The Panelists were:

K Vaitheeswaran
COO - Fabmall India Pvt Ltd.

S. Mohan - CEO
Society for Innovation and Development ( IISc)

Kiran Nadkarni - Managing Director
Kaatizone  (Also MD- Jumpstartup)

Subrata Mitra
Managing Partner - Erasmic Venture Fund

Prabha Parthasarathy - Senior Consultant, Erehwon Innovation Consulting

Balaji: What is unique about pioneers?

Kiran: Passion is essential for the success of any startup. People must believe in themselves. For a small startup to grow into a large company, one must transform from an entrepreneur to a manager. Entrepreneurial passion holds everyone together in a team. Your business must have a strong differentiating factor, be it innovation in the product, the market place, in technology or the overall offering you are giving your customer. The customer has to be delighted.

Subrata: No one really knows what works. You have to find what works for you and what works for others. We look for a good team in a startup that we are going to fund. That encompasses passion, believing in what you do, team work and the uniqueness factor. With the team comes an idea and the market for it. The team needs to know how to build and sell. These are the ingredients for a successful startup.

K Vaitheeswaran: The ability to dream big is required for a startup to work. Think big, reach for the stars.  Passion is simply not negotiable. It is not a job, where you work in a certain time frame. Unlike in the US here there is a social stigma to failure. The decision to leave your job and start a business requires a lot of courage. It is a mental block

Hire people who share the same passion of yours and same entrepreneurial mindset. Hire people who are smarter than you, else the founding team's efforts go in vain. Capital is also very important for a startup. If it is a greenfield venture (doing something no one has done before), make a business plan. It helps in talking to Venture Capitalists (VC's).

While starting, you need to think from your heart rather than your mind. The mind will tell you that the plan will not work, whereas the heart will tell you it will. When we started off with the online shopping business in India, the online penetration was small, we knew very few people would transact, but we felt that we should go ahead with it. You need to be passionately involved with the business but don't get emotionally attached, as you must be able to take hard decisions in the event of failure. You need to be lucky. You have to be in the right place in the right time and Fortune has to smile on you.

Mohan: Technology is developed by various faculty members and students of our institute; In my role at IIScI get them connected to big companies, like Boeing, GM, Tata Motors, and Mahindra. I get projects from them which generate money for them and the institute. I encourage students to become entrepreneurs. Faculty should not become businessmen, as one cannot do justice to research and teaching while also starting a company. Thus we started incubating companies where the faculty member is a director, an advisor or a consultant, in which case the faculty's ideas go into the market through somebody. Thus he becomes a mentor.

Prabha: All of us as individuals, in teams, organizations, at different points of time, reach a stage of nowhere, where you either become stagnant with your thinking or you become complacent with things happening around you, or you end up replicating a model or strategy that has been done by others already. A pioneer is the opposite of this. I have experienced it from various organizations, quantum breakthroughs have happened in the Indian soil. The kind of impact that a pioneer creates is quantum, it redefines reference points. That qualifies to be a true pioneer. The second is that he creates a new orbit. The opposite of a pioneer is a settler, who looks for certainty and predictability. A pioneer is willing to go contra to the predictability, consistently fighting gravity, in terms of what is possible and what is not. In the olden days, pioneers set out in ships to conquer new lands. The pioneers would get on to the land to check if it's safe to live in there. They would again get back to the ships to conquer newer lands.

Balaji: Is it worth your while being a pioneer?

K Vaitheeswaran: It's difficult to reach the destination sometimes, as the journey is difficult. It is the attempt to do something different which counts. Money wise, I would say it is not worth it.

Subrata: Look at what you are doing, and what are you doing it for, fame or money? What are you looking for?

Kiran Nadkarni: Being a pioneer you always have the first mover's advantage. Be a pioneer all the way, innovate on an ongoing basis. Create wealth within the parameters.

Balaji: Any personal experiences while spotting the right opportunity?

Kiran Nadkarni: I am in the mundane fast food business. I worked in the US for three and a half years for Jumpstartup. Retail business is what I enjoy being in. It is important to keep in touch with all your customers. The Indian food industry has become mainstream. I want to take Indian food to the international market.

The three criteria for a Venture Capitalist to fund a business are: a good team, innovation and market opportunity. Coupled with all this is luck, which is a must for any business to succeed. I was not a foodie but my mind ruled my heart, I took a rational decision, as the market opportunity was huge in the foods business.

K Vaitheeswaran: Our business is of high volume and low margin and we concentrated on aggregating volumes. It was in this process that we set up the first physical store and it did very well. Soon we were 4 stores old, we realized that a mind-boggling opportunity faced us. 80% of the resources then got allocated to the physical stores. Soon as the internet usage started to grow our online business also started doing well.

Prabha: It is the whole notion of opportunities versus creating them. The successful companies have created opportunities. For that matter, any plan is inadequate. You need an insight as to what can tap maximum opportunity. Is the VC funding the individual or the insight? Breakthroughs have happened because someone has created the opportunities.

AM: How relevant is the business plan? It is said that in the first three months of the business, it goes for a toss.

K Vaitheeswaran: You can be reasonably certain that the plan won't work. Because a plan is based on so many assumptions.

Subrata: Be clear about your services, Identify the customers who are interested in your business. People look at a business plan from many angles. Look at the operational aspect of your business.

Balaji: What to do about growth pangs since resources are less? How to go by the first few years? Any learnings?

K Vaitheeswaran: When the market collapsed, we probed within, whether this business has a future, will it turnaround and if it will how long will it take? We were ahead of our times. So we focused inwards. Controlled costs and lowered our spending to just stay alive. Run your business just as you would run your home. We thought we should outsource our marketing to our customers. If we gave him a great experience he will do the marketing for us. So we focused our time and resources on processes, ensured that every email is replied to and on time and so on. Those tough days brought steel to our business.

Balaji: Keeping the team together? Any learnings? Things to remember?

Kiran Nadkarni: We were the pioneers as VC's in India, as TDICI. We hired people from IIM Bangalore to work with us. We encouraged them to work for less by showing them the big picture. We motivated them to stay around TDICI. We supported entrepreneurial companies, not knowing how to exit.

Prabha: You may spot the opportunity but the mindset has to be changed. Many people have the mindset of selling, make presentations, worrying if they will be accepted or not; a few have the mindset of enrolling people to your vision. If you treat your business as a project and then you have the mindset of a manager, whereas in a venture you need the mindset of a person with a mission. A person with a mission is passionate about his business, as he is doing it out of his passion, while a managerial mindset is that of a professional. Passion does not come from numbers.

AM: Any social stigma? How to deal with the emotional turmoil?

K Vaitheeswaran:  It is a part of business and not an easy question to answer. Take it as a challenge. We are still 2 generations away when entrepreneurship will be celebrated. Be prepared to deal with it. One should understand that entrepreneurship means that the chances of failure are more.

Balaji: When you leave a good company, the respect goes away; as an Entrepreneur you need to realize that as an employee in a large company the respect shown by people is for the company and not you as an individual.

Prabha: The perspective has to be corrected. We have worked with many organizations of which 14 have come up with major breakthroughs, in the form of social innovation. There is an equal number of small and large scale industries that have succeeded by innovating, be it Subhiksha, CavinCare, Wipro. It is something to be proud of. We Indians fight an uphill battle and succeed; this is termed as the gravity index. They are fighting and managing to make it happen. Only an Indian can do it. He just goes ahead and does it, without waiting for infrastructure.  As Indians we have this capacity to generate the Escape velocity so we can expect to see a lot of Pioneers as we go along.  

Compiled by Rohit Gupta.

Issue BG67 Oct06

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