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Category Archive : Leadership

The Funded Entrepreneurs Group

I just got back from my trip to Kolkata which was planned in order to introduce the founding team of an upcoming investment to Mr. Aditya Ladsaria of Chaibreak (an Artha investee) and Mr. Miftaur Rahman of Wow Momos (a fantastic venture that I deeply respect but unfortunately didn’t get a chance to invest in). The objective of the trip was to give the new founders the chance to learn from two sets of successful founders that had no previous background in food, yet managed to fund their respective successful food startups from customer capital before raising venture capital. I especially admire Aditya & Miftaur’s razor-sharp focus towards addressing the customer’s needs through constant innovation in both, the product and operations.

I was a mute spectator (for the most part) in the conversation between the new founders and the experienced ones, but thoroughly enjoyed listening to their detailed discussions about operations, product innovations, customer loyalty management, HR, etc and all the other topics that concern building a business, except “how to raise money from VCs”. This experience gave legs to an initiative that I have wanted to launch for the last 8-12 months i.e. the Funded Entrepreneurs Group.

The idea is to put a group of founders that have already raised money (seed, angel, pre-series A, series A, etc) into a conference room for a couple of hours every 4-6 weeks to talk about matters that only another founder that has raised money can relate to – ‘how to build the venture!’ The discussion shall take place behind closed doors with no recording so that any founder from any stage of the business growth cycle can ask questions – no gyaan sessions only mutually beneficial universal learning.

I strongly believe that when a founder learns the solution to a problem from a fellow founder who has faced a similar issue and managed to overcome it, the solution seems more do-able and the problem less enigmatic. This will also help form a stronger and more cohesive ecosystem for all entrepreneurs. Going forward, the group can also share business leads or transact with each other and the possibilities remain endless, but for now, lets stick to getting a first meeting done.

Artha helped organise a meeting in an open discussion format for angel investors under the age of 50, with a minimum of 5 investments with a similar objective of learning from each other’s experiences. Those meetings have successfully been going on for the past 11 months with beneficial results for all the participants. Currently, the discussion has graduated to deal sharing and evaluating each other’s investments.

My team and I are excited to be able to organise the first Funded Entrepreneur Group meeting for the founders of our ecosystem. The meetings won’t be sponsored by anyone so that the attendees’ independence will be maintained, but there will be a thorough scrutiny of each person that attends to ensure the sanctity of the event. The exact costs of the event shall be shared between the attendees but I do not expect the cost to exceed 500-1000 per attendee inclusive of tea/coffee and a snack.

So, if you are an entrepreneur who

  1. Has raised outside capital
  2. Are willing to share your experiences to help another founder
  3. Are interested in meeting other founders to build your business

Then email us on feg@artha.ventures with

  1. Your full name
  2. The name of your venture
  3. Link to the article announcing your latest funding round
  4. Your mobile phone number(s)

If there is enough interest, I would love to organise the first FEG meeting in 2-3 weeks (based on everyone’s ability). Email us as soon as possible!

30/2018

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Desperation is the Name of the Game

If all things are equal between two candidates that want me to be their mentor, what would be the difference, that would make all the difference? No, it’s not how equity you will give me or how much respect you have for me… The correct answer is – desperation.

I am not referring to the desperation to get time, money or references, but the desperation that burns through the eyes and words of the prospective mentee to succeed. The desperation that cannot be dissuaded by failure, drowned out by rejection or simply because they didn’t get an immediate response from someone they attempted reaching out to for help. I am referring to that desperation that will make a person turn the world upside down to get what they want – yes that desperation.

In a world of unlimited opportunity, this is the kind of desperation I look for, to decide who I should devote my limited time (a precious resource) to. A person must innately want to achieve the skill he is seeking my mentorship for, and not only be attempting to achieve it because he ‘has to’. This distinction leads to a visible difference in the amount of passion and desperation a person exudes.

The lack of this type of desperation and conviction in the importance of achieving that skill doesn’t bode well for my ROTI (Return on Time Invested).

So, if you think I’m being arrogant, standoffish or aloof to your call for help, I am only checking to see if you are as desperate as you are making it out to be.

29/2018

The One Thing I Couldn’t Relate to in Padman!

I finally saw Padman on Thursday night and I’ve got to confess, I absolutely loved it! I identify with the struggles and humiliation that Laxmikant Chauhan, the protagonist, goes through as he attempts to improve female hygiene practices ie convince the females in his home and village to use sanitary pads instead of a rag during periods. Even though his wife, mother, sisters and entire community abandon him, forcing him to leave his village, the fire within him continues to burn, driving him to achieve the improbable. Down and out on luck, Laxmikant encounters a lady who resurrects him and joins his fight. Her help transforms Laxmikant from a failed entrepreneur about to be beaten to pulp by his creditors, to one that receives international acclaim and success.  To thank her for all the help and support, he named his product after her. Then, when things were looking up for him his entire community, family, and even his wife wanted him back and he left the hand that took him to the peak to go back to the people who were fairweather friends. This is betrayal or to put it more crassly, spit in the face of those that stand by you and support you when you’re down.

This made me think about how in my own journey, I have encountered several such fairweather friends and colleagues. These people who I thought were my near & dear friends, didn’t take a moment to think before throwing me down the well when I was struggling, but when I seemed to be doing well, these same people touted that “they always knew I’d make it large.” I keep these fairweather friends at a very safe distance because their next attempt to bury me is awaiting the next trough in the long journey of success.

I keep close and regard those friends, family members and even colleagues who stood with me when I was struggling the most. People like Laxmikant Biyani who let me use his office rent-free when I didn’t have the capital to pay rent (and he has refused to take rent even now), my Chacha, Ramesh Damani who provided endless moral support over and above his investments in/with me and finally my team that started Artha when it was just a dream and stuck around when that dream struggled to breakthrough. Whenever I write my memoirs (and I will), they will feature prominently in it.

So, that was my peeve with Padman, why leave those that support you at your worst and go back to those that will be with you only when you are doing well? What lesson does the movie impart to the other Laxmikant Chauhan’s have been vilified by their own support system for doing things that are out of the box but continue the fight? What is the lesson to those people that have the heart & courage to support someone else in their fight?

I loved the movie until this plot twist occurred… the writers should have had the courage to script a new ending instead of opting for a Suraj Barjatiya type of impossible, unrealistic happy ending.

I wouldn’t go back, in the movie and in real life.

27/2018

A Sunday Treasure Hunt, for a Good Cause

I am the Vice-Chairman of Mumbai One Round Table 221 (M1RT221) which is part of Round Table India. One of the objectives for our table this year is to host an enjoyable philanthropic event that while contributing to a noble cause will provide an interactive and enjoyable Sunday afternoon with family and friends.

Our first such fun event for 2018 is the “Carwars: Treasure Hunt” that is taking place on March 11th, 2018 from 9 am to 12 noon at National Sports Club of India (NSCI). Participants will be given a set of clues to decipher, which will take them around Mumbai to parts of the city that they haven’t been to in a while or never before. The last time we hosted a similar treasure hunt in 2015, it was a resounding success. We have a ton of memorable pictures of participants posing as statues at Hanging Gardens or hidden signboards around Fort. I am sure that this year will be better than the last one J

The entire proceeds from this event will go to Reevive of Cancer Charity Trust. Reevive an organisation that helps financially challenged cancer patients to fight this horrible disease by giving them access to quality treatment. Their zero administration cost policy is what sets them apart. The organization supports patients from the Tata Memorial Hospital and the money that is donated to them gets directly deposited into the Hospital’s treatment account so that it can only be used towards the treatment costs and medicinal expenses of patients. This ensures that any money contacted to Reevive directly reaches the hands that need it the most.

This event will be a Sunday well spent with family & friends for a cause to help those in need.

Breakfast will be provided at the venue before you go off on your hunt so get there early! There will also be lunch after the hunt (so make sure you make it back!)

To register for this event click here: http://imojo.in/6t6gzz

If you would like to be a sponsor for this event or donate (because you’re an awesome person) email me by clicking here

This event is supported by the Young Volunteers Organisation.

26/2018

Venture Idea: Putting the Custom in Customer Service

One of my favorite entrepreneurial movies is Rocket Singh Salesman of the Year. The movie has a dialogue that goes, “customer ke toh naam mein hi mer likha hai” (the word customer has mer (pronounced “marr” is the Hindi word for ‘to die’) embedded in it). This single dialogue aptly defines the treatment meted out to the billion Indian consumer customers every single day.

All one has to do is go through the Facebook page of any Indian brand and it will not be hard to find the abundant record of horrific complaints and the apathy awarded by these brands to their customers. Although I have been on a crusade against JetAirways for the ad hoc changes to its Frequent Flyer experience, I have seen very little progress in brands making an effort to improve how they treat their customers. Despite the government’s attempt to provide adequate protection to the consumer by allocating a separate consumer court to resolve consumer grievances and penalize erring brands… the problems are only continuing to mount.

I believe that the next ten years will be the golden age of Indian consumerism. With this thesis in mind, I strongly believe that there is going to be the need for a service that goes beyond allowing a customer to air their grievances but actively taking control to resolve these complaints. For a small fee, this service provider can engage with brands to resolve customer’s problems. If that route doesn’t work they should also be able to prepare the legal documentation required to take the brand to consumer court. They can even go a step further to provide the contact details for competent lawyers who can file & fight these cases. As India marches to 1,000,000,000 online via mobile – the market potential will be massive!

I have been on the wrong side of several bad consumer experiences in India and there used to be a company called myakosha.com that was solving my problem. They played the role of a service provider who resolved these issues directly with Idea, Jet, AMEX and other companies that I was facing issues with. I simply loved their service and the way they made these brands come running to me to solve their errors was an experience worth living through. However, for reasons best known to the MyAkosha team they pivoted to another business model leaving a gaping hole in the ecosystem. Now, I am personally motivated to be that agent of change for the way Indian brands treat their customers. I have a design team ready to develop the front end, know a law firm who can provide the infrastructure & know-how for this service and am willing to fund this project out of AVF.

I am seeking individuals who have a strong background in social media marketing, customer complaint management, and a strong tech background. I am also looking for a person with a strong background in data analytics to build out this venture.

Do you know someone or a team that fits this bill?

Email prospects@artha.vc with a cc to karishma@artha.vc.

25/2018

KISS for your Investors

Imagine that you have been invited for a stand-up comedy show of a well-known comic. You are excited about the show, arrive well dressed with a date in arm, get your favorite drink and are sitting in the front row with bated breath. Then your comic comes on stage, everyone starts clapping (including you), the atmosphere is full of excitement and anticipation. Just as the comedian begins to speak, you realize that his act is in Russian, Spanish or Klingon i.e. whatever language is completely foreign to you and the audience. For the first 3-5 minutes, you try hard to understand what he is saying then look around to see a similar look of bewilderment on everyone’s faces. Some people leave almost immediately, and the remaining make heckling sounds, the artist looks bemused but act continues, rooms starts emptying out and finally you, who has checked out mentally a while ago, decide that it had been enough and join the beeline to the exit. How inclined are you to attend a show with that comic in the line-up the next time around?  

Unfortunately, several founders are guilty of being that incomprehensible comic. Using acronyms or words that only your peer group understand may give the smart founder several accolades at startup events but leave investors (like myself) flummoxed about what the business really does. In fact, I feel that if a founder cannot explain what they do in layman’s terms to someone who has no knowledge of the technical jargon of that industry, then the business is too complex for me to invest in. A founder may feel short-changed because as an investor, I am supposed to be “in the know” but the truth of the matter is that I am not supposed to be the knowledgeable person in the room about their industry, the founder is!  

This video from the show Silicon Valley aptly explains what I fear as an investor 

A founder that is unable to explain what their business does to me in terms that I understand, is running a business that most customers won’t understand. To educate a customer entails a long sales cycle, and I find it is best to avoid such long-tail plays. However, when a founder is able to explain a complex model in simple terms, it gives me immense confidence in the fact that prospective customers will understand it too and therefore not hesitate to adopt it. Not only that but also the founder will easily be able to train lay people on selling his/her product or service and achieve targeted sales without hiring expensive talent. For the investor to have such confidence has tremendous value.  

Here are some of the tools that founders can use to explain complex business models:  

  1. Paint a picture of what their target customer currently does to solve the problem and how their product/service will change their life  
  2. Dumb things down by using simple everyday terms that anyone can understand 
  3. Use check-backs like does that make sense? to ensure that your audience hasn’t lost you 

There are many other techniques that founders could use to present an impressive but comprehensible pitch. The best way to test a pitch is to present to the most challenging audience i.e. people that wouldn’t understand their business at all. These unfriendly audiences will force you to KISS (Keep It Simple Stupid) for the investor, which is exactly what we are looking for!

So, don’t try to challenge the intelligence of the mere mortal investor and just KISS for us!  

23/2018 

Why We Must Become that Asshole Investor (from time to time)

2018 started off with a bang for Artha India Ventures. 4 of our portfolio companies successfully raised new rounds with pre-money valuations of more than $5 million. As a team, we are very happy with the solid multiples that we received on our investments and it validates our thesis of getting in early, building solid value and increasing wealth for all shareholders. These are the times when we look forward to celebrating with our founders for a job well done and to wish them luck on the new journey that has just begun (with the incoming investor).

However, there are a couple of founders that bring forth disturbing issues at the time of signing documents that hold up the entire round of investment. Usually, I can classify the issues that force this reaction into two buckets. The first and most contentious issue is the diktat issued by the incoming investor to disallow any of the previous investors from participating in the new round.

As an investor who invests in multiple stages, we have specific clauses in our investment documentation that allow us to participate in future fundraising rounds of a company. Whatever the logic the new investor can provide (more on this in a later post) we as the early backers of the venture expect the founders to stand up for us and remain loyal to their word and contract, that were negotiated and signed when we initially decided to back them. While many founders ensure that we get to participate in the new round (thank you to them), we do not have sympathy for those who behave this way even without being coerced by another investor.

At the time when these founders needed the money, they eagerly signed the documents with these terms clearly being stated, but when it comes to actually following through for a follow-on round they want to cry foul. To completely sell yourself to the incoming investors and screw over your earliest backers doesn’t bode well for our ecosystem. Firstly, the new investors will only put in stronger clauses to ensure the same doesn’t happen to them in the following round and secondly, the later investors will be way more cautious and hesitant when considering the opportunity to participate because of your past behavior towards investors.

Unfortunately for them, Artha does not respond well to oppression tactics and while we can understand the occasional tough spot a founder finds himself/herself in, the founder cannot always cry wolf.

To be involved in a bitter conflict at a time when we should be celebrating victory is a situation I want to avoid at all costs, but founders need to understand and respect that just like them we too are running a business and to deny us the rights that we mutually agreed before entering the relationship, tinkers with our business model. Just like they would not like to tinker with a business model that is doing well – neither do we!!

21/2018

 

 

6 Books I’d Recommend to Every Entrepreneur

An entrepreneur’s primary role is to sell. At any given point the entrepreneur is selling whether it is

  1. Selling himself on why he is pursuing this idea.
  2. Selling his employees on why they should join or stay at this venture
  3. Selling his friends and family on supporting him in his new (and often crazy) endeavour
  4. Selling his customers to try out the new product or service he has developed (and to pay for it)
  5. Selling his business as an investment opportunity to potential investors
  6. Selling mentors on why their valuable time will be well invested in him
  7. Selling to investors to continue supporting his business

The list of selling activities can go on for pages… and I still would not have even scratched the surface of the number of selling activities that an entrepreneur is actively involved in. Therefore if there a skill that an entrepreneur should learn is the skill to sell.

I have found that the following 6 books made the maximum impact on my sales, investment and entrepreneurial careers as well as the careers of people whom I have mentored and helped to grow in their respective sales and entrepreneurial roles.

Ideally, you should read these books in chronological order since the level of complexity increases as you progress down the list.

  1. The Greatest Salesman in the World by Og Mandino
  2. How to Sell Anything to Anybody by Joe Girard
  3. The Four Agreements by Don Miguel Ruiz
  4. How to Win Friends and Influence People by Dale Carnegie
  5. How I Raised Myself from Failure to Success in Selling by Frank Bettger
  6. Unlimited Power by Tony Robbins

Have any books helped YOU shape your entrepreneurial career? I would love to know so do share them in the comment section!

11/2018