Prateek Dayal

A few days back I received an email from NSRCEL about a talk by Kanwal Rekhi on entrepreneurship. I heard about Dr. Rekhi first when I did my internship in IIT Bombay a few years back. Dr Rekhi is an IITB alumnus and has donated significant amount of money to IIT Bombay and started KReSIT there and also in Michigan Tech. He has a very impressive resume as an entrepreneur and as an investor and I decided to drive down to IIM to listen to his advice to students/entrepreneurs.

Dr Rekhi talked initially about his journey as an entrepreneur and the challenges he faced being an Indian entrepreneur in the valley in the early 80’s. Around that time, Indians were considered to be great engineers but not good CEOs or businessmen and therefore they had some trouble raising money. Dr. Rekhi told that he met over a 100 VCs before they got funded. He finally took Excelan (his startup) public and it was listed on NASDAQ in 1987. They were later acquired by Novell where he stayed till 1995.

I really liked a couple of points that he mentioned during his talk and would like to list them down here

•  Always have your fundas right. What he means by this is that you should always think of revenues, costs etc while making business decisions
•  If you wanna sell to the geeks, let geeks do the customer service and pre sales.
•  Ignore YAFO (yet another f**ing opportunity). Have a single focus and try to learn and solve one pain point well. It takes years to do that and distraction is easy
•  Your first funding should come from friends and family because it comes with more responsibility to be successful and give returns. This is generally good early on

There were some more points he mentioned that I don’t remember now. A lot of points would seem like common sense but it was good to hear it from someone who has such an impressive track record. Its amazing how many of these points are being ignored by companies right now, especially in web. If you get a chance to listen to him, please don’t miss it.

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I had been thinking of writing this post for a long time now but never really got around to writing it. Partly, I wanted to know how some other people feel about this. I think it was good to have a discussion with Prof. Suresh yesterday at IIM Bangalore about these issues. So here it is finally :)

These days, Bangalore has atleast one entrepreneurship related event every week. More often, there are more. Some of these are conferences and some unconferences. Most events see a large number of aspiring entrepreneurs and a few people who have already taken the plunge. People who have been there and done that are always in minority. Specially in the unconferences, most people are aspiring entrepreneurs or people who are currently fighting it out to make it big.

If you attend these events and pay some attention, you can almost always catch words like amazon, google, youtube in the discussions. You can often hear about how Google came in when search was already a very competitive market and they revolutionized everything. How they did not make any money for years but focussed on building a great service and eventually reached great heights. People often talk of how the founders of these startups had a vision and they stuck to it untill they made it big. However for some reason the same people find it very hard to relate to the entrepreneurs around them. Entrepreneurs who are more or less like them, who worked with them before and are now on their own, trying to figure things out.

I find this very ironical. I believe there are somethings almost all entrepreneurs have in common. Some phases in life almost every entrepreneur/startup has to go through. Talking of the same phase in the context of successful startup inspires people whereas a startup in the same phase (but not big yet) cannot find many supporters (in the startup circle).

Confusion Rules a Startup

More often than not, people assume that by definition, startups would have it all figured out and only then founders would take a plunge. However if you zoom into the early life of most successful startups, they too took some time to figure out things. Paypal and Blogger are two great examples of startups who took sometime before they finally knew what it is thats gonna make it big for them. Things are never crystal clear right from the start. Zeroing in on something that can become big and can be monetized takes some time. Even in the context of an idea, there are several details that take time of figure out. Most startups do their market research on the way. Founders at Work is a great book to read to understand startups and entrepreneurs.

You don’t start a million dollar company. You grow yours into one

You can at best start a company. You cannot start a million dollar company. Atleast not most times. You identify a need, solve some problems and then scale it up. There are a lot of startups who have grown this way (Craigslist, PlentyofFish, Blogger). In fact there have been several companies in India too. The most popular of the lot would certainly be Naukri.com. All these companies took time to grow. Simply because you have not made a million dollar in the first year or two does not mean you will not make it in the next five.

You will make mistakes

Making mistakes is inevitable. When you are trying to do something new (again relative) and when there are no references/guides available for every step you take, you will go wrong often. Even the big companies have had failed products. Google had to buy youtube despite having Google Videos. Apple has had failed products. Several companies join the Techcrunch Deadpool every month. Mistakes are part of the whole startup experience. So if your next door startup just threw away their last 3 months of work because it did not take off the way they thought, don’t write them off.

Marketing IS a problem

“But how will you market your idea?” is a question I hear too often from the crowd in such events. Trust me when I say that we are all trying to figure it out. I believe all startups are finally an exercise in sales and marketing more than anything. So the companies that figure it out are gonna make it big and you know how long it takes to make it big. So don’t expect to hear in a few lines the answer to this question. Marketing is an ongoing process. Everyone is new in internet marketing. We all know how romantic social media is but very few of us have had a chance to go out with it yet.

Photo Credit: richardmasoner

Monetization takes time

Most companies put monetization last. I think its fair enough considering that no real monetization can happen unless you grow to a critical mass. Since every startup (atleast the bootstrapping ones) have very limited bandwidth, founders prefer to put that into marketing and gaining that critical mass rather than monetizing early on. Give these guys sometime. Google could monetize only after a few years. Facebook and Orkut are still trying to figure it out. Would you write them off?

Its not all romantic

Startups take time and this is doubly true in India, where internet has still not reached every corner of the country. There are not gonna be many quick exits. Most people would have to stick to their ideas for reasonably long and not everything they do during that phase is gonna look romantic. The Dip is gonna take over sooner than later and only perseverance would get startups out of it. During the dip, romantic is the last thing a startup is. However once out of the dip, that phase and the story of how founders could pull the startup out of it looks very romantic. So next time you meet a guy who has been trying to get to the next level for the last one year, don’t write off his startup. If you are concerned, try to analyze his bottlenecks and see if you or your contacts can help.

This post is not about not questioning a startup. Its about taking the right lessons from the successful (or failed) startups and then looking at startups around you in the light of that knowledge. If we want to develop a true ecosystem, we must begin to understand the startups well first. We must understand that they are different from big companies, they have different needs and different priorities. Thats what makes entrepreneurship so differnet and hence fun :)

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I have been doing Muziboo for about a year now and it has certainly been one of the greatest learning experience of my life. I have learnt a lot, met a lot of interesting people and generally had an exciting time. But still sometimes late in the night when I am done coding something up, I step back and wonder why I am doing this :)

So I decided to write down my thoughts here. Basically these are some of the much talked about reasons people quote in favor of doing your own thing. I have written why I feel these reasons cannot really be the source of motivation for long. Atleast they are no longer a real motivating force for me.

Be Your Own Boss

Unlike how it looks, you will probably have to be very disciplined while doing your startup. If you are living the garage life, you will have limited funds and you would wanna make the best use of your time. Its good because you will learn to be more productive and value time but that disciplined life is unlike what you would imagine before you get into your startup. Think of your boss or manager who comes on time, works all day and leaves late (and works on weekends too). You will be that guy :)

Make a quick exit and retire

Good luck with that. I personally feel that atleast in India thats not gonna happen. Not in the web 2.0 space for sure. Web 2.0 ecosystem here is still shaping up. Big giants like Reliance and IndiaTimes still prefer to build their itimes and bigaddas than go out and acquire exisitng networks. I suspect that the top tier sitting there looks at exisiting networks and decides to throw 6 man months internally to build something than to acquire. I am pretty sure that this will change but I think its gonna take a few years. Great acquisitions typically happen when the acquiring company knows how to take something and make it a part of their brand and monetize/grow it. Blogger is a great example of that. Google would have never been able to push out so many adsense units so easily otherwise. Same goes for feedburner too. So quick exit cannot keep you motivated for long.

Make something that millions use

You wish! There is a possibility that millions will use your product but that will take some time (few years if you are lucky and more otherwise). Engineering a product and marketing it are very different games altogether. If you believe in “make it and they will come”, you are gonna be surprised soon. Selling your product to millions takes a lot of time and money. You will get a lot of passionate users initially but finding hundreds of thousands of such users is gonna take time.

Great Technical Learning

This is true to a large extent but after about a year, you will have to move fulltime into sales to battle problems mentioned in the point above. I have talked to a lot of startups in the last few months and I believe that eventually almost always all startups become an exercise in sales than technology. This is most certainly true for the co-founders atleast. Your code is no good if enough people don’t use it. In web particularly I feel the most interesting challenges come in only when you have a lot of traffic. Building a website is not really rocket science. Scaling it is.

So then why do a startup. I guess that can be another post :) Sorry to disappoint you if you did not find what you were looking for. If you have any points to add, please do leave them in the comments. I would love to know if its just me (and some people I know) or there are other startups too out there who agree with what I have written.

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Disclaimer: The views expressed here are solely mine and not of my company Muziboo. However since I own half of Muziboo ….. :)

You are working hard on your startup and you meet tons of new people every week and tell them about your startup. If you are lucky, probably 1% of them would love your startup and show it. This is certainly true in our case. If I go to a barcamp or OCC or other startup events, less than 1% of the people there are excited to hear about Muziboo. Most people dismiss the concept as yet another social network (about which I wrote here).

Before I go any further, let me accept that I too am very rarely excited about someone’s idea. I guess this barcamp there was only one startup, LifeBlob that truly excited me. Last barcamp, it was flipkart. So what I am trying to say is that the post is not about why people don’t love my startup but about who is the best critique for my startup.

Are Startup Events or B-plan contests best critique?

Honestly, I don’t think so. I have never applied for a B-Plan contest but I have not even seen too many success stories coming out of there. I define success as some company that won in a b-plan contest and then got into business and eventually survived and made a profitable business.

Lets talk about startup events. We applied last year for proto.in and were rejected. In the true startup spirit, I did take some learnings out of it but then I was confused all the more on finding out that Saffron Connect (link won’t work .. the site disappeard) had presented in the first proto.in. Even if I look at the last proto, there are startups that have not even launched and have had a chance to present. I would put HeadStart.in in the same league. We were rejected there too, only that we did not even receive a rejection letter. We had to call and ask the organizers about the results and the guy I called was clueless. Proto and Headstart in my opinion should take out sometime to write to the companies rejected so that they can take some useful learning out of the whole experience. Untill they do that, I dont think they are the best critique for your startup.

These events reminds me of my school that used to kick out every average guy (academically) and keep only the best of the best and then show a great success story in every board exam. How those people have fared in life after school is a different story. I therefore believe a true startup ecosystem should help those who need it. Pruning and showcasing the best is only a part of the story. I love OCC and Startup Saturday for that the help they offer to one and all and I think they will go out to become the most useful startup events in the next few years.

Is it the experts in your domain?

To some extent .. yes .. the experienced people in the domain can offer you some really good insights. We have been fortunate to meet some people who can give us good legal, financial or sometimes even common sense perspective on things. However I feel that there are very very few people in the web space right now in India who can be called experts. This is true all the more in web 2.0 space. User generated content sites are always dismissed by most experts on design, scalability, VCability or similar front. I am sure had I pointed out craigslist or flickr or even a facebook to them in the early days, they would have dismissed them too. If you give point the same examples now, they would still dismiss them terming them as an one off thing. But thats exactly the point, most startups are one off successes. Its very tough to spot trends in successful startups. Still most experts or events are trying to spot the trends when declaring winners or potential winners. They are looking for the coolest technology or the most scalable idea or the most VCable business. How is it then that the deadpool list keeps getting longer?

I guess its a combination of luck, persistence, execution and idea (in that order) that determines success. So then who is the best critique?

Your users are your best critique

Yes .. thats it .. its your users. If people come to your site/product and use it and recommend it, you are doing well. If not, time to improve. Its really as simple as that. If you are onto one of those one off successes, there would be a lot of early adopters who would swear by your service and use it regularly. They would evangelize it like its their baby. If you cannot find many such evangelists, then you are not doing something truly useful. If you look back at the examples I mentioned before, craigslist, flickr, macintosh all had tons of evangelists in the community. I therefore think that if users love you, you have a good chance of succceeding. Everything else is useful but not mandatory. To pick better words, every other review (or the lack of it) about you cannot make or break you.

Feel free to debate my thoughts. Again in no way do I consider Muziboo successful yet. However I do believe that we are onto something and we will hopefully get there if we can survive for that long. I am thankful to a lot of people who did/are helping us on a daily basis and ofcourse to our users.

That said, I feel its time for the startup egosystem to start morphing into an true ecosystem.

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For an early stage startup, it is very important to be recognized by the press. Word of mouth is a neat way of spreading but it works well only after you have reached a critical mass. In a country like India, people trust  newspapers and magazines a lot. Once you are on a newspaper, your brand’s credibility goes up. In case of Muziboo we have seen that everytime we are on newspaper, we get a lot of new signups and our traffic generally goes up. We have been covered by Economic Times, Times of India, Mid-Day, Bangalore Mirror amogst few others outside Bangalore.

Last few months, I have talked to a lot of journalists and I thought of writing about how you can try to get noticed by the them. The sad reality is that it is not possible to get noticed by them. If you approach them, they would certainly not write about you. Also if you are a self funded company, the chances of getting on a national daily drops significantly. In general anything that a funded company does (right from closing the first round of funding) is news and everything you do is at best a cheap publicity stunt. Therefore writing to someone is by definition a bad idea. Don’t do it. Its not worth the time and the disappointment.

Now one way to get noticed by the press is to get noticed by a lot of other people. People who are in the game (other startup founders, people higher up in the career path) who would probably know the press. Most of our press mentions have come from such relationships. Our users (yeah!) and friends happened to talk about us to some reporter and they covered us. More often than not, a very big newspaper would not cover you exclusively but thats ok. You would get there (so would we some day)

Now since most of your friends would not really know the press, you need to make sure you attend Open Coffee Club meetings, Barcamps and any other meetup that you can and talk about your startup to every guy you can. Yes .. every guy you can because you don’t know how the universe will conspire to get you a press mention.

Now that you know whom to talk to and where to find these people, it also helps to be prepared with a story. A story thats romantic, believable and easy to communicate. I think you should have a 30 sec pitch (one line about what you do and why you do it) and a 2 min pitch (why its insanely great). I am not telling you to make things up, but if you are not prepared, you will not be able to make the best use of your time. I remember talking to some 100+ people in Barcamp 5 and it was fun. It really helped me refine my pitch.

If you can call what I wrote above techniques, then they have worked very well for us. Like everything else about a startup, its important to be persistent at it. In general, you cannot build contacts when you need them.

Best of luck getting press’d :)

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This may seem like a funny topic for a blog post. The idea is not to come up with a  title that draws attention (I hope it does) but to write about an inherent dilemma that lot of bootstrappers go through. I go through it and I know a few other people go through it. I am not sure if its true only in the Indian context or globally. I have a feeling that it has to do a lot with India though and you will soon know why I feel that way.

Why is someone not doing it? People Need it!

When I was in IIT Guwahati we were a small campus with about 500 students. Compare this with other IITs that have that kind of intake for undergrad program alone per year. I think the first few batches are really entrepreneurial in the sense that they try to define the culture of an institute. In our case the culture meant a lot of technical and cultural festivals that other IITs hold too. Stuff like Alcheringa, Techniche and having chapters of societies like IEEE, ACM, SPICMACAY etc. Fewer students meant fewer people to attend and even fewer people to organize these festivals (they are almost 99% student initiatives). The first few batches could have easily ignored these things as we were small and not there yet but they did not. They fought hard to get these festivals, chapters going. They wanted IITG to feel what other IITs feel every year. They wanted juniors to come in and feel part of a legacy. They wanted to get there … and they tried to do on their own. I am sure they could have focussed their efforts elsewhere and may be achieved something more for themselves and not cared about this, but they did not.

When I joined there were lots of things in place and lots of things not in place. Like some other classmates, I played a role in SPICMACAY, Technical festivals and the IEEE chapter. It took a lot of time and sometimes I wondered why I am doing that (so did many of my friends). The answer was that I just felt responsible and felt bad for not helping in shaping the culture when I would crib about a lot of missing things. I think thats what it is. Some people just feel responsible for shaping up the culture in a place and feel ashamed in running away from it when they can clearly see something missing.

Aren’t we talking about the web here?

Yes we most certainly are talking about the web here. I feel that web (in India atleast) is no different from what we described above. We know how its in the west and a lot of us crave for those kind of webservices in India too. It could be web-ifying your daily needs (like food, medicine, reading, shopping etc) or building online communities around hobbies (say photography, music, writing etc). Lot of times we feel the need for a service and start building it. No one else would attempt it probably because there is no VCish value creation there (millions –> billions) but there is a lot of value creation in terms of touching a lot of lives.

Once you start building a service that people actually like using, you find out that it takes a lot of time, energy, thought and money. Time is not free as most people think because you can always use that time to pick up another consulting gig and make more money or just plain spend it with family. So in the end you end up asking yourself why you are doing something that may or may not scale up to millions of dollars (or say to the salaries that your peers would draw for the next few years). I think again the answer lies in the fact that most times when you crib, you also feel responsible for fixing things up. You go out and create those missing services creating a lot of value but not value enough. I am quite certain many entrepreneurs around me felt a need (and a business too) and started up. However only later you realize that not all needs are needs enough for VCs and people around you. Ofcourse the lack of any kind of angels (people like you, the dreamers but with more money) makes things very tough along the way.

So what am I trying to say?

May be this is a very personal post but I do know some other people going through this dilemma. I know that in India there is a need for lots of everyday products but once someone builds them they are gonna get into this classic problem of not creating “enough value”. If you talk to the “experienced” people (people who create real value or nothing at all), you will get to know how well they know the broadband penetration numbers, the mobile penetration numbers and how semantic web is the future of the web and nothing else is worth solving. I am quite certain that it happens all the time.

Sorry if you were looking for a solution to all this … as I write .. I am looking for one too.

Thanks for reading so far!

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*This is crossposted from Muziboo.com Blog. The only thing not true anymore is that I am not fulltime into Muziboo (as in no consulting on the side). The original post can found here

Nithya and I started Muziboo.com around July 2007 and have been running it since then. I have been hacking away to keep the service up and running and Nithya has been working on spreading the word about it

After installing this wordpress blog today, I decided to write a bit about our journey so far. The motivation behind muziboo, our vision, people we have met and generally recollect the exciting last 6 months.

The idea for Muziboo came one fine morning over tea when were chatting (literally) with a friend and I told him how I always feel a service like Flickr.com can be really cool for music, specially for a country like ours with so many people passionate about it. Nithya was around and she felt that this can be a real cool idea. We brainstormed for sometime (may be a few days) and decided we will go ahead and implement it. We knew that a service like this has to be very different from youtube .. we wanted to have something more serious about music and therefore decided to go the audio way. I started learning about web technologies and Nithya started researching about user communities etc.

After evaluating lots of technologies, I decided to write the site in Ruby On Rails … I was quite convinced that I do not want to do the site in a CMS .. just to make sure I understand the internals well and can modify/customize the website as much as I want. We worked for about 3 or 4 weeks and started showcasing the site to people around 15th August. By September 2007 we, were about 100 user strong and had about 50 uploads.

Thats the time we got associated with Open Coffee Club (OCC) Bangalore. On the left is a picture from one of the opencoffee club meets where we were chatting about Muziboo.  In general, I feel OCC is a great place to go and hang out if you are trying to start something on your own. Great people and great brainstorming and sometimes you can get some real help for free

So far Muziboo had been a part time venture for us. Around October time frame, I quit my job and started doing Muziboo fulltime (almost). Nithya quit her job one month after that and we are now both completely into Muziboo. I am still working on a few consulting projects because we are bootstrapping Muziboo and that helps us meet our expenses comfortably.

Thats the story of Muziboo till about early November. Personally I feel this is where it turned really exciting for us. I will write more about it in part 2 of this series. Stay tuned!

The second part of this post can be found at Muziboo Blog here

I will soon be writing a post about how and why I transitioned out of my day job into a fulltime startup that still does not pay the bills for me. Please subscribe to my RSS feed to stay tuned.

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