Are you ready to launch yet?

I could be wrong, but I think this is a question that quite a few startups (and even more established players) grapple with at various points in time – whether its the initial launch, subsequent updates etc. The question tends to be more critical for startups because it could very easily be a life-and-death scenario, and startups typically cannot afford a sizeable Quality Assurace organization to tell them if the quality of their offering is up to snuff. A lot of factors go into such a decision – Features, Quality, Competition and Timing amongst others. And please bear in mind that this post is written in the context of our experience, which was building a consumer internet website. Depending on your product/service, some of these points might not apply. 

At the time of planning the release, in addition to an ideal target date, you hopefully have the right set of features identified as well as prioritized into Must-Haves and Nice-to-Haves. It might be tempting to go for more fine-grained categorization, but I think that’s overkill especially when you are a startup. It will also be tempting to put a lot more features into the Must-have bucket, but when you are on an aggressive schedule and have limited resources, it is very important to be practical and have goals that can actually be accomplished. And while more features seems more exciting, it also means more code, more testing, more stuff for your users to grok, and most importantly, if you can’t make a good first impression with some of the features, it will hurt more than help the cause. The target date is likely governed by business constraints, so you’d like that to be a fixed target – if that’s the case, then you have to be refactor your feature list appropriately. If the planned launch is a big event, you are likely to spend a good deal of money and effort in promoting it, so it’s all the more important to plan realistically, allow for contingencies and ensure that you do meet the target date.

So you know what features are being targeted and you have a rough schedule for when you expect the work to be complete – make sure the milestones are clearly identified and you have allowed time for fixing bugs, stabilizing the product etc. As the development team is probably busy implementing them, a plan to test the new offering needs to be in place, and more importantly, start getting executed in phases. Initially, its probably just the development team testing it…then the rest of the core team starts to give things a go, and eventually, the broader team starts to get involved. Everytime we were getting ready to launch an upgrade for our site, we would have every staff member test it out and make sure that the functionality on the site was intact before it left the door – new features work as advertised, no breakage in the key functions on the site, no obvious performance degradation etc. When you are small team, you better be able to do that. And if you can build some basic automation around these key elements as you go along, you are going to save yourself a lot of effort and money down the road, especially if you plan on doing a few iterations of this cycle. If your offering has integration points with other partner sites, then you most certainly want to ensure that those are well-tested and validated as well. It is important to track quality as you go – all you need is a simple, centralized trackable list and a sound process to keep your team moving thru that list. We used Google Docs to file our bugs/work items, assign ownership and track progress. Granted it isn’t as granular as we’d like it to be and doesn’t provide a lot of tracking support, but it gets the job done. Get your team to be discplined about entering and updating issues into the list and review the list on a daily basis to keep things moving.

Once your satisfaction level with the quality increases, you should consider sending notification out to a limited audience (called friends and family) and get some external validation thru them before you go truly public – we have managed to find and fix quite a few issues with that approach (because they accurately reflect the end customer, come with a fresh, unbiased and un-cookied perspective and also allow you to test a wide variety of browsers, browser versions etc) but their time is valuable for sure, so go thru this exercise only after you get your product quality above a certain bar. And when they report issues, somoene needs to own that relationship, respond to the finder and ensure that those reported issues are tracked and addressed.

As you go along, it is also important to keep the target date in mind and take stock of where you are. If everything is going well and things are on track, then great. But they typically won’t be, software is hand-made after all. You will have decision points at various stages to decide whether the date gets moved or whether features get cut, and what the implications of each of those decisions need to be factored in. For instance, we had a big update planned in time for Valentine’s Day because of anticipated traffic but still faced some issues with our payment module and had to postpone – it meant losing a lot of potential PR, but the right thing to do was to postpone the release. So stay on top of your list of open issues/bugs, make the right decisions and make them quickly as the need arises and prepare for the launch. Once the site is ready and certified, then the hard work truly starts especially if you are a servicing business like ours. More on that in the next post

Choice of Office Productivity Tools

My guess is that this is a topic that one tends to take for granted, especially if he/she is used to working in a bigger company, mostly because there are already well-established toolsets and processes in place to conduct business on a daily basis. When it comes to your own startup however, the need for effective productivity cannot be understated – and hence the stress on choosing the right set of tools. What makes this a challenging exercise is the fact that most tools in this space (collectively called the Microsoft Office Suite) will most likely be beyond the budget of a fledgling startup. Few can debate the power of the tools and I still maintain that no other toolset even comes close to comparison yet, but it is an undeniable fact that the price makes it unaffordable for a startup. The last time I checked, an Office Professional license was priced at around Rs. 15k – not only are you not going to be able to afford it, chances are that you are probably not going to need about 70-80% of the functionality that comes at that price point. From our experience, it was pretty clear that we primarily needed Word & Excel, and to a much lesser extent, some Powerpoint. So what options did we explore?

First, we wanted to try and find a cheaper MS Office suite – there was a lot of hype around this subscription-based Microsoft Office SKU that was priced at around Rs. 1500 for a 6-month subscription, and renewable at a lower rate. Still not cheap, but a lot more affordable. The problem? This SKU was about as real as Harry Potter and Hogwarts – despite a thorough search for over 2 months, we were unable to find a single reseller that even knew about this SKU, let alone being able to sell it to us. And we were MSFT alumni, if we had so much trouble locating this edition with our network, I can only imagine how much harder it must have been without that reach. I now believe that this was just yet another feel-good, keep-the-PR-engine-happy initiative that was never meant to see the light of day.

So moving on to some real software that we could actually get our hands on, we tried Openoffice. The best part is that its free. And it has all the basic functionality you’ll need when it comes to documents, spreadsheets, task lists (Writer and Calc instead of Word and Excel) etc. Its free and that shows – its not quite in the same league as MS Office in terms of look, feel, UI etc but you get what you paid for, and it was more than sufficient to get the job done. Interoperability was a challenge and when we had to share documents with folks outside the company, we had to remember to save it in an MS-compliant format (the rest of the world is pretty much on MS Office, it seems like), had issues with formatting across platforms etc. One big unintended benefit with OpenOffice Calc was that it allowed a much simpler, richer data import process into our SQL Server database by allowing simple conversion to the CSV format (comma-delimited) – Excel supports this too but was rather messy with string data, not always consistent with single and double-quotes etc. When it came to creating slide decks and presentations, the gap was a lot more noticeable with Impress, the proposed Powerpoint replacement – not quite as rich, the presentations don’t look good or as professional, which is a big problem especially when its for an external audience. And with Powerpoint 2007, Microsoft has definitely taken it up several notches, so I think the gap has only widened. But overall, Openoffice provides a good, cost-effective alternative.

And then there is Google docs. A very compelling choice, that has certainly added a lot of powerful features over the last several months and is catching up rather nicely with the leader. The big difference is that this is available online only – so while that prevents offline editing and therefore impairs productivity, it also makes collaboration that much easier. There is only one central copy – sharing the document is super easy, allows concurrent editing and collaboration, good integration with gmail and gtalk, and there is no need to forward, store and manage multiple copies locally. We used the Spreadsheet a lot more than we used any of the other tools and particularly for things like task and bug tracking, creating lists etc, this was extremely simple and powerful at the same time. From a features standpoint, there is still a long ways to go however – sharing data across sheets in a book, complicated formulate, filters etc are all features that one would want to use on a regular basis as a heavy spreadsheet user and thats one area where the Google Spreadsheets fall short.

So in short, we ended up using a combination of these tools depending on the task that they were best suited for. But thats an approach that is not the most efficient and certainly doesn’t scale very well as your startup evolves, so in that sense the search for the ideal toolset still continues. Zoho seems to be very promising and fairly extensive, but I haven’t had a chance to play with those yet.

What tools do you use in your environment? If you have any experiences to share in this regard, please comment.

Offline Operations – Should you even bother?

As the topic suggests, this is a sequel to my last post. If handling offline operations is such a challenging task, should startups even venture into that problem space? Probably stating the obvious, but the answer depends – depends on the problem you decide to go after, the team you have in place, the size of the team, the resources that you have at your disposal, and last but not the least, a good understanding of where your passion and competencies lie. If your team is predominantly a strong technology group, it does seem easier to go after a pure technology play. Sure, such a pursuit has its own set of challenges but at least they are more likely to be in a relevant domain thereby vastly improving your chances of addressing the problems that crop up.

The vast majority of startups in India though, especially the ones in the Internet space are about solving an existing consumer pain-point, making it easier for customers to do something that they need to do and have less efficient ways of doing today. And typically, solving such a problem does involve handling offline operations – if not, where is the question of solving anything? More often than not, they seem to be ideas that have worked in markets elsewhere and are then adopted/adapted for the desi audience. Nothing wrong with that – getting those same idea implemented successfully in the local market is a pretty big challenge, requires a fair bit of localization of the original idea and therefore worth going after. It is also worth noting that the vast majority of the startups that have gotten funded so far fall in this category – among other reasons for this phenomenon, one factor is certainly the fact that it seems relatively easier to get customer transaction with such a venture. If its a fairly common problem, such as booking airline tickets, there is a significant addressable market size, a problem that customers will identify with and one that will provide instant gratification for the end-user. Obviously, one would need to do a good job of solving the problem to continue to gain marketshare, but at least the opportunity to attempt a solution is relatively easier to get. In short, there is obvious benefit in going after such a problem, but as stated earlier, handling the operations in an effective and efficient fashion has to be an important part of the gameplan for such a startup.

In general, it is good to ask the following questions:

1. What is the problem I am solving?
   Hard problem, simple solution is an ideal principle to keep in mind, I think. In other words, in order for your venture to be compelling, you need to solve a hard problem but in your own interests, the solution needs to be simple. Note that hard problems usually involve manging operations that are non-trivial, but that is where you can add value, by reducing the complexity of those operations. And I am not having fun with words here, but solving hard problems in a simple fashion is definitely not simple, so doing this will take some hard work.
2. What is different about my solution? Why am I better than the competition?
   Yes, you should have competition no matter how cool your idea is, even if that competition happens to be the traditional way of doing things. Make sure you differentiate yourself from that competition and have enough fuel in the tank to continue staying ahead.
3. On a related note, how do I protect my turf?
   If the idea is good and you are able to execute well early on, thats great news…but that will also bring in competition. When folks see your initial success, they will also see an opportunity. While you will have your strenghts, your solution will also have its weaknesses (after all, you are a startup – you cannot possibly do everything), and good competition will see opportunities in those weaknesses. This is unavoidable but you can certainly anticipate this, plan and minimize the impact. The more differentiation you have and the harder the problems you solve, the more secure your moat is going to be. Yes, it is hard work, but you knew that already.
4. How well does my solution/offering scale? Does it become increasingly efficient?
   The answer better be an obvious Yes here. This will take a while to achieve – a few months to even a few years, maybe, but you need to be able to get there. The inflection point at which the scale starts to show big improvements in efficiency can vary, but that inflection point needs to exist and it better be within a reasonable timeframe, if not the ROI is not going to be compelling. I am probably over-generalizing here, but technology is your best friend here. The more you employ technology (smartly, of course), the easier this will get to accomplish. For us, one way to look at it was that the bulk of our initial expenses was in staffing – Customer Service Reps, Delivery Executives etc. And our approach was to try and improve the extent we could get rid of manual processes in our workflow, make existing processes more efficient with technology solutions so as to increase the ratio of volume of business to staff size. Apply your own variables/examples here, but the simple guideline to remember is that your revenues should increase without requiring a proportionate increase in costs.
5. Who is my customer? Will they pay for the solution?
   It is very, very important to identify who your customers are. Sometimes, the answer to this question isn’t as simple as it appears, because you could have multiple customer segments, and your solution typically addresses different pain points for each segment. Understanding those pain points, the extent to which they are a pain, will that customer pay you if you eliminate or reduce that pain are all important questions to answer – and the answers will be critical in helping you determine the scope of your solution. The customer does not have the resources or the motivation, financial or otherwise, to address those issues but your value proposition that you are able to solve those problems at a fraction of the cost. Simply stated, the more obvious the justification for the customer to pay you for your service, the better off you will be.

I came across an article recently that is related to this topic that made for good reading – check it out. Happy reading!

Offline Operations for an Online Startup

If I had to look back at our history over the last 2 years, the aspect that stands out as most challenging has been handling the offline operations to keep the online business going. However, it is also the most critical part of our offering, it is why customers come to us in the first place. And this is true of most, if not all, Consumer Internet plays in the e-commerce space, for they are all about making it simpler for consumers to perform some activity, namely Commerce, that was hitherto performed offline. If it is indeed the most important aspect and is also the most challenging, how does a startup prepare itself to handle this challenge?
 
For starters, it is important to truly understand how much energy will go into this activity. If I go back to our own story, we knew that would be the key area, but even so, I think we underestimated the extent to which it would be important for us. It is easy to get caught up in the coolness aspect of launching your venture/site, but don’t lose sight of the fact that the Operations form the true lifeline for your business.

There is the initial groundwork needed to launch the site and get things going so you have offerings for the customer that comes visiting. But that’s the easy part – the real thing starts when you have a paying customer place an order because at that point, everything else becomes secondary. Handling that customer’s request to his/her satisfaction should be your only goal from there on until that gets taken care of. And if you are doing well, you are hopefully getting that steady stream of orders, so that goal becomes perpetual.
Once you are convinced about the importance of your Operations, you will need to staff up accordingly, and preferably starting all the way at the top. In fact, I would go to the extent of having someone on the founding team with deep Operations experience in a similar setting elsewhere. Having that level of ownership for an area that’s as important will go along way in ensuring that it gets the right level of attention and effort, and that you are taking the necessary steps to evolve your team as you go along. Hiring this expert was certainly a challenge for us, and we asked one of our advisors for ideas. Given that on-time delivery was an important aspect of our service, he suggested that we look in a vertical with a similar mandate, such as the airline industry. The ground staff responsible for ensuring that flights take off on time for any airline understand the importance of keeping things running like clockwork and might be ideal candidates for consideration. We didn’t get the opportunity to act on that advice for various reasons, but I thought it was a great idea, completely out-of-the-box. Likewise, having folks that have managed an employee base similar to your operations force will obviously bring the value of that experience with them, and that value will get more and more critical as you grow. Just as the quality of the team is important, you also want to size it appropriately – as a startup you can’t afford to overstaff but at the same time, you dont want to understaff and compromise on the quality of your service. So, depending on the nature of your operations, estimate the volume of business you expect to generate (and review this against actuals on an on-going basis) and  ensure that you are sufficiently staffed to handle that volume.

As you staff up, it is equally important to put a process in place (and again, refine the process as you go) for your various operational tasks – shifts/attendance, petty cash inflow/outflow, auditing, order processing, customer support, customer follow-up are some areas that come to mind. And any such process better be centered around the customer and your Quality of Service (Qos), for if the quality gets compromised, then its only a question of time before the process becomes moot. You simply won’t need it because your customers aren’t coming back.

So lets say you have a team in place and you have a well-established set of processes that enable your team to chug along and that your early customers are happy with your service and keep coming back. Pat yourself on the back when you get to this stage because it does mean you have survived the early phases. Now comes the bigger problems, ones that you almost want to have. Scaling up, without compromising quality, is a huge challenge. It is important that a customer and quality focused culture are now a part of your organization’s DNA. Only then will you be able to onboard your newer employees (the ones you will need as you scale up) and train them to sustain the same levels of customer satisfaction. But more importantly, scaling up needs investment, usually from Venture Capitalists. And in order for them to be interested, the scale has to be much better than linear. You need to be able offer the kind of 10x returns that would interest them, and that is hard to do if you are not becoming increasingly efficient as you scale up. This is what makes a business model like shaadi.com or naukri.com a lot more compelling – to get 10x more volume, they don’t need 10x the staff. To take our own example, if we need to hire an Operations team of size 10x (and therefore 10x other associated costs such as rent, utilities, benefits etc) to handle 10x the volume, that is probably not such a great value proposition for the VC. We have to be able to prove that we are able to handle the growth in volume with lower and lower transactional cost per order handled. Needless to say, it is going to be hard to demonstrate this efficiency in the early stages because you are still growing very quickly, but after you get to a certain critical mass (and that better be within a reasonable time period), the efficiencies better start kicking in. In order for this happen, it is almost imperative that technology is put to good use in constantly refining your business workflows and processes. The more manual operations you are able to replace with automation (presumably at lower transactional cost), the better off you will be in driving this efficiency, thereby increasing your ROI.

Some examples I have seen lately are predominantly technology teams that start up a venture that has a significant Operations/Logistics play to it (including our own, of course) – while they will no doubt be able to use their technology expertise to solve some of the complex logistical challenges down the road, it is important that they take the necessary steps to ensure that they are able to handle their initial operations well, demonstrate early success and subsequently grow to the point where that technology expertise becomes critical. Unfortunately, the value of the technology is only going to be truly realized when the volume gets to be significant, and growing to that volume will take a lot more than just technology, so hope these teams plan accordingly and execute well. Good luck!

Barcamp Hyderabad on Oct 11, 2008 @ ISB

The next edition of Barcamp Hyderabad is here. There is a visible change in startup activity in Hyderabad over the last couple of months – more informal meetups, more organized events and presentations, some semblance of investor activity and the early signs of a startup community are all great positive signs. For a while now, I have envied my fellow entrepreneurs in Bangalore because there definitely seems to be a better support system (and experience has shown how valuable having that support is for a startup) in place in India’s Silicon Valley, but things are slowly starting to happen in Hyderabad as well. These are early steps no doubt, but they are certainly in the right direction and will be great for the community here. What is needed is your support to help the community grow and thrive, so please attend.

The theme for this Barcamp is also very relevant to most startups here – Technology Entrepreneurship. A lot of folks have already registered, including a few speakers, so if you are interested in startups, entrepreneurship etc, I assure you that this will be worth your time. The Barcamp is on Oct 11th (kicks off at 2:30pm) at the Indian School of Business. One doesn’t need an excuse to visit the beautiful ISB campus – this is a great choice of venue. You can find more information on the event here. Hope to see you there!

Choosing the right Development Tools for ASP.Net

After a lot of posts about very generic startup stuff, its probably time to talk about something that’s more technical in nature. After all, we are supposed to be a Consumer Internet startup with a strong technology leaning. I am sure there will be more topics to discuss on the technology front, but I felt an ideal start would be talking about our choice of our Development Toolset.

The entire founding team had worked for a considerable amount of time at Microsoft, and therefore the .NET application stack was very familiar territory for us. We felt pretty strongly that picking technology that we already had expertise in would make things easier, especially since we had made the choice that we would develop the site and any components surrounding it ourselves. Looking back, I think we would still agree with that decision because it has kept things very simple for us as far as managing our aggressive schedule was concerned. I don’t know if things would have been the same had we gone a different way, say with the LAMP stack, but my guess is that the steeper learning curve, especially in the early days might have posed some challenges.

So, given that the technology choice was fairly straight-forward, we also needed the right set of tools for our development needs. Clearly, we wanted nothing to do with pirated software and only wanted Genuine Software but it is also common knowledge that Microsoft’s products aren’t exactly cheap. And for a startup, if something is not cheap, then it is not an option. The web server (IIS) and the database (SQL Server) came with the hosting package (more about that in a later post) we purchased for our production needs, we still had to worry about our own development machines. That is where the whole Express SKU came in very, very handy – I think Microsoft has done an absolutely fantastic job with these Express products to counter the Open Source challenge. On our dev machines, we had SQL Express, and for the IDE, we took the same Express SKU of Visual Studio, both of which are free for download on the Microsoft website. Note that the Express SKU comes with its own set of rules, but I am sure the License Agreement has more exciting facts on the Terms of Use, so be sure to read it if you choose to use this SKU.

When I first started using the Visual Web Developer 2008 Express product, I expected a lot of the functionality to be unavailable because it was a free product – to my pleasant surprise though, I really don’t remember feeling limited at all. Setting up the site as a project, running an instance of the site from within Visual Web Developer 2008, stepping through the code, setting up breakpoints and debugging the running instance, all of these were remarkably straight-forward with the Express product. In fact, the whole task of setting up my project and getting a running instance of our site from within VWD took me no more than a couple of hours. And if you are familiar with the VS IDE, you will find the VWD Express experience to be very similar – highly intuitive, lot of convenience built in, allowing you to focus on just your own code instead of having to worry about the rest of the infrastructure. Two thumbs up for Visual Web Developer Express, especially considering it didnt cost us a single penny to use. What you don’t get are the more Enterprise features such as the Team System features, integrated bug tracking, code repository etc but chances are you’ll not need them in the very early days, so this is a great stopgap solution. And its all VS, so migrating your code should not be an issue when you are ready to migrate to the paid versions.

As I stated earlier, we have a lot of reasons to be biased towards Microsoft, so take my recommendations with a pinch of salt. However, if you are committed to the .NET stack and are looking for a cheap approach to get things going, then the Express SKU is a god-send. On a somewhat related note, I recently tried to set up a pilot LAMP site for a different project I was working on. The pilot was free, the download was fairly straight-forward and the instructions in the README were pretty simple, but after a long and frustrating exercise, I still couldn’t get the thing to work. Only some cryptic error messages (a problem that folks typically attribute to Microsoft products) and not-very-useful log files, nothing that could help me resolve the issue. I’ll continue to fight that battle and I think Open Source is great, but there is something to be said about software that comes from the Microsoft stable, they definitely do a lot of things right.

Support on the Home front…

While I have often thought about how hard life can be as a startup entrepreneur, I have to admit that I haven’t nearly thought as much about how much harder it has been for my family to support me through all the highs and lows. Quite easily, its a much harder challenge – mainly so because its such a thankless job. They don’t really get to experience all the highs that you enjoy running your own startup, and have to endure all the lows and more. And they didn’t even really sign up for that role by choice – In all likelihood, they just wanted you to do what you wanted to do and therefore went along.

This post is a tribute to Anusha, my wife and the rest of my family. While not all of them agreed with the decision of starting off on my own, they have given me one hundred percent of their support one hundred percent of the time. Life is hard now, but it would have been impossible had they not backed me as strongly. Obviously, Anusha took the bulk of that burden and has patiently travelled on the journey with me, carrying a lot of the baggage during that time. The fact that she still has her job is definitely a relief – the pressure isn’t as intense as it could potentially be when it comes time to pay the bills, god alone knows how much worse that would be. But really, I honestly think that’s the easy part. If you know me, I have my fair share of mood swings and can be a very unpleasant guy to be around, especially at home where I take the liberty with people close to me – and I was that lousy when I had a stable job, career was going well etc. So you can only imagine how much worse it would be now, considering I take all the stress from the startup home and unload it one go. I think she now knows quite well what hell must be like, and still puts up with it, forever a smile on her face. Thank you, dear Anusha, its not without reason that I consider you my best friend for life. Sometimes you have a gift in your possession that you know you don’t deserve but yet you are never going to give that up – you are my special gift.

A friend recently sent me a blog post that also highlighted the importance of family for everyone involved with a startup, including employees. I think it was a great piece, and is very relevant for this post. The author has done much better justice to the subject than I ever can. So, if this topic interests you, read on.

Stay focused on the goal, Stupid!

All startups have a reason to exist – and no, it is not just about how cool the idea is, how solid a team is behind the venture, how passionate the founding team is etc. All these are good attributes but really, it is all about what value the startup claims to provide, and specifically to which target customer. And while it might seem obvious that fulfilling this value needs to be the core focus of the startup in the early days, reality seems to be rather different. I recently met the founder of a new startup who was taking a fair bit of pride in explaining that his startup had seven different things they offered to customers – yes, seven. And it was very hard to try and correlate what was common to the seven offerings, or how they all related to the core value he was claiming. Now if he pulls this off and succeeds in doing any of the seven well, then thats obviously very commendable, but I am reasonably certain thats not going to happen.

In any case, the topic of core value is what this post is about – and what follows is completely based on our experience and what we learned from it. So any resemblance to anything else is completely coincidental and obviously unintended. Our startup began out of a core idea. The core idea, in our case, either addressed an existing problem, or made something better, or enabled some new possibility, depending on which customer’s perspective you were viewing it from. [Note that there are at least two problems here. The core idea better address only one of these aspects, not all three of them. Its hard enough doing justice to one, let alone three objectives. Secondly, you should really only have one target customer segment, and the solution you are building should be consistenly the same from that customer segment's perspective - having a matrix of possible customer segments, customer perspectives etc is a short-cut to nowhere. So attribute those mistakes to our inexperience and read on...]

In any case, keeping that solution and the target customer in context, an initial plan of the How gets defined, with some initial goals and milestones for your team to target during the early stage. With that plan, you simply start executing. Great! Now, somewhere along the way, things aren’t taking off as well as you had anticipated, revenues aren’t coming in as strongly etc and you start to get a little anxious. Its time for some readjustments, you tell yourself. Probably the right thing to do…but at the same time, you have to ask yourself a very fundamental question – do these adjustments support our core value prop? does this truly help what we set out to do? And if the answer is a No, then its probably not the right adjustment. Of course, you will have situations where the adjustments are indeed right and they warrant a refinement (or even a major change) of the core value prop, but to me, that requires going back to the drawing board, questioning your fundamental assumptions and making any necessary changes to the core idea before you go too far with the adjustments themselves. What is absolutely not a good idea is to continue to believe that your core vision has not changed and your adjustment doesn’t really support that vision, but yet, with some short-term interests in mind, you push yourself into going forward with the wrong adjustments. It might even be possible to justify these “initiatives” as minor or that they won’t distract your team’s true focus, but wake up and stop pretending. You know that’s not true. If you have customers at the receiving end, then no initiative is minor. Even if its minor today, it will become major at some point, at least in their eyes. Thats why they are paying you!

If you’d like a simple example to illustrate my point, I’ll use one from our own history – our core mission is to make it easier for small businesses to go online and enable customers to easily find these businesses. At some point, we convinced ourselves to mange small events for a couple of our customers because there were requests for us to do it. It really had nothing to do with our core goal but it was an opportunity to earn some revenue, get some reach to a bigger customer base, didn’t require a great deal of investment etc. While we ideally should have politely turned those opportunities down and focused on our true objectives, we concluded that accepting these commitments would help the bottomline and went ahead and did them for a while. Bad idea! What wasn’t so obvious at the beginning was that these things have a cost – if you only have a small core team (and you better only have a small team if you are a startup), then every minor distraction is taking valuable cycles away from meeting an already challenging objective you’ve set out for yourself. And your team will slowly start getting confused about what our real day-to-day objectives are – the goals we set for ourselves, or these adjustments that cropped up along the way. How do you keep them focused on the right goals? In the long run, would that additional revenue truly seem worth that cost? With the benefit of hindsight, I strongly feel that it does not.

As a side note, there are the examples of consulting gigs that fund startup products but thats a very, very different scenario – you are not under time or revenue pressure for the startup, your core revenue is coming from the consulting assignment and therefore the startup or its mission is probably not your primary focus etc., so lets not get apples and oranges mixed up.

So, in closing, should you just keep going after the core idea that was originally defined without making adjustments? No, absolutely not. As I stated in my earlier post on The Business Plan, I think its good to constantly review your milestones, progress towards your stated goals, validation of the assumptions, targets etc you had defined and thereby ensuring that your core idea is either still intact, or that you are able to refine it as appropriate. You obviously don’t want to do this as a daily exercise, that will absoutely not help – but a periodic review, preferably with your Advisory team, based on your idea, your goals, your time horizons, your team situation etc is a well-advised move. Note that all ideas need time to germinate and take some time to come of age, so try not to be too impatient about expecting results from the ideas that you start implementing. More on that topic in another post, its time to sign off on this one.

The 8C’s of a Startup Team

You’ve probably read enough articles from a lot of experts about the Team being the most important element of a startup. In fact, the primary factor that investors consider while backing a startup venture is said to be the Team. So what makes a good Team?

From our experience, I’ve tried to list the attributes that we learned was critical to the startup team, in no particular order. Enjoy!

Chemistry – You are going to spend more time with your Team than your own family over the next several months of your startup journey, so keep that in mind when you select your fellow adventurers. It is absolutely fundamental that the team gets along. You are going to see more than your fair share of ups and downs, and being able to enjoy this ride with each other is very, very important. After all, if you are not having fun doing this together, then you are probably not going to be able to do it for very long.

Culture – Probably something that gets underestimated more often than not is the Culture that the team shares. While its obviously not necessary to agree on every aspect that falls under culture, there needs to be basic agreement on the value system – things like integrity, means of earning business etc. Not paying enough attention to this can certainly impact the Chemistry and everything else that goes with it. And as you grow, this shared culture should evolve into the basic DNA of your organization, so this is something that needs to stand the test of time. Taking the time to understand why each member of the Team is involved in the startup is probably a good starting point to evaluate the cultural fit.

Completeness – In the early days, the Team is the be all and end all of your startup. That means that the Team better be complete with regard to the goals that you are trying to achieve and what those goals entail. Of course, during various phases, the goals start to change, evolve etc and this will warrant evolving the composition of the Team as well but you better not be missing any key functions for the goals you are trying to achieve in that particular milestone. If that happens, it is quitely likely that all the good work of the rest of the group will come to nought. For instance, if that milestone requires achieving a certain volume of sales, there needs to be someone in the core team that’s capable of making that happen. Not every member on the team needs to be a rock star, but together, you better have a unit that is special and capable of big things.

Commitment – Again, probably something that’s taken for granted. Working through the early days of a startup is often considered sexy and exciting, but very few first-timers truly realize how difficult those early days can be. The core team needs to show unflagging commitment, and not just in patches, but on a consistent (read daily) basis. For those that are doing this part-time, this can quite often be a challenge, but if you don’t find a way to do this, you are going to quickly fall behind and will find it much, much harder to recover. And if you don’t recover, well, you know what happens…

Collaboration – Lets say the team is complete and every member has his/her role assigned, so you have primary areas of ownership clearly identified. But there are going to be times when the primary owner is overwhelmed and the rest of the team needs to play a supporting role and pick up the slack…and some of this will most certainly be dirty work. Someone has to make the coffee, someone has to clean the plates and so on…No one said it was all cool work but the work has to get done – so you better get busy on those plates.

Communication – If there is one thing that gets taken for granted, it is the Communication aspect. Please do not underestimate the importance of keeping everyone on the same page – beware, this is very easy to do and you won’t even know it. It is quite likely that you are working on a somewhat distributed setup, and a lack of communication can not only foster inefficiency, it can quickly lead to frustration and create a negative climate all around. And as we all know, such negative sentiments will pull your entire team down like quicksand. Have regular meetings, status updates, reports etc – whatever it takes to keep the communication lines open and functional.

Character – If you are involved in a startup, you probably have a lot of Character to begin with. Good, because you will need it and you will be severely tested. Unless you are one of those incredibly lucky startups, the proportion of bad news will far outweigh the good news that you get to face and it is just incredibly important that you don’t let it wear you down. Every day is a fresh start and the commitment to the goal cannot waver – and that takes character, lots of it.

Commander – And last but not the least, you are a team and you will work together and a lot of decisions will be by consensus because its a small unit, but there are certainly times when you’ll disagree. It is therefore important that there is a clear leader in the group. And it is very, very crucial that the leader is the right person for the job. While being able to command respect is a necessary condition, it is absolutely not sufficient. The leader is the one that shows conviction, demonstrates tremendous clarity of thought, stays committed to the vision, is able to stare adversity in the face and lead the team in pursuit of the stated goals. You are expected to question decisions that you don’t agree with, but in the event that there is disagreement, you have to be able to trust and defer to your leader’s decision-making abilities and support the team, period.

I do make it sound very serious and somewhat negative, don’t I? Its because after almost two years of doing our venture, I now fully believe that the Team is the most important aspect to the startup that there is, and the attributes I list above warrant a good deal of attention. If you are able to assemble the right team and go after the objective together however, it makes for nothing but an unbelievably fun ride!

Office Space for your Startup

It has been exactly one month since my last post. And despite my commitment to write at least once a week, I had to make an exception for the last 4 weeks because I was busy getting our new digs ready. Our new office space (the landlord gave us just the building shell – finishing it up was our responsibility) not only took a month to get ready, it also meant that we didn’t have a proper space to work out of for a month. Now thats a killer for any startup, particularly one with an operations group, dealing with live customer transactions on a daily basis. I thought our Operations team did a commendable job of handling our business for the month we were in a temporary space, especially given all the crazy Hyderabadi rains that seemed to find just the right time to show up. Thank you dear customers for bearing with us during this challenging time, you were certainly very patient and understanding.

Now, how we got into such a mess is a topic worthy of a lengthy discussion but I would be digressing…what this really got me thinking about was the key criteria for startup office space, how you decide etc.

Firstly, you obviously want the space to be cheap – that is true for all startups, funded or otherwise. Beyond that, all the other criteria depend on the size, nature and type of startup, so I will just stick to our experience. Ours is a consumer facing startup, and brand visibility is paramount. We are now bang opposite Cyber Towers, one of Hyderabad’s most prominent landmarks and the fact that we can prominently display our name in such prime real estate adds incredible ad value. Lots and lots of eyeballs, and hopefully at least some of those will translate to site visits and so on. The next key aspect for us was phone and broadband availability – network strength, coverage etc. Those two are mission-critical elements for us and if either of them is down, then the business suffers greatly. And unfortunately, despite all the data that indicates otherwise, you still can’t take either of these for granted in Hyderabad, even in an area like Hi-Tec city. Sad, but true! So we have backup options, but that adds to the cost, and that hurts. Then there is availability of power, which is just as critical. If you don’t want to (or can’t afford to yet) burn money on a UPS system, then you better make sure the power supply is pretty reliable. Of course, no one could get away from the nasty power cuts for hours together last month but generally, this seems to be less of an issue on our side of town. And then there is parking – obviously an extremely premium feature, especially if you want to be on any major roadway. If you have more than a few employees that drive their motorbikes and cars to work, then you better pay attention to this and have a solution in place. You could mitigate some of that by picking a terrific, central location – encourage them to ride the bus or the metro. Not only is it cheaper, it is also pro-environment. Central locations typically also come with plenty of eateries, chai addas etc, and your employees will most certainly need those. Finally, do some basic surveys of the locality, the surrounding environment, challenges that other companies in the neighborhood face etc and be sure that those are ones you can handle or live with.

Thats on the outside, which I think is harder in some sense. On the inside, more than anything, you want the place to be clean, functionally well-designed and something your employees will enjoy spending the bulk of their day (and night?) in. If you need to invite a partner or a customer over, you obviously don’t want to be uncomfortable having them over. Space constraints depend on your size/staff but some key things to think about are clean restroom(s), a pantry/lunch room with some basic amenities, sufficient power points, phone/LAN outlets (Wirless is the way to go if you are a true tech outfit, everyone has laptops etc but if you are like us and have older systems for the non-technical staff, then wireless can get expensive), plenty of light (the more the natural light, the less you’ll spend on lights and power) and ventilation – nothing unique about these requirements but one tends to compromise on these in the interests of keeping costs low. You dont want to be Penny wise, pound foolish. Startup needs tend to expand quickly and you’ll want to accomodate those without having to move again, so think a little longer term while still worrying about your budget. And not to be fancy, but try and accomodate a meeting room in your plan if at all possible – as you grow, you’ll need to be on conference calls with partners, customers, investors, internal team etc and a separate room can be a blessing, especially if you don’t have offices/cabins. Make a list of core requirements and nice-to-haves clearly separated out, plan your budget well (and please be realistic – if you are in Hyderabad, simply double your budget and start again) and check out at least a handful of options before deciding. Not only will that give you a pulse on whats out there, it will also help you think about stuff that you hadn’t earlier. Finally, make sure your space is in a commercial building (and not operating in a residential one – such an arrangement is cheaper but also illegal and can quickly get you in trouble).  Visit a few other startups and talk to them to see what traps they fell into.  If you are in Pune, Mukul’s tips at might be helpful.