Power of Digital  to engage with your Customer, don’t be afraid to seek help from those who have walked the path before you. If there is anything we can do to help, it will be our pleasure…

Startup DNA

What does the DNA of a startup look like? While almost every startup believes that it is building something entirely unique, there are some defining characteristics that dramatically increase the probability of startup success.

Shane Snow – the Chief Creative Officer of Contently – lists some excellent points in his post. Here are a few of my favorites…

  • Rather Than Planning, Doing
  • Looking For 80/20s
  • Split Testing And Iterating

Bias for Action has got to feature among the top of any list you see on this subject, since a startup is essentially about getting started with the idea, and not just making elaborate plans on paper (or on a spreadsheet!).

If you are planning to launch a startup soon, be wary of collaborations with key stakeholders (partners, vendors or even senior staff) that do not exhibit this trait. You will regret it if you don’t, and waste precious time in the bargain.

Pareto’s Principle of 80/20 will definitely apply to your ToDo list, once you start your journey on the road to entrepreneurship.

Yes, the list of things to do will be long, and every item on it will seem important. But, every entrepreneur has limited resources and limited time at his/her disposal. And, in the end, what will matter is that you did the things that mattered most – and ignored the ones that didn’t.

Finally, Testing and Iteration will get you further than most, and also ensure that you get bang for the buck.

Should you advertise on Facebook or Google? Should you use subject line A or B in your introductory email? Should you go with logo option 1 or 2? Very often, we don’t know what will work in a particular context, but can ascertain our course of action based on data, as long as we are willing to learn from the experiment, and iterate as needed.

If budget is a constraint – as it often is – you need to run carefully though-through experiments to see what works better. Discard what doesn’t, and scale up what works by putting more resources behind it. If budgets are generous, run even more experiments!

May the force be with you.

Startup Perils

Yes, India’s startup scene is currently witnessing what can only be called “rush hour”. Yes, everyone and his cousin seems to have a startup idea, and is on his way to get funded. Yes, the co founders of Flipkart and Snapdeal have become the poster boys of the new economy. Yes, Uber’s valuation of $50 Bn puts it ahead of General Motors’ market cap by $4 Bn, today!

But, there is a dark side of startups that we don’t seem to want to talk about…

Rahul Yadav – CEO of Housing.com – was sacked by the Board, and more than 160 employees were let go recently. Ola and ZopNow have faced “hacks” by users being able to recharge their wallets without paying real money. Foodpanda recently features in the news for accepting orders from restaurants that have long been shut down, and other operational woes.

The story is not limited to these well-known names. This is an issue that affects many, many startups. The fact is that a few boys (or men) writing code, does not a business make. Building an organization requires a tremendous amount of skill sets, and not every one is suited for the task, regardless of how noble their intent is.

This is not a post meant to discourage folks from quitting their jobs and forming a startup, nor is it meant to feed the paranoia of those of us who ‘never use their credit cards online’, or dissuade young aspirants from seeking employment in other startups. It’s all of that, and more.

We play a variety of roles in this ecosystem. We are customers, employees, partners, co-founders and vendors to this brave, new world of startups. The old adage – caveat emptor – applies in its true spirit.

There will always be those among us who wish to ‘game the system’, or hack their way into disproportionate gains, or (as founders) just be ill-equipped to predict what lies ahead and end-up not delivering on objectives as intended. The way things used to work is no longer the way they do. And, the fact is that there just aren’t enough checks and balances built into the ecosystem to prevent such fiascos in the future.

As Peter Parker once said in Spiderman, “With great power, comes great responsibility.

The Internet is a democratic force to reckon with. But, the responsibility lies with us to watch out for the perils on the path ahead, and take appropriate measures. Whatever role we play in this – employee, vendor, customer – it is up to us to figure out what the risks are, and safeguard against them.

The Uber model allows a driver to earn up to Rs. 100,000 a month in earnings, but it helps if he understood that he has no control over the ‘Rate per Kilometer’ charged to clients, and that the demand for rides may not always last. The young man with his motorcycle, eager to join an e-commerce giant as a delivery boy, can surely dream of a brighter future, but it helps to know that the company can run out of funding if it does not operate with prudence. The customer can be overjoyed on finding his favorite local eatery on an ordering app, but also face disappointment two hours later when he finds out that his order was not sent through at all!

No, the answer does not lie in locking up your credit card, disconnecting the Internet, or refusing to participate in any manner. We will, however, need to improve our understanding of the “new world order”, if we want to use these ‘developments’ to our advantage.

We are living in exciting times – there is no doubt about it. Just keep an eye out for the dangers, while you’re out cruising on the information superhighway…

Startup Success Myths

Rahul Varshenya makes a cogent argument in the Huffington Post on Why You Shouldn’t Emulate Silicon Valley for Startup Success:

Don’t make the mistake of imbibing what you hear coming from the mouths of the Silicon Valley behemoths for there are many, many more who have proven otherwise.

 

Here are some of those ideologies to be wary of:

 

#1 – The success of your startup depends on having a co-founder

#2 – Build an MVP. Always build an MVP

#3 – A services business is a shameful one to start. Build a product.

#4 – Outsourcing product development is a bad thing.

The write-up offers interesting insights and data points for any startup to consider. If you were planning to just wing-it, it would sure help to learn about how the world works, and about the various lessons in success and failure. But, we agree with Varshneya when he writes, “You don’t need any Silicon Valley pundit directing you what or how you should build or run your business.”

Here’s our addition to the list of ideologies to be wary of:

#5 – Growth is more important than Revenue

#6 – You need substantial capital (read: funding) to scale your venture

#7 – A well-defined Business Plan is the key to startup success

#8 – Scaling up exponentially is the only viable business strategy

None of these points ought to be dismissed outright or accepted as gospel truths.

The fact is that every entrepreneur is on his own journey, and if he succeeds, will impact the world in his own unique way. We believe there is ample room for “the misfits and the rebels” to show the world what they can do, when they combine purpose with determination and drive. Don’t you think?

Entrepreneur Dilemmas

This post was also featured on YourStory

Start your own business, and you will soon discover that the life of an entrepreneur is full of dilemmas – ones that have no easy answers.

Yes, we may have learnt some lessons from the dot-com crash of 2000, and some of those learnings apply even today. But, the environment in which we operate is far more complex and dynamic than ever before. As a result, there are more questions than answers.

What compounds the problem is the fact that many entrepreneurs often have no one they can approach with such questions – friends and family may not have the business context or skills, and experienced mentors are hard to find.

Organizational Tradeoffs

It starts with the kind of organization you wish to build.

Some will advise you to build a Lean Startup while others will advocate the importance of thinking big.

A “lean” startup means bootstrapping your way to success, building on a Minimum Viable Product, and iterating based on real customer inputs. Thinking big, on the other hand, involves ambitious plans that need a fair bit of funding and large-scale thinking for them to succeed.

This issue assumes even greater importance if you’re not already flush with capital, since the “run way” you have to remain in business will be directly impacted by the choices you make in this regard.

So, which way should you go? Is being cautious better than being ambitious, when it comes to building a business?

Product Tradeoffs

It’s not just the organization – your product approach can significantly impact your chances of success.

A newly created product or service should either address a specific customer need previously unmet, or do it in a manner that is cheaper or better than current alternatives. But how good is “good enough”?

Should you labor over the details of every pixel… ensure that even the packaging is picture perfect? Or should you focus on the all-important shipping date, and risk rolling out a buggy or less-than-perfect version to paying customers?

Some will remind you that the earliest versions of Facebook or Google were far from ideal, while others will wax eloquent about the attention to detail that makes Apple products such a worldwide hit.

Which path is better? Which route is likely to bring success?

Market Tradeoffs

Simply building an excellent product is not enough – there are dimensions to your Market strategy that also need clarity.

A key question here is: How important is competition? Should you be focused on improving on the competition, or ignoring the competition and building something no one else has done before?

Peter Thiel advocates in ‘Zero to One‘ that incremental advances will only get you so far – what’s needed is to choose boldness over triviality, not just make incremental advances. But in the ‘Lean Startup‘, Eric Ries writes of the virtues of the iterative cycle of Build-Measure-Learn, and of continuous testing and experimentation.

So, who is right? Which approach will get you the glory and riches you so deserve?

Capital Tradeoffs

Even if you’ve figured out the answers to all of the above, there is the issue of the most important resource of all – Money.

Here too, the choices are as tricky as you can imagine. After all, every business has a limited amount of capital at its disposal, and often needs to make choices on how that money should be spent.

So, should you seek capital early on to ensure rapid scale-up, or delay external funding as much as you can, to retain ownership and control? Should you focus on Revenue, or place a priority on Growth and customer acquisition so that a competitor does not end up blowing you out of the game altogether?

What’s the best way to solve this dilemma?

The Journey Within

What should a business owner do when facing such choices?

Well, my learning has been that the journey is more of self-discovery.

Yes, it is important to learn how the ecosystem works, how business works, and how the economy is shaping trends that can be leveraged to your advantage. But, it is equally important to know what you are, and what matters to you.

That understanding of Self becomes your compass, when you seek answers to such dilemmas. That understanding, is how you separate the noise from the music, as you figure out the answers for yourself. And, that understanding informs your decisions, as you traverse the path that you alone must walk.

Lewis Carroll got it right when he said, “If you don’t know where you are going, any road will get you there.

Yes, you will continue to face conflicting advice, and come across opinions of business leaders that make you question your own beliefs. But a true entrepreneur must stand his ground in the face of adversity and conflict. After all, the ones who change the world are “the crazy ones, the misfits, the rebels”!

May the force be with you.

The New Gold Rush

 

The time is right, they say.
Any one and every one is launching a startup.
In fact, billion-dollar valuations are fast-becoming the norm! Just look at Flipkart and Snapdeal…

 

Like most of you, we too are bombarded each day by the media focused on the runaway success of startups and entrepreneurs. Any one with half a bright idea seems to want to cash-in. Feeding the frenzy is the (often mistaken) notion that if smart folks (read: VCs) are investing billions of dollars (yes, billions with a B!) in these business enterprises, they must be doing something right.

Well, yes and no.

Let’s take a look at some of the numbers, as reported in a recent article in the Economic Times…

  • Flipkart was valued at $1 Bn in Aug 2012, and is valued today at $11 Bn
  • Snapdeal was valued at $200 Mn in Jul 2011, and is valued today at $1850 Mn
  • Zomato was valued at $2.5 Mn in Jul 2010, and is valued today at $660 Mn

Do you think it is possible for any well-managed company in the ecommerce space to provide an incremental “value” of $10 Bn in just two years?! For those of us in India, that means Rs. 60,000 crores!!! In two years. And, that’s just with one “startup”. (As a reference, currently, the market cap of ACC is jut over half of that.)

Yes, many of these organizations have capable managerial teams, exemplary leadership, and the ability to scale. No doubt about that. But, it may well be a myth for us to assume that these valuations represent the true worth of their business.

Here is what we’ve understood of the Venture Capital business: When a seed fund invests in a new idea, its goal is to take it to the next round of financing (Series A), and make healthy returns on its investment. This story continues in successive rounds of financing, until the logical end is reached – Initial Public Offer (IPO), where folks like you and me literally “buy” into the dream of raking in a small share of the future profits, by buying shares in the company. That’s how the game works. Nothing wrong with that, as long you understand the mechanics.

However, things start falling apart when any one and their cousin imagines overnight success by converting an idea into a “billion dollar firm” within a year. Another fallout is that, inevitably, some businesses miss out on “investor love” and fall by the wayside, despite having a competent team and business model in place. When you think about it, how different is TaxiForSure from Ola Cabs? Or Infibeam from Flipkart? But, now that we know the dozens of zeroes added to their valuations, it’s kinda difficult to see them in the same light as their distant cousins.

Sumanth Raghavendra, Founder, Deck App Technologies sums it up well: “Valuation is ultimately a vanity metric – something startups can brag about, but it is far from a reflection of a company’s true worth.

Yes, in the short run, customers benefit by the discount mania prevalent on such services, and it is not uncommon for funded startups chasing higher levels of growth to offer their products and services below cost. That means, at a loss. But, Growth can only serve as a substitute for Revenue upto a point.

Ultimately, any organization will need to deliver exceptional value (not valuation) to its customers, to survive, sustain and succeed.

P.S. If you run a fledgling startup, or aspire to do so soon, our advice would be to reign in those zeroes and focus on getting the basics right.

Taking Stock: Year 1

It’s been one year since I launched “ThinkShop“.

Yes, this was my second stint as an entrepreneur. But, in many ways, the experience was completely different. Unlike the last time (which was more than 13 years ago), I was no longer a starry-eyed, young man, without a care in the world. This time around, I was a wee bit wiser, more mature, and understood a little better – what lay in store for me. But even I couldn’t have anticipated all that transpired.

Here’s a quick look at how Year 1 has fared…

  • Attended a plethora of business & technology events
  • Addressed hundreds of eager listeners via workshops and talks
  • Reached out to hundreds more via press mentions and articles
  • Met with a range of interesting folks from different industries
  • Signed up a number of clients, across domains
  • Worked on multiple projects, across platforms and solutions
  • Attended dozens of workshops on a diverse range of topics
  • Made connections & exchanged cards with hundreds of people
  • Experimented with different formats in the quest for a workplace
  • Worked more hours in a day (and week) than I thought possible
  • Stayed up nights “figuring out the answers” (work-in-progress)
  • Improved self-awareness, and discovered a little about myself
  • Learned to enjoy higher highs and deal with lower lows
  • Clocked more steps on my Fitbit than I’d imagined
  • Tried out a few pilot experiments to develop products & services
  • Collaborated with a few people, but had to part ways, soon after
  • Said “No” to countless things, ideas and people (ongoing effort!)
  • Learned of a lot of things, and realized how much I still don’t know
  • Traveled to places I’d never been to, including some that I had
  • Joined in a number of family celebrations and events
  • Did not miss a single important occasion related to my children

When I look back on the year gone by, it has been nothing short of living life to the fullest – making each day count.

I wouldn’t trade it for anything. Would you?