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From 200K to 0 – Gone in 60 seconds

November 9, 2011

During a casual conversation with my partner’s wife she asked me a question which kind of made me thinking. The question was “Why do two guys (me and my partner) who are making more than 200K+ combined quit their jobs and start something (going to zero)”

I tried to put the same question across different social boards – linkedin, Facebook etc and tried to get an answer about “Are entrepreneurs masochists”. Given the tremendous pain they go through, the amount of sacrifices they make (both physical and mental), the kind of uncertainty they face and also not only they go through this pain but also their immediate family also face the same music. This boils to the fact that why someone goes through all these for the light at the end of the tunnel.
1) Are entrepreneurs simply driven by monetary gains?
2) Do they clam for bragging rights?
3) Are they like the cry babies who want attention all the time?
Over the past 4 months I have had sleepless nights and still do about not hitting revenue numbers, not being able to satisfy customers and not being able to get into strategic partners nor come up with earth shattering products. Never did I worry about profits – I do worry about them but more from a point of what are the ways of building revenue thereby building a company and thereby profits. Also as with any startup in the very beginning one will come up with many obstacles and pains that the monetary part (at least from a startup point of view) is not lucrative when compared with that of existing jobs. So I feel that monetary gains is definitely not the criteria that would drive entrepreneurs – how else can one explain successful serial entrepreneurs
To an extent man is egoist – he/she wants others to praise them and notice them. An entrepreneur is a homo-sapien and definitely would like a little serving of bragging rights. But most of the entrepreneurs after having achieved that success would become humble (my experience) because of the ups and downs they go through to make it happen. Also I feel that entrepreneurs earned it because of the same reason – they made it happen in the toughest of the environments. Also I would rather term this as mentoring than bragging rights – successful entrepreneurs want to guide budding entrepreneurs like me to avoid certain routes and strategies that they fell for.
I read an article about CEO’s being babies – they want attention all the time, they make a mess of things and wants other to clean it up. Entrepreneurs on the other hand want less attention to themselves and focus more on executing their ideas. Entrepreneurship is all about execution and hence the third point of center of attention becomes an oxymoron.
So what drives entrepreneurs, based on my experience
1) Passion to build something and be known for it. When the rest of the world said that it cannot be done, being passionate and to the extent of being stubborn trying it out and making it happen.
2) If you ask a mother the fun of motherhood – going through 9 months of agony and birth pain, the same kind of a feeling an entrepreneur also will have. When his/her idea/product goes through those execution pains and finds acceptance from customers, the same kind of an euphoria an entrepreneur goes through.
3) The rush of taking split second decisions, the analysis that goes in understanding various aspects of company building, ability to take charge of one’s destiny and so and so forth. All these are some genuine reasons one takes up this path.
Believe me over the past 4 months I have come across so many instances where I was asking a simple question – is it worth it. I think the experience by itself is worth it and the satisfaction I get from this is very hard to explain

Groupon IPO & BuyWithMe LayOffs

October 30, 2011

Two important milestones in the daily deal industry that has occurred in the past couple of weeks – Groupon filing for its IPO (scheduled for Nov 4th) and massive layoffs at BuyWithMe. Both these events have a tremendous impact on DesiSauda and we are watching these events very closely.

Now for the first event – never in the history of corporate world has a company went from a startup to IPO. Also never in the corporate history has a company’s business model been dissected, analyzed and thrashed/revered by so many pundits across the world. Also never in the business world has one seen a company that went ballistics (with the Google offer of $6B) to valuation of $25B and now less than half off within such a short time. I think that given the industry – intersection of retail and technology such a roller coaster is inevitable and we feel that as the industry matures there would be very few players left. Also the chatter about the industry, viability of the model and the accounting rules around profitability has increased tremendously after the Groupon IPO filing – I got 4.5M search results in Google within 0.19 seconds when I typed “Groupon IPO”. Come Nov 4th Groupon’s list price as well as how it performs will have a massive bearing on the industry – if it tanks then the naysayers will say “I told you so” but in case if it takes off, then still the naysayers would say “wait till it crashes”.
The brings to the second event – the massive layoffs at BuyWithMe. This company started off with a massive infusion of funds from Bain Capital and is considered the third in the line after Groupon and LivingSocial (still Google Offers is in beta stage). But I feel that apart from trying to be another “me-too” player BuyWithMe did not have any differentiated offering. From a vendor perspective if I am planning to go with BuyWithMe they are better off going with either one of the top two players. At the end of day either you are a niche player like us who caters to a very specific niche market or is in a dominant position within the entire market. On the same lines I have seen a recent article about Google Offers partnering with niche players like Mamapedia, Zozi etc to offer a wide range of deals to its customer base.
We are in a very exciting phase of the whole deal industry – where we see some shifts in the market place where there would be some consolidations amongst different players as well as shake outs. Let’s wait and watch the fun games…

Entrepreneurship & Fatherhood

October 21, 2011

I was recently blessed with a baby girl (to be precise on Sep 30th) and it was one of my most joyous occasions. Life all of a sudden had become very hectic – balancing the addition of a new member to the family at the same time devoting time that is needed for my venture. While tonight (Fri Oct 21st, 1 AM) I was trying to get Anika to sleep and I have been trying to adopt various strategies – letting her cry, trying to swaddle her, holding her close to me, walking with her etc. While doing this it suddenly hit me (that is the inspiration for this post as well) that a startup and a new born are one and the same – with the new born one has to adapt (life style – no more late night parties, no loud music, everything is baby proofed etc) and adopt new strategies to raise them. There is no right or wrong approach here – one has to do everything and anything to succeed and get a good night sleep. So is the case with startups – one has to constantly keep trying new strategies – from selling to customer support to customer acquisition and see what sticks and keep repeating that approach successfully.

Time only will tell what is the best approach and hopefully with that and some key learnings I would not be second guessing myself a lot many times.

1+1 > 2. a secret sauce for success

October 16, 2011

As a startup company involved in the deal business it is imperative that my company reaches out to its target segment quickly and in a cost efficient manner. lets try to analyze the current deal market – there are so many Groupon clones out there with the basic model itself being bashed out by many pundits day in and day out. Given this clutter and so called deal fatigue making oneself noticeable is a daunting task and that too given the market we operate – a very niche segment with very specific marketing channels. All these challenges combined with the vast marketing budget we have (yes we do have a marketing budget) we have to innovate so that we have the maximum bang for the buck.

On another note completely we all know what team work is all about and how 1+1 is greater than 2 provided that participating 1s are complementary in nature (why am I talking about team work when this was supposed to be about marketing and reach). On the same lines as how individuals team together for the greater good so do companies have to collaborate so that they can achieve something that each cannot or achieve in an inefficient manner. Over the past three months we have approached multiple organizations to collaborate and to partner with DesiSauda and below are some of my learnings

1) Collaborate or Perish: As a startup company it is absolutely imperative that one has to collaborate with different organizations. So make this as a critical part of your strategy and come up with a gameplan that focuses on this topic. During one of our very early on meetings with a VC one of the questions that was posed to us was about “networking” effect – he wanted to find out what kind of a carrier are we choosing or selecting to ride on. That is when it hit us that having a successful partner strategy is critical for a shot at success and that is when we started to adopt this philosophy of collaboration.

2) Have a gameplan: Understand and crystallize what your company’s value proposition is – this is what you have to offer to your partners. Once you have this story set then you can go any partner and pitch in for a business case as to why they should partner with you. The story can be simply monetary gains to your partner or it could be much more strategic in nature – the later is of value to your partner and hence you need to come up with the value story that your partner can understand and appreciate both in the short run and in the long run. Come up with a list of tangible and intangibles that you would bring to the table and if possible quantify them

3) Cast the net wide: Do not be selective in approaching partners – cast your net very wide. What I mean by this is that approach organizations, groups where you see that your company would benefit from and at the same time you can tell them a story about how they can benefit from this relationship (point 2). So in a way reach out to all organizations that target your market – even though on the periphery it might look that you and your partner might be competitors. If you build a value story then your partners are willing to listen to you and based on your story might agree to partner with you

4) Be Proactive: Once you come up with a value story and approached the partner actively seek their audience so that the story is repeated and it becomes a fact. It is in your own interest to have your company on their radar – if your partner is a big company when compared with yours. Keep calling and meeting so that they can see that you are aggressive and at the sametime help you keep repeating the value story to them

5) A long courting period: Most of the organizations we have approached took a very long time in deciding – either yes, may be or not interested. The ones that are not interested are the ones who quickly turn around and say no, the ones who are really interested will say yes within the first and second meeting and the may be’s procrastinate. Unfortunately most of the partners fall in the “may be” category (this goes back to point 3 which helps to zero in potential partners) followed by nay sayers. You will spend considerable amount of time in pursuing your partners and they do not see/visualize what is that you are bringing to the table and what you are expecting.

So far we have had few successful tie ups that resulted in significant traction but still there is a long way to do. We at DesiSauda are actively seeking partners and we will know how effective our strategy had been. I am positive that I will be posting couple more insights into this in the very near future.

Steve Jobs – A man with a Midas Touch

October 8, 2011

The world has lost a visionary…

Jobs no more…

These were the headings on various articles and when I googled Steve I got 1.54B hits within 0 seconds. Over the past two days all the media – print, online, radio, TV and every other conceivable media is just talking about Steve. This shows the kind of impact Steve had on the society or just that there is a media hysteria and a mob mentality that affected everyone (which I doubt). I recently posted on my blog about some famous quotes from Steve and now I am penning this obituary for him – I personally feel that Steve is a great inspiration for entrepreneurs like me as he struggled many number of times but he was able to come back because he had the conviction. So rather than writing how great a manager, an inventor and a person he is I would rather analyze the impact Steve had on society as a whole and what better way than looking at some hard facts.

20381 – number of days Steve lived

5000000 ~ 6000000 – apple 2 (first personal computers) that were sold by Apple

5000000 – Steve paid for Pixar

350000000 – Gross revenues world wide from Toy Story that revive Pixar and in a way Steve Jobs

12 – number of feature films by Pixar

630000000 – gross revenue for all the twelve movies from Pixar

740000000 – Pixar acquired by Disney in all stock deal

429000000 – $ paid by Apple to acquire NEXT, Steve was not paid any $$

1500000 – number of apple shares given to Steve Jobs

275000000 – number of ipods sold (till Sep 2010)

100000000 – number of iPhones sold (Mar 2, 2011)

28730000 – number of iPads sold (June 25, 2011)

Net worth – 8300000000

Customer Service @ startups

October 5, 2011

Before starting this venture I always thought and had the opinion that I as a customer has a right of getting absolutely awesome service and any issues that I faced I always expected them to be resolved in my favor. I took the adage “customer is king” to heart and expected the same kind of a royal service from all organizations no matter the size that I interacted with. Again having lived in France for an year I truly appreciated the kind of customer service one gets here in US of A.

So what changed over the past 4 months? Having been on the other side of the table do I still hold this adage? As a CEO of the company do I still provide exceptional customer service? Were there any instances where I felt that my customers were being unreasonable? Have I at any point felt that “customer is not the king”

Before I start answering all these questions I just want to make one point clear – whenever DesiSauda is interacting with its customers I always make it a point to the team to put themselves in the customers shoes and treat them the same way they want themselves to be treated. This is the single most important guiding principle that DesiSauda adheres to when delivering customer service. Now jumping back the list of questions

Yes I still hold the adage “customer is king” to heart. For example I received a rather very nasty email from a customer asking us to stop spamming emails and calling us as “dumb”. Now that particular person is a customer and no matter what he/she says one has to take it in the stride – I am not condoning that person’s behavior and use of unparliamentary language. When I started framing an email back to the person I was very cordial and explained to him about our email policies, how we respect his privacy and how he can unsubscribe. At the time I was framing this email my partner asked me why am I being so nice to such a person and I simply said that this person has written such an email just because he was frustrated or just that he was having a bad hair day. I immediately get back an email from the same person apologizing for his rudeness and thanked me for giving him directions as to how he can unsubscribe – he being a customer is king and I expect the same kind of a service no matter how I behave (obviously there are certain limitations in which a business operates)

As a CEO do I expect DesiSauda to provide exceptional customer service all the time? Not exactly – we always do a cost benefit analysis and try to accommodate most of the customer requests. What I personally believe is that the key ingredient in providing exceptional customer service is taking that additional effort in following through and better communication – this is related to my earlier post about HRB5M syndrome. Going back to the earlier point there were instances where we declined customer requests as being unreasonable even though we know that it would piss them. But again from a cost perspective it would not be economical for DesiSauda to satisfy those requests – note that a company cannot do this CBA on a short term basis and has to look into the value that the customer can bring to the organization over his/her life cycle.

There were many instances where I felt that my customers were not being responsible and hence not kings at all. For example for an event we sold tickets at discounted price and a customer walks to our counter when the event was halfway through and demanded a refund which we obviously rejected. In these cases obviously customer is not the king and there has to be some education on the customer’s front as well.

I am hoping that as DesiSauda grows we continue to provide great customer service and we will be known as one of the companies that has created a name for satisfied customers.

HRB5M Syndrome

September 29, 2011

What is this HRB5M syndrome? What are its symptoms? Is it contagious? Who will be affected by this? What is the cure? What is the prognosis of this syndrome?

Did I catch your attention? Am I scaring you by coming up with an unknown disease name? Will you run to your doctor to get yourselves checked?

Before you hit the gas pedal and run off to the doctor finish reading this blog post.

HRB5M – Hit Refresh Button every 5 Minutes. This is the syndrome that I am affected by and based on my conversations with other entrepreneurs it looks like everyone else who are in this entrepreneurial boat are affected by this. What does this mean – I refresh my email every 5 min (as a matter of fact even more frequently) and the reason I do this is to check if there is any customer complaint, if there is any sale made or if there is any other email that needs urgent attention. As a matter of fact all emails to me need immediate attention and I am so addicted to responding to an email that I can boast my SLA levels be way way higher (counter productive). Now is this syndrome limited to only email client only – now this syndrome has slowly impacted my Facebook page as well. I refresh my Facebook page every 5 min to see if there is any comment posted on my FB page or if I have added any new fan. Once I find any new interaction I start slicing and dicing the activity – go deeper in to why anyone has posted any particular comment and if anyone has become a fan then what are his/her connections that my company can go after.

So the symptoms for this syndrome are frequent visits to different pages and refreshing the pages, extreme anxiety in case of any non activity on the pages one visits and a penchant to stick to high levels of SLAs. With these symptoms is this syndrome contagious – as a matter of fact once you enter into the entrepreneurship race you are affected by this – at least my studies have shown this (my sample size is around 10). But the question is – is this contagious. So technically speaking this is contagious but it does not spread by contact or from one entrepreneur to another – it affects a person just because he/she joins this bandwagon.

Is there a cure? Will the big pharma companies jump onto this and invest millions to reap billions?  As for the cure the only way I can get away from this syndrome is to turn off the computer and get busy in other activities Рworking on strategic alliances, meeting with customers or business development. But still one part of me keeps wondering whether there has been any new activity on the email front or on the Facebook front. Now the question is will this subside or increase with my company growing Рmy guess is on the contrary it will increase and also the number of channels increasing I would guess it keeps growing. The only solution for this is some discipline Рhave a strict regimen of email and Facebook dose, when one can check and to set expectations so that your ecosystems knows when to expect a reply or response from you. Now the ball is my court!!!