Five valuable leadership lessons from startup founders
Startups
are the new leadership schools. As they spawn new business models,
these upstarts are redefining the way things are done. Here are five
stories from five entrepreneurs that hold lessons for aspiring
entrepreneurs, established companies — and life.
Lesson 1: "If you chase passion, money will follow"
Vivek Prabhakar CEO & Co-founder, Chumbak, a design-led products company
Lesson 1: "If you chase passion, money will follow"
Vivek Prabhakar CEO & Co-founder, Chumbak, a design-led products company
Back
in 2009, when Vivek Prabhakar and his wife Shubhra Chadda, decided to
strike out on their own after decade long corporate careers, they ran
into an obstacle most first-time entrepreneurs face: money, or the
lack of it. Both Vivek & Shubhra are army brats.
Prabhakar's father served in the Indian Navy while Chadda's father was an air force pilot. "Given our backgrounds, we did not have the capital to start our venture. And it was too early to approach venture capitalists," recalls Prabhakar.
The husband-wife team had an idea of creating a company that would sell funky design led products like fridge magnets, designer phone cases and other zany curios. For the better part of a year, they had researched on the kind of products they would want to sell, how they would promote them and in which stores they would sell them in.
There were no market surveys, no retail dipstick studies. "All we had was a gut feeling that there was a space for the products we were so passionate about creating," recalls Prabhakar, who was then the father of a two-year old child.
The couple had a "15-minute discussion" after which they decided to sell their apartment in Bangalore to raise money. The apartment fetched them Rs 40 lakh and the duo started negotiating with manufacturers in India and China. Chumbak launched on the web in April 2010.
Within a year, sales had crossed Rs 2 crore. Last June 2013, the company launched its first store in Bangalore. Today, Chumbak has 35 stores in 10 locations across the country and revenues are growing at 300 per cent. "We have never done a market survey till date. We have let our gut and passion guide us. If you chase passion, money will follow," Prabhakar told ET Corporate Dossier.
It's a philosophy that guides the startup's hiring philosophy as well. "One question I ask potential hires is: what do you do beyond work? We all have a life beyond work and your passions often lie there. If your passion is just work, we don't end up hiring that person," says Prabhakar, who bought "a better, nicer apartment" two years ago.
Lesson 2: "If you are going to fail, don't be afraid of failing spectacularly"
Ambareesh Murty CEO & Co-founder, Pepperfry, a furniture e-tailer
Prabhakar's father served in the Indian Navy while Chadda's father was an air force pilot. "Given our backgrounds, we did not have the capital to start our venture. And it was too early to approach venture capitalists," recalls Prabhakar.
The husband-wife team had an idea of creating a company that would sell funky design led products like fridge magnets, designer phone cases and other zany curios. For the better part of a year, they had researched on the kind of products they would want to sell, how they would promote them and in which stores they would sell them in.
There were no market surveys, no retail dipstick studies. "All we had was a gut feeling that there was a space for the products we were so passionate about creating," recalls Prabhakar, who was then the father of a two-year old child.
The couple had a "15-minute discussion" after which they decided to sell their apartment in Bangalore to raise money. The apartment fetched them Rs 40 lakh and the duo started negotiating with manufacturers in India and China. Chumbak launched on the web in April 2010.
Within a year, sales had crossed Rs 2 crore. Last June 2013, the company launched its first store in Bangalore. Today, Chumbak has 35 stores in 10 locations across the country and revenues are growing at 300 per cent. "We have never done a market survey till date. We have let our gut and passion guide us. If you chase passion, money will follow," Prabhakar told ET Corporate Dossier.
It's a philosophy that guides the startup's hiring philosophy as well. "One question I ask potential hires is: what do you do beyond work? We all have a life beyond work and your passions often lie there. If your passion is just work, we don't end up hiring that person," says Prabhakar, who bought "a better, nicer apartment" two years ago.
Lesson 2: "If you are going to fail, don't be afraid of failing spectacularly"
Ambareesh Murty CEO & Co-founder, Pepperfry, a furniture e-tailer
In
September 2011, Ambareesh Murty was on a flight to Goa drafting an
email which he intended to send to his wife. It was an email
explaining to her that Pepperfry, the furniture e-tailing venture he
had co-founded six months ago was about to run out of money.
"In fact, we were down to our last Rs 10 lakh. Ashish (Pepperfry co-founder) and I had dug into our personal savings, our mutual funds and it had all burned through pretty quickly," says Murty, who had quit his job as Country Manager of eBay India to found Pepperfry.
Ashish Shah, too, had quit his job as head of eBay Motors India. "We had commitments, in terms of investment term sheets from investors, but actual investments were yet to come," says Murty. The six month old startup was also facing a crucial HR conundrum: most parts of its operations were working in silos.
For example, the folks who crafted furniture were based in Jodhpur and had little idea about how the internet worked. The employees in the Delhi office who understood retailing did not understand the nuts and bolts of the furniture business. The company's HQ in Mumbai had ecommerce experts who knew little about retailing or the furniture business.
And money was running out. "Ashish and I had a chat and decided that if this wasn't going to work, let's at least fail spectacularly," recalls Murty. "So we decided to spend most of our last Rs 10 lakh on an offsite in Goa."
In the end, it was money well spent. "People got to know each other and understand how other parts of the business worked. Almost overnight, communication improved," says Murty, who sees that offsite — which 150 people, including suppliers, attended — as a turning point in the company's fortunes.
In the end, he did not send that email and Pepperfry is eyeing revenues of Rs 400 crore by the end of 2014.
"In fact, we were down to our last Rs 10 lakh. Ashish (Pepperfry co-founder) and I had dug into our personal savings, our mutual funds and it had all burned through pretty quickly," says Murty, who had quit his job as Country Manager of eBay India to found Pepperfry.
Ashish Shah, too, had quit his job as head of eBay Motors India. "We had commitments, in terms of investment term sheets from investors, but actual investments were yet to come," says Murty. The six month old startup was also facing a crucial HR conundrum: most parts of its operations were working in silos.
For example, the folks who crafted furniture were based in Jodhpur and had little idea about how the internet worked. The employees in the Delhi office who understood retailing did not understand the nuts and bolts of the furniture business. The company's HQ in Mumbai had ecommerce experts who knew little about retailing or the furniture business.
And money was running out. "Ashish and I had a chat and decided that if this wasn't going to work, let's at least fail spectacularly," recalls Murty. "So we decided to spend most of our last Rs 10 lakh on an offsite in Goa."
In the end, it was money well spent. "People got to know each other and understand how other parts of the business worked. Almost overnight, communication improved," says Murty, who sees that offsite — which 150 people, including suppliers, attended — as a turning point in the company's fortunes.
In the end, he did not send that email and Pepperfry is eyeing revenues of Rs 400 crore by the end of 2014.
Lesson
3: "Jot down your intent for everybody to see"
Neeraj Kakkar CEO & Co-founder, Hector Beverages, maker of Paper Boat beverages
Neeraj Kakkar CEO & Co-founder, Hector Beverages, maker of Paper Boat beverages
What's
the one street food that people associate Mumbai with? Vada Pav. If
Mumbai had a quintessential drink, it would be Kala Khatta, a tangy
concoction made from jamuns.
"When we started working on this recipe in March 2012, we found that jamun is a tough fruit to process and not easily available despite being indigenous. There was a point when we almost gave up and decided to make the drink with Black Currant, which was to be imported from Europe," says Neeraj Kakkar, cofounder and CEO of Hector Beverages which makes the Paper Boat range of Indian ethnic drinks like Aam Ras, Jal Jeera and Kokum.
"At that stage of product development, a junior executive, who had recently joined the company, stepped forward and reminded us all that we were veering off from our stated goal: Of making drinks as authentic as one can. That was a pretty big moment in our little history," recalls Kakkar. "From that point onwards, we persisted on getting it right," he adds.
So, Paper Boat launched a search countrywide for jamuns which lasted a year. At the end of it, it found "Jamun, in all its glory" in Muzaffarpur in Bihar. Today, Paper Boat's Kala Khatta drink sells 50,000 litres per month and is among the top 3 drinks in its portfolio. In all, the company sells over 1.5 million liters of drinks every month.
After the Kala Khatta experience, Paper Boat has stuck to its philosophy of maintaining authenticity of its new products. Take Kanji, a popular drink in North and Western parts of India. Kanji is made from purple carrots. Unfortunately, purple carrots are not easy to find in bulk quantities.
"In the midst of this conundrum, one person from the product development team suggested that why not make it with red carrots instead? This time, however, the rest of the team immediately shot it down," says Kakkar. The company now works with farmers to grow purple carrots, whose seeds are shipped from Turkey and grown in the foothills of Ooty.
Lesson 4: "The best investments are made on people"
Aprameya Radhakrishna Co-Founder of TaxiForSure, a taxi aggregator
"When we started working on this recipe in March 2012, we found that jamun is a tough fruit to process and not easily available despite being indigenous. There was a point when we almost gave up and decided to make the drink with Black Currant, which was to be imported from Europe," says Neeraj Kakkar, cofounder and CEO of Hector Beverages which makes the Paper Boat range of Indian ethnic drinks like Aam Ras, Jal Jeera and Kokum.
"At that stage of product development, a junior executive, who had recently joined the company, stepped forward and reminded us all that we were veering off from our stated goal: Of making drinks as authentic as one can. That was a pretty big moment in our little history," recalls Kakkar. "From that point onwards, we persisted on getting it right," he adds.
So, Paper Boat launched a search countrywide for jamuns which lasted a year. At the end of it, it found "Jamun, in all its glory" in Muzaffarpur in Bihar. Today, Paper Boat's Kala Khatta drink sells 50,000 litres per month and is among the top 3 drinks in its portfolio. In all, the company sells over 1.5 million liters of drinks every month.
After the Kala Khatta experience, Paper Boat has stuck to its philosophy of maintaining authenticity of its new products. Take Kanji, a popular drink in North and Western parts of India. Kanji is made from purple carrots. Unfortunately, purple carrots are not easy to find in bulk quantities.
"In the midst of this conundrum, one person from the product development team suggested that why not make it with red carrots instead? This time, however, the rest of the team immediately shot it down," says Kakkar. The company now works with farmers to grow purple carrots, whose seeds are shipped from Turkey and grown in the foothills of Ooty.
Lesson 4: "The best investments are made on people"
Aprameya Radhakrishna Co-Founder of TaxiForSure, a taxi aggregator
In
August 2011, Veerendra Gowda approached the promoters of TaxiForSure,
a Bangalore based taxi aggregator with a radical suggestion. The
lanky driver owned a single cab, but he wanted to be an
operator.
"We were astonished," recalls Aprameya Radhakrishna, co-Founder of TaxiForSure. "The thought of allowing a driver to become an operator never crossed our mind. But Gowda said he had a few friends who drove taxis, who would listen to him and whose customer service he could vouch for. It made perfect business sense."
TaxiForSure gave room to Gowda to leverage his strengths — access to a driver network in his circle of family and friends, ability to speak to them in the way a driver would understand, manage them on an everyday basis, be the single point of contact for all their requests.
Before Gowda, TaxiForSure was working with a few taxi drivers who owned a couple of cabs each but all of them were directly managed by the company. "We were open to give bookings to anybody and everybody. There was no structured model that we were working on," says Radhakrishna. Gowda's suggestion was a game-changer for TaxiForSure.
From a paltry 40 bookings that the cab aggregator was logging each day in early 2011, it has shot up to a staggering 30,000. The operator model has become a key differentiator for TaxiForsure. It now works with over 10,000 drivers across 12 cities.
As for Gowda, life has taken a turn for the best. "He now has a network of 350 cars and earns a revenue which is 30 times what he would have earned driving a car," says Radhakrishna. He has a team of nine people and has earned societal respect amongst his peers as well. The moral of the story, says Radhakrishna, is that the best investments are made on people.
Lesson 5: "Look for trust more than skills in partners"
Hari Menon Co-founder & CEO, BigBasket.com, an online grocery store
"We were astonished," recalls Aprameya Radhakrishna, co-Founder of TaxiForSure. "The thought of allowing a driver to become an operator never crossed our mind. But Gowda said he had a few friends who drove taxis, who would listen to him and whose customer service he could vouch for. It made perfect business sense."
TaxiForSure gave room to Gowda to leverage his strengths — access to a driver network in his circle of family and friends, ability to speak to them in the way a driver would understand, manage them on an everyday basis, be the single point of contact for all their requests.
Before Gowda, TaxiForSure was working with a few taxi drivers who owned a couple of cabs each but all of them were directly managed by the company. "We were open to give bookings to anybody and everybody. There was no structured model that we were working on," says Radhakrishna. Gowda's suggestion was a game-changer for TaxiForSure.
From a paltry 40 bookings that the cab aggregator was logging each day in early 2011, it has shot up to a staggering 30,000. The operator model has become a key differentiator for TaxiForsure. It now works with over 10,000 drivers across 12 cities.
As for Gowda, life has taken a turn for the best. "He now has a network of 350 cars and earns a revenue which is 30 times what he would have earned driving a car," says Radhakrishna. He has a team of nine people and has earned societal respect amongst his peers as well. The moral of the story, says Radhakrishna, is that the best investments are made on people.
Lesson 5: "Look for trust more than skills in partners"
Hari Menon Co-founder & CEO, BigBasket.com, an online grocery store
The
venture was ahead of its time. Credit card, internet penetration was
low and people weren't ready for e-commerce. And then, the dot-com
bust happened. Key investors exited. To survive, Fabmart started
offline stores and became Fabmall.
Eventually, in 2004, India Value Fund, which held a stake in Fabmall, merged the company with a Hyderabad based chain of supermarkets, Trinethra. The Fabmall founding team was put in charge of the merged entity. In 2006, the Aditya Birla Group took over the stores and rechristened them "More".
That more or less seemed like the end of Team Fabmart, as each of them went their separate ways. However, prodded by serial entrepreneur couple K Ganesh and Meena Ganesh, four of the original six founders of Fabmart — VS Sudhakar, Hari Menon, Vipul Parekh, and VS Ramesh — got back together.
In their second innings, they launched BigBasket, an online grocery store that is now a leader in its field. "In an entrepreneurial journey, things will go wrong. When they do, the members of the founder group must trust and back each other. Else, investors will try and break the group to have their way," says Menon. "Trust, more than skills, is something you must look for in co-founders."
Menon argues that most entrepreneurial breakups happen with cofounders who are fresh out of college. How is it working with the same bunch all over again, especially, given that another co-founder V S Sudhakar used to be Menon's boss in the earlier venture?
"For the external world, I am the CEO. But internally, we have our roles carved out on a functional basis," says Menon. That comfort, says Menon, comes only with trust, age and experience.
Eventually, in 2004, India Value Fund, which held a stake in Fabmall, merged the company with a Hyderabad based chain of supermarkets, Trinethra. The Fabmall founding team was put in charge of the merged entity. In 2006, the Aditya Birla Group took over the stores and rechristened them "More".
That more or less seemed like the end of Team Fabmart, as each of them went their separate ways. However, prodded by serial entrepreneur couple K Ganesh and Meena Ganesh, four of the original six founders of Fabmart — VS Sudhakar, Hari Menon, Vipul Parekh, and VS Ramesh — got back together.
In their second innings, they launched BigBasket, an online grocery store that is now a leader in its field. "In an entrepreneurial journey, things will go wrong. When they do, the members of the founder group must trust and back each other. Else, investors will try and break the group to have their way," says Menon. "Trust, more than skills, is something you must look for in co-founders."
Menon argues that most entrepreneurial breakups happen with cofounders who are fresh out of college. How is it working with the same bunch all over again, especially, given that another co-founder V S Sudhakar used to be Menon's boss in the earlier venture?
"For the external world, I am the CEO. But internally, we have our roles carved out on a functional basis," says Menon. That comfort, says Menon, comes only with trust, age and experience.
By T
V Mahalingam & Rajiv Singh, ETCD 12 Dec, 2014
No comments:
Post a Comment