Comfort Zone

How comfortable could you get before it starts bothering you? Before the very comfort ends up becoming a source of unease, if not discomfort?

For me, this would happen fairly quickly. I'm pretty used to change. New schools, new cantonments, new friends - things were great growing up as a fauji kid. So 5 years in 1 city, in 1 company were a little too much for me when I started work. Sure, I travelled a lot, but I kept coming back to the same city. At least for the first couple of years, I switched houses about 4 times. Then even that gave out. And little by little, I started getting trapped. In my comfort zone.

And it's a nice thing, while it's happening, but you don't realize it. It just creeps up on you all of a sudden. There you are, enjoying all the little things that slowly become a part of your life, becoming a regular at the gym, same time everyday, the same music everyday, the same people everyday, coffee breaks with the boys everyday, in your designated nook, becoming a regular at the friday evening happy hours at Firangi Paani, becoming a regular at sunday lunch-time at the biryani joint.

Then one day, you think of moving, of switching jobs, or some such thing, but quickly discard that thought - I'm too comfortable here!  That is when you know,  time's up. I'm too comfortable for my own comfort...

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Homecoming

Back in Delhi !

It feels good..
good to be back where I belong,
good to be where I wanted to move to during all those years in Hyderabad,
good to be where the food is great and the people boisterous.
Yeah, it's a good feeling !

Ever since I bought the T-bird, I'd always dreamt of riding around the Rashtrapati Bhavan, North Block - South Block and India Gate - wide open avenues, beautiful old buildings from the raj, and fresh air!
I did just that a couple of weeks ago, and then topped it off with a childhood favourite, an orange-bar, at the roadside.
The simple pleasures of life !

I've just finished reading 'The Last Mughal', and next on the list is 'The City of Djinns', both by William Dalrymple. I'm totally motivated to go and see the historic places in Delhi, try out the delicacies special to each place - chaat at UPSC, parathas at parathe vali gali, biryani at Kareem's, chicken at Anmol Chicken, and some places for rajma and mutton.

So my motto is one place to see, one treat to eat, one person to visit !

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Why didn't I think of this?

Now that the MBA is over, I think one of the things that'll remain with me (hopefully) is something that Prof. Pablo Martin de Holan said at Segovia to the effect that an entrepreneur is basically a person who is always looking for opportunities, anywhere and everywhere.

With this in mind, I see so many new businesses that are just so simple and obvious, you wonder why didn't I think of this?

Here's one I came across recently:-



We've all seen people addicted to their games. That makes a game a great place for an advertisement to sneak in, as long as it's non-intrusive, and doesn't piss off the gamer.

On one hand, Kiip is a great and oh-so-obvious way for developers to monetize a game, and on the other hand, it's a cool way for a company to advertise themselves (by offering one of their products, as a real reward for clearing a level or breaking a high-score).

My team - we guys thought long and hard about giving reward programs a 'smartphone' twist, but we never came close to anything this elegant.

Really, why didn't I think of this?

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ReviewPro - taking web 2.0 to the hotel sector

This Wednesday, we had RJ Friedlander over for a talk. He talked a bit about his background, his company, and it's business model. The focus was on the later stages of a startup's evolution, when you have a product out in the market, you have sales and the startup is maturing.

The talk was interesting, and RJ was free with a lot of figures and information. Quite refreshing. RJ said that it was quite unusual for him to give a talk like this, as he didn't believe in 'networking', since a minute spent networking meant a minute not spent on the product. Yeah, it was that kind of a session !!

RJ is the founder/CEO of ReviewPro, a co. that specializes in providing hotels a service that lets them analyse the reviews they get on various sites. It works in a SaaS model, and one of the interesting things about the pricing adopted is that the prices are kept really low. The hotel finds itself getting more value for money, and sometimes recommends it to another.

Another thing that RJ was felt rather strongly on was the need to focus most of your resources, that being money, attention and manpower, to the product, and not too much on marketing the product. Build it and they will come.

Both these things make sense given that ReviewPro caters to hotels, primarily in Europe. This is a long tail, B2B market. So you don't need to spend massive amounts of money on promoting the brand, SEO, advertising campaigns and the like. Targeted sales will do. And the pricing too, works - had it been a market with a limited number of clients, the pricing would have to be spot-on. In the long-tail context, there's more than enough to go around, and the low price guarantees renewal of contracts, and word-of-mouth publicity.

As in most other cases, RJ's style of functioning was a reflection of his background/personal traits. Take for instance, the hiring and firing of employees - RJ, probably as an American, values firing a person just as easily as hiring one. But this is essential in a startup - you need different kinds of people at different stages, and with the right attitude. You can't afford 'average' people with an 'average' commitment to the job. Fair enough.

However, for me the most interesting insight was something that RJ mentioned in passing - when the whole web 2.0 idea was exploding, RJ saw that reputations built painstakingly could be destroyed in days and the businesses wouldn't even know. Clearly this was a problem, and someone had to solve it. And hotels were really sensitive to this kind of online review that was just catching on. And pronto, the seed of an idea was sown.

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Minube.com - perhaps a tad too much going on?

Today we had Pedro Jareño of Minube.com talking about his 3 year old social-travelling startup. 



AN INNOVATIVE,  CLEARLY DEFINED CONCEPT
Minube has a fairly simple and clear mission - to focus on the 'inspiration' phase of planning a trip. The way they see it, inspiration is followed by planning (think TripAdvisor), comparison (think Kayak), booking, actually travelling, and finally, sharing memories (Facebook/Picasa/blogs).

They see the inspiration phase as an uncontested space, and one that web 2.0 can address. They're spot on. And they're also spot on in latching onto this idea that one man's shared memories can be another's inspiration.

As Prof. Eduardo would say, so far, so good !

IMPLEMENTATION OF THE CONCEPT

My concern is that I (personally) didn't think this clarity of thought/purpose is transmitted to the operation, in the form of a website.

For instance, Joao pointed out that one of the first things that you see is a feature for exploring flights. Not Minube's core focus. To Pedro's credit, he accepted this, and said that he's open to feedback.

Another, for a first-time user, the purpose of the website isn't instantly clear. There are quite a few things you see, before you figure out what it's all about. Contrast this with Facebook's statement, bang on the front page !

PRIORITIZATION NEEDED
Another area where I'd say there's too much going on is with the business model. I appreciate that Minube.com doesn't believe in banner ads and the like. Bravo! But in the absence of this 'known evil', their revenue stream is dependent on 3 different areas. 

Putting myself and my startup in their shoes, I can't blame them, either. It's awfully uncertain for a young startup adopting a non-traditional business model. You'd welcome money any-which-way it comes in.

But sooner or later, they'll have to prioritize. With more financial security, I'm sure they'll fine tune this. They've got an admirably clear mission. They're flexible. They're focussed on their community (re: no banner ads, connecting well with users etc.). All things point to Minube hitting the big leagues soon !!

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Part-time entrepreneur

Last time, we had a remarkable story presented. Picture this -

• a lady needs to start a business, any business, so that she can pay taxes, and then become eligible for retirement benefits from the state 
• she starts the business in a small town in the province of Galicia, Spain 
• 2 people work part-time to run the business, sourcing tools and selling them online 
• They become successful, reaching € 1000 a day in revenues, still with just 2 part-time employees
• All this, totally self-financed

Amazing, eh? There's surely more ways of running a business than I'd thought !!

I'm talking about Alberto Torron, who's one of the people running todotalodros.com. Here are a few nuggets from the talk:-

KEEPING COSTS DOWN
Working out of small towns & villages is a great asset for them : they have lower costs, and great relationships with dealers
They outsourced all non-core activities

BLUE OCEANS
When expanding, they set up a new website to sell headsets, instead of expanding the offerings on todotalodros.com. They've consciously stuck to verticals, creating new lines, and not merged these new businesses into one portal.
This way, they keep it focussed, and don't compete head-on with e-Bay.

CUSTOMER SERVICE
The co. is doing just one thing, sourcing tools from all over at the lowest cost, and customer contact. And what it's chosen to keep in-house, it's doing very well
The owner personally responds to customer queries. They are able to cross-sell, up-sell and yes, sometimes down-sell very effectively
They're really inspired by this idea : if you want something and I don't have it, no problem. Just give me some time, and I'll get it for you

A few memorable quotes from Alberto Torron (paraphrased):
"Choose trustworthiness and close contact with customer over a glitzy website to retain & convert customers"
"You don't need a tech background to run an internet biz. An open mind, and just the basics are enough"

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Chicisimo : using PR for community-building

Yesterday, we had a session with Gabriel Aldamiz-echevarria, founder of Chicisimo. Gabriel was here to talk a bit in general about his entrepreneurial story so far, and then specifically about using PR for a startup. In this case, the success or failure of Chicisimo hinges on it's ability to build a large and involved/active community of users. Good PR is key to this.

The most interesting things that I took away from the session were:-

Gabriel ventured into a business that he didn't 'get' at first. Can't blame him, Chicisimo is about young girls sharing their 'looks' and commenting on each other. Gabriel is quite far removed from this target segment !
But it doesn't matter if you don't really follow why do people behave in a certain manner online. What matters is that you think of a way to get 'em together on your site to continue doing whatever funky thing it is that they do, and then make money off it !!

Inspite of a PR background, Gabriel was emphatic on this - the product has to speak for itself. All other publicity is secondary.

And while still on the topic of publicity, it's imperative to figure out how best to influence your target segment.
In Gabriel's case, his target segment were the young fashionistas, who probably devoured fashion magazines and blogs. But these fashion journos and bloggers probably got pitched similar ideas every single day.
So Gabriel decided to go a step further, and pitched to people in his own circle of entrepreneurs, both here and in Silicon Valley. End result, Chicisimo got some buzz going for itself in the 'business of fashion' circles, and that drew in the fashion journos and bloggers like anything !

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Inaki Arrola - Keeping it real, keeping it simple

We've all heard the old saw about common sense being fairly uncommon. Inaki Arrola, an eminently normal guy feels he's "strange" when compared to entrepreneurs. He just might be right...

This session, we got some pretty grounded, real-life insights.

2 people in his family, buying the same car, comparing notes, realize they've been quoted different prices by different dealers, realize there might be an opportunity here, and you know how it goes. He went into business with cousins and friends with the grand startup capital of EUR 28.500.

Don't do business with friends and family he says. In fact, a recurring theme in his talk was the need to keep work and family separate. Keep their needs separate, keep your time for them separate.

Mix the two, and you might not be left with a wife, and not much of a business either !!

Inaki stressed the importance of beginning with the end in mind - do you want to get into entrepreneurship because you want fabulous riches, do you want to be your own man, do you want to keep embracing the newest idea out there. Not that you're gauranteed to get whatever you set out to get, it's just a question of getting the goals right.

Inaki got into a business that was already estabilished, the incumbents were (and still are) much bigger than him, his new company had no strategic differentiating factor, his team was light on tech. talent in the beginning. And yet, here he is today, talking to us to-be 'tech start up managers' and doing fairly well for himself.

His secret sauce is, like the man himself, very simple and straightforward: Connect with the user as best as you can. Now that's quite vague, so he went further - keep the user interaction on the website as minimal and simple as possible. He thought back to the websites he liked, and what exactly was it about them that he liked, and distilled his likes and dislikes into a sleek landing page for coches.com. This kind of a thing sets coches.com apart from the bigger guys, who're so similar that you wouldn't notice a thing if you switched their logos around on their websites.

In keeping with his common-sense way of doing business differently, he said that he rarely offers equity to new employees to lure them in or keep them motivated. The reason is quite simple - equity in most startups is going to turn out to be useless for the poor youngsters who'd rather have some disposable income. To keep them motivated, Inaki prefers bonuses when the company is doing well. It's a lot more meaningful for the employees.

All said, a very sensible entrepreneur. I'm very impressed !!
Main takeaway, in a field where everyone is going nuts trying to be different, just doing the common-sense thing might make you different from the rest !!

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Fund-raising, serial entrepreneurs and Kaka

Ka-ching !! the sound of money raining in from VCs....
Yesterday, we had a session with Jorge Mata, a successful serial entrepreneur and investor, the man behind My Alerts and Berggi and many more. Jorge gave a talk on raising funds for startups.

The talk was extremely interesting - the topic was money, and how you can raise it, so obviously everyone was interested, and Jorge is a speaker with a flair for the "quotable quotes". And yes, Enrique had put up the twitter list for our class hashtag #ietechstartup, and most of us were tweeting Jorge's comments in realtime.

At the outset, I don't really get the idea behind becoming a 'serial entrepreneur'. I can see why it might appeal to some, but it's not for me. Jorge is a self-proclaimed 'serial entrepreneur'. So while I personally don't agree with this concept, I must say, Jorge's reasoning was very coherent and consistent.

The points that were either new to me, or somehow thought provoking were :-

* It´s very important to relinquish stakes to VCs very carefully
Hand over too much, and even a successful exit would leave you no better off financially.

* a good board is there to protect your investors from you

* Processes are probably more important than platforms/trends
Too many people are thinking about platforms, trying to become the next Facebook or Twitter, and not enough thinking about solving a problem or improving a process

The best part came when a classmate and friend prefaced a question with a blunt statement 'It looks like you're more of a professional fund-raiser than a professional entrepreneur'. Ha ha. I loved it !!
Then again, different perceptions, different definitions. None necessarily better than the other.

OK, how does Kaka fit into this?
Jorge Mata raised as much money in the peak years (´99) as the entire valuation of the MAB today ~ € 60 Mn.
To put that in context, Real Madrid purchased Kaka for about € 65 Mn similar amount !!
Different priorities :)

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Masterclass - the business of blogging

Last week, we had the first 'live' session at our 'managing tech startups' class. We had Julio Alonso talk about bootstrapping, the attention economy and the importance of analytics in the attention economy.

JULIO ALONSO and WEBLOGS SL

A brief bio. Long story short, in 2005, Julio left a successful consulting career to start Weblogs SL, a privately owned co. running 40+ vertical blogs in Spain and Brazil. He's doing quite OK, and for the last two years, he's been featured in El Mundo's list of the 25 most influential people on the internet in Spain.

SO WHAT'S SPECIAL ABOUT IT: BOOTSTRAPPING

Personally, the most interesting bit about his story is the part about bootstrapping and making it a self-financing venture. Partly, it was an attempt to avoid the excesses of the crazy internet bubble that burst not so long ago. Partly, it was a goal to remain EBITDA positive, every single year, even if it came at the cost of slower growth. But I think the biggest factor was this idea of being in it for the long haul, not just to make a quick buck (which is what VCs want). This takes a lot of guts, and self belief.

THRIVING IN THE ATTENTION ECONOMY : STICKING TO THEIR ROOTS

Weblogs is sustained by advertising revenue. And advertisers pay for ads shown to readers when the content of the blog is relevant to the ad. So the more the content, and the more the readers, the more the revenue. Simple enough?

Maybe not that simple. A key asset and differentiator for Weblogs is their regular and knowledgeable reader-base. You can't mess around with these people by taking them for granted and bombarding them with ads, or even worse, ads irrelevant to what they're reading. The balance between commercializing the content and retaining the reader's attention is a fine one.

Weblogs' policy has been to stay true to their roots, prioritize content over ads, and where possible, enmesh the content and the ads together. Julio talked about a pretty interesting idea 'content going into advertisements', as opposed to 'advertisement going into content', which is the norm. They did this by embedding their (pre-existing content) recipes into an ad campaign they conceptualized for a food chain.

Their superior (i.e. more relevant) content is what'll ultimately keep them safe from the new threat posed by content-farms. Moreover, this is where Weblogs' bootstrapping comes into the picture in a business sense: they are free from any investor pressure to maximize revenue by plastering ads all over the place, or to increase page-views by directing the creative bloggers to "follow" a trend.

ANALYTICS:

One thing Weblogs could do better is to capitalize on their prime asset, their loyal reader-base. With their drilled-down analytics, they can charge advertisers a premium fee for ads shown to their loyal readers, as against a standard fee for ads shown to the one-time users.

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Online news sites suck !!

Reading news articles online is a pain. There is hardly any content, you have click through a gazillion pages to get to the point, and the ads keep distracting you from the (largely useless) content.

AdBlockplus is the solution, I hear you say...
Hmm. Only partially.

I'm using it, and I usually end up with 2/3 of the screen blank. And the infuriating next, next, next clicks are still there.

Anyhow, this pic says it better than any words possibly could.

Picture courtesy a friend, A.B.C.

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Hire for attitude, train for skill

Hire for attitude, train for skill - that's the gist of a new article in the HBR. Can't argue with it, it makes perfect sense.

But then, I thought about the industrial scale recruitment drives that quite a few companies launch for entry level positions. No way you can effectively gauge the attitude of some 25,000 to 30,000 youngsters straight out of college. That, to a certain extent, explains the high attrition rates at firms that recruit this way.

I guess, the ground reality at this stage is one of large companies hiring for 'learnability' or basic intelligence, and being able to think quick on one's feet. It's about all that the HR folks can do in such a situation.

Now, you can either bemoan the job-hopping nature of these youngsters, but still carry on with business as usual, since you realize that this is a price you're prepared to pay for reckless growth, or else you acknowledge that it's not a problem with the youth, not even a problem with the HR strategy, maybe it's the corporate strategy that should be examined !

PS: As usual, the armed forces do it right, evaluating a person's attitude and then sending them off to the NDA/IMA/OTA for bringing the rest up to speed.

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