With the spurt of angel interest and an increasing number of billion dollar companies (valuation and not revenues), entrepreneurship is becoming a serious career option in India. More and more startups are getting off the ground and raising their first funding. As an active investor in and observer of entrepreneurs in India over many years, I thought I would share some of the potential gotchas potential entrepreneurs might consider as they step out into the wide world:
a. It’s not just for the money:
I have seen entrepreneurs who have the passion for the idea, but sometimes the vision is not clear, sometimes it’s clouded by just the money aspiration. The entrepreneurs who tend to survive and thrive- really have it deep inside them. They have a vision- they want to change something. That’s what gets to the investors- that’s what keeps them going through the dark (and everyone goes through the dark phases). So it cannot just be about making 100 crores in 5 years.
b. Communicate within and outside:
All entrepreneurs know they have to spend time communicating outside ( necessary for survival). At times even this is not taken as seriously as it should- the best are generally good at this, again this can really be the difference between success and failure (as failure to communicate well may lead to the inability to raise funding). Equally important is to communicate within- some think they need to do it when the company is 100+ employees, or it is the job of HR- it is not, HR is not going to motivate employees through your vision. Also, it’s not only about talk- it’s also about action- “If you really want to build the best tech platform for xxx” then you should not have a mediocre guy hanging on in the tech department.
{ Also read: how to become a successful entrepreneur }
c. Know/Share your metric:
Every business has at best 3 core metrics which can tell where it is headed (beyond revenue and gross customer adds). It could be your customer/revenue churn, unit economics, engagement, etc. It’s key to knowing them, measure them and communicate upfront- don’t wait for investors to guess 45 minutes into the conversation. Also be very clear with how the metric is measured when talking to investors- at times entrepreneurs make convenient assumptions and don’t bother to explain them up front, which can cause serious dissonance. Also, need to drive the same internally as well, let your employees know what you are after and frequently, they should know what really matters to make the company successful in the near term.
d. Have clarity on your organisation and the gaps you need to fill:
Be clear on your team and personal strengths and weaknesses and your strategy to fill the gaps, do not wait for a potential investor to second guess you on this. While hiring is not easy in the hot market, it’s always helpful to have a clear template on key positions and articulate the plan- no one person can do it all alone. At the same time, many gaps can be filled with part-time/freelance help in the near-term. On a related note, entrepreneurs need to be mindful of how they can contribute their personal charisma, passion and vision to be able to onboard good people- this is sometimes ignored. Bringing on board strong outside hires can snowball into a significant advantage in building a strong team, so not a good idea to kick this can down the road.
Guest Author:
Deepak Gupta is CEO & Co-Founder of Equity Crest, a curated seed-funding platform and also an angel investor.
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