Wednesday, July 8, 2009

Journey to entrepreneurship...

From long time, I had this dream of becoming entrepreneur and at last, I could realize it last month, Jun'2009. I knew that this is going to be a tough job as I am new to entrepreneurship but I realized that it is not really that tough if you enjoy what you work and you work for what you believe in.

I do not remember when first time, I thought of becoming entrepreneur, may be, it is in blood as I belong to a community known as "Baniya" in India. Baniya means business person. I am a calculated risk taker and I do take risks after doing my home work with whatsoever little I know. The day, I entered in IIT-KGP, I knew that one day, I can realize this dream and it took 10 years to have that courage, confidence, financial stability, family support (in fact, strong support from family), goodwill among friends (even those persons who are yet to become friends), some level of network and most important recession, which brought me out of comfort zone. Sometimes, you feel like flowing with life especially when life is smooth but than one day, you are in mid of the river and find that one storm has arrived from nowhere and you need to take prompt action to sail and reach to destination safe and sound. Recession has had similar impact on me.

What might make the difference is your preparation on your dream. How far one goes, depends on how strong the foundation is. Entrepreneurship is a creative process and I learnt a few steps from many individuals and I could take care of some of them. Below mentioned points might help a few other entrepreneurs as well.

1. Understand your finances
Only few can undermine the importance of money especially when you are about to take a new journey. One must calculate the current savings and how long can one survive. In my opinion, do not count on your properties, immovable assets at this point because those will be useful if you hit rock bottom for some reason. In normal scenarios, I could foresee that I can survive for about an year even if I do not have any profit from new venture (Pls note that I do depend on my spouse's income which is very very big support). Me and my wife sat together and understood our savings and inflows and we collectively thought of a few cost cutting measures, like, delay paint for our flat, no major expenses, cuts on outings, reduce lavish lunches/dinners/parties etc and we felt that we can pay our EMIs, we need not to trouble our parents (and extended family) and more important that we need not to borrow.

2. Ensure family support
There is an old saying that hope for best, prepare for worst. Life looks good when everything is going good but in bad times, it is the family who provides moral, emotional, and financial support. This is key to start business as one will have rough patches on the journey (like Indian roads:)) and that time, if someone is around, life does not look that bad.

3. Develop competence
One need to be thorough in the area one wishes to enter unless you have huge money and you can hire experts in that area. One also should learn a bit of company law, equity, finance, HR, legal areas etc to not to be cheated by others. Network can help you in reaching to key stakeholders but its your competence, confidence which will convert it in a deal. In simple words, do not miss a single opportunity to learn. Just be open to any kind of learning.

4. Nurture your friend base
I am realizing that most of the tasks get done due to the relationship one share with his/her friends instead of logic behind the task. Sometimes, we argue a lot about a particular task with a person but if we share great rapport with the person, the argument reduces. One's friends are their business managers in the beginning when one can not invest much money in marketing. At times, one's reach in market is directly proportional to the friends one has in the beginning. Needless to mention, do help your friends in need, share life with them and one might get unbound, limitless opportunities.

5. Build your network
Who can dare to deny importance of network in coalition days? Do attend most of the business events (like, startup fairs etc), attend trainings, Alma mater, from very beginning. Nobody can predict that which relation may help you in getting some assignments. Do initiate/ involve in community service projects as it might help in building goodwill and some good friends.

6. Understand customer base
Synonym to business is customers. Do some amount of research on what industry segment one wish to enter, what problems one is trying to solve, who can be potential customers etc. Have a discussion with few potential customers to understand their challenges, pain areas and wish lists. It might help you in refining your approach.

7. Prepare business plan
Enough is written on need of business plan and one can do google to know enough on this topic. Point is that one need to keep end in mind, have a clear vision & mission statement and a plan to achieve them. Planning is like setting strong foundation and validating your thoughts with industry veterans. It is indeed even more important if one is looking for investments.

8. Business vs Service
Each business addresses some or other need of society hence it does have a social linkage. Society at large must feel benefited with that business. The degree of benefit may vary. New company must highlight that how do they plan to create more value to society. Define the USP (Unique Selling Proposition) or in minimal words, explain your unique offerings or value to society.

When one does business than always have your interests in mind and be clear on that. In other words, service is done with more involvement of heart while business is done with more involvement of mind hence have a clear distinction between these. In nutshell, no space for intuitions, collect as many as facts possible before the jump.

9. Plan distribution of equity
If you have many partners and investors than must plan equity carefully. One of the major factor of loosing trust can be this. Choose your partners carefully with whom you share trust. It does not matter that how long you have been knowing them but it does matter that what is the general perception of the each individual. Building competence is easier at times than building trust.

10. Unique identity of company (Logo, name, website etc)
For some reason, I do not see parents naming their son / daughter with very old names , like, mine. There is lot in name and its important that we understand it. If one wish to create its own brand, do not copy some already published name, like lets refrain from naming your company Petsi in line of Pepsi. It might not give impression of creativity. Name of company should reflect your line of business.

Logo is something which should reflect theme of the company. It can be a simple line if one can explain rationale or theme behind it. It should generate curiosity among onlookers and they should ask you that why did you do it this way.

Website is one's identity in faceless world. It is never complete and one will always find scope of improvement. Have a basic website ready to launch as early as possible. With so many open source frameworks (content management system, like, Joomla) available, it is very easy to build website with minimal technical knowledge.

Not sure, where this journey will take me but I just thought of putting my thoughts and one may provide his/her feedback that does it look enough or am I missing any important point.

Bye for now..
Hariprakash Agrawal (Hari) - Optimizing with Coordination