TiE Luminaries session with Sameer Guglani and Nandini Hirianniah

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(This post got deleted as part of some migration – putting it up again)

The MVP team will be doing an interaction about entrepreneurship and sharing the entrepreneurial journey with the audience at the “TiE Luminaries session” on Thursday 26 March 2009.

Mr J S Bedi, Chairman Gian Jyoti Institute of Management and Technology has coordinated with TiE Chandigarh to have the session at their campus:

Address: Gian Jyoti Institute of Management & Technology,
Phase-2, S.A.S Nagar (Mohali)

The session will start at 3 PM. In case you are planning to attend, we request all of you to be there on time.

Looking forward to meeting some interesting folks.

Y Combinator Gets The Sequoia Capital Seal Of Approval

Techcrunch reports the news about 2 million investment in YC from Sequoia and prominent angel investors (Ron Conway, Paul Buchheit and Aydin Senku) . They also report that YC will now be doing 60 companies / year, up from 40 / year.

This is another big validation for the business accelerator model pioneered by YC and adopted by folks like techstars, seedforum and MVP. The premise of model is that the cost of doing business has gone down significantly. With the right support, guidance and capital of around 15-20K USD it is very much possible for team of Young, Talented , Focused and Passionate entrepreneurs to build a business with significant value. Which means businesses with good user traction, evolved products and business processes, revenues, break-even and more.

These initiatives are obviously good for the VC industry, and its good to see it officially recognized. The specialized and organized support for the super early startups is resulting in stronger startups, which means returns on the investments of the VC firms will be higher and more number of VC investments will lead to creation of successful companies.

Another important aspect of this model is the special focus and availability of active support from founders of companies working alongside in the same batch as well the alumni founders. All of these folks have experienced creating real companies and have unique capabilities, contacts and experience which proves useful for other folks part of the program at YC  / Techstars / Seedforun / MVP.

Read my previous about “First time entrepreneurs (FTEs) – Building businesses in India“.

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WWWN (Part 2): Presentations & Pitches

Previous post in the WWWN series : Extreme Marketing

(WWWN = Whats working whats not)

Creating Business Presentations and pitching your venture to people is an essential part of a startup founder’s job. The audience can be angel investors, VCs, potential partners, potential employees, potential acquirers, bar-campers, OCC guys etc. I have looked through quite a lot of presentations, have worked on a number of presentation / pitches with start-up founders and of course did more than 30 versions of the business presentation and 80+ pitches for madhouse. Here are some points that are good to know while working on presentations & pitches.

Creating the Business presentation / pitch:

  • Present only 10-15 slides, nothing more than that
  • Consider tailoring the presentation a little bit; keeping the target audience in mind
  • Suggested slides (see example presentation below)
    • Title slide
    • Summary / Highlights (4-6 bullets, high level business summary)
    • Market size / market opportunity
    • Business Overview / Business Metrics (these are not financials)
      • Current Numbers and Projected Numbers 6 or 12 months from now
      • Numbers that represent your business the best and  show the audience that you are running and presenting a real business
      • Example: Visitors, users, registered users, active users, revenues, products released, customer acquisition cost, number of outlets, employees etc
    • Team
    • Problem the venture is solving
    • Service / Product (how it is different than other available alternatives)
    • Sales and marketing strategy
    • Key Challenges
    • Competition
    • Financial Projections (optional for very early stage ventures)
    • Closing slide
  • Exit Strategy
    • Don’t have this as a slide. Just talk about it towards the end while presenting or when asked
    • Don’t promise exits in 2-3 years, any good business takes 5-7 years, that the horizon for angel investors
  • Team slide
    • Have it as 3 or 4th slide, not later than that
  • Financials
    • Dont show projections beyond 1 year in your presentation.
    • For young startups, no one really knows what will happen beyond even 6 months.
    • Claiming you know what will happen beyond one year is not a smart idea
    • Have 3-5 year projections ready if people ask for it but do not claim accuracy of these, say that there are based on our current assumptions. We believe things will change significantly over the next 6-12 months and we will rework these accordingly.
  • Create an appendix section to include additional details of slides
    • Org structure
    • Product screen shots (too many screen shots right now, need to reduce and show clear flow)
    • Details of market size etc, graphs etc
  • Don’t use “colorful” backgrounds. Keep a white background : simple, clean and readable
  • Use uniform font size and color:
    • Arial is one of the most readable fonts
    • Choose a font color for “Slide title”, go for the dominant color from your logo
    • Maintain the same color and size in all slides. Font size between 36-44 is good for slide title
    • Use black color for all the body text in the presentation
    • Use same font size for all body text. Font size between 14-18 is good for body text
  • Once you do an initial version of the presentation, there will surely be too much TEXT in the presentation, now you need to “DETEXT” – that means edit and cut off all unnecessary text, remove all words that don’t add any value
  • Have small and crisp points. Most bullet points should be one line or max 1.5 line long. Don’t have any para type of bullets. Split longer points into smaller bullets
  • Vary the presentation of content : break the monotony , give visual breaks and create interest
    • Use different content layouts – dont have only “bullet lists” in each slide
    • Try one column bullet slide, two column bullet, 1/2/3 tabular formats
    • Be be careful not to over do it, use the most suitable format to present the content and do not use something because you have to use it
  • Don’t use language that is too “Domain specific” . Use language that is simple and can be understood by people who are not “Domain experts”
  • Not everything needs to be written on the slides, many-a-times we tend to pack each slide with all that we want to say and making the slide text heavy. Human attention span is very low and no one reads all of the information-loaded slides. Hi-light the important points and keep the rest for oral / spoken presentation. This will prevent the main/important points from getting lost.
  • Keep the size of presentation less than 1 MB, many mail servers block 1MB and more attachments and anyways they take more time to load/view.
  • Presentations become large due to use of heavy images, use the compress images feature of MS Powerpoint to reduce the presentation size. Choose web/email resolution for images.
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Pitching the Startup

  • Be humble. Remember – Humility disarms.
  • Be calm, composed and confident.
  • Always, always be on time. Never miss an appointment. For god’s sake put the appointments on all your calenders, start early, keep a buffer of 30-60 minutes. Keep people informed if you are about to get delayed.  In more than 50% meetings founders show up late or don’t show up at all. This is a serious damage to the reputation of the startup.
  • Show up clean and presentable. I am not advocating a formal look, be causal if you like so, be formal if you like so. But keep your self clean and presentable. Don’t look PUNK.
  • Crack a joke, tell an anecdote, make general conversation, figure out a connection. Before jumping into the presentation, create a comfort level, break the ice.
  • Weave a story. Don’t just show a stand-alone slide, weave a story around the venture, create interest, tell how you came up with the idea, etc. Engage the audience.
  • The passion, commitment, involvement, confidence and energy needs of the team to come thru. So turn it on, talk enough about the team, its all about people.
  • Don’t look cold or unconcerned.
  • Focus on now and may be next 3-12 months. Spend most time on plans / features/ revenues etc of now and of next 12 months at max, dont keep talking about things that will happen beyond that – people are interested in your immediate future – beyond that no one really knows what will happen.
  • Multiple people presenting is always very tricky and can be problematic. Its best if you can choose one person from the team to present. In case you decide on multiple presenters, work very hard on the hand-overs. Try to just have two sections, presenter 1 does section and presented 2 does section 2 – No back and forth.
  • Product demo: jump into the product demo as soon as possible. Show the real stuff and the impact will be 10-20x as compared to “prepared slides”
  • Listen! Listen! Listen! Many times folks who you are presenting to will say stuff. Be very patient in listening to them. Give them respect and let them complete, before you talk. Don’t be overtly defensive, be open to suggestions/feedback. Give your response and answers in a structured manner. Many presenters start answering before the person talking has finished.
  • If you are asked a question whose answer you dont know or are not sure about, its totlaly cool to say “I dont know the answer, but let me try or I will get back to you “.  Dont try any BS, if you dont know the answer.
  • Make note of action items (mostly stuff to get back on ) which come out of the presentation and make sure you do get back 100% on or before the promised due date. Again here more than 70% founders will miss promised deadlines or not get back at all, just by doing this you can get into the top 30%.
  • Have your set of questions as well, which you would like to ask the audiences of investors, partners, bar campers etc.
  • Practice! Practice! Practice! – you can never do it enough. Practice in front of people  – take feedback and improve.

Couple of bonus TIPs from Ankit

If your audience is a potential investor:

  • Be very clear what you need money for. You can skip it from the slides. This is a question, which surely is going to be asked, if investors are showing even a little interest in your startup.
  • This part has to be extremely clear in your mind. You should be ready to tell how do you plan to spend the money.
  • One thing common to most of the VCs is that they are good with numbers, that is their core area.
  • Testimonials can provide good customer validation.

If your audience is barcampers:

  • Try not to pitch your company directly. Start explaining some concept, and then plug in your company as a case study.
  • For example, a few years ago, Rashmi Sinha used to give presentation on Taxonomy, tagging etc and then she used to plug in Slideshare as a case study.

(Thanks to Ankit, Indus and Nandini for reviewing the post and giving valuable inputs)

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Shout ’em out louder!

(This post was born out of internal discussion that took place in MVP forums. Its jointly written by : Sameer, Ankit, Nandini and Indus)

Bharat Matrimony

Bharat Matrimony (BM) has launched its facial search feature that enables you to upload celebrity (you can also upload your ex-girlfriend’s pics) pictures and BM will find a look-alike. Check it out here

Though the technology is imperfect the idea is so perfect on so many levels:

  1. Viral nature
  2. Engagement of users
  3. Stickiness of the site
  4. Differentiator from other sites
  5. Users having fun, part of so many jokes

It totally rocks and its great to see an Indian company leading its way in innovation. On the other hand its disappointing to see so less buzz created by them in the Startup media.

AdaptiveAds

Glam Snaps Up AdaptiveAds. Mumbai based startup AdaptiveAds was acquired by Glam, a leading ad network based in US. This news was covered very well by Techcrunch and and other leading tech blogs of US about a month back, but again coverage in Indian Startup media left a lot wanted.

Adaptiveads, a mumbai based startup, clearly demonstrated that an Indian startup can target the global market very well and it makes a lot of sense for other Indian Companies to tap into borderless economy. When we can serve millions of western companies by being an outsourcing hub, by developing the core technology for them, why cant we guys put together our collectible brains to bring Indian products to whole world.

Startup Media

The current Startup Media in India consists of the leading startup blogs, some newspaper / magazine columns, couple of dedicated magazines and little bit of TV coverage. The main credit for creating the “Startup Media” goes out to the leading startup blogs, they have been at it for few years now and have done quite a good job of covering the news, sharing good practices, aggregating discussions around startups. They have built a strong and sticky community of readers / contributors around them.

Shout ’em out louder

Though a lot has been done, there is a need to increase and provide regular coverage “towards celebrating / highlighting / sharing the Indian startup ecosystem triumphs”. This post is a request to Startup media to shout louder about the successes. Indian ecosystem is evolving and it definitely requires much needed boosts from media to encourage them. There are quite a few successful Indian startups, may not be to the tune of 10-100 million USD, but still doing pretty good. But, every mention will only encourage and boost the morale of the others to push the bar & succeed!

Some suggestions to the Indian Startup Media:

  • Add regular weekly features that bring out startup success stories, backed by research. Bring out the reasons for the success and help others learn and get inspired. This can also be done with some guest writers contributing.
  • Missed out on covering the news in time? – not a problem – write enough juice and they’ll quote you on their blog!
  • Dig into the development of the startups you have already covered, ask them to keep you updated, monitor their blog feeds for news of successes – followup stories is always a welcome for a reader!
  • A lot can happen over coffee – spend more time with startup founders (new & old), listen to their stories – can make for a good copy!

Communication channels are the most important for development of any eco-system (Even Hitler banked on it) – you have the power to influence and help startups imbibe good practices – make the most of it! This will go a long way to also help dispel India’s image “as only copycats, service-based companies and outsourcing hub”.  It will encourage the ones who are on the edge and are evaluating doing a startup. Current and potential investors will see the successes and increase the financial participation towards Indian startups.

The day is not far when people will be bringing Garam chai and Samosas to your home (riff from people bringing donuts/coffee to Arrington to get covered) . While you make them the stars, they will make you the celebrity!

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How to practice quality in your startup?

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(This article was written for IT magazine and was published in Feb 2009 issue. Original article can be founder here)

These thoughts about quality crystallized in my mind while I was reading Robert Pirsig‘s “Zen and the Art of Motorcycle Maintenance: An Inquiry into Values”. There was such a rush of thoughts in my head that I had to keep the book away and start writing down my thoughts.

Pirsig offers this definition for Quality:

“Quality is a characteristic of thought and statement that is recognized by a non thinking process. Because definitions are a product of rigid, formal thinking, quality cannot be defined.”

But then below the definition on the blackboard, he wrote,

“But even though Quality cannot be defined, you know what Quality is”

Startups are essentially units of passionate, committed, and somewhat foolish people trying to accomplish things which would normally be considered far out of reach for them. The only way for the startups to make it across to the other side is by ‘practicing superior quality’, quality in all aspects of the startup:

  • Quality of the founding team
  • Quality of the idea
  • Quality of the execution
  • Quality of the product design
  • Quality of everything else being done in the startup…

Now the question really is, if ‘quality’ can not be defined, how does the startup practice it? The short simple answer is that Quality at a startup directly proportional to the:

  • Sense of quality of founder(s)
  • The discipline with which they follow it
  • The amount of pain they are ready to bear to ensure quality is practiced

The ‘sense of quality’ is not something one is born with, its something that comes with ‘care’.

Though the Google founders were not UI experts, they came up with a high quality search page design, because they deeply cared about the users experiences. They cared about keeping it simplistic and natural to how people would want to look for information. As a founder you must first of all ‘care deeply’ about all things that your company is doing. This ‘care’ will turn into the ‘sense of quality’, which will give you the ability to tell good quality from bad.

Evan Williams; the founder of blogger cared so deeply about the users of blogger, that he stayed on with the company as a single employee running servers, teaching himself stuff, writing code, talking to users, fixing bugs even when all other employees moved on, when the company had almost no money. He did not leave, he stayed on continuing to ensure quality experience to the users whom he cared about and prevailed. Blogger became Google’s first acquisition.

Similarly, the guys who designed the first spreadsheet ‘VisiCalc’ spent less time coding but a lot more time thinking to make it easy for people to use, to ‘make it natural’. They knew they were competing with ‘back of the envelope’. They cared about the users, cared about minimizing the number of clicks and steps that a user needs to go through for performing a function. And if that was not the case, they would have designed a product which would have sunk without a trace, like many other ‘low quality’ products.

Once the founders reach a point where they care about everything that matters, the next most important thing is they have to get ‘quality’ people onboard. They have to instill ‘care’ and teach the ‘quality’ to each of these guys.

How can founders/leaders teach quality?

Some of the points to keep in mind would be:

  • Understand that you are also learning the subject which you are teaching, so be open to questioning and changing your existing ideas and beliefs
  • Unless its science or math, never give rules to be followed
  • Provide a broad framework to help the guy get started, but make it clear that these are not rules, its just one representative framework. It can be wrong, can be changed, challenged and improved ( mental model )
  • Use real-life examples and case studies to understand and learn from the examples along with the person your are discussing it with
  • Evolve and further understand the model as you proceed
  • Also establish that learning for everyone is a continuous process, everyone is learning
  • Don’t try to arrive at rules / rigid patterns from past data or information
  • Finally, create adaptable mental models – which can handle randomness

Tim Brady, the first employee of Yahoo after David and Yang was obviously given the quality training by the founders, though he was a business guy and these guys where geeks, they managed to convey their care and sense of quality about various things.

Always remember, there is no single or fixed number of routes. There are as many routes as there are individual startups. So don’t follow rules. Make your own rules. ‘Care’ about every damn thing and ‘ensure highest level of quality’ in every task undertaken, every person hired, every product feature designed, every sales call made. Just be paranoid about quality and not let it go. It’s a tough thing to ask and that’s perhaps why there have been so far and few who have made it through.

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First time entrepreneurs (FTEs) – Building businesses in India

Just read the couple of articles written by Paul Graham : Y Combinator (answers what exactly does YC do?  or  Seedcamp, Techstars, MVP etc ) and Equity (explains why should you give 5-6% equity to a program like YC)

The thoughts expressed got me thinking about how should First Time Entrepreneurs (FTEs) go about building businesses in India. While a lot is in common between the approaches of YC, SC and MVP there are a bunch of things unique to the Indian Ecosystem which FTEs should consider.

Uniqueness of India

First things first, only during the last 10 years India has started seeing bootstrapped or garage startups by talented, educated, experienced and passionate folks who dont have access to a lot of capital but have the skills, will to solve problems and the staying power. The number of successes out of these have been limited and have not been really publicized for folks to get inspired by or learn from.

The VC industry is just about 8-10 years old in India as compared to 50-60 years in US and Europe; among them majority of the funds in India are under 5 years old. VC being a long gestation industry we are a good 5-10 years away from seeing major VC success in India. Most of the firms are focusing on the existing pipeline deals in the market and there are quite of few of these available – companies by serial entrepreneurs, companies started by Executives (CXO, VPs) from large companies, some of FTE companies where the traction is fairly significant, also since PE sector has performed very well and the bigger funds are shifting time and money to PE  deals. Clearly all of the above are the right things to do for the Indian VC firms, since the firms need to perform for their investors. None of this directly supports the FTEs, which is where the gap that needs to be filled in.  We need to create new pipeline of deals that will become successful startups and will feed into the VC pipeline 1-2 years later. That’s the role folks like MVP, iAccelerator, Upstart.in and others are attempting to play.

Another dimension of difference is IT / internet. The penetration of Internet and PCs in India is quite limited (9 computer for every 1000 people, as compared to 700 for every 1000 in USA). On the other hand the awareness and usage of IT in companies, specially SMEs is limited as well. There are a lot of other fundamental needs to be fulfilled in India (remember we are a developing country).

FTEs in India: What to focus on ?

First thing to ensure is to build a cash flow positive business within the initial capital that you have managed to raise (self, friends, family, fools). Keep lowest possible costs and create early revenues. Expenses should ideally be below 50,000 INR and in no circumstances higher than 1,00,000 INR a month.

Dont think of funding as a validation for your venture. Be prepared to wait longer, to build your business to the 50-100 crore revenues in 7-10 years, with VC funding coming after 2-3 years of being in business or no VC funding at all. If this does not appeal – don’t do a startup.

Internet only business models targetting indian market are not going to viable for atleast 2 years ( or more). View internet as a cheap way to build products and get the initial users with zero marketing budgets. From day one build alternate channels : mobile, call center, SMS, kiosks , shops , sales team into your model. Use technology as a enabler to drive costs down and to drive quaity upwards, but do not depend on customers using it directly via internet.

If your idea only lends itself to internet, think about doing it for developed markets like US and Europe.  India still has lower costs and we are very bullish on build here – sell to the developed world model.

So while you take into consideration the universal wisdom of building businesses, paying attention to the uniqueness of India can make an big impact on the outcome of your venture.