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Category Archive : Inspiration

Are entrepreneurs high performance athletes?

While I was in London last week, I was lucky enough to have fish and chips with Dr Marcel Muenster of The Gritti Fund. Marcel has had a unique career path of becoming a fund manager, he studied medicine in Germany, did a Masters from John Hopkins and was an entrepreneur before taking the plunge into becoming a fund manager. Since we were together on a couple of panels for a Family Office conference on alternative investment strategies, we got talking and realized that we have a lot in common despite our career paths having started in wildly different ways. However, when Marcel spoke about utilising his medical knowledge to get the best out of entrepreneurs, I was hooked.

Marcel is setting up a unique accelerator experience for entrepreneurs in the Middle East through The Gritti Fund. One of the important USPs for this accelerator will be that it will require entrepreneurs to work with a psychologist who will mentally condition their minds for peak performance. Marcel believes that entrepreneurs go through similar experiences as high-performance athletes i.e. the performance pressure, a roller coaster of highs and lows and the failures outnumbering successes by a long margin. Therefore, instead of treating the entrepreneurs like a herd of cattle he wants to carefully manage their psyche and bring out the best in each one of them.

I resonate with his thoughts because I have been on the entrepreneurship roller coaster several times as both an entrepreneur and seed investor. I have been through the months and years of sustained pressure and have seen my entrepreneurs facing the same. Many times, I can only watch as the entrepreneur makes a series of blunders due to the pressure that his entire ecosystem has put on him/her; it irks me to be a silent bystander in such situations.

It is serendipity that I am in the middle of reading the autobiographies of two widely successful athletes i.e. Michael Jordan and VVS Laxman. It is clear how the former’s mother and latter’s uncle played instrumental roles in protecting these athletes from parental, societal, friend-related and performance pressures. They built a kind of cocoon around them during their formative years and performing years and continuously steered them to maintain focus on their craft. A similar comparison could be drawn in Warren Buffet’s autobiography where his wife and friends built a cocoon around Warren so that he could remain lost in his world. Marcel had thought through about marrying both these concepts, it was one of the big ‘aha’ moments of my life.

31/2019

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What a Bank Should Do for My Business

After what seems like an eternity, the relationship manager of one of the largest private banks in India sat down with me to understand my grievances with this bank. Recently, I moved one of our business accounts to a competitor bank and that triggered the RM of the current bank, to question why I was looking elsewhere. When asked, I pointed out the inconvenience of needing a specific certificate to be issued and installed on each device to be able to log into my business bank account. If for some reason I ever found myself without the certificate ordained devices, I was locked out of all my business accounts (which for obvious reasons is a hassle). While I am yet to understand how this process made it off the drawing board in the first place, the fact that one of the biggest banks in India was still using it, years after expiry, clearly indicates how little the bank understood about the requirements of a business today.

The RM promised that a completely revamped system was coming into place in 7-8 months and tried pitching the “support” that they provide for start-ups. As a response to this, I asked if I would have to continue to write physical letters to be able to change the address of my digital mailbox (aka email address). While he could not answer my question, I got the exact answer that I expected – to put it bluntly, large banks take their business customers for granted because of the lack of better options. While the start up support initiatives that banks put on marketing creatives look good, their backend continues to operate like it did in the 1990s. It is high time that this changes. Though the RM left with promise to do what he could, we both knew he was just a small cog in a big mess.

When I woke up this morning and replayed the interaction in my head, I had serious doubts whether the relationship manager could do even 10% of what he had promised. Therefore, I created a wish list of what I would like my bank to provide in order to have me and my business as a customer…  

  1. Single-day opening and shutting of bank accounts
  2. Business savings accounts to park excess monies
  3. Painless and easy ways to obtain a corporate credit card
  4. Seamless processes to add/edit/remove employees from company accounts
  5. A smart and all-encompassing mobile application
  6. An automated overdraft facility based on corporate credit history
  7. Easily accessible innovative lending products
  8. Quick and simple access to company investment accounts to park excess funds (in mutual funds or other investment products)

Do you have any to add?

17/2019

Entrepreneurial Ego…a Necessary Evil?

Vinod shared an interesting post inspired from a talk he gave at an event in Nagpur, on Sunday:

I read the article shared in that post this morning, and it was quite powerful. Let me state that I am not in agreement with the massive extrapolation of $1 million in 1878 to a $900m in 1930s. There is a gap of more than 50 years in which many things could have happened. Also, let’s not forget the fact that Sam Andrews died in 1904 so he would not have been around to enjoy his gain!

I do agree with Vinod that an entrepreneur must exude certain confidence, spunk and calmness under pressure. But most people are not born with such qualities so a ‘fake it till you make it’ attitude is required in the early stages which could be shrouded in a fake ego. However, an individual can quickly lose awareness of the fake ego and it can be replaced with a real one when success gets into the place it shouldn’t – the head.

But the one quality that has been consistent in successful entrepreneurs in our portfolio is their ability to drown the ego and ask for advice and help from people that can push them to get better in their role as an entrepreneur, manager or networker. They not only remember the advice given but also provide feedback on whether that advice is working for them or not and ask for pivots.

The creation, nurturing and growth of ego takes the entrepreneur away from the exact qualities that made him/her great in the first place. Therefore, I agree with Vinod that a fake ego is required but the entrepreneur should have a person who can act as their totem and remind them if they have gotten lost in the very thing they created.

16/2019

It Took this Infographic to Fully Appreciate 2018!

2018 has had its fair share of highs and lows, and it wasn’t until my team summarized our progress through the year (personally and professionally) that the all-encompassing scale of this year was visible, and what a year it has been!

2018 in a Nutshell

Armed with this data, I’ll be evaluating and sending out the hits and misses for 2018. I will especially keep in mind the misses when planning my goals for 2019. I will be sharing my list of goals for 2019 within the week because I truly believe that unless one announces their goals to the universe, there is very little chance of actually achieving them.

That’s it for this year, see you in the new year!

104/2018

Scheduling a Weekly Visit to Menlo Park

I have inculcated a new habit of listening to podcasts during my morning routine replacing my old one of playing loud music to get me charged up for the day.  

Today I heard Robin Sharma’s podcast – The Secret of Massively Creative People and loved his suggestion to create a “Menlo Park” i.e. a place where one can disconnect from the world and give way for the creative side to express itself.  

When I started thinking about it I realised that my best work, especially the things that require me to concentrate viz. investor updates, blog posts, long emails, developing or understanding complex financial models, etc. have all come while I was completely disconnected from the world. I was either on a long flight or holed up in a hotel room.  

This powerful suggestion has me deeply enveloped in thought and I am strongly motivated (and encouraging entrepreneurs) to schedule a visit to Menlo Park every week. 

Would love to hear if anyone has tried doing this and what results they were able to accomplish.  

92/2018

The Journey from 500k to 5 Billion Demolishes 5 long-held Startup Myths

It has been over a week now since the news of OYO’s $1 billion round and ascent to unicorn status became official. This is a huge accomplishment for Ritesh and the entire Indian start-up ecosystem as the new round’s purpose is primarily to expand OYO’s reach outside India, something very few Indian start-ups can boast of. I expressed the enormity of this moment in a quote to Ananya Bhattacharya of QZ.com.

OYO’s journey smashed many myths that founders, investors and journalists hold strongly about start-ups. I took the last week to decide the 5 most common myths that can be done away with, for good.

1. The first-round valuation is important to set the floor for later rounds

OYO’s starting valuation of less than 3 crores was not an obstacle in its journey to become the 2nd most valuable Indian startup. The important thing is that Ritesh was able to EXECUTE the plans and ideas that he pitched in his fundraising presentations.

P.S. OYO did well even though we invested in their seed round in tranches… it did not affect any of their growth rounds of equity, obviously!

2. Founders should save equity for later rounds

It is important to note that: 75% of zero, is zero. Unless there are multiple term-sheets being shoved into a founder’s inbox giving him/her stronger negotiation leverage, founders should just focus on raising enough capital to execute the objectives set for the round and investors should provide value-adds besides the capital. Founders that under-raise or hold long drawn-out negotiations for better valuations are doing themselves and their startups a disservice.

3. IITs/IIMs degrees is a pre-requisite for startup success

It is well known that Ritesh did not go to college and got a $100k Thiel Fellowship for choosing entrepreneurship over a college degree.  His journey is a testament that even the best education is useless if it cannot be applied in the real world that we live in. I enjoy working with humble founders like Ritesh who; work hard, study hard and are teachable over conceited founders that expect royal treatment for the degree(s) that they hold.

4. Only deep-tech and hi-tech startups get the big bucks or those with a truly unique idea

The real beauty of OYO’s success is the simplicity of its business. Since none of the incumbents were paying attention to the gap in the budget accommodation space, it allowed OYO to swoop in and leave them in the dust. OYO’s initial premise was to provide a clean room, free breakfast and free wifi at an affordable price – that’s all. The execution required hard-core sales and marketing prowess and strong leadership aided by technology, not the other way around.

5. Founders should not pivot or that will destroy their startup

It is important for founders to have a flexible business plan so that they can address the changing needs of their target market. Ritesh pivoted Oravel to OYO rooms, Harsh Shopsense to Fynd and there are many such success stories that started out very differently from where they ended up and they all teach the same lesson – be prepared to change the action if the outcome is not what was expected.

91/2018

Perfecting the Vacation Auto-Response

I have been finding ways to manage the dual stress of entrepreneur and venture capitalist through 7-day breaks with the simple objective to ensure that

  • I am (almost) completely off my digital devices
  • I have time earmarked every day to read books
  • I am disconnected from work, especially my emails
  • I am pursuing a hobby or spending quality time with family

So, as I write this blog post from the departure lounge at the airport, embarking on my 4th 7-day quarterly break I am excited about the benefits these breaks have provided me. I return from these breaks with my creative batteries recharged, armed fresh perspectives on solving issues within Artha or the portfolio we manage and (most importantly) my energy levels are renewed and restored to 100%.

However, a major stress factor for me before (and after) these breaks is the massive pile-up of emails that I am supposed to go through once I am back. I thought that my auto-response emails that inform the sender that I am out of network and my replies will be limited until I am back would reduce the influx. However, I would also come back to a bigger email problem than I had assumed and I would get hounded by people in the first 2-3 days after I was back in the matrix.

I realised that the issue was that the auto-response implied that as I soon as I was back I would be responding to those that had sent emails in my absence which wasn’t going to be the case. Therefore I needed to try something new. So when I read a post from Brad Feld from 2015 wherein he talked about dealing with the same issue that was plaguing me, I was all ears!

Brad’s post was refreshing because it puts the onus of being on top of my priority list, on the sender of the email, not the receiver. I believe that the approach is brilliant but for someone of Brad’s stature especially as Indians are highly affected by the tone of something more than its intent. I deliberated over this for most of the evening and I decided that I should test whether my fears are grounded in reality. Therefore if you are one of the people that emails me in the next 9 days you will receive an immediate response that will say:

I’m checking out for a vacation until the 24th of September, 2018. I’ll be completely off the grid.

When I return, I’m going to archive my inbox so I’ll never see this email. If you’d like me to read it, please resend it after the 25th of September, 2018.

If you need something urgently, please email sandesha@artha.group and she’ll either help you or get you to the right person at Artha Group to give you a hand.

Cheers!

Anirudh A Damani

I am going to test out the hypothesis that those that really wanted to reach out to me will make the effort to reach out to me on the 25th of September and if their issue requires an urgent resolution the competent hands of Sandesha will be available. In essence, I have made the decision that the renewed energy I bring from the 7-day breaks should be expended on my portfolio companies and my team instead of cleaning up my inbox!

88/2018

Video of the Week: The Undisputed King of Bollywood

I must be honest that I was not a big fan of Akshay Kumar through most of my teens. His movies centred around his martial arts abilities and he had typecast himself into a brand of cinema which I did not identify with. Then something happened 10 years ago that altered the actor’s career and this transformation & success formula should be a case study at the top management & entrepreneurial schools in India as it pole-vaulted him to highest paid Bollywood actor (7th highest in the world).

Akshay has been a vocal critic of movie schedules that can take 300-400 days and he adopted a simple success formula which I found is on the lines of the lean start-up mentality.

  1. Akshay completes his movie schedules in 60 days (Housefull 3 was done in 38 days!) which significantly reduces the carrying cost of the movie i.e. the path to profitability is significantly reduced.
  2. He releases 4 movies a year, therefore, increasing the number of shots he has at delivering a hit. Compare that to the competition that does 1-2 movies a year, therefore, has to maintain a near perfect record.
  3. The more releases per year also means that Akshay gets to read the audiences’ pulse regularly and he can adjust/alter/update his next product iteration thereby catering to his customer’s (read: audience) preferences much faster.
  4. The success of this simple success formula can be gauged by the fact that Akshay has delivered 100+ crores in box office collections every single year since 2007

The inspiration to do this research came from two videos wherein the actor provide an insight into his journey, both are must watch videos!

The first one is in Hindi

The second one in English

84/2018

Hats off Manjit Singh!!!

Amid all the din surrounding the Wizard of Omaha’s endorsement of Paytm’s pole position in the Indian Paymentech space, an endorsement which must be the proudest moment for any entrepreneur, but the day belonged to another Indian. This is the story of an Indian runner who has (reportedly) never won a gold in any national level race. He was considered the rank outsider in the 800m finals of the ongoing Asian Games in Indonesia, in fact, he was the second best Indian in the final. But what happened over the next 2 minutes is going to be remembered for a very long time.

Manjit Singh who hails from Haryana, came from nowhere to win the gold medal for India and pipped India’s best runner, Jinson Johnson to 2nd place. This gave India a very rare 1-2 finish at the Asian games. I could not find a better video of the proud athletes accepting their medals draped in the tricolour but it so rare a moment that even the poor quality video cannot take away its sheen.

Jai ho Manjit Singh & Jinson Johnson!!!

73/2018

That 1 Skill that Separates a Good CEO from a Great One

Being able to consistently predict and deliver accurate future outcomes is a skill that separates a good CEO from a great one. And no, I am not referring to the god-like ability of Steve Jobs to predict how products like the personal computer, iPod, iPad and of course the iPhone would completely revolutionize the computing world, because you only come across those type of CEOs once in a lifetime. To expect that kind of ability from every CEO is simply setting yourself (and the CEO) up for disappointment.  

Then, there are CEOs that can gauge their company’s strengths & weaknesses, read market conditions and deduce estimates provided by their sales or operations team to provide a range of performance metrics that the company’s employees can work toward delivering. These predictions can be the sales numbers, margins, profits and/or any other metric that can be used to measure the company’s performance. The CEO could then drive the team to meet these deliverables within the mid-point of that range. This ability to predict an outcome makes a great CEO.  

However, an obvious question that can pop up is ‘why would a CEO want to be at the mid-point of their predictions and not over-deliver?’ 

The reason is a CEO that consistently projects numbers that the company will beat gains the reputation of sand-bagging and their seniors discount their prediction ability.  

A great CEO is skilled enough to provide an unbiased and precise reasoning as to why the numbers his/her team were on the lower or higher end of his/her estimate.  

Just reading this note from a CEO can tell you whether that CEO is at the top of affairs in his company or not.  

I called this ability a “skill” because it is something one develops over time with proper practice. Therefore, if you are a CEO and want to learn this skill, start by predicting the sales numbers your company will achieve in a month. Jot down 3 numbers i.e. the low estimate (if everything goes to hell), the mid-estimate (if everything goes according to plan) and the high estimate (if you happen to catch a lucky break!). Share these numbers with your board or mentor along with the list of assumptions you made to generate them.  

As the month progresses you will start to see that some of your assumptions are playing out and some are not. On the 7th, 15th and 22nd day of the month predict whether you will be at the higher or lower point of the range and clearly state the assumptions that have led you to believe that. At the end of the month i.e. on 30th or 31st, you will have the initial prediction and 3 follow-on predictions to compare with your final number. You will now be able to analyze which of your predicted scenarios played out and which ones didn’t. Take that learning and predict an outcome for the next month i.e. just practice, practice and practice.  

When the range between the high and low estimates are shrinking, it is a sign that you are getting better at this skill. You will begin to see which manager overpromises and underdelivers and which one does vice versa. After some trial and error, once you have a good handle on predicting one metric, add one and so on.  

63/2018