VOL 4 / ISSUE 1 / OCTOBER 10
ARY VERS ANNI N O I T I ED
Small & Mighty REVEALED a star-cast of start up artists tells YOU how to OVERCOME CHALLENGES and WIN BIG
The 3 Milestones of Business Models
On a Chocolicious Journey
Movies To Suit The Entrepreneurâ€™s Mood 142 pages including cover + 16 pages booklet
he promise held by MSEs in terms of driving the progress of the country and their importance for balanced economic development is widely acknowledged. However, the sector by virtue of its size, diversity and geographical spread, also necessitates a robust supporting framework to ensure that startups turn to proﬁtable enterprises. Availability of collaterals is one of the challenges faced by entrepreneurs in the MSE sector, especially ﬁrst generation entrepreneurs. To facilitate collateral free lending to the sector, the Government of India and Small Industries Development Bank of India together set up the Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE). During its decade long service to the MSE sector, CGTMSE has grown in scale and size to enable ﬂow of institutional credit in greater measure to the sector. Over 4 lakh guarantees for an amount of `16,500 crore have been approved by the Trust till date. With the active support of the Government of India, RBI, SIDBI, Member Lending Institutions and other stakeholders, CGTMSE is committed to facilitate collateral free credit to the MSE sector across the country and work diligently towards achievement of the goals of ﬁnancial inclusion.
U.R. Tata CEO, CGTMSE
Credit Guarantee Fund Trust for Micro and Small Entreprises (Set up by Government of India & SIDBI)
Oct 2010 VOLUME 4 | ISSUE 1
Small & Mighty
opportunity 22 On a Chocolicious Journey In the three years of its inception, Cacobean Chocolatier has grown to become one of the leading manufacturers and suppliers of premium gourmet chocolates in the country. By Sarin Patrick
30 Gau Grass Sewa: Cash Cow With a difference If cows in certain parts of Delhi have been looking unusually healthy of late, blame it on Kawal Kumar Grover and his unique social enterprise called Gau Grass Sewa! By Nimesh Sharma
118 For a franchisee, life begins at 60 Retirement from job could be the ideal time to chase your dream. The good news is, many settled brands might be looking just for you. By Sharmila Das
OCTOBER 2010 | DARE.CO.IN
33 Cover Story: CEO Insights 34 36 38 40 42 48 50 52 54 60 62 64 66 68 70 72 78 80 82 84 86 88 92 94 96 102 104 110 112 114
Anurag Batra, Exchange4media B.G. Mahesh, Oneindia.in Lalit Agarwal, V Mart Pradeep Garg, Kundan Group Rahul Dev Rajguru, Aquilonis Amit Ladsaria, Turtle Dinesh Agarwal, Indiamart Hemal Patel, Elitecore Solutions Hrishikesh Damle, Atrimed Anshu Gupta, Goonj Rishi Modi, FreshRank Saumil Majumdar, Sports Suresh Tota, Compact Hometel Vineet Rai, Intellecap Vipul Prakash - Elixir Vrinda Rajgarhia, Sweet World Allwin Agnel, PaGaLGuy.com Faisal Farooqui, MouthShut.com Jacob Mathew, Idiom LH Manjunath, Siri Gramodyoga Samsthe Parichay Upadhya, New Look Laser Clinic Shamit Khemka, Synapse India Vaibhavi Thakkar, Blend Finance Varun Mirchandani, Onicra Vineet Bajpai, Magnon Solutions GP Singh, Advantec Coils Hema Malini, Incite Cam Center Sandeep Parekh, LinSec Advisory Hanuman Tripathi, Infrasoft Vibhas Prasad, Leisure Hotels
BOARD OF ADVISORS N R Narayanamurthy
Chief Mentor, Infosys
Chairman & President, Wadhwani Foundation
Gururaj ‘Desh’ Deshpande Saurabh Srivastava
Chairman, Sycamore Networks
26 The 3 Milestones of Business Models
Chairman, Indian Venture Capital Association
Kiran Mazumdar Shaw R Gopalakrishnan
Chairman & MD, Biocon
By Vijay Anand
Executive Director, Tata Sons
Professor of Entrepreneurship, INSEAD
Abraham Mathew Prashanth Hebbar
President Senior Editor
ANALYSTS Binesh Kutty Nimesh Sharma Sharmila Das Shinjini Ganguli Shradha Mohanty
128 Your Perfect Website
By Rajaram Rajendran
OPERATIONS Ajay Dhoundiyal Product Manager Prasanna Srivastava Product Manager Debabrata T Joshi Manager Events VIjay Rana Design Anil John Photography
98 SALES & MARKETING MA Jaideep Associate VP Mario Gabriel National Sales Manager Yogesh Bhosle West Ankur Kalia North Manas Mishra South Kingshuk Sircar South-East Asia
PRINT & CIRCULATION SERVICES Rachna Garga VP T Srirengan GM, Print Services Sudhir Arora Senior Manager Circulation Sarita Shridhar Assistant Manager, Reader Service
44 Funding Challenge Analysis By Shinjini Ganguli
56 Marketing Challenge Analysis By Sharmila Das
74 Quality & Process Challenge Analysis
14 Feedback 16 Exchange 28 Statistics: Private Equity / Venture Capital Investments
By Prashanth Hebbar Printed and published by Pradeep Gupta. Owner, CyberMedia (India) Ltd. Printed at International Print-O-Pack Limited, B-204-206, Okhla Industrial Area, Phase 1, New Delhi-20 Published from D-74, Panchsheel Enclave, New Delhi-17. Editor: Krishna Kumar. Distributors in India: Mirchandani & Co., Mumbai. All rights reserved. No part of this publication may be reproduced by any means without prior written permission. BANGALORE 205, 2nd Floor, # 73, Shree Complex, St.Johns Road, Tel: 43412333 CHENNAI 5B, 6th Floor, Gemini Parsn Apts, 599 Mount Road, Tel: 28221712
134 Back of the Book
98 HR Challenge Analysis By Shradha Mohanty
106 Technology Challenge Analysis By Nimesh Sharma
KOLKATA 23/54, Gariahat Road, Ground Floor, Near South City College, Tel: 65250117
MUMBAI Road No 16, D 7/1 MIDC, Andheri (East) Tel: 42082222
127 Nasscom's Product Conclave
DELHI D-74 Panchsheel Enclave Tel: 41751234
PUNE Flat No. 9, F Block, Popular Heights 3 Koregaon Park Tel: 65000996
Inspiration and Insights
SECUNDERABAD #5,6 1st Floor, Srinath Commercial Complex, SD Road. Tel: 27841970 SINGAPORE 1, North Bridge Road, # 14-03 High Street Center Tel: +65-63369142 CORPORATE OFFICE Cyber House, B-35, Sec 32, Gurgaon, NCR Delhi-122001 Tel: 0124-4822222, Fax: 2380694
142 pages including cover
OCTOBER 2010 | DARE.CO.IN
122 Demystifying Cloud Computing
By Madhur Chawla
138 Of the Students, 125 How to Move to the Public Cloud? By Shikhar Mohan Gupta
By the Students, For the Students
The brightest young people in India now want to do their own businessâ€“and chart their own destinies By Pradeep Gupta 10 OCTOBER 2010 | DARE.CO.IN
ANNIVERS ARY EDITION
New Deal: If you are bright, think business n sheer physical sense, India is simply not the country it was a decade ago; but it is on the intellectual side that the change has been the most dramatic—and telling. As a country we do not, any longer, think like a third-world nation. Young, daring and even brash, our people are busily breaking barriers, transcending stereotypes and competing at the cutting edge. To them business is as exciting (and viable) a career option as say medicine, engineering, auditing and civil services, were to my generation. We are now a nation of young people brimming with enterprising possibilities and expressing ourselves boldly in a new ecosystem that promotes entrepreneurship. It is a world apart from the Raj, both colonial and License-Permit, in which business has pushed forth almost magically from nowhere to the fore as a career choice, especially among BSchool pass-outs. It is no longer the last resort that it once used to be. The brightest young people in India now want to do their own business—and chart their own destinies. This change in mindset has come lockstep with the change in our ecosystem. During my time the entrepreneurial ecosystem simply did not exist and setting up a business back then was tough. Not any more: young technocrats passing out of IITs and IIMs, today, can expect their projects to be incubated by specialized mentors and funded by angel investors. In other words, those who aspire to start a business have unprecedented opportunities to realize their dreams. There are organisations like Proto ready to walk with you provided you have a sound technology idea. In the current scenario, the social cost of failure has gone down visibly. When we started our ventures, only one out of ten people would suc-
ceed—and those who failed, invariably faced social scorn and worse. That has changed: people are more risk friendly now. In this extraordinary evolution of the eco system the media has played an important part essentially by describing the changing contours of a nation as it freed itself from an old, constricting order. It has educated, inspired and cheered a new generation of enterprise in a society shaking off the burdens of the past to face a new world with a new deal.
Challenges The ﬁrst big challenge for an entrepreneur is putting together a good team. When you are starting out, you look to attract good talent to come and join you. But, this is never easy. The second challenge is to get a VC on board. This is a particularly difficult if you are looking to start small, with an investment of say around a million dollars. There may be some VCs willing to bankroll tiny startups, but even these would normally not look at anything lower than $ 5 million. Some may possibly come down to $ 2-3 million but that is the absolute bottom. So, if you are looking to start below those levels, then you would have to approach angels or incubators. Finally, there is the challenge of getting the ﬁrst customer. For small entrepreneurs angels would be very much the way to go, because a) they are willing to put up very small amounts and b) they come in with a long-term horizon and with the intent of sharing both the losses and the rewards of the business—they may invest small amounts but they are also willing to write it all off. Finally, I would say that the most important changes I have seen are the change in the mindset and the evolution of the ecosystem. This is a great time to be an entrepreneur. And I invite you all to join the party. DARE.CO.IN | OCTOBER 2010
FROM THE EDITOR ROTIDE EHT MORF
ANNIVERS ARY EDITION
Democratising Entrepreneurship By Prashanth Hebbar
ight years ago when we were right-tuning our careers, I had a meeting with a colleagueturned-entrepreneur discussing his business. We were recovering from the post-9/11 recession in the economy. And here was this guy who declared, ``I will never go back and work someplace, even if it means I have to survive by selling dosas by the road-side.’’ I did not understand the full import of his statement. In hindsight the transformation had begun. Rewind to the third quarter of 2009, not less than a dozen of my friends had jumped into entrepreneurial waters. Some of them were long-time jobbers. Upon inquiring I got the stock answer, “I can live better earning for myself.” Such an attitude. And that too in the midst of a recession. Things had indeed changed. As months passed by I realized there is actually a free ﬂow of people moving from being jobbers to entrepreneurs and vice-versa. This was an interesting phenomenon. I had always heard things to be black-andwhite. ‘Once an entrepreneur, always an entrepreneur.’ ‘A man used to a regular pay-check at the end of the month can never live in uncertainty the entrepreneurship begets.’ There was no dearth of wise cracks and slogans. But here I saw people moving to and fro between the two stations—job and enterprise.
There is actually a free flow of people moving from being jobbers to entrepreneurs and vice-versa
All these started falling in place when we were discussing our third anniversary issue, the one you are reading. What I had seen was a total transformation of the mindset. You would have read Pradeep Gupta’s thoughts (if you haven’t, please stop now, read it and come back). We are actually witnessing the democratisation of entrepreneurship, a situation where every individual feels he or she can be an entrepreneur. So we thought, a good idea is to become a catalyst in this cause and make our 3rd anniversary issue a reference book of how to face challenges. We asked 30 select CEOs from diverse business domains to write about their major challenges and how they overcame them. The result is a fantastic aggregation of some of the rare insights into building, nurturing and growing the business despite challenges. I hope it stands long as a reference material for anyone facing challenges who can ﬁnd solace in the knowledge that others faced the same issues. Now, here’s the deal. If anyone of you want to connect back to our CEOs, you can contact us so that we can connect you. And there lies a major transformation that we, at Dare are ushering unto ourselves. We are re-discovering the space, watching you closely and learning from your own experiments
Small & Mighty REVEALED a star-cast of start up artists tells YOU how to OVERCOME CHALLENGES and WIN BIG
in change, into being your partners in progress. How? By becoming your extended arm for information, data, and business connect. If you have noticed the changes in design and layout, its part of it; where we bring in a clean, clutter free approach to information dissemination. Many of you may have noticed our web portal, http://www.dare. co.in, which has undergone a change. That is also part of our transformational process. In short, we are trying to bring in all the pieces of information delivery mechanism together to meet your demands better and connect with you more deeply. Tell us what you think. We are always grateful to your continued support, a reason why we are in business, and look forward to deeper intellectual connect with you. Interact with me on Twitter @phebbar DARE.CO.IN | OCTOBER 2010
Farming Health and Wealth A lot of people are now opting for organic food especially for children. Even though its more expensive, more people are becoming aware of the benefits they have for their health and the environment. For sure, there is a market for those who would start organic farms & that market is growing. - Ria Thompson (Organic Acai Berry)
Daily Dump Going Green in just 600 rupees Great idea for good hobbies at home and reduce the burden on civic authorities. I would like to start at famous temple town of Tirupathi which is suffering with more plastic garbage mixed with recyclable waste thrown in and out of dustbins which is an ugly sight every where on the roads. - Srinivasulu V
The coming of the social commerce websites Congratulations to the MyDala team! A good concept.. in case you are looking for franchises in Chennai, do contact me as I am interested and based at Chennai. - Desy
ABCs of Entrepreneurship Education The article is very good as it is informative for us . Really I learned a lot by reading this and just keep us updating in future as well . Thanks for this - Monty Dave
Nursery Admissions & A Worried Parent I read your post on nursery admission issues and no help for parents. Very well written. This is exactly the same issue that led us to start NurseryAdmissions.com three years back. We are trying our best to ensure that parents don’t have to go through this
14 OCTOBER 2010 | DARE.CO.IN
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horrible experience and get all the information and support they need. We are not only trying to influence the policy makers but also make the schools change the way they deal with parents. In fact, for the past 2 years we have fully bootstrapped this venture and have been working on making a platform which would take care of all admission tensions of parents. Our community has now reached a strength of more than 25K families. At this moment, we are catering to parents from Delhi, Gurgaon, Noida, Ghaziabad and Faridabad, with plans in place to be present in more cities soon. We need more parents to be aware of the platform and to join it in order to make a difference and be considered a strong opinion changer in the education industry. The schools are already taking notice of the same and we are sure that in times to come, we would be able to see more schools that are “Parent Friendly” if they want the support of this community. Education has become a consumer product due to the amount of money involved and we believe that schools should be answerable to parents as well as being responsive to their feedback. Education has changed a lot over the years and we strongly believe that it is now a equal partnership between schools and parents. As for your point about counselling services, we are at
final stages of announcing this service for parents with some reputed names in education behind the initiative. This service would be very affordable too. - Raj Arora, NurseryAdmissions.Com
Had you thought ‘Working-From-Home’ could have so many benefits? Employers take unusual advantage of employees when they are working from home e.g. ur office ends at 6.30 and in most cases the boss would let you go if its running too late..but at home there is no time limit..and the boss doesn’t acknowledge this.. instead asks you to work beyon designated office hours. - Paru Taneja
Government funding subject to backing by Technolgical Institute I agree Government funding at the moment is just a joke. I had submitted an idea to the Tamil Nadu Technological Development post and was invited for a presentation. After the presentation they said it was brilliant I even have e-mails to that effect. But then they said I had to apply for TePP through some institution. The problem is these Institutions are only interested in their own students. - Detroit
Your faithful and friendly financial partner in all Your business requirements. Our mission is to provide positive thrust to the growth of MSME Sector and to foster fair banking practices. Bankâ€™s commitment to Micro & Small Enterprises (MSE code) is implemented by the bank , which sets minimum standards for banking practice relating to Micro & Small Enterprises. The SME Care Centers/Help Desks are established in all the Regional Offices of the Bank to attend to grievances of MSME customers. Credit facilities without collaterals and third party guarantee is provided under Credit Guarantee Fund Scheme For Micro and Small Enterprises (CGMSE) as per the terms of the scheme. Entrepreneurship development training is provided through various training institutions of the bank(SIRD/ RUDSETI) free of cost for promoting entrepreneurship. Bank has designated specialised branches to cater to the requirement of SME sector in identified centers.
Help Line : 1800-180-MSME Or : 1800-180-6763 Contact your nearest Branch for details OR log on to www.syndicatebank.in for more details
• partners • mentoring • funding • guidance • advice • ideas...
Starting my food venture in Gurgaon-Delhi-NCR I am passionate about food and running my own business. I am starting my food venture in Gurgaon-Delhi-NCR (declining an offer from Symantec). As a firsttime entrepreneur, I am facing various issues and will continue to encounter such issues as I grow. As of now, I am facing an uphill task of finding a good team. I have done all the groundwork in the last few weeks and need atleast one more member who is equally passionate for food and a career in this field. I have planned to launch the venture in the next two-tothree weeks. I am looking for people interested in the venture. - Sumit Agarwal Response What theme you have chosen for Food and What’s your investment capacity ? Please revert with all details to give a thought on that. - V.S. Reddy
Mentoring required for starting own business Hello, I am a 29 year old girl who wishes to start her own business in the food and restaurants segment. I have a few ideas which I feel would work in the Bangalore market but I’m unsure as to how to proceed with them. Any guidance and mentoring for the same would be much appreciated. - Sushma
Looking for restaurant startup partners I am a 29 year who wishes to start her own business in the food and restaurants segment. I have a few ideas which I feel would work in the Bangalore market and am looking for experienced partners who would understand and share my dream. Please mail me -Akhila Sankaran Response I am interested and looking forward to join in food processing unit at hyderabad post by cell. Provide me his details. - K.Bala krishna reddy
16 OCTOBER 2010 | DARE.CO.IN
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Investors and team members required for Rural healthcare Concept I have a concept on Remote Healthcare Services – an end-toend healthcare delivery system for the developing world. I am looking for people who want to be a part of the core team and also angel funding to kick off the pilot. - Sanjay Sharma Response I want to contact Dr. Sanjay Sharma who is running rural health care project, published in August 10 of Dare in exchange column. - Ameet Kumar
SEO, SEM, SMO, PPC and Website/e-Commerce Development Service Partners We are a innovative information technology (IT) company in India which provides services like search engine optimization (SEO), pay per click (PPC) marketing, social media optimization (SMO), link building, website design and development using content management systems (CMS) and e-commerce website design and development. We are looking for potential partners and resellers who will be working with us and promoting our services. Please feel free to contact me in case of any query and to become a partner - Amitava Sen
Response I want to contact to Mr. Amitava Sen who is running innovative information technology company n need resellers. - Ameet Kumar
Need funds for retail startup I have always been very keen in retail sector specially in garments. I have a good location which has the potential to grow but needs money not huge amount. Would love to discuss the same and get started hopefully. Please contact me on email. - Preity Sharma Response I want to get in touch with Ms Preity Sharma regarding her query in Feb 2010 issue related to her interest in retail sector. It would be lucrative enough to get in touch. - Ronak Somani
Bio-gas based power generation plant We have 500 animals in our farm and want to install bio gas and bio gas based power plant. Please send your quotations and technical details. - Kunj Behari Mahipal,
Interested in Partnership in tyre recycling I’m interested in starting Waste tyre
r a vegetaria requirement fo
n restaurant in
ojanalaya) rant (Jain Bh au st re n ia ar get e main blish a pure ve ar, which is th az B i ar h Jo s I plan to esta Jaipur` tea time. I am amenities in at dinner and a tr with modern es ch or h Shimla, wit hra market or at - Ashok Bot investor. looking for an e aurant. Pleas set up a rest to ve ti ia it ed in your in I am interest ding. r details inclu send me you t floor area. 1. Restauran pital needed. 2. Working ca ney y) - Rahul Varsh sion plan (if an 3. Your expan
• partners • mentoring • funding • guidance • advice • ideas...
recycling plant in Nagpur, anyone interested in joining hands in this venture are most welcome and may get in touch with me through email or can just call me. -Tushar Padgilwar
Imported Garments and accessories business If anybody is interested in starting exclusive imported ladies hand bags, purses, clutches, soft luggage, sari covers, mobile covers, vanity kits, traveling bags and other ethnic fashion accessories business, do call. There is 30 to 80per cent margin in the business. - Ronak Somani
Involvement in business of bamboo products I am looking for individuals, private or public limited companies who would like to involve with us in doing bamboo business on a large scale. I am basically based in London, UK and have access to UK and EU markets. - Pranab Debnath Response I am into manufacturing of Bamboo Flooring. I have a factory at Guwahati [Assam]. Its a project with capital investment of about 6 Crores. Our complete finishing line is European. Please let me know how we can work together for our mutual interest. - Gautam Kothari
Looking for core team with funds and passion for Education We are a 2 yr old Training organisation based in New Delhi working in all new age issues life skills, Stress, Anger and Time Management, Reiki, Yoga, Meditation, Corporate offsite with stress buster exercises, Leadership, Effective Communication, etc. We are looking for core team who shares the same passion and zeal to make some difference in the society with a capacity to invest as well. Please contact us for further details. - Harsh Arora 18 OCTOBER 2010 | DARE.CO.IN
Submit exchange requests at: website: http://www.dare.co.in/ marketplace.htm OR email: firstname.lastname@example.org, OR SMS ‘DARE <your msg>’ to 56677 OR twitter.com/daretostartup
Startups in online Finance management website and Green computing I am a 24 year old software engineer at Bangalore. I was working for 2 years. at a US retail company where I brought to life many online & store sale enhancing ideas. But I did not receive any appreciation for my work. I quit and joined another. But I want to start my own company where I can innovate in the space of: 1. Online finance management and providing saving options. 2. Develop my own product for development of energy saving embedded software. I already wrote a white paper at college but could not get it published due to lack of guidance. Please help me realize my dream. I understood my potential at my previous employer, as I could impact the company’s topline. - Jigisha Aryya
Growing Business of Oilseeds I’m a chartered accountant based in MP. I’m into part-time farming for the last 7 years. I want to start large scale mechanised farming of the field crops (like cereals, pulces, oilseeds etc.) under cooperative / joint ownership model. If interested in the venture, please contact me. - Vivek Verma
Supply of Old Used Tyres for recycling from Europe We are a Europe based company in a position to supply old used tyres of different makes and sizes for recycling from Europe in bulk. Any recycling unit interested may contact us via email. - Devendra Gupta
Waste paper recycling plant We are dealing with waste paper recycling technology and program since last 15 years level. If any body wants to start, we can support them in terms of supplying of cost effective equipments installation, training, etc. - KP Bikal
Selling insurance salvage We deal in all types of used industrial machinery, for any kind
of used machinery you have for sell then please contact us. - Hitesh Joshi
Starting business of solar products I am not a big player in the Indian electronics industry to invest in crores, but I want to start my own business based on importing solar products from China. I have no knowledge in importing any product and its associated intricacies like import duty, etc. Could you please guide me through the process? - Balraj Bhardwaj Response Can you please revert with your business profile and detailed requirement directly to my email id.? - Sanjay Arora
Available Funding for International Trade We are providing funding for Export/Import to executives in International Trade, with existing background only, looking to venture out on their own. Requirements: - Existing background in Export or Import, for the product in question. - Existing network of buyers and suppliers, for the product in question.
• SME CREDIT CARD: A simplified sanction process valid for 3 years for loans up to Rs. 10 lakhs in manufacturing, trade and services sectors. • SME SMART SCORE: A simplified loan model for working Capital/ term loans up to Rs. 50 lakhs in manufacturing sector and up to Rs. 25 lakhs in trade and services sector. • GENERAL PURPOSE TERM LOAN FOR SSI SECTOR: Loan for any specific commercial purpose in manufacturing sector. • OPEN TERM LOAN: A presanctioned term loan with the option of multipal disbursements for various purposes valid for 12 months. • TRADERS EASY LOAN: Easy loan for specific business needs of traders, wholesalers and professionals having collaterals like land, buildings and liquid securities. 90% of the credit needs can be sourced based on the value of the collateral.
• SBI SHOPPE PLUS: Loan to individuals/ proprietors/ partners etc for construction of their residential house and for construction of Office/Shop, purchase of furniture, equipment, etc. • TRANSPORT PLUS: To finance purchase of new transport vehicles and WC finance against receivables for fleet operators. • SCHOOL PLUS: Loans to educational institutions for land and building, repairs/renovation, furniture, equipment, vehicles etc. •
DOCTOR PLUS: Loans to Doctors for setting up clinic/ nursing homes, Path Labs, drug stores, ambulances, computers, vehicles including expansion/ renovation of existing premises etc. • CGTMSE SCHEME: Loans (covered by CGTMSE) upto Rs. 1 cr can be provided without any collateral/guarantee to the manufacturing & services sector. • S T R E E SHAKTI SCHEME: Women entrepreneurs are financed under the scheme to set up their enterprises for gainful employment.
• SME CAR LOAN: Loans for purchase of passenger cars, jeeps, m ulti utility vehicles and sports utility vehicles etc., to the promoter/ partner / senior executives of the SME units/their family members.
• ELECTRONIC VENDOR FINANCE SCHEME (e-VFS): An Online, easier, faster and cheaper mode of finance to the suppliers against the receivables due for the sales made to the Industry Majors.
• CONSTRUCTION EQUIPMENT LOAN: Term loan for purchase of construction equipment viz. loaders, excavators, cranes etc., for the MSME units and contractors.
• ELECTRONIC DEALER FINANCE SCHEME (e-DFS): An Online, easier, faster and cheaper mode of finance to the dealers for the purchases from the Industry Majors.
• partners • mentoring • funding • guidance • advice • ideas...
- Extensive existing product/ domain knowledge of the product in question. - Funds to cover loss potential of one transaction. How it will work: - Product will be something to be exported or imported in LCL or FCL quantities. - Candidate will provide CV and domain profile, with a business plan and a trade proposal, accompanied by buyer and supplier details and trade projections for one trade plus demand/supply information/projections for a year, with three trades parallel max. - Candidate will satisfy all queries and research whatever information required. - Upon approval, we will propose a profit share and terms. - Upon acceptance, candidate will provide deposit towards loss potential of the deal, as defined by us. - Candidate will execute one trade in our company name. - If the trade executed results in a loss, we will recover the loss, plus interest agreed upon from the candidate’s deposit and refund the balance. - If the trade is profitable, candidate’s deposit will be returned along with his/her share of profits. - Candidate will then be asked to trade on our company name for a year, profits will be retained with us, but no investments will be needed. Every trade will require approval from our team. - After a year or even before, the candidate will either be dropped or asked to form a company with equity funding from us and continue in the business. - We will arrange required debt funding from Institutions and/or private sources. - Will exit at opportune time or may continue as investors. - We will maintain presence on the company’s board, as long as we stay invested and will fulfill the role of Independent Director and Strategic Advisor. - Will provide access to foreign 20 OCTOBER 2010 | DARE.CO.IN
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Channel Partners Required For Magazine Marketing We are a premium GREEN DIGEST publishing firm whose inaugural issue is being released in Sep 2010. We are on the look out for channel partners in the cities of Mumbai, New Delhi, Kolkata and Chennai. Interested firms who are into related marketing activity or space selling can contact us for a long standing beneficial relationship in this business vertical. - Jagadish
companies owned by us, for the candidate’s company once it attains requisite size to operate abroad. Only go-getters with exact trade plan, domain expertise, existing contacts and capable of expressing their plans on paper. Please do not make alternate proposals or provide information in parts. - Sanjay Arora
Interested in manufacturing and retailing lamp shades and chandelier in the NCR I have a passion for designing lamp shades and chandeliers. I am interested in manufacturing and retailing the same in NCR. Since I have no prior business experience, I am looking for someone who can provide me with both mentoring and financial assistance. - Alakananda Sikdar Response I’m interested to know more about your plans. - Jitesh
Channel Partners for Bamboo Products We are a premium Bamboo Flooring manufacturer in India. Ours is the first unit in India with complete European finishing line. We are into production since last 5 years. In order to expand our market, we are looking for Channel Partners in all the tier II towns in India. Person with good contacts with architects, interior designers may please contact. - Gautam Kothari
People needed for opportunities between South Africa and India We are an Indian company looking for trading opportunities between South Africa and India. Product line is not yet decided, and we are currently conducting surveys. Interested parties may contact. -Rana Jitendra Singh Response With reference to your exchange, I request you to provide me with additional details of the same. -Dipti
Entrepreneurs for company in solar energy space We are a 1.5-year old company working in the solar energy space. The company has started generating revenues now. We are looking for an enthusiastic entrepreneurs to drive it aggressively to the next level. Here are the required qualities: 1. Based out of Bangalore 2. Ability to drive execution by spending full time 3. Electrical (engineering) background and passion in the (solar/wind) energy business 4. Long term and high goal commitment 5. Ability to contain costs - Raghavendra Ijjada Response I have a keen interest in Solar energy sector and looking for partner and to invest in the company. Please send me your company profile. - Rahul Varshney
from cyber café to online examinations ! how a paperboy turned CEO of an IT company setting pathway to successful online exams. Kapil and his team is now busy preparing for the next big leap, as they are already approached by other universities to work together.
Paperboy to CEO
The great pleasure in life is doing what people say you can not do.. "I was very excited; as it was the first time I appeared for an online exam. Surprisingly, it was so easy to appear for it, and was a great experience. I am now interested to know, if this can also help us to learn online in future...” an engineering student expressed to us, after her online examinations for University of Pune. In a scenario where there was a close media watch towards the online exam by Pune University, considering the one after another incidents of failing to conduct such exams by IIM,IGNOU, TMV and other Universities, Kapil Bhutkar's Team at CYBRIDGE set all to succeed the UOP exams for the fourth time in a row in June 2010. We approached this young entrepreneur aged 31, to know how he could do this. "This is not the first time, we are doing it since 2008 when we conducted the first exam" he said, "The environment in India is different compared to the US and other countries. We have to counter problems like power failures and unnoticed Internet break downs, and at the same time there is the advantage of cooperative participants and highly motivated staff at the centers and university. An Indian company can understand the practical problems much better compared to others, and in the also deliver a solution that works even in extreme cases.”
Born and brought up in a middle class family in Pune, the cultural capital of Maharashtra which has rapidly transformed to an IT hub after Bangalore, Kapil took up the job of a paperboy as his first job. "Rupees sixty, was what I got as my first salary as a paperboy", remembers Kapil, "after my school I took up the job to earn, in 1994. It took 10 years to get the first offshore payment in 2004 from a US client, that too was USD 60" "I still remember my first introduction to computers, after my graduation. I was really scared to touch the keyboard on day one. I could not have even dreamt of being in IT that time."
Then how it all started? "Well, soon after my course I started a cyber café with one friend. Shortly, I took up a small course on programming and started to develop at my own for studying it. I used to write programmes for about 16 to 18 hours a day, just to practice, " he tells.
About CYBRIDGE Kapil started CYBRIDGE in year 2006, with a vision to provide o u t s t a n d i n g We b s i t e C o n t e n t Management Systems, which can reduce the efforts on offline editing of a website. A CMS is integrated with the client website, and client can add or edit the contents anytime from anywhere.
“We specialize in providing multilingual CMS systems. And now the success of Pune University Online Exams, have opened new doors for us in the educational industry." So, what next? "Well, I really dream about an education system with no boundaries," he speaks with dreams in his eyes," I dream of a system, which will allow me to select economics, biology, literature and drawings as my subject of interest, study them online via virtual classrooms, and then appear for the exams, when I am ready. A leading institution has approached to us and we are working on a solution for this together."
Challenges “There were enormous number of hurdles and problems I went through. From capital gathering to team development and financial disasters to breaking partnerships," disturbed a bit with the old memories, he says. But on the other hand, I got team members who trusted on me for a long time. And yes, I should not forget to mention my wife Jyoti, my parents and my family who stood strong with me in the toughest time" he mentions.
Students appearing for Pune University Online Examination, at one examination center. Kapil Can be Contacted at his website - http://kapil.bhutkar.com or
In the three years of its inception, Cacobean Chocolatier has grown to become one of the leading manufacturers and suppliers of premium gourmet chocolates in the country. Director Sarin Patrick tells us more about the company and how the journey has been so far By Sarin Patrick 22 OCTOBER 2010 | DARE.CO.IN
here are chocolatiers everywhere in every city. However, there is nobody else in the market today who has taken the route that we have taken. We are different from the typical FMCG companies like Nestle or Cadbury. For instance, Cacobean as a brand cannot be found on any shelf or as a ﬁnished product in any retail. We have taken the route of private labeling.
Opportunity Spotting Hotels have a big demand for chocolates. Many of them know how to make them but they cannot handle beyond a certain volume. Making them is labour intensive work and requires a lot of time. A regular chef who has other routine
work to do will not have time to prepare them. We saw an opportunity in this predicament of hoteliers. We supply them semi-ﬁnished products and raw chocolates with a soft core cut of speciﬁc dimensions and sizes. Hotels process it further and sell it as a ﬁnished product. In the industry today, we have made a mark as institutional suppliers. And riding on this early success, we are ready to roll out our own branded chocolates.
Process As USP We address another pain point in chocolate manufacturing industry. We make use of automated processes. Take for instance, the 25 mm diameter truffles that we make in
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our completely automated facility, are all centre ﬁlled which in itself is unique because making a chocolate with a soft centre ﬁlling is a pretty complicated process. And you can’t really do volumes manually. We have a machine, which is completely automated to do the process. Chocolates, thus made by us, serve as the raw material for the institutional customers. They buy the chocolate which is, say, 20 mm, 25 mm or 27 mm in diameter and which has a soft core. They then garnish or enrobe the chocolates to sell as ﬁnished products. The most complicated part is already done by the machine. They are sold by us as semi-ﬁnished products in bulk. Our customers do not have to go through the pain of moulding, melting and the process of center ﬁlling. They buy 80 per cent ﬁnished product and do the last 20 per cent manually. The biggest advantage of working with us is we have developed our own unique filling which otherwise has to be imported or bought locally at a steep price. Our fillings have one year's shelf-life. We have a neutral filling which can be customised to suit anybody’s requirement. We just have to add the natural flavors and customize it for end-users’ requirements.
Extending to Corporate Gifting The other part of the business is corporate gifting. We work with the likes of Johnson & Johnson, Van Heusen, United Breweries Group, Whyte & Mackay to name a few. We also cater to banks like ICICI bank and HDFC bank. Gifting during Diwali or Christmas day are our typical seasonal businesses. Jewelery industry have the practice of gifting their loyal and high-value customers round the year. That’s a good market for us. We started with 2000 boxes a year and now it has gone up to 50,000 boxes.
FACT FILE Origin Cacobean’s parent company, India Cocoa is in the business of cocoa for the last 19 years. That was what motivated us to look at chocolate as a business. We source beans from farmers and process them. And the beans are sold as a product. It came into existence three years back. It took us one and a half years to actually formulate the design and the format in which we wanted to enter the market. Cacobean is a private limited company, with stakes and investments from all the directors. It is an expensive business for anybody to get into because there is no domain expertise in India which we can easily tap. We had to depend upon external sources, which were expensive. Today, our infrastructure, products and business strategies are in tune with global markets and we can cater to anyone, anywhere. We can even cater to a retailer in Europe or Middle East. In the last one and half years we have already touched the major retail giants. We import raw materials; we buy our chocolates from among the best companies of the world, from Singapore and Belgium.
Value addition We are one of the few chocolatiers who are based in Kerala, the land of
Company Name: Cacobean Chocolatier Pvt. Ltd. Business Domain: Chocolate Manufacturing CEO: Sarin Patrick Started: 2007 Headquartered: Cochin, Kerala, India Turnover: Confidential
Opportunity Spotting: 1. Demand in Hotels cannot be met with manual units. Center filling automated process removes a big pain point in the industry 2. Take private labeling route
USP 1. Our center-filling process 2. Customized natural flavours
Must Do 1. A good market survey 2. Gap analysis 3. Efficient mapping of resources
spices. And we have come up with innovative ways of incorporating natural ingredients like chocolates with cinnamon, clove, chili, pepper. It has been very well accepted and this is something we plan to launch across the country at airports as a brand. We are in the process of negotiating with people who want to take it up as a brand of their own. Everything is ready, we only need to take a call on whether it would be our own or should it be marketed and sold and distributed by somebody else. DARE.CO.IN | OCTOBER 2010
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24 OCTOBER 2010 | DARE.CO.IN
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DARE.co.in is revamped
Thanks for being a regular visitor to our website over the past years. On our third anniversary, we decided to get the website even more user friendly and useful to you. Here are some of the features of the newly revamped website.
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Comprehensive Content Menu As before, we have content segregated into main sections of interest with sub-sections under each. We have pulled out Blog and Exchange upfront for quick access and contribution by you. Daily updated Feature Stories Latest updates on other sections of the website Latest Exchange Posts, Latest Articles, Latest Polls, Latest Blog Entries, and Latest Comments User Tool Bar You can now customize the content boxes to suit your tastes. With this tool bar, you can choose what areas of interest should appear in each of the section’s boxes. You can also move the sections up and down by simply dragging and dropping it to a position of your choice. Also, you can collapse any (or all) section if you want to do that. Digital Magazine We have the first two years of print magazine completely digitized for you to flip through, for free. We are in the process of adding the third year’s magazine too. Photo Blogs You can view our team’s Photo Blogs and add your own too. Forum Discussions View the latest discussions happening on the forum. Jump into any of those, or start a thread of your own. We have a community going here. That said, the new website is best experienced than to be read about. So go on, visit www.dare.co.in, enjoy our knowledge platform and give your valuable comments as well!
DARE.CO.IN | OCTOBER 2010
The 3 Milestones of Business Models There are three fundamental milestones that a business crosses as it's growing from a founder known concept, to a startup and then to a small and medium enterprise
ompanies evolve, at times diversify and rarely morph into a completely new avatar all by itself. While the second and third scenarios aren’t commonplace, it is absolutely essential for a company to evolve as it grows. What isn’t evolving is simply dead—or on its way there. There is usually a confusion among entrepreneurs between what is perceived to be a business model and the revenue model of the company. While the revenue model of an enterprise is about the product offering and the client and who pays for it, the business model of a company is the implementation plan on executing the grand vision of living up to the mission while being proﬁtable. There are three fundamental milestones that a business crosses as it’s growing from a founder known concept, to a startup and then to a small and medium enterprise. The business models of ventures is closely linked to each one of these stages.
Stage 1: Ramen Profitability Any entrepreneur who is setting out on a new venture and does not have the experience that comes with building companies and managing cash ﬂow has the ﬁrst milestone to achieve. While being ramen proﬁtable or breaking even might not have the lure and glamour of the bigger and fast growing companies, this is a very crucial milestone. And while investments into the future are important, this takes precedence to validate the fact that 26 OCTOBER 2010 | DARE.CO.IN
you are a viable business. The standard equation that is given to validate a business by the expression ‘revenue minus cost equals proﬁt’ is where this venture stands—simple, uncomplicated and a viable goal to aim for.
Stage 2: Sustainable Margins Once you get proﬁtable, the next step is to start thinking about what are the things that you can do to optimize your margins, keep competition at bay and also start looking at new sectors that you can diversify into in the future. Most enterprises struggle at this, because this is the stage where you have to start measuring everything that can be measured—from the average margins, the bad debts incurred through failure of collections, the cost of sales, the cost of delivery of the service, the cost of maintenance, the cost of customer support—each and every element of the business has to be measured and monitored. Three things usually help at this phase—automation, technology and processes. Automation removes the human element and thus removes the fallacy that comes with it. Technology helps create a cohesive environment to keep an eye on how the entire system ﬂows while processes ensure that you lay the ground work for the future. The equation of revenue minus cost equals proﬁt still holds here as well. What you also come to realize is that that cost is a variable and you can,
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While being ramen proﬁtable or breaking even might not have the lure and glamour of the bigger and fast growing companies, this is a very crucial milestone in fact, control some of it, and not so much the rest of it. Identiﬁcation of these is what happens at this stage.
Stage 3: Non-Linear Growth Practically speaking, most companies never get past stage two. In this stages your margin goes astray, systems are not complied with and your target segment gets disrupted. Every assumption you had made till this point goes out of the window. So, you are required to redeﬁne your revenue model, revamp teams and go back to stage one all over to get it started—or at least for bits of it. If you are talking to any reasonable venture capitalist who is honest enough to tell you what is it that they are exactly looking for—it’s the companies that can actually get past stage three. And statistically speaking, less than 2% of companies founded will actually qualify for this—even lesser when they are just startups and haven’t seen the reality of turning proﬁtable and managing their margins. An enterprise reaches its third stage when it can increase revenues while keeping the linear cost component low. The key to the code is-keep the cost of customer acquisition as low as possible and the delivery costs at a fraction of it. An enterprise should also try to keep the cost of customer support low and yet deliver a stellar product or service. This is where intellectual property based ﬁrms and also product companies have a signiﬁcant leverage as they can build a product once and sell it repeatedly, thus keep the costs low and enjoy a non-linear return. However, the world is changing with the advent of several innovative business models such
as cloud computing, time-share models, shared infrastructure, pay-per-use model, etc. Today, there is an opportunity for quite a few businesses to take advantage of such models but the reality remains that most do not succeed. And the ones who do, change the face of the industry. There are three reasons why I thought it was quite crucial to write about this. Firstly, it has to understood that most businesses can be very successful and enjoy healthy proﬁt margins, grant you everything you aim for ﬁnancially, and still not get past the second stage of business model evolution. Secondly, as an entrepreneur, especially early stage, you have to realize that predicting the projections or future of a stage three business without even going through the ﬁrst two stages—or having any experience of building a business before—are mostly empty promises made and a lot of time wasted pitching to raise money. The third is what I hope you’d take away from this—India is a land known to have built several businesses which looked like stage two businesses but soon turned out to be stage three businesses as they morphed and diversiﬁed—the likes of Bharti to Reliance are living examples of it. But if you set your eyes on a non-linear return business without the experience and patience of knowing the steps, the journey could get frustrating. As they say, there is no easy way to build a business. It takes time and it is always a hard way. Vijay Anand is a serial entrepreneur, the founder of Proto.in, and the Vice President (Incubation) at IIT's RTBI. He tweets at @vijayanands. To write to the author, please send an email to firstname.lastname@example.org with the subject line 'Vijay Anand'. DISCLAIMER: The views expressed here are that of the author and do not represent the magazine's.
DARE.CO.IN | OCTOBER 2010
Private Equity/Venture PE Investments
* VC investments are a subset of PE SOURCE: Venture Intelligence PE/VC Deal Database
PE investments in Cleantech (Jan-Aug)
SOURCE: Venture Intelligence PE/VC Deal Database
28 OCTOBER 2010 | DARE.CO.IN
SOURCE: Venture Intelligence PE/VC Deal Database
PE investments in Cleantech (Jan-Aug)
SOURCE: Venture Intelligence PE/VC Deal Database
ANNIVERS ARY EDITION
Capital in August 2010 Top PE investments in August 2010 Company
Top VC investments in August 2010
Amount ($ M)
Amount ($ M)
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SOURCE: Venture Intelligence PE/VC Deal Database
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SOURCE: Venture Intelligence PE/VC Deal Database
Top PE Investments in Cleantech Company
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SOURCE: Venture Intelligence PE/VC Deal Database
DARE.CO.IN | OCTOBER 2010
Cash Cow With a difference If cows in certain parts of Delhi have been looking unusually healthy of late, blame it on Kawal Kumar Grover and his unique social enterprise called Gau Grass Sewa! By Nimesh Sharma
awal Kumar Grover, a Delhibased footwear businessman, was holidaying with his family in a typically bubbly marketplace in Jaisalmer, lost in a dizzy riot of colours, when suddenly he was distracted by the shrill cry of a bell that wouldn’t stop ringing. When he turned around to check what the racket was about, he saw a young lad riding a cart from one doorstep to another and collecting packets of various shapes and sizes. “These bags have leftover food, Sir, and I collect them every morning to feed the cows,” the lad declared triumphantly. “The bell is to announce my arrival!” Right there and then the 64 yearold Grover knew how he was going to use most of his out-of-business hours through the rest of his life. He would, he decided, organize whole-scale community efforts to feed cows with food people otherwise junked, as a unique social enterprise!
30 OCTOBER 2010 | DARE.CO.IN
Now, Grover’s is by no means a billionaire business driven by robust revenue models and supply chains— as a starter, this service does not make any money for him, nor does he expect it to. Yet by linking man, beast, food and fodder into a unique organization of shared values and mutual proﬁt, his simple idea, bummed of a lad in Jaisalmer, is unleashing change through large and expanding communities around the northern districts of Delhi: from Shalimar Bagh, where it all started, to Ashok Vihar, Rohini, Pitampura and beyond. Certainly the cows are smacking their lips with relish and for sumptuous reasons! Instead of foraging on plastic, paper and a mélange of other rubbish in garbage dumps they now get to feast on home-made food - that too at their sheds, on time. Not surprisingly, the output of milk has changed out-of-sight, both in terms of quantity and quality, which means more liquidity for the cattle farmers-
-literally. Equally, with households now producing less garbage, the environment is smiling too. But what about the funding? Who pays for the salaries to the rickshaw-wallahs, employed by Grover to peddle the food? At ﬁrst, for many months, Grover funded his initiative all by himself; but obviously this was not a sustainable model. Says Grover: “With the incomes of the cattle owners rising on account of the improved diet that was being made available to their animals, I knew that they wouldn’t mind paying for the service, at least to cover the expense.” That gut feel turned into a belief when for a few days the service became erratic. “My phone never stopped ringing,” says Grover. “The milkmen wanted to know why the food packets were not arriving on time,” To Grover this was proof that the idea was working. “I went to the goushalas (cattle sheds) and milkmen and bluntly told them that if they
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wanted the food for the cows then they would at least have to pay for the wages of the delivery boys, the rickshaw drivers!” They agreed readily. So, supported by a growing number of house-wives, their kitchens and a motley bunch of rickshaw pullers,
goumatas eating rubbish at garbage dumps?' Yeah, it’s awful, an insult to our religion. 'How would it be if we could feed them with food we generally throw away at our homes?' Sure. Let’s do it. Sometimes, it was that simple for Grover.
in bright yellow. The service took off in February 2008, initially covering 10 blocks of his neighbourhood in Shalimar Bagh. Alongside, Grover approached two major cow shelters (goushalas) on the outskirts of the city entrust-
ELEMENTS - HOW IT WORKS
“With the incomes of the cattle owners rising I knew that they wouldn’t mind paying for the service, at least to cover the expense.”
Modified rickshaws painted in yellow carrying six steel drums and printed information, moves around the colonies from 8 am to 1 pm, their bells ringing. Each drum is for a different kind of food:rotis, vegetable peels, hay and so on. People who have leftovers to contribute come out of their homes on hearing the bell and put the items in the relevant drums.
- Kawal Kumar
Once the rickshaw-wallah has covered the area, he ferries the food to the milkmen
Grover has set up a self-sustaining community venture that could serve as a template for future entrepreneurs looking for viable business opportunities in the social terrain. However, unusual as Grover’s enterprise might be, the basic thought behind its success, surprisingly enough, reads like a lesson straight out of a B-School copy book: the key to building a successful business is to identify and fulﬁll real needs in the marketplace efficiently and at the lowest possible cost. Equally, it is important to keep it simple: Grover did not need complex SCM software or extensive market research to get housewives to donate leftover food to the cause of serving hungry cows, which in the Hindu belief quite literally, enjoy a holy status and are often referred to as gou (cow) mata (mother). It wasn’t easy, but making the right noises at the right places backed by a few hundred simply worded pamphlets, did the job nicely! 'Isn’t it horrid to see the
However, while selling the idea to his neighbours was relatively easy (the message spread rapidly by word of mouth), executing it on the road was quite another thing. The ﬁrst headache for Grover was ﬁnding rickshaw-wallahs who could be relied upon to collect and deliver the food every day, without fail. Then there was the problem of ensuring that they would do the job honestly. “What if they sold some of the food on the way to supplement their incomes or asked people for money as donation for cows?” But, clearly, Grover had not come this far, to back out and so with some help from his friends and neighbours each of the problems was sorted out, “We displayed clear messages on the back of the rickshaws asking people to not give any cash to the rickshaw-wallahs,” says Grover. Then to give them a distinct look and make them easily identiﬁable, all the rickshaws were painted
ed with the task of tending to 6000 aged cows. Although these shelters receive some daily government allowance per cow to feed the animals, it was never easy for them to ﬁnd fresh food for such a large number of cattle-heads. So, Grover’s idea was like godsend. “They happily agreed to pay the salaries of the rickshawwallahs,” says Grover. From its humble beginnings, Grover’s unique social welfare enterprise has now spread across an ever widening circle of colonies in Delhi, involving more than 100 rickshaws, about 8000 kgs of food per day, innumerable families and thousands of cows. Sure, Grover, the man who started it all, does not make money from the venture, but it has helped poor rickshaw-wallahs ﬁnd regular income and milk-men enhance their earnings. Most importantly, it has provided many people an unusual way to atone for their prodigal sins in a land where cows are god. DARE.CO.IN | OCTOBER 2010
Small & Mighty REVEALED¬A¬STAR CAST OF¬START¬UP¬ARTISTS¬TELLS YOU¬HOW¬TO¬OVERCOME CHALLENGES¬AND¬WIN BIG
CEO Insights : FINANCE Anurag Batra – Exchange4Media | B.G. Mahesh – Oneindia.in | Lalit Agarwal - V Mart | Pradeep Garg - Kundan Group | Rahul Dev Rajguru – Aquilonis MARKETING Amit Ladsaria - Turtle Menswear | Dinesh Agarwal – Indiamart | Hemal Patel - Elitecore Solutions | Hrishikesh Damle – Atrimed QUALITY & PROCESS Anshu Gupta – Goonj | Rishi Modi – FreshRank | Saumil Majumdar – Sports | Suresh Tota - Compact Hometel Vineet Rai – Intellicap | Vipul Prakash – Elixir Consulting | Vrinda Rajgarhia - Sweet World HUMAN RESOURCES Allwin Agnel – PagalGuy | Faisal Farooqui – MouthShut.com | Jacob Mathew – Idiom LH Manjunath - SIRI Gramodyoga Samsthe | Parichay Upadhya - New Look | Shamit Khemka - Synapse India Vaibhavi Thakkar – BlendFinance | Varun Mirchandani – Onicra | Vineet Bajpai - Magnon Solutions TECHNOLOGY GP Singh – Advantec Coils | Hema Malini KR - Incite Cam Center And Sandeep Parekh - LinSec Advisory | Hanuman Tripathi – Infrasoft | Vibhas Prasad - Leisure Hotels
SNAPSHOT Name: Anurag Batra Age: 38 Education: B Tech, MBA Experience in business: 15 years Leadership style: People Friendly and Goal oriented
When you run out of business...
Don’t hesitate to change or fine tune your original business plan to get the right results
Set up in: 2000
By Anurag Batra have always maintained that I am an accidental entrepreneur. I did not plan to become an entrepreneur, just stumbled into it. As with most entrepreneurial journeys, it was only after I got into it that I discovered the pitfalls along the way and navigated my way around them. This took me in an entirely different direction, and today my business is far from what I envisaged. Don’t get me wrong. I love what I do, it's just that it’s not what I thought I would be doing. I have faced many difficulties along the journey, but by far the most challenging was sourcing the funding for the venture. I was lucky enough to present our plan (I have two partners) to an angel investor, who saw opportunity in us (honestly speaking, he trusted us more than the business plan we presented), and gave us funding and other support. He later told me that what really impressed him was the story we told him and not the numbers, the data or the fact that no-one had come up with this product till now. It was the story. It was how we explained what our product would do, how it would change the current scenario of doing business, and how it was the need of the hour that really convinced him. It was in the ﬁrst few hours of our meeting that he made up his mind to invest in our business, according to him, the rest of the time was spent on making sure that his hunch and the data was in the same direction, and safeguard-
34 OCTOBER 2010 | DARE.CO.IN
Name of the enterprise: Adsert Web Solutions Pvt Ltd Domain/Industry: Advertising & Media Marketing Turnover: Privately Held (Undisclosed) Employees: 110 Headquarters: Delhi Website: www. exchange4media.com
BUSINESS MODEL exchange4media was set up eight years back with the aim of publishing niche, relevant and quality publications for the marketing, advertising and media professionals.
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ing his interest. I can't begrudge him that; after all, I would do the same if I were in his shoes. We went around setting up our business and working towards the goal, but with poor results. Finally, when our funding amount started drying up and we started looking for more funding from our angel investor, he clearly told us that he had invested a certain sum of money based on his risk appetite, and that he expected us to make the business work within that sum of money. He told us that we could change around the model but that was all the funding that we were going to get. He was even willing to accept that the business would fail and thereby his investment but he was not willing to throw good money after bad. It was a difficult situation. We had to quickly develop a new business model, one with low investment and high yields. There were some teething problems that we faced but it was a case of survival. We were desperate. Thankfully, we were lucky that it started generating modest revenues, which soon built up to sustainable amounts. We had to manage our expenses and run the business on a skeleton staff and on a shoe-string budget, which we continued for quite some time. Since then, we have come a long way, where we have become the leading group in our domain, but that’s another story.
Raising funds should be Plan B in all entrepreneurial journey. Use your own money if possible The point I am trying to make is that funds are a key issue in every startup. There is never a situation of unlimited cash reserves, let's face it, if that were the situation, no ﬁrsttime entrepreneur would ever fail. In the worst condition, he would simply be developing the business model, and the business would be at a stage where the revenues simply had not caught up with the costs. It is working with a budget that is the real trick. I know of several entrepreneurs who started their enterprises on little money and good ideas but just ran out of money on the way and were unable to sustain it. I am sure that if they had funding for a little while longer, their enterprise would have been successful, unfortunately, it was not meant to be. On the other hand, one of my friends who started with very little seed capital (saving up some money and borrowing a little from his relatives) has made it big today. He said that he had a very simple rule when he started off that the costs could never be greater than the revenues. Even when extending credit to his clients, he ensured that he never
gave more credit than the proﬁts he derived from the client. He was willing to give up some opportunities and a lot of his comforts to stand by this rule and ultimately it paid off. Difficult times will emerge in every entrepreneurial journey (it is part of the game) but only those who stick through the rough time will emerge successful. Funding is a mixed bag, it is not only about the money that you get. I live by the rule that an angel investor should have no role to play in the day-to-day functioning of the business. After all, the person who started the business and is running it is the best person to lead the team. Thankfully, we were lucky that way our angel investor gave us a wide berth and would only ask us of the returns on his investment. However, I know of several cases where the investor had more than just investing in mind, and wanted to take over the company. Usually, the hallmarks of such relationships are evident in the beginning itself, and if you and the funding entity do not see eye-to-eye on the objectives, the leadership and other key issues, the deal evaporates or quickly sours. Ultimately, funding should always be the Plan B in any entrepreneurial pursuit. The ﬁrst option is to use your own funds. In the event that you do have to go in for funding, make sure that the reins of the business remain ﬁrmly in your hands.
DARE.CO.IN | OCTOBER 2010
SNAPSHOT Name: BG Mahesh, CEO Age: 43 Education: BE (Computer Science), MS (Computer Science) Experience in business: 18 years Leadership style: Give others the credit for success, take blame for failures. Big learning: Patience & focus are very essential for long term success.
Pioneering a new model calls for patience The key lies in persevering through your model despite lack of demonstrable data points. They will come eventually By BG Mahesh ost of the Internet users you come across may be from urban India, who is comfortable with English. Reports say a mere 12 per cent of the Indian population is comfortable with English, meaning a whopping majority of India are non-English consuming users. This essentially translated to ‘OPPORTUNITY’. Many ask me for ideas for starting an internet venture. My response has been the same – try to solve a problem which people face in their daily life. We knew many users in India wanted to read language content on the internet. That is how we decided to go the language way on Oneindia. in. Make no mistake, we do English also because Indians in general are bi-lingual – English + mother tongue. We wanted the users to spend their online time only on Oneindia.in irrespective of the language they were comfortable with.
FACTSHEET Name: oneindia.in Domain: internet portal Turnover: Private Set up in: 2006 Employees: 85 Headquarters: Bangalore Website: www.oneindia.in
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BUSINESS MODEL Advertising is the main source of revenues for the portal. Ecommerce is a new introduction on Oneindia.in
ANNIVERS ARY EDITION
We started Oneindia.in in January 2006 with a clear mission in our minds – to make language content available to Indians. You read often about the lack of availability of language content on the internet, we want to be part of the solution, not the problem. Oneindia.in today has 5 Indian languages – Hindi, Kannada, Malayalam, Tamil, Telugu. Our traffic has grown impressively over the last four years. We also have another vertical, click.in, – which is a leading horizontal classiﬁed site. Both these properties are owned by Greynium Information Technologies Pvt. Ltd. The first few years we concentrated on increasing the reach of Oneindia.in (unique users), there was a casualty because of this approach–revenue growth. Our revenues were not growing at the same pace as our page views. We knew the reason for this problem – we did not have a dedicated sales team. My partner Sriram Hebbar (COO) was able to devote only part of his time to sales, the rest had to be devoted to operations. Believe it or not we never travelled out of Bangalore for any client meeting. Very few know we never had a sales team. One of the reasons being – lack of funds to hire good sales professionals. Sales team in the online world can be expensive. People with few years of experience were demanding over `10-12 lacs per annum, but I wanted guarantees on performance. For sales team it is a must to have the compensation linked to performance. But we were not in a position to hire good people because we were not funded. To execute many of our plans we had to look around for raising funds from VCs. While most VCs agreed what we had was good, none of them were willing to bite the bullet. For them languages was still an
For VCs language internet was still an unknown entity so they hesitated to invest
unknown thing. If you closely watch, most of the companies that receive funding have a model that is proven in the West. We were in a space which was unique to India alone. In China, English is rarely used, so automatically people had to consume content in Chinese. In India, as I said before, we are bi-lingual. I wasn’t able to show an example were a business based on bi-lingual model had succeeded. My argument was–I am setting the standard, I am setting the example, I am taking the lead in this space. But finally it boiled down to “show us where else this has worked.” Convincing VCs was just not easy. Very few agreed (then) that languages were being consumed online in India. The other thing which went against us was the lack of internet penetration. Tier-2 and Tier-3 never had good access to Internet. In fact many parts of
It boiled down to show us where else in the world has vernacular Internet worked
Bangalore still don’t have access to wired broadband. Everyone is aware of the internet, but access was difficult. Needless to say many of the prospective Internet users would have been accessing Oneindia.in if they could. We were losing out on user base but then you need to understand–there is nothing you can do about it. So instead of whining try to innovate, concentrate on improving the product you already have, try to increase the number of revenue models you have. VCs wanted us to have ‘transactional revenues’. We had to demonstrate language speaking internet surfers are willing to ‘buy’ on the internet, however small, we had to show language users are open to spending on the internet. We did sell few books, bus tickets on our language sites but we needed to have dedicated teams to scale that model. I had a good resource who could translate my ideas to a presentation. My colleague Sriram Hebbar was doing a great job on the ﬁnancial plan. We had all the supporting materials a VC was looking for but that was not enough. Rejection can be tough but I made sure I took it as a challenge; rejection only increased my commitment towards the company, shareholders and employees. It is important to learn to say ‘I don’t know the answer’ to many questions. It is better to be frank and acknowledge any good ideas you hear from VCs. Over time I too started seeing some valid points in what the VCs had to say. If they said “no”, I asked “why?”. Then I use to analyze the reasons they gave. There is no need to accept or reject everything they say, but you must be honest to yourself while analyzing the feedback. Because if you are not having an open mind while analyzing what they have to say you will be the ultimate loser. DARE.CO.IN | OCTOBER 2010
SNAPSHOT Name: Lalit Agarwal Age: 40 Years Education: PG Diploma in Finance from NMIMS Experience in business: 20 years Leadership Style: Leading the organization with strong willpower and business strategy. Big Learning: Chase your dream.
How to handle large investment venture?
FACTSHEET Name: V Mart Retail Pvt Ltd Domain: Retail Turnover: 200 crore Set up in: 2003 Employees: 2000 Headquarters: Udyog nagar Industrial Area, peera garhi , New Delhi -41 Website: www.vmart.co.in
Being innovative, undaunted by adversity and continuously fine tuning oneâ€™s options, finance can be landed By Lalit Agarwal Mart Retail is engaged in hyper market stores with an average area of 10,000 to 15,000 sq. ft. through an impressive chain of 63 fully integrated stores in 49 different cities spread of more than the area of over 4,000,00 sq.ft. We have ten exclusive women western wear outlets, called V Galzs & we are planning to touch 100 marks, which will take total retail area to over 10 lakh sq. ft. in tier II and tier III cities by the end of fiscal year 2011. We started our journey with a mission to offer quality garments to the common man. With the eyes on quality of the product, we have now become the household name in most of the families. Shopping
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BUSINESS MODEL V Mart Retail Pvt Ltd runs through 63 integrated retail stores in 49 different cities. V Mart has two retail formats V Mart which is a mega retail store and V Galzs which are exclusive women western wear fashion outlets.
ANNIVERS ARY EDITION
at V Mart is an experience that actually amazes the first timers. Itâ€™s not just the reasonable pricing that attracts our shoppers but also the brilliance that is displayed in the designs conforming to the latest trends. I thank my designers for their understanding of fashion demands of all age groups. Our quality standards are strictly maintained at all levels right from the sourcing of raw materials to the final finish of a garment. It is this quality commitment that has enabled V Mart to produce successful brands such as Charcol, Jwhite, Jinxx, Grrovy Kids, Cruxx, Fellow, Kool, Needle, Sword, Appache and Quasi under itâ€™s private label category. Today, in addition to garments, we have in-house products like FMCG and general merchandise. Once a customer leaves our store they are bound to come back to us as h/she gets a product that exceeds their expectation. It was difficult to initially think on the lines of starting a retail chain because of heavy investment required. To pool in money, private investors, friends and relatives were assured of commission on sales, interest , margin percentage, and such things. By commission sale we mean on per-piece or on total sales. We agreed to share the revenues generated from the profit of the business. The basic thing is that we never left any opportunity to collect any funds coming our way . Whichever option was feasible and practically possible, we have done it. New investors were hesitant to invest in our business and to convince them and to get the funding we offered them commission on sales too. Additional funding was still required, because retail was in boom and there was a huge opportunity in the market. To grow further with new stores, we needed additional funds and it was hard to raise from the exist-
Government policies may limit you in some ways but donâ€™t lose heart
ing financial arrangement. Hence, we started discussions with banks, but there was the challenge of providing collateral security to get the loan sanctioned. We had submitted inventory and fixed assets as part of the collateral. Challenges were met by some means and or the other and growth was supported by necessary funds. Initially, suppliers were not ready to supply goods on credit. It was also a big challenge to ensure best product with good quality from reputed vendors . Our merchandising team managed to convince the vendors touting our vision and expansion plans. Our market reputation too helped us. Lot of organized players started entering the market and competition became intense day by day. We needed to get sharper and sharper to stay and create a space in the market. To meet the competition we had to grow simultaneously because unless and until we achieved optimum volumes in sales we would not able to source
Only high end PE would help us in our ambitious expansion plans
products at reasonable prices and that would hurt the business. This led us to think once again on various funding options which included debt, PE, IPO, mergers and loans from small investors. But there were huge challenges in all the above mentioned options. Because of the scale of our operations and size of the company. But our model and our passion for the business did not allow us to rest for a single moment. We kept on evolving the options and opportunities until we found private equity investors. Retail grew at a rapid pace between 2002-07. During this period, V Mart was also growing at a CAGR of 40 per cent. The number of stores were increasing for which we needed more investment in terms of assets, merchandise, manpower and so on. We decided that the capital investment should not be the hindrance for our growth so we searched out for the best viable options in the year 2007. Private equity investors was the best option for us to support our expansion plans. We worked with SBI Capital and eventually landed Aditya Birla as a PE investor. Organized retail is just six per cent of the Indian Retail. It has a huge potential to grow in future which is well known to all the investors. Limited options of funding are available in India because retail operate on rental models and there is very limited scope of buying properties. So the financial institutions/banks find it difficult to finance. Every policy has its pros and cons. FDI policy in India limits investing options for a retailer like us. For V Mart too it limited the options of funding. Foreign money in any case is welcomed by Indian retail industry and similarly by us. The costing of other options like FDI policy from the investment point of view is needed. DARE.CO.IN | OCTOBER 2010
SNAPSHOT Name: Pradeep Garg Age: 49 yrs. Education: Graduate Experience in business: More than 30 years Leadership Style: Democratic (Participative) Big Learning*: He has learned how to play a vital role in the global market scenario in extremely dynamic and challenging business environment.
SME meant high risk business Meticulous financial planning is the only way to stay out of a debt burden and keep the growth engine chugging
FACTSHEET Name: Kundan Rice Mills Ltd. Domain: Trading H.O. At New Delhi Employees: Around 350 Headquarters: New Delhi Turnover-300 crore Set up in- 1980 website-www.kundangroup. com
By Pradeep Garg BUSINESS MODEL ith the sole objective of achieving big, I started my business venture in 1980. I wanted to build my venture to become a truly global organization in the business of international trading of organic and inorganic chemicals, edible oil, pulses, wax, basic drugs and allied products by developing and continuously upgrading our quality systems and professional skills. But achieving that milestone was not easy and it was not at all a cakewalk for me. Because, in those days, it was difficult to arrange ďŹ nance. The common perception was to take a government job and business was not
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Kundan Group deals in diversiďŹ ed trading and distribution of different commodities The business group has interest in manufacturing as well as domestic and international trading activities.
ANNIVERS ARY EDITION
the preferred career option. However, to start the venture I needed ﬁnance. At that time, banks used to charge very high interest rates on loans. To start my business I needed funds which was hard to ﬁnd from the existing ﬁnancial arrangements. I started discussions with banks, but then the necessity of providing collateral security proved hurdle for my venture. Those days, ﬁnancial institutions were also reluctant to provide any assistance to SMEs because of the high risks attached with the businesses. The inherent problems of small enterprises, like lack of transparency and non-adherence to accounting norms, acted as deterrents in getting ﬁnance. The non-availability of affordable finance affected investment plans and growth of SMEs. Moreover, because of the perception that SME is high risk industry, banks would charge high interest rates and this acted as another major impediment in accessing funds for us. Also, the time required to approve SME loans was often very long. To get a bank finance one needed to submit elaborate documents and the process involved detailed paper work. For me, convincing a suspicious bank manager was very tough and they were reluctant to understand my funding need. It’s not an easy task to obtain business loans. We needed to present an impressive business plan to convince the lenders. Another important thing was to be very precise on the priorities and financial projections for the forthcoming years. A business loan taken without proper planning could have led to debts. It is far easier today than when we started our business. The problem of funds got sorted out after we decided on meticulous financial planning. In business, financial forecast or financial plan refers to an annual projection of income and
Financial plan refers to an annual projection of income and expenses for a company, a division or a department. A ﬁnancial plan can also be an estimation of cash needs and a decision on how to raise the cash
The non-availability of affordable ﬁnance affected investment plans and growth of SMEs. Moreover, because of the perception that SME is high risk industry, banks would charge high interest rates and this acted as another major impediment in accessing funds for us
expenses for a company, a division or a department. A financial plan can also be an estimation of cash needs and a decision on how to raise the cash, such as through borrowing or issuing additional shares in a company. In our case we undertook financial planning to achieve the strategic goals and objectives. In our financial plan, we described the activities, resources, equipments and materials required in order to fulfill the desired goals. With this financial plan we tried to get finance from our internal source and financial institutions. After much effort we achieved the financial support from leading financial institution. As of now we are on a very good growth path, we diversified our business portfolio, and each and every category, and I think we are doing very well. Kundan Group is the exclusive licensee to market/distribute/ manufacture Jolen Products in India. Jolen is best known as cream bleach product from USA and we are the only licensee in India for the product. We deal in international trading and distribution activities of various products that includes pulses, chemicals, waxes, sugar, cosmetics, etc. Apart from Jolen, we have tie-ups with other international brands and domestic consumers as well. Our regular suppliers are based in Iran, Qatar, Oman, UAE, USA, Europe, South Africa, UK, Singapore, Malaysia, Indonesia, Libya, Russia, Romania, Ukraine, Uzbekistan, Korea & China. In a nutshell, I can foresee Kundan becoming the most trusted name in the world of 24X7 global business environment. We have our corporate office in New Delhi with branches at Mumbai, Kolkata, Ahmedabad & Hyderabad. At present, Kundan owns 26 branch ofﬁces and to make the business operation easier, we have opened few branches in overseas countries. DARE.CO.IN | OCTOBER 2010
SNAPSHOT Name: Rahuldev Rajguru Age: 37 Education: BE + MBA Experience in business: 13+ Leadership style: Trust, Delegation and Accountability Big learning: When we were ready to take the risk, we could have taken it a bit early. We wasted lot of time in planning and thinking.
Taking a plunge into the mobile platform world Opportunity was big at the same time our own salaries were high. We were driven by our passion to finally venture out By Rahuldev Rajguru e were churning the idea of building a mobile technology almost a year ahead of starting Aquilonis, but we did not want to do something which is difficult to sell. We knew that US is the market which is going to adopt what we are trying to build, but how do we reach companies over there sitting in India. That was the question running in our minds for a long time. We started working on the technology with the help of a couple of technocrats who worked with us at that time till we found our ďŹ rst customer. We were offered $ 1000, a small sum by our customer to begin with. We were excited and we worked in the nights and weekends to make sure we deliver what the customer is looking for. It did work well with us sitting in India and delivering in the US without any reference or track record. Our motivation was sky high. We were still thinking when to quit the job. Those days there werenâ€™t many professionals with diverse mobile technology experience, which was good in a way but was
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FACTSHEET Name: Aquilonis Technologies Pvt. Ltd. Domain: Mobile technology and solutions Turnover: (prefer not to disclose the current revenue in public) we would like to become a 100 Cr company in 5 years. Set up in: May - 2008 Employees: 20 Headquarters: Bangalore Website: www.aquilonis.com
BUSINESS MODEL Technology licensing and mobile app building
ANNIVERS ARY EDITION
the deterrent factor in us wannabe entrepreneurs as our salary was growing at an astonishing pace. All the time the pendulum of sustaining the business versus remaining cash positive was hanging over us. We thought that it would be easy to start if we get some ﬁnancial assistance, but we soon realized that it would be more frustrating and would dilute our focus. Then we got a customer who was willing to commit long term as they saw a huge potential in our technology. We decided to quit our jobs and I led by example by quitting the job ﬁrst followed by my co-founder, Devang Thakkar. Since then Aquilonis not only sustained through the worst economic slowdown but also grew from a single-bedroom company to a 2500 sq feet office today - from a 3 member team to a team of 20 in 2 years. Funding is a buzzword for every startup and cash is the lifeline on which it starts a bumpy ride with a vision and a dream to succeed. We too were in the same boat when we decided to quit our jobs with fat pay cheques every month. India is a country where you need to physically prove before you utter the word funding, unlike the US, where people (mainly angel investors) believe in your idea and provide you a platform to kick-start your dream. We were very much aware about this scenario and decided not to invest our time behind this mirage. Instead we believed in the saying of some of the great entrepreneurs that, “Your customer should be your ﬁrst investor. When we discussed with few people that we want to develop a technology, we were laughed at because they thought that only multinationals and larger organizations can build a technology. During my career, I traveled through many countries and some of those were very small but they had offered some of the greatest technologies
People believed that technology cannot be built in India and it usually happens outside
the world has ever seen. To my surprise, majority of those were invented by small companies in those days. I got an opportunity to travel to Israel several times and I could see technological innovations coming out from very small companies, not one or two but many. This validated my belief that one needs a mindset to build a technology and not the money or a big name. I have been traveling to the US since last 10 years and every time I go there I ﬁnd a lot of innovation in mobile technology. I have seen the US telecom market when they were on TDMA technology and have witnessed the transition to 3G that has changed everything from the way people do their business or their daily lifestyle. Without mobile adoptability this would not have been possible. I spent the last decade of my career only in mobile technology, which helped me visualize it’s potential. These experiences helped us decided to venture into mobile technology
Customer advance and regular payment ﬂow was our only hope
and fulﬁll our dream of innovating something unique. I talked the idea with Devang sometimes in mid of 2007, he liked it but his immediate reaction was where do we get the money to build it. At that time, neither we had money to build a technology that takes a couple of years nor we had done any research on what we wanted to do. So, this posed the biggest challenge of the need to get the ﬁrst customer and staying proﬁtable. After slogging late night hours and weekends for a few months we ﬁnally decided that one day we are going to make this happen and I was sure our customers would be willing to pay. We knew we were taking a risk and it becomes an important weighing factor when our salaies are hefty. Indian culture is very protective especially when you have a good position and fat salary, with all luxuries at your doorstep. In such a situation, inviting more opinions would not have made any sense and instead would have caused severe damage to my motivation. I had the buy-in from my wife, which was the most important aspect. The wise thing I did was not to seek what my parents would feel, instead I chose to inform them after putting in my papers so that it doesn’t leave room to explore and go back on my decision. Still they believed in us more than what we could instill in ourselves, this was the encouragement that helped us put the ﬁrst step in the direction. We were fortunate enough that we could grow our business in the tough economy where survival was the biggest issue for many companies. It is futile to approach a customer in India when you just have an idea or a prototype of your technology ready. Thankfully for us, our global experience especially working mainly with the US customers came handy. DARE.CO.IN | OCTOBER 2010
Give me money, Please!
A redeemable idea and expertise don’t guarantee a successful show for a pinched entrepreneur. Money is indispensable, and equally inaccessible for the smaller players! By Shinjini Ganguli majestic Rolls Royce could well be reduced to a fancy box of coloured tin without fuel. And so can be a potential entrepreneur to just another dreamer without moolah. While an economically-viable idea is a pre-requisite for a business, availability of adequate fund is a pre-requisite to such an idea. Such is the importance of funds. But incidentally, its availability is
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inversely proportionate to its importance, especially, for small and medium enterprises (SMEs). Despite, being the backbone of an economy and the key source of economic growth, dynamism and ﬂexibility in a country, SMEs are subject to scepticism of lenders. This is partly because such enterprises involve high risk element given their volatile nature in comparison to larger and stable ﬁrms.
Altering Perception Of late, close to two decades postliberalisation of the economy, a slight shift in the perception has occurred. “Today, all the banks are focusing on MSMEs,” says Vara Prasad, General Manager (Mid Corporate & MSME Dept.), Union Bank of India. Parag Patki, CEO, SMERA, credit rating agency for SMEs, says, “Commercial bank credit to MSEs,
as a percentage of net bank credit, had declined sharply since the late 1990s. From 14.3 per cent in 1997, it had come down to 6.5 per cent in 2007.” However, signalling a change he further adds that, “A slight improvement has been noticed in the year 2008-09 with the percentage surging to 9.9 per cent; which possibly could be due to change in deﬁnition of MSEs in the year 2006.” As per the MSMED Act, 2006, investment ceiling has been increased to `5 crores (for manufacturing units) and `2 crores (for service units) from the level of `1 crore prior to this act. The percentage may have risen but the ﬁgures remain fairly insigniﬁcant, reinforcing the persistence of funding as an imposing challenge for SMEs. The smaller players, who choose to stick to the organised credit market, meet with incessant obstacles in various stages of funding.
An entrepreneur to meet the funding requirements at the initial stages of his business generally approaches a bank. But gets stuck at the very threshold for he knows not how to work out a project plan, which is the ﬁrst step to approach a bank. A project plan, a detailed report on various aspects of a existing or new business, could make or mar the loan prospects of an enterprise. So “it is important to have commercially, technically and economically viable idea in the ﬁrst place,” emphasises S C Kalia, Executive Director, Union Bank of India. “We look at various aspects such as—the current ratio, debt-equity ratio, marketing capability, tie-ups,
What do banks look for? • Sound Project Plan • Collateral • Credit Rating
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FUNDING availability of raw material, etc. while assessing a business project,” states Kalia. “The banks just look at ﬁgures,” says nonchalantly Nitin Patil, Director, Logix Info Security. While many don’t have any to show, a good lot are unable to show qualifying ﬁgures as they maintain their books at deﬂated levels to avoid taxes. “We extend loan up to 20 per cent, in special cases a maximum of up to 30 per cent, of the projected turn-over. However, if the books show low ﬁgures while their requirement of loan is high, there isn’t much that we can do,” says T R Bajalia, Executive Director, IDBI Bank Ltd. Among other challenges in securing a bank loan, collateral is a crucial one. As per rule, banks can’t ask for collateral for loans up to `10 lakh, but many still do. Bajalia says, “We have directed our staff not to ask for collateral up to `100 lakh.” According to him it is important that the mind-set of banks, especially the ones set in rural areas, is changed as they are still reluctant to sanction loans without sufficient collateral.
Interim Stage While in the initial stages entrepreneurs manage their fund requirements through friends, family or banks, for the next round of money they mostly chase angel investors. Somewhere between banks and Venture Capital (VC) lie angel investors; they provide the much needed credit to entrepreneurs when banks are no-more an option given their limited exposure and VCs choose not to invest in lowscale operating enterprises. Talking about the challenges faced by entrepreneurs Chairman and Managing Director of CyberMedia Group and co-founder of Indian Angels Network Pradeep Gupta says, “Convincing an angel investor is the biggest challenge for an entrepreneur.” Angels looks at
What do Angel Investors look for? • Scalability • Quality of Management • Differentiating Factor • Traction • Exit Option
scalability of the business, quality of its management team and its differentiating factor. He further adds, “For angels to invest, a business has to be a differentiator.” A plain vanilla business is unlikely to be funded by angels as they take high risks and therefore, expect high rewards. Angels only pick those businesses where preliminary validation of the concept has occurred or where a few customers have signed-on.
Take-off Stage It is in this stage, when businesses have high credit requirements (beyond `10-20 crores), entrepreneurs approach the VCs. They are high risk investors who are interested in companies with high growth potential. However, in accepting the risks, they demand a higher return on their investment and the expertise lent by them in promoting the business. “VCs demand an exorbitant 30 to 50 per cent shares depending on one’s strength,” says J N Agar-
“Today, all the banks are focusing on MSMEs” — Vara Prasad General Manager, Union Bank
ANNIVERS ARY EDITION
What do VCs look for? • Scalability or Market Potential • Quality of Management • Market Size • Technology/Differentiation • Traction • Exit Opportunity
wal, Managing Director, Jaipan Industries. While considering for investment, “The two crucial elements VCs look at are— the market size and the quality of the team,” says Harish Gandhi, Executive Director, Canaan India. Scalability of a business majorly depends on the market size of the industry and the maturity of the market. While the actual growth depends on the team that executes and delivers. “Tractionanddifferentiationaretwo deciding factors,” says Mohanjit Jolly, Managing Director, Draper Fisher Jurvetson India. Any validation, from customers, partners and even employees gives comfort to the investors. However, the most important thing they lookout for is the exit option for their investment, either through IPO or merger and acquisition.
“It is important to have commercially, technically and economically viable idea in the first place” — S C Kalia Executive Director, Union Bank
“I approached three VCs and all asked the same question—What is the exit option?” says Atul Tibrewala, CEO, Catridge Junction who ﬁnally gave up and decided against going for VC funding. He grudgingly complains that, “We look for funding and they look for exit option.” In response to entrepreneurs’ disapproval against VCs’ prioritisation of exit option, Gandhi opines, “Ultimately, exit has to happen—why else will a VC invest! It invests to get great return.” However, “the onus of assessing the time of exit or the method is not on the entrepreneur necessarily. The fund assesses the space of exit, likely valuation, type of exit, etc.” says he. The challenges involved in accessing VC funding, however, are not limited to conventional challenges. With the surge in the number of potential deals with VCs, it is becoming increasingly difficult for entrepreneurs to rise above the noise and get noticed. In fact, with the VCs doing more of later-stage investments, the start-ups are getting pushed into a prototypical catch-22. “They need capital to make progress; and they need to show progress to get capital,” says Jolly.
Challenge-Mitigating Agents While accessing funds remains a formidable challenge for SMEs till date, credit rating certainly mitigates their predicament. The agencies rate the enterprises on—industry risk, business risk, management risk, ﬁnancial risk and project assessment risk. Making it easier for the lender to understand the current position and potential of the unit. “Credit rating helps MSMEs save time, effort and money while applying for bank credit. It also simpliﬁes and quickens the process of lending to MSMEs,” says Patki. He further adds that, “Lesser insistence on collateral, release of collaterals taken earlier, quick disbursals
“Convincing an angel investor is the biggest challenge for an entrepreneur” — Pradeep Gupta Co-founder, Indian Angels Network
“We look for funding and VCs look for exit option” — Atul Tibrewala CEO, Cartridge Junction
are some of the other tangible beneﬁts of credit rating.” Credit Guarantee Fund Trust for Micro and Small Enterprises is another help-agent for struggling entrepreneurs. The credit guarantee scheme by CGTMSE provides guarantee cover to banks on loans to micro and small enterprises (MSEs) up to `100 lakh. The scheme has been instrumental in gradually extenuating collateral as a potential challenge for those seeking bank loan. “Banks are moving away from the mind-set of collateralised lending,” says U R Tata, CEO, CGTMSE. And it is evident from that fact that the organisation has enabled 4,05,000 micro and small units so far to secure collateral free loans under this scheme.
Stay Fit to Fight There’s a total of 2.61 crore MSMEs in the country, as per the Quick results of 4th All India Census of MSMEs (2006-07), and all are struggling to survive. But as the Darwinian theory goes, it is the survival of only the ﬁttest; so as long as an enterprise has the potential, competitive advantage, best strategies, strong management team, upgraded technology and most importantly the zest to be the best, lenders will give the money! DARE.CO.IN | OCTOBER 2010
SALES AND MARKETING
SNAPSHOT Name: Amit Ladsaria Age: 37 Education: B.Com (hons) Experience in business: 18 years Leadership style: Process driven Big learning: Money is never a constraint if you are serious about your business.
Turtle comes out of its shell Sometimes thinking way out of your size can pay off big, so long as you can put the money where your mouth is
Name: Turtle Limited Domain: Men’s Apparel Turnover: 65 cr. ( 09-10), 95 cr (approx.) 10-11 Set up in: 1992 Employees: 1500 employees directly + indirectly Headquarters: 20, Round Tank Lane, Howrah -711101 Website: www.turtlelimited.com
By Amit Ladsaria y foray into men’s apparel was in a manner of speaking providential, designed by stylists in heaven! Seriously, it just happened almost all by itself, before I could even weigh my options. My maternal uncle had lured me into helping him during summer holidays in his retail store. And for a school boy the bait of a pair of Nike Air was good enough! I had been a good student and my family was in the business of film distribution and I was in tearing hurry to get on board too. Little did I realize that a summer assignment was going to give my future such a spin. While at the store I found that there was a demand for readymade shirts. I convinced my uncle, Sanjay Jhunjhunwalla, to start a brand of our own. Thus, Turtle was born in 1993. I would like to consider myself as the first employee of the company and including me the number was less than 10. We started with 20 shirts a day and sold them easily through my uncle’s outlet. I somehow, completed my graduation and plunged full-time into business. In the early days, I was the proverbial odd - jobs man, doing everything from cooking to cleaning bottles! I can safely say that I know all
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BUSINESS MODEL The focus of the model was to market high-end men’s apparel at budget prices across the country through organized retail chains as well as traditional street-side stores. The brand is essentially targeted at urban/semi-urban men below 30— aspirational and trendy but not necessarily rich. Turtle was positioned as a third alternative between expensive big-ticket international brands and low-end shoddilytailored clothes sold at bargain basement stores.
ANNIVERS ARY EDITION
the MBOs across the country for as the only salesman I have travelled the length and breadth of the country many times over. Between my uncle and me, we figured out that there was a huge market for quality ready-to-wear apparel at affordable prices. We related to our customers and their aspirations. Generally, operating out of Kolkata is considered a disadvantage for the main markets are elsewhere. We turned this into an advantage for there was very little competition in Kolkata and we grew from strength to strength. Today we are available across the country in over 700 MBOs as also at most of the large retail chains. Early in my business life I realized that brands always outlive individuals and thus invested in building the brand. Our advertising campaigns were received by both the public and discerning professionals. I also understood the importance of technology and people. We invested heavily in both these. Today we are on an Oracle platform and information is available at the press of a button—anytime, anywhere. Our warehouses and logistics are way above the industry norm and are constantly evolving. I did face a few challenges in the course of my business; one was regarding positioning the brand, though I didn’t perhaps use this term then. The issue was whether to offer dealers huge margins and expect them to push Turtle to customers or should we risk advertising and hope that it would work and pull customers. We decided to take the latter route. Then came the question should we take the “come, buy, value for money” route or should we look at the aspirational route. After lot of thinking we decided to go with the latter. While we can
The challenge was to decide between offering big margins to dealers expecting them to push Turtle and resorting to advertising
pat ourselves on the back with the benefit of hindsight, putting our money where our mouth (to use a cliché) was indeed a tough call especially as we didn’t have deep pockets and a mistake could have potentially broken us. One will have to bear in mind that we didn’t have a marketing team and nobody in the industry at our level had tried this. Another choice we had to make fairly early was between launching an all-India sales initiative and confining it to West Bengal so that we could consolidate before venturing out into other markets. Largely driven by gut feel we decided on the “in for a penny, in for a pound” approach and went national and thus today we have a strong pan-India presence. One thing I have learnt is that money is never a constraint if you are serious about your business.
I do not cut corners when it comes to investing on technology or knowledge
For example, if we have enjoyed the support of our bankers at all stages, it is surely because our figures and values have been a constant source of assurance and comfort to them. My friends joke that for a `100-cr company we think like a `1000-cr organization. I don’t drive fancy cars and eat at Page 3 restaurants. However, I do not cut any corners when it comes to investing in technology and knowledge. Our executives are frequently sent abroad to learn the best practices. At Turtle even the junior most people can voice their views without fear and it is not only heard, but often acknowledged and appreciated. I know every single employee by name and they all have free access to me. Today, we have a team of thoroughbred professionals and we have changed quite a few rules in the trade. Most of our trading partners have been with us from the beginning and I know most of their families. As regards the next five years all that I can say is that they are going to be far more demanding. If you look at human evolution the last 500 years have produced more than the previous 5000 years and the last 50 years have witnessed more change than the earlier 500 years. So I think the next five years will be more demanding than the past 50 years. We will have to gear up intellectually, emotionally, physically and not the least technologically. High points of my business life? Never compromised on quality and ethics, haven’t succumbed to temptations of shortchanging the customer, government or employees. As for regrets or disappointments, I feel I could have done much better. Turtle and the passion for it have left very little time for me to pursue any hobbies seriously. DARE.CO.IN | OCTOBER 2010
SALES AND MARKETING
SNAPSHOT Name: Dinesh Agarwal Age: 41 years Education: Harcourt Butler Technological Institute â€“ Kanpur, B. Tech, Computer Science & Engineering (19861990) Experience in business: Over 14 years Leadership Style: Participative Leadership
Empowering SMEs with internet Internet, today, is no longer a means to overcome boredom. It, in fact, is changing the very face of the business world By Dinesh Agarwal
Big Learning: Clarity of mind is a prerequisite for any budding entrepreneur. Besides, one must possess far sightedness and the drive to excel in any given scenario.
FACTSHEET Name: IndiaMart.com Domain:Online B2B marketplace Turnover: 50 crores Set up in: 1996 Employees: Over 2000 Headquarters: Noida Website: www.indiamart.com
eaving a secure job in the US and coming back home to India to start my own business was not the kind of future my family had envisioned for me. And therefore, they were initially apprehensive about this whole idea. But, they have been supportive throughout the journey. There have been critics as well who wrote me off saying that a niche idea of using Internet for enhancing business services cannot be proďŹ table. Today, I am thankful to all the criticisms as these have been the driving force towards making the company a successful and a leading online B2B marketplace. We have never seen a downturn in our business. I come from a traditional business family which is why I always had an inclination to set up my own business. And to give my dream a shape, I started this business with a capital of `40,000 and one assembled com-
50 OCTOBER 2010 | DARE.CO.IN
BUSINESS MODEL Offering SMEs a virtual store-front with a dedicated webpage for businessbusiness transaction.
ANNIVERS ARY EDITION
puter. At that time we did not have any investment from outside sources. It’s only recently that we got funds from a technology venture capital. When we began our business, we had liaison with different trade associations like Federation of Indian Exporters, ASSOCHAM, PHD Chambers of Commerce, CII for their member directories which could be published online and also participated in certain trade fairs. We also posted mails and sent bulk faxes to various enterprises, details of which we had collected. At that time Internet was not a popular medium. We initially began as a website-making company and then developed into a complete B2B marketplace. Since we were developing business websites, I felt that it was imperative to build a directory of these business websites. As a result, our ﬁrst few clients were primarily for website-making. Nirula’s was amongst our ﬁrst clients and I am glad to share that they are still associated with us. Other clients which showed trust in our potential were Jindal Steel, the Triveni Group and some exporters. In 1998-99, when inbound travel and tourism took off, we were making websites for Indian Travel Agencies and Tour Operators. At this point, a major share of our revenues were generated from inbound tour operators in Delhi. By 2001, the travel market had slowed down, but by then, our B2B marketplace had matured and was showing signs of becoming one of the largest B2B portals in India. The time when we started it was extremely difficult to get people on board because of the niche idea of our business. Nobody wanted to join one-man army organisation. However, the valuable support of family members, friends and assistance from outsiders gave tremendous boost to turn the dream into
We took the decision to list companies for free and used them for lead generation
reality. As the company grew, people showed more and more inclination to be a part of our company . The major problem for us was the unawareness of Internet as a media among a large number of entrepreneurs, especially the Small and Medium Enterprises (SMEs). Moreover, when we started listing and categorising the websites designed by the company under various business verticals, we realized that these categories were either empty or contained few names. We took the decision to list companies for free and used them for lead generation. Apart from this, we launched an inquiry forwarding service where we started printing the email queries that came to us and forwarded the same to the relevant businesses by fax or post. We sent around two to three hundred mailers from our office everyday and that continued for ﬁve years. This generated a lot of
We have never seen a downturn in our business
interest among SMEs and they called back to know more about IndiaMart.com. Our marketing team was actively involved in reaching out to these SMEs and educated them about us and the online media. This was majorly done as the Internet connection had not had a huge impact in the business community then, as it has today. One of the biggest challenges that we faced was in educating about the beneﬁts of the Internet for their businesses. One of the main reasons for this was that the SMEs were not aware of this medium. In addition, another initial challenge was building an efficient team. With our continuous efforts to address these impediments, we have been able to successfully resolve them over the years. Our company has received funding from Intel Capital. We also have a private equity deal with BCCL (Bennett, Coleman & Co. Ltd.). The deal provides us with ad space in BCCL properties such as Times of India and Economic Times. Since the procurement of investment, there was no looking back and thus, I was able to build a strong growth trajectory for IndiaMART.com. With the aim to present SMEs with all the possible matches in the B2B category, we have made conscious efforts towards providing the best in online B2B marketplace. This has been possible because of our sound and aggressive marketing strategy. For years now, we have planned nationwide awareness campaign. This campaign include advertising through print, TV, Radio, internet and events such as conference & seminars. Apart from this, we have joined hands with ET NOW to present IndiaMart Leaders of Tomorrow Awards 2010 speciﬁcally launched to acknowledge the signiﬁcant contribution of SMEs in propelling the Indian economy. DARE.CO.IN | OCTOBER 2010
SALES AND MARKETING
SNAPSHOT Name: Hemal Patel Age: 48 Education: Advance Project Management from Standford University, MS in Computer Science and BE in Electronics and communication Experience in business: 20 years Leadership style : By Technology - to maintain our cost leadership Big learning: Failure is not the end ……it is the stepping stone for your success !
How to build a global technology brand? Understanding the domain as well as anyone, investing on R&D to catch the latest trend, being compatible with global standards and perserance means you are global. By Hemal Patel litecore Technologies Limited, an IT product company, boasts of a global clientele with sales and distribution network across 97 countries through 55 distributors and around 3000 resellers. Rewind the scene about 10 years back and I can tell you, we were just barely hanging in there, patiently waiting for things to turnaround. But we were certain that we would soon rule the future of this industry. Established in the year 1999, the company is an established player in the IT scene with domain expertise in network security and telecom billing solutions with a strong channel-oriented focus. Today it is counted among the very few IT companies in India which offers globally renowned IT prod-
52 OCTOBER 2010 | DARE.CO.IN
FACTSHEET Name of the enterprise: Elitecore Technologies Pvt . Ltd Domain: IT (Network Security and Telecom Software) Turnover: 83 Crore Set up in: 1999 Employees: About 450 people in all Headquarters: Ahmedabad (Gujarat) Website: www.elitecore.com
BUSINESS MODEL Elitecore caters to the Internet Security market through a range of Uniﬁed Threat Management (UTM) appliances sold under the brand name of Cyberoam. Its other division offers convergent Billing and revenue management solutions for the telecom market.
ANNIVERS ARY EDITION
ucts, however, sometime back it was struggling with some credibility issues being an IT Product company from India. Indian companies in this industry weren’t trusted much in the international market. We wanted to change this. And, today, I am glad we could. We have been successful in carving a niche for ourself in the market. Creating credibility among international distributers and partners was the most difficult challenge that we ever came across. Being an Indian ﬁrm offering IT products in the international market was like selling India made donuts in America. We worked day and night to change the perception. Customers complained that we lacked certain level of R&D and our products weren’t compatible with certain networks. There was an array of discomforts expressed by our distributors and partners. We took all the criticism and endured the resistance as a challenge. To combat the problem we put all possible resources to work on the R&D. We shifted our immediate focus on thorough research and innovation. Further, to gain credibility in the market, we took advantage of our low cost base operation in India. We offered cost-free training to our partners while our competitors charged a heavy fee for the same. Additionally, to make our customers believe in us we decided to go out of our way to help them. Pre-sales and technical support has been our sole motto since then. We gladly accept to resolve product related issues of customers, even if they emanate from our competitors’ products. Our engineers work round the clock to help our customers. While we were at it, we realisedto gain credibility it was important that our customers were familiarised with our name ﬁrst. Visibilty was an important issue that demanded immediate attention.
To handle the question of global visibility, we have participated in trade shows, seminars and conclaves in a sustained manner
And to ensure that we needed to do some aggresive marketing to position ourself right in the market. However, our budgets didn’t permit any over-the-board expenditure on marketing. So, we decided to keep it simple and cost effective. Marketing costs were high and our funds were tight. For the ﬁrst seven years we didn’t have any surplus fund. We basically sustained on our revenue and debt ﬁnance. Banks have been really helpful. While VCs shied away from ﬁnancing or even remotely showing any interest in us. They refused to invest in a company that operated out of India. It’s only recently, we successfully raised private equity funding from The Carlyle Group, Washington DC based private equity ﬁrm. In absence of adequate funds we decided to mark our presence through Regular Partner road shows and End Customer shows. We took part in Global trade shows like Interop, GITEX, CEBIT and Coommunic Asia. Thus, we successfully overcame all plausible marketing
While VCs shied away from our business, banks showed a lot more interest in what we do
issues with cheap yet extremely effective ways. We did aggressive PR activities, Analyst Relations, showcased our case studies and presented papers at global summits and conclaves and thus built our credibility in a very sustained manner. We also collaborated with trade bodies and presented at different forums. And while we managed to overcome certain challenges, we got stuck with something worse. While distributors, who actually sell our product in the market, had to be convinced that we were real and would’nt disappear, international distributors, specially European distributors, proved extremely difﬁlcult. They refused to take our products unless and untill we were rated by Gartner, which is the world’s leading information technology research and advisory company, as they were sceptical. But to be reviewed and rated by Gartner, a company had to show a certain volume of sales which we didn’t fulﬁll initially. However, ﬁnally, in 2009, after struggling for a long time, we made it to Gartner’s Magic Quadrant, a proprietary research tool developed by Gartner which aims to provide a qualitative analysis into a market. And gradually, over the years we got accepted as members by various global trade bodies and received several global product certiﬁcations which make our brand truly global and creditable today. Further, to keep our customers and partners happy, we decided to divert funds to innovation. Every quarter we launched something new for them This exercise proved pretty helpful. The strategic decision of maintaing low cost base operation in India and capturing global market share gave a revenue of $ 20 million and 25 per cent net proﬁt. We have risen from a 10 member team to an army of 400 plus. DARE.CO.IN | OCTOBER 2010
SALES AND MARKETING
SNAPSHOT Name: Dr. Hrishikesh Damle Age: 41 Education: MD Experience in business: 8 years Leadership style: Democratic Big learning: Control expense
How we won the trust of the medical doctor community
FACTSHEET Name: Atrimed Domain: Pharmaceuticals Turnover: Private Set up in: 2004 Employees: 220 Headquarters: Bangalore Website: www.atrimed.com
Our mantra was to â€˜Keep the Promiseâ€™ we make. We worked hard for years to gain trust in the market By Hrishikesh Damle ndian pharmaceutical industry is very competitive. There are basically three types of players. The bulk drug manufacturers, who supply the basic raw material to Indian and mostly to overseas clients; Companies primarily focusing on making formulations for predominantly Indian companies. The third group which is the most competitive and challenging is into brand-marketing and sales. Of course there are those, mostly veterans, who are involved in all the three type of business. From the very first day, Atrimed started its business focused on branding and sales of the products. Though the company has a presence in a range products like antibiotics, nutritional supplements and
54 OCTOBER 2010 | DARE.CO.IN
BUSINESS MODEL We innovate products, carry on branding exercises and market.
ANNIVERS ARY EDITION
pain medicine, the big emphasis was on herbal skin care and nutrition products. The biggest challenge for any company in the branding and marketing segment is creating trust across all participants of business. This is especially significant in country like India where most of the business is carried out on trust rather than rigorous formal agreements. Trust is also important owing to the nature of business. Ethically and legally, we have no margin of error in quality of medicines. If you look at medical field as a whole, barring few aberrations here and there, the field has been able to reach high standards in six sigma scale. Be it quality control department of a pharmaceutical industry or cardiothoracic surgeon mending the organ, precision is the objective word, nothing less than that would suffice. Early days of business were a nightmare for us giving us a sinking feeling every time we encounter resistance in the market. But for our team’s resilience and strange (stupid ?) feeling that we would succeed, we should have closed shop quite early. As a practicing doctor and having very little experience in Industry it was daunting to confront challenges which I never expected. If you could notice, self and others consider doctors as a sub species of homo sapiens! Signature authority, very formal environment and selective socialization is inherent in this profession. Every client encountered by a doctor is less knowledgeable and solely depends on the judgments of doctor. In short, there is no question of mistrust. Our challenges were multi-fold. One the one hand, we had to creat trust among doctors towards quality and efficacy of of products. On
Ethically and legally, we have no margin for error for healthcare business
the other hand, attention had to be given in creating trust among distributos that our products would move faster. We also had to demonstare that our network of medical representatives is efficient in helping the distributors collect their dues from the retailers. The last one meant that we make no mistake in employing a good quality and motivated sales force. How can one solve so many variables? There can never be quick fixes for these challenges in pharmaceutical industry where typically supply was more than demand. Does that mean that it is unwise to get into this business? That’s far from the truth as it is one of the fastest growing industries with very healthy ROI. We gambled on the Americal philosophy of market place. As a business principle, we did have unique products but mostly in niche segments with small market size, which did not fetch us desired sales. Though discovery of new molecules take many years asking for millions of dollars, there was lot of scope for improvisation in formulations. We had a very strong and a young
We saw an opportunity in improvization of existing formulations.
formulation team which was raring to go. We continuosly churned the market for a gap we can exploit. We came across iron syrup market where we could see a very evident gap. Most of the iron syrups were not palatable. Most of them tasted bad with instant rejection from children and women. Established firms were selling the same stuff since they were stuck with the products which they were marketing since many decades. Our formulation team came up with a fabulous iron syrup which tasted like “Gulab jamoon” with deep orange flavor. It was very easy to demonstrate the USP of our product to doctors who were looking for such a product. The product took off immediately and created sense of faith among doctors towards our company. I can still recall the emotional speech made by our zonal manager at a sales meet soon after the launch, where he recalled how he had come close to quitting the job but for this product. He was not alone. All of us were rankled by constant rejections which used to be the order of the day. Finally, our new iron syrup changed all this. The outlook of the doctors towards our company changed, which helped introduction of other products, all of which had certain amount of novelty in the presentation. Very soon we started selling good number of units and for a short period we survived only due to this product. The best thing to happen was strengthening of my conviction about professional ethics of my colleagues. Contrary to popular belief among sales force that doctors prescribe for the sake of gifts and favors they receive, here was an example that doctors prescribe a good product if created to their need and presented to them appropriately. DARE.CO.IN | OCTOBER 2010
SALES & MARKETING
The changing phase of marketing The 1990s witnessed the evolution of marketing as a pivotal tool for small business enterprises. Now with the social media coming in a big way and yielding benefits for many, it's time to take a closer look at what challenges have forced these changes in the marketing scenario of SMEs in the past 10 years By Sharmila Das 56 OCTOBER 2010 | DARE.CO.IN
ANNIVERS ARY EDITION
arketing activities have gone through a paradigm shift in a span of 10 years. The Internet boom is one of the reasons. Today’s entrepreneurs are restless and keep exploring innovative marketing strategies. Whether it’s the design of a company's website or an email to the client, the change is omnipresent in every marketing activity. Realizing the changes in marketing scenario a brief synopsis is discussed here with a hint of the challenges thatdrove these changes.
Face of the company Ten years back how many of us used to check website of a company before a visit? Not many of us would exactly remember the numbers but it was negligible. Business enterprises now understand the signiﬁcance of the website of the company. In the designing of content too change is evident. Instead of 'we', more personalized references are frequently used. The change is led by the fact that authenticity is what everyone looks for.
Companies have learned that showing 'we care' is good marketing.
Word of mouth marketing or viral marketing In today’s age there are so many campaigns that it becomes really difficult zeroing in on a single option. Amidst this info-clutter if a suggestion comes from our relatives, colleagues, friends or partners, we prefer choosing that to others. Small business enterprises have learnt that the old-world word-of-mouth marketing is still the best option albeit with a touch of technology. Information on the go is another marketing challenge that has led small business owners to adopt advanced technology. Today’s mar-
CSR is mainstream No conventional means of marketing would reap as much beneﬁts as new and innovative ones. In the pursuit of new and unconventional marketing strategies, marketing departments have begun leveraging social factors like being more environment friendly and charity funding. Consider this: out of the total number of mails we receive in a day, how many out of them have a message appended that reminds us not to print the mail if not necessary? If any organization is installing any eco-friendly device, the information about it is passed on to the wider world of their business circle. To circulate the message one does not need to rely on TV or newspaper. Today, web pages and micro blogging sites are sufficient enough to yield beneﬁts.
“Marketing has evolved from a mere division of a business enterprise which had specific role to play like any other division. Now marketing is required to establish it in a new avatar where everybody in the company is a marketer with their marketing ideas. Thus everyone in a business organisation needs to understand the new role of marketing and act accordingly.” — Vineet Kanaujia GM-Marketing, Safexpress
keting strategies suggest uploading business updates on any of the social networking sites and let the world know about it.
Networking over net Networking serves as the integral part of businesses. The way a business owner, today, gets connected with people is different from how he did earlier. The challenge was to connect with key business people at ease. To enhance networking, small business owners now tweet their business updates. The role of networking sites is also very signiﬁcant in making the change.
Sponsoring an event Ten years back sponsoring as a tool of marketing was restricted to big business enterprises only. Now the growing marketing challenges have forced the small scale business owners to put their foot forward in this marketing activity. Small business enterprises have been using this medium of marketing very smartly over the years. They have taken to sponsoring socially relevant events, which helps a business project its social responsibility image and indirectly improves visibility among its target audience. In business, no one can ignore visibility factor as it leaves mark in the minds of the customers and competitors as well.
What are you talking and how? The term marketing communication was not so common in the world of business 10 years back. Small business owners were not aware of using marketing communication and were facing hurdles to reach to their customers. Besides, the communication models were also not very effective either. Compared to those days, today we see that communication scripts are written to impress and not merely to express. DARE.CO.IN | OCTOBER 2010
SALES & MARKETING
Major Marketing challenges • Marketing communication • Competition from foreign brands • Deciding on investment criteria • Coping up with the training and learning requirement • Connecting with customers
a business organisation needs to understand the new role of marketing and act accordingly.” The number of TV channels and newspapers have increased immensely and that gives a tough challenge to marketers to select their medium of advertisements. Harish Bijoor, Brand Guru and CEO, Harish Bijoor Consults Inc. says, “Small businesses in the past (10 years ago) were reasonably insulated from the world of speciﬁc strategy. Today, they are savvier. They focus on the ability of a business to deliver based on a clear and cogent strategy.”
strategy. Vineet Kanaujia, GMMarketing, Safexpress says, “Marketing has evolved from a mere division of a business enterprise which had speciﬁc role to play like any other division. Now marketing is required to establish it in a new avatar where everybody in the company is a marketer with their marketing ideas. Thus everyone in
Customer centric businesses Small businesses in the past did not essentially swear by being customer centric, hence the commonly faced challenge was the gap between services offered and the actual demand. Over the years, the small business owners realized the increased need to be customer friendly. It was no more a mom-and-pop show. Bijoor rightly says, “The small business owners understand the language of customer service much more now than before.”
The Changed organisational role All the challenges discussed above led to the rise of new marketing era in small business enterprises. Marketing has evolved as a business philosophy rather than a business 58 OCTOBER 2010 | DARE.CO.IN
“Small businesses in the past (10 years ago) were reasonably insulated from the world of specific strategy. Today, they are savvier. They focus on the ability of a business to deliver based on a clear and cogent strategy.” — Harish Bijoor Brand Guru and CEO, Harish Bijoor Consults Inc.
Training and learning In the evolving phase of marketing strategies, different marketing training and education programs are proving to be a catalyst. The desire to take up marketing as a career option has increased amongst students. New technologies, innovation have lined up into the marketing activities. Small business owners have begun to eagerly pursue executive management courses with specialization in marketing. In this context, Bijoor says, “Marketing related courses and studies help but few small businesses embrace learning. It is only in the last couple of years that entrepreneurs of small businesses have sent their children to B-schools while they go to attend Family Business MBA programs. Learning helps. Training is something that makes a cauliﬂower of a cabbage, as Mark Twain once said. It’s true. Small businesses ﬂower when the right training input is added to them.”
End Note To sum up it’s safe to conclude that this evolution of marketing trend has helped small business entrepreneurs in many ways. It’s now the responsibility of the enterprise owner to get the marketing mix right to yield good results.
PROCESS AND QUALITY SNAPSHOT
Name: Anshu Gupta Age: 39 yrs Education: Mass communications ( IIMC) - journalism and then advertising & PR, PGEconomics Experience in business: 10 years, 1992-98- corporate/adv. agency: 98 -founded GOONJ Leadership style: Grow as an idea not as an organisation./ Big learning: It’s not only about becoming leader, its about creating leaders and also - LAGE RAHO !
Clothing the world is noble People often fail to recognize the kapda in the roti-kapda-makaan because it does not have a visible tangible problem associated with it By Anshu Gupta realized very early in my entrepreneurship journey that I have chosen a ﬁeld where dealing with new challenges is integral to achieving success. A signiﬁcant amount of my efforts were spent in confronting these challenges, resolving the situation and moving on with fresh set of learning. Several times, I have looked back at these situations, some of which were near death, if I may call them, and feel so happy for the way they turned out for my organisation and me.
It was good that funds did not come easily Our organisation Goonj decided to 60 OCTOBER 2010 | DARE.CO.IN
focus on the issue of lack of clothing for a large number of India’s population. Our biggest challenge was to convince people that this indeed was a problem. Indians are used to seeing children of rural populace and urban underprivileged without clothes. We fail to realize that cloth-
People would rather have us build a school building rather than raising funds for clothing rural children
ing is one of the three basic human needs, along with food and shelter. Here was a problem that was larger and more serious than the more popular and well-known issues of society. However, we soon realized that it was far easier to raise funds for ﬁght against AIDS than to launch a campaign that would clothe the needy. Those were really tough days for Goonj. Money was hard to come by and we were not able to get started. However, looking back, the delay in receiving ﬁnancial support gave us an opportunity to learn more about the problem. We understood how the world at large saw this is-
Name: Goonj Domain: voluntary organisation Turnover: 3.00 crore Set up in: 1998
ANNIVERS ARY EDITION
Focuses sharply on clothing for the under-privileged.
Employees: About 130 people in all Headquarters: New Delhi Website: http://www.goonj.org
sue and what was required to correct this perception. We soon got on to creating awareness and changing the perception of the people. Looking back, I think if we had received funds easily at the initial stage, we would have right away plunged into our work—collection, processing and distribution of clothes—perhaps, without really understanding the law of the land. This key learning played a vital role in the way we began our operations when funds started coming in. We realized that the growth of the organization does not lie in generating volumes but in creating a movement and taking the idea further.
Stay with your vision One of my earliest lessons in entrepreneurship was to carry a strong conviction in your vision. A belief that is so strong that no amount of external pressure or luring could move it. In 2008, Bihar faced severe ﬂoods. As it usually happens, the villages were the worst affected. Since the ﬂood situation was well reported in the media, there was no lack of funds available for ﬂood relief. An organization approached us with a proposal to build a school structure in a village. We declined the offer and told them that in our view the village
did not need another physical structure. The money should be used to ensure that more kids attend their schools regularly and employment is generated through the staffing of skilled teachers and other employees. After a while, the organization came back with the money and told us to carry out what we had proposed. When we asked them why have they returned to us, they replied, “We want to work with you.” It is about building relationships. It is about providing the customers the assurance that it will happen. And, ﬁnally, it is about transparency.
Show them the value and they walk with you For the collection, processing and distribution of old clothes, we had put in place a system of supply chain and logistics that would
We realized it is far easier to raise funds for ﬁght against AIDS but not for a simple problem like clothing
achieve two objectives: • ensure that those who give cloths understand the social situation and contribute and not just make it an act of discarding unwanted cloths and • those who receive the clothes contribute certain value based on their abilities so that they do not consider the cloths to be donations. In order to ensure that the ‘donors’ understood the need for clothes among the underprivileged and volunteer to ‘donate’, we told them that individuals would have to bring their clothes to the collection centers, which were the houses of some of the volunteers. We refused to go to their doorsteps to collect. For the process of identifying the needy and distributing the cloths among them, we partnered with local social entrepreneurs, who were the opinion leaders. However, we soon realized that not many among them understood the value of distributing clothes. I told them if I give money, I must receive a report on how the money was spent, along with a couple of photographs of the progress made. However, whenever I asked them for a report on the clothes distributed, they would not revert. There began a whole process of educating the social entrepreneurs about the situation. We got them to meet the villagers, who explained, through real life stories, of the lack of clothing being a major health and social issue. Parents narrated instances of their children dying during the harsh winters. Young and educated community members explained how they could not attend job interviews as they didn’t have a decent dress. And, womenfolk highlighted the social and healthcare issues they were facing due to the lack of sanitary solutions. The social entrepreneurs realized the need for clothes among these people and came forward to support us and take up the task of distributing them. DARE.CO.IN | OCTOBER 2010
PROCESS AND QUALITY SNAPSHOT
Name: Rishi Modi Age: 34 Education: Certiﬁed Internet marketer Experience in business: 14 yrs Leadership style: Dynamic and aggressive, creating leaders around Big learning: Always be people-oriented
How to build an effective organization? You have to plan processes and the organization structure in such a way that you derive the highest leverage from them By Rishi Modi perating at optimum capacity is what every organization desires at the end of the day. Such a performance can be provided with an effective organization structure and work processes. This along with high performance management ideas can deliver an energizing leadership that drives the company towards success. By focusing on the organization structure and work processes, we will ﬁnally get to know what leads to high performance. I started working as a SEO freelancer in 2004 but the business
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model of Freshrank was conceptualized in 2006. The idea of Freshrank was conceived when I realized the growing need of a good SEO service provider in the online world. I was encouraged by my family and friends in this endeavor, and
I always focused on leveraging high-perfomance management ideas
the biggest support came from my brother-in-law Mr. Govind Agarwal (Managing Director – Fresh Rank SEO Consultancy Pvt. Ltd.) who has been highly instrumental in the company’s success. Freshrank is an SEO Company with a resolution to offer the best SEO services in the UK and India. It provides vital services like SEO, link building, online reputation management, social media marketing, video marketing, content development and Pay Per Click. For ideal optimization of websites, Freshrank offers its extensive ex-
Name: Freshrank SEO Consultancy Pvt Ltd Domain: Internet Marketing & SEO Turnover: Private Set up in: 2006
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Paramount SEO services offered with experience, expertise, trust and care
Employees: 200 + Headquarters: Mittal Industrial Estate, Andheri, Mumbai Website: www.freshrank.com perience and expertise. Freshrank strives to drive their client’s websites on top of popular search engine rankings. Organizational success cannot be attained by hiring talented people alone. A poorly designed workplace will prevent even the best and the brightest employees from doing their best work. One of the leading causes of low employee morale and productivity is a poor organizational design. Improvement is needed in four crucial areas of your organization structure and work processes: • High employee turnover. (Specially in case of highly talented professionals) • Low productivity. • Increase in customer complaints. • Decrease in proﬁtability. Freshrank works as a business that is people oriented and not sales or target oriented. By implementing this ideology in the business model, we were able to tackle all problem areas. We have built a strong network with our clients, employees, partners and vendors with our business philosophy. An organization is empowered when the human resources are strongly motivated, is something we strongly believe in. To get the best possible results, every organization has been designed perfectly. Scrutinizing and
modifying your organization’s design structure and processes will deliver better results for your business. Organization design is not a new concept. It has also been referred to as: • Open system design. • Socio-technical systems design. • High performance work systems design. • Total quality management. • Participative management, and • Re-engineering. The name that has been given to organization design isn’t important. A change that is approached systematically with long term commitment from the leadership team is what is important. The performance of your business will be impacted by the constant design choices made. It will be independent of whether you choose to use an organization design model. Our process came into existence bearing one thought in mind, ‘Highest level of satisfaction for our customers’. With this idea in place, we were able to create an efficient business process.
The performance of the organization depends how it’s structure is designed
Advantages of enhancing organization structure and work processes: Improved employee satisfaction– A culture of commitment is created with effective organization. The accountabilities, authorities and goals of the business are completely understood by people. They also see themselves as strong contributors to the success of the organization. Improved customer satisfaction– To meet customer expectations, employees are better able to deliver superior quality services and products. Improved ﬁnancial performance– Productivity increases and wastage is reduced leading to substantial returns on the business when an organization’s employees and goals are aligned properly. Improved competitive advantage–A well-aligned, ﬂexible and productive business is able to meet the demands of a shifting market place with an effective organization design. The organization structure and work processes are created by an organization that is speciﬁcally designed with a focus on high performance. By tapping into their talents, skills, ideas, energy and creativity, each person can contribute to their full potential. To attain employee satisfaction, at Freshrank we have included several employee performance incentives, rewards and bonuses. By setting targets that are achievable, our employees have remained focused and are motivated to keep improving. Customer satisfaction is the key for a business to keep going and we have incorporated several strategies to register customer complaints, if any. With a dedicated quality control team, customer care team, service review team and a feedback team, our customers have been able to communicate all queries easily. DARE.CO.IN | OCTOBER 2010
PROCESS AND QUALITY SNAPSHOT
Name: Saumil Majumdar Age: 38 yrs Education: B. Tech (IITB), PGDM (IIMB) Experience in business: Been an entrepreneur since 1998. Started new concepts in training, tech support and now sports; got initial customers, raised funding (seed, angel, VC), built the team. Leadership style: Ideas & technology Big learning: Don’t ever give up on your idea. Hang tough...
When kids play, it pays...
Successful business is not about finding the easiest way to the jackpot. It is about sticking to your convictions, no matter what By Saumil Majumdar e learned early in our venture that cracking the right business model for an enterprise is a make-or-break challenge. It is one thing to identify an opportunity and it’s altogether a different thing to ﬁnd the right model to make it work. In 2003, we began with a simple idea in mind: get children back to the habit of playing, chieﬂy by creating beautiful playgrounds. The ﬁrst reality check came when we saw that our playground-based model was simply not scaling up to our expectations. We had reckoned that once we created this dream playground of ours, a whole host of real estate players and goverment agencies,
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would jump in and ride with the business, ensuring resource ﬂows and growth. But in reality, our assumption proved wrong. This instantly squeezed our cash flows. Put simply we were rapidly running out of cash. The
No matter how bad a situation is, it too shall pass. At times I have needed twenty lakhs next morning without a clue on where it would come from
writing on the wall was: "What next?" There were just two options: 1) Quit and return to our jobs and 2) Stick it out, regardless of what. We were approached for doing non-sporting events, the moment it went out into the market that we might want to do other things. Must confess that at that time these feelers were like low-hanging fruit. We had corporates asking us to do rock shows, fashion shows, dance competition and what have you. And the pay off wasn’t bad. This was clearly a difficult predicament, a moment of reckoning. But we decided to stand ﬁrmly with our original idea. We hadn’t entered the sports business to do rock shows! We might as well then
Name: SportzConsult and EduSportz Domain: Sports, events, education, schools Turnover: 10 crores Set up in: 2003 Employees: About 165 people in all Headquaters: Bangalore
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Schools ask the company to set up, manage and drive their education and sports curriculum on their campuses. The company brings in the equipment, the expertise and the manpower to run specialized programs. The schools pay on a per child, per month basis.
have gone into software or something else. It was tough, believe me, to say no to those suitors and to stick to our path. But we realized that the moment we said yes, we would go into a tailspin from which there would be no way out. You cannot do successful business by zeroing in on the easiest way of making money, regardless of the context, your passion and what you really believe in. Or else, what’s wrong with a salaried job? Our idea was to make money while doing sports. We had seen an opportunity, we picked it up but ﬁnding the right model was the key. We talked to potential customers. Found out what is it that they wanted. We held back from over spending and focused on going to the market as fast as possible. Yet one year down the road we realized our model was not right. We had well-wishers asking us politely about where we were going because they were really concerned. In our minds, however, we were very clear that we didn’t want to give up on this. We just said we will ﬁnd a way. So in early 2004, we re-looked at our proposition, which was very simple. We wanted children to play. So, at every point in the next ﬁve years from 2003 we started businesses with the idea that in the next business we will make lots of money
and then we will come back and do something for children. Later that year we got into events and sports marketing. This basically involved getting sponsorships for sports events organized by others. We tasted some success here and cash ﬂow situation eased up a bit. We got bolder and moved into sports tourism, selling hospitality tickets, package tours around Formula One events and such like. That model worked to a certain extent. We then saw an opportunity in building business-to-consumer sports portals and mobile sports portals. But this business too would not scale up. Then came the turning point. In 2008, we started working with schools and this model has worked for us. Schools outsource their physical education and sports curriculum to us. We use their playground but bring in all else — the text books, curriculum drafts, equipment, lesson plans, trainers, assessment routines, ﬁtness reports, et. al. The school pays on a per child per month
Remember the cost of not pursuing your dream is much higher
basis. We now have 75 schools and the list is growing. It is ironical that the model that’s working now is actually no different from what we set out to do so many years back: providing physical space for kids to play. Only now, the schools provide the real estate. So, in hindsight, if I had gone to work with schools in 2004 itself, I would have had a thousand schools today. Interestingly the model was right where we were but we went looking for it everywhere else and came back. Today we have SportzConsult, the events and marketing business which is growing and EduSportz, the school sports business which is an excellent discovery. We are trying out a number of ideas, what we call modelling, but they are not businesses yet. We are a small company. We will do around ` 4.5 to `5 crore this year in each of our businesses. Cumulatively, that would add up to `10 crore. SportzConsult employs 25 people and EduSportz about 140. I always say that all of this is good in hindsight. You do feel that, “Hey! if you cracked this then you can crack any stuff.” What I have learnt is that no matter how bad a situation is, it too shall pass. I have been in situations where we needed 20 lakh next morning with no clue on where it would come from. But we survived all of it. I often tell people that it makes sense to stick with their original idea simply because of the effort that would have gone into thinking up and validating it. It’s very subjective, personal and perhaps contextspeciﬁc. But, what I would like to say is that don’t ever give up. If you have thoroughly validated and researched your idea before starting off, the question of moving away should not arise. Remember, the cost of not pursuing your dream is much higher. If you really want it, do it. DARE.CO.IN | OCTOBER 2010
PROCESS AND QUALITY SNAPSHOT
Name: Suresh Tota Age: 43 years Education: B.E in Electronics from SJCE, Mysore Experience in business: Been an entrepreneur from 1992, after a brief stint at TCS for about 18 months. Managing the business of serviced apartments from 1997 through various independent legal entities. Leadership style: Democratic Big learning: Bring in ownership of issues among many stakeholders in terms of risk and rewards for better delivery, commitment and growth.
Hospitality industry lives and thrives by processes we create A system dependent process ensures lesser pilferage, better valuation, easier funding and marketing, quality delivery, transparency, easier tax assessments and a better life in general. By Suresh Tota hile CEOs of most industries would proclaim that the challenges faced by them are enormous, I would go a step further in validating such claims in the domain of serviced apartments and professional corporate accommodation. Ours is a nascent, sunrise industry that is perceived and expected to be low cost, that draws unfair comparisons with star hotels. With multiple locations, each handling multiple logistics, most of which are precariously entrusted
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with a set of managers, who in turn are the best candidates for attrition contribution. A set of raw housekeeping boys at the service of the guests, whom we have supposedly lured from the star hotels, whose ego needs to be addressed and com-
The acid test is in the transformation from the small to large
pensated for the so-called perceived compromise. With compliance required with 15 plus government departments, whereas the smaller operators enjoy the luxury of being away from government limelight, with TDS issues, fund liquidity, expansion plans, training, quality, innovation, the list could go on. What makes the clock tick is the process. In the earlier days of our organization, one of our mentors had told ius that in a small enterprise most issues are personally per-
Name: Compact Hometel India private Limited Domain: Organised, professional corporate accommodation / serviced apartments Turnover: 11 crores in 2009-10 Set up in: 2007 Employees: 140 +
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Serviced apartments as a substitute for hotel accommodation by taking rented accommodation of fully furnished properties or a revenue share arrangement with an existing operator , thus providing a wider choice of properties to clients.
Headquarters: Bangalore Website: www. compactguesthouses.com
formed, supervised and managed by the entrepreneur. The quality of the deliverables would be incomparable. However, in large enterprises, learned & wise experts at the helm of the affairs ensure the deliverables. At that level there is the luxury of being able to afford consultants and quality certiﬁcations. The acid test is in the transformation from the small to large, which challenges the entrepreneur’s ability to decide on aspects that have holistic impact on the organization. It is during this critical phase that we need to ensure that the gap between the quality of desired and the actual output is minimum. The key to a successful transformation is in designing, customization, implementation management, monitoring, and constant evaluation of processes that are setup to reduce this quality delivery gap. While designing the process, it is very important or rather imperative to make a shocking assumption, that everybody who is partaking in the system is DUMB. When in the process, please do not let people think and decide by themselves, but just follow the instruction and hence play along the process. The point I am making is that the decision should not be that of the individual, but that of the organization, which is impregnated in the process. Let us draw a simple comparison with a computer. Computer components
do not think. The software (the process) gives instructions which are followed by the components, thus creating the near zero quality gap. If the millions of participating diodes and other components partook in the evaluation of the instructions, or started thinking, imagine. In my trips abroad, at the cash counters of departmental stores, when I saw that the attendant could not add $ 8, $ 5 and $ 19 without a calculator, I found it amusing. We Indians are much smarter, I thought. But then came the realization that there lies the problem. We are smarter in things that we don’t need to be. Their process tells them to use the calculator, irrespective of the amount, where there could be no error. If the attendant starts thinking that he could do it mentally, we are leaving it to his judgment to play on the balance sheet of the company. During my photo sessions in the guest room for our company brochures, I thought that the bath towel placed in the bed would look better
The decision should not be that of the individual, but of the organization, which is impregnated in the process
if one edge was slightly ruffled and I ventured to do it. Since it looked good on the photo, we decided that we will have similar placements of towels everywhere. The next time, I saw two edges folded. Later, there were multiple folds, folded in different angles making a mockery of the towel in the bed and the original concept. A far cry from the desired ‘ruffled feel’ to a ‘rusted feeling’. The mistake was allowing the room boy to decide what would be good. He would do it to his taste and his taste need not necessarily match with that of the owner or more importantly the guest, thus creating a gap in quality. With our process, we have at least solved this with a simple instruction-place it in the bathroom towel rack. Unfortunately, there is no ‘One size ﬁt all’ process or systems. There are no ﬁt-it forget-it processes also. The processes, whose ultimate objective is to improve the quality output of the deliverables, should be designed with the local business environment. The processes needs to mature with time and that too would require tinkering from time to time by the top management. More the entrepreneur spends his personal bandwidth on the setting up of processes and systems, more the distance the enterprise will travel smoothly. Simply put, better processes lead to a better quality of life in general at the workplace. Just like every problem needs to be viewed as an opportunity for implementing a solution, every instance of a problem or an anticipated problem needs to be captured and integrated to make the enterprise, a process driven one. While the policies of the company could be elaborate, immaculate and praiseworthy, the processes ensure that these policies are implemented and the adherence is monitored. Don’t let the people run the process. That would be the recipe for ruining it instead of running it. DARE.CO.IN | OCTOBER 2010
PROCESS AND QUALITY SNAPSHOT
Name: Vineet Rai Age: 39 yrs Education: PGDFM Experience in business: 10 years, Founded Aavishkaar, Intellecap and IntelleCash Leadership style: Trust in Youth Big Learning : When the going’s tough, stick around and believe in your guiding principle come what may
It’s the soul that must win With just nothing in my hands, I dreamt of creating a fund that would finance social business ventures By Vineet Rai
have been an entrepreneur for the last 10 years. When I decided to tread this path early in my career, I was prepared for the hardships, particularly those that are experienced by social entrepreneurs. I was all of 28 years of age when I dreamt of becoming an entrepreneur. The last time my father gave me any money to spend was about 10 years back. However, as it happens with entrepreneurs, somewhere in my soul I heard my calling. With just nothing in my hands, I dreamt of creating a fund that would ﬁnance social business ventures. I knew that my fund, though will focus on social space, must run
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like a for-proﬁt organization. I was clear in my mind that we needed to bring in systemic changes in the rural space and create employment.
If I could sail through these challenging times, the credit goes to my wife and parents who did not let me know of the hardships and encouraged me to focus on the mission
My partners and I put our minds together. Since we all knew what we wanted to do and what impact it would create, putting together a PowerPoint presentation for the funders was an easy job. Despite the uncertain times, we did manage to raise some money, albeit far below our expectations. The entire money would go into projects and nothing was left to support our personal lives. There was very little money available to pay salaries. They were traumatic times. The cost of living in Mumbai was putting additional pressures. My daughter was born around that time and there were occasions when we would not
Name: Intellecap Domain: Social Investment Banking and Advisory Turnover: 17 Cr Set up in: 2002
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Intellecap is a venture capital fund which funds social enterprise. The fund itself works as a regular venture capital.
Employees: 55 Headquarters: Hyderabad Website: http://www. intellecap.com
know where the money for next days’ milk would come from. A lot of entrepreneurs go through this phase of life. Even as our belief in the idea and the mission keeps us going, we ask ourselves some tough questions. It is during such times that the moral support that one could receive matters a lot. If I could sail through these challenging times, the credit goes to my wife and parents who did not let me know of the hardships and encouraged me to focus on the mission. Then, of course, you need a partner who tells you constantly that what you were doing was right. I was lucky to have such a partner in Pradeep P. We had reached a time when raising more money was essential for the sustainability of the organization. And, there came a grant of half a million dollars from an institution. They told us that we were doing a great job and that they were keen in ensuring that we continued our ‘good work’. However, they were not interested in investing in our fund and instead agreed to give us the money in grant so that we were able to tide over our difficult times. Half a million dollar was godsend for us. However, I was clear from the beginning that Aavish-
kaar would not accept grants, because we always wanted to remain a for-proﬁt organization. We saw ourselves in a conﬂict situation. Saying yes to the offer would destroy our belief, while given our ﬁnancial situation, saying no to the offer was akin to performing harakiri. A lot of discussions among us partners followed and we ﬁnally decided to say no to the offer. It is needless to say that our decision plunged us into more serious situation. My mentor Vijay Mahajan told me that if I was to continue I would soon become a martyr. We had to act fast to ensure that our survival was not at stake. Slowly, we resurrected Aavishkaar. We cross-subsidized it by doing small businesses. We took our assets to $35 Million. Looking
We had set up this organisation with a vision that no individual or entity will ever become the majority shareholder of Intellecap
back, if I had said yes to that offer of grant, we might probably have closed shop by now. The experience taught us the importance of staying frugal, do things in the best possible manner and stay focused on our goal of identifying early rural ventures. Soon enough, our conviction in our vision was put to test once again. An investor approached us with the offer of taking majority take in Intellecap. We had set up this organization with a vision that no individual or entity will ever become the majority shareholder of Intellecap. It would always be owned by a distributed set of people. We were a very small company and wanted the investor to come in because we respected them a lot. Their valuation was also very attractive. However, after an internal discussion we declined the offer. At the time of taking this decision, I involved my young colleagues in the organization, discussed with them the consequences of our decision. It was a great opportunity to create a lasting bond with my people. Eighteen months later the investor approached us again, this time with a request to take a minority stake in Intellecap with an investment of $8.3 Million. Our conviction found a huge support. In an entrepreneur’s life, there would be umpteen occasions when his/her strong conviction is questioned. These situations are tough, because they all seem to be logically the right decision to take at that point in time. You need to then tell yourself that not falling in line with the logic is the most logical thing to do. You may sometimes need to review your belief and adjust. Never your conviction. Whenever I find myself caught in a fight between my head and my soul, I end up taking the side of my soul. DARE.CO.IN | OCTOBER 2010
PROCESS AND QUALITY SNAPSHOT
Name: Vipul Prakash Age: 36 Experience in business: More than 15 years Education: BBS (DU) Leadership Style: Risk friendly, Delegation driven, Hands-off Big learning: Don’t stick to an idea that has failed. Keep looking for the new elixir of business life
Hunt heads, rule corporate jungle When the world is not enough for your dreams, try coming back to your roots. Holding on to the few lifelines thrown at you, with perseverance may pay off By Vipul Prakash traveled all across the world in search of success. Little did I know that my quest would end in my homeland: India. After six months of training in my family business of textiles, I opened a small agency in Dhaka for sourcing clothes which did well. Soon we shifted to the Middle East and by 1996, under the name Pristine Trading, we grew large and were operating out of 16 countries. Around the same time I went to New York and launched a dotcom with VC funding. Disaster struck in ’97-98 when all our businesses went down.
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That’s when I decided to try my luck in India. My interest was in computer education. So, we started with Websity, a franchise of IIS Infotech. This
If I could earn `42,000 in a day, how much could I earn in 300 days? The ﬁgure of `1.26 crore per year was mesmerizing
was to be our stepping stone into our future business. We were facing a problem of placing our students when a friend running a software business offered to hire my students on the condition that I get him three experienced employees. I did that easily. He gave me `42,000 for it. I did some number crunching immediately. If I could earn `42,000 in a day, how much would I earn in 300 days? The resulting ﬁgure of `1.26 crore per year was mesmerizing. I decided to get fulltime into recruitment industry—the business of hiring for others and
Name: Elixir Consulting Domain: Recruitment Process Outsourcing (RPO) Set up in: 2000 Turnover : 65 crore (2010)
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The company’s business is centered around fulﬁlling critical HR needs of business organisations. It headhunts and gets paid for every recruitment, through several specialized divisions—RPO Provider, Executive Search, Temp Staffing and Elixir, Knowledge Management Centre and contingent hiring services. With a thousand customers, Elixir has high quality recruitment standards and uses updated technology. Besides, Elixir also offers products like Employer Branding.
Employees: 396 + (1200 Temporary Workers) Headquarters: Noida, UP Web: www.elixirconsulting.com/
getting paid for it, and later recruitment process outsourcing. We started on Sep 1, 2000 without any business plan. With the hard-earned `42,000, I hired a consultant for `6000 per month, paid rent of `3000 per month, and had overheads of 1000 pm. The ﬁrst year was very challenging. There was no work and very few people wanted to join us. Within three months we ran out of money. Then, a friend who runs Matrix Cellular called up asking for a sales person. I told him we would ﬁnd him the best candidate, but I need the money upfront. He threw a lifeline at us with an advance of `18000. The lifeline led to a windfall. A few days later, Max Ateev contacted us for a project manager. We found them the right person and made `180,000. There was no looking back after that. With swelling conﬁdence and a bulging pocket, I started hiring people. By March-end we had earned `14 lakhs with 5 people. And over the next three years the turnover doubled and then almost quadrupled. We had hit the accelerator at a very early stage. The result: we sped to our current turnover of `65 crore, with a wish to offer a unique
Elixir experience to our more than a thousand clients. In 2004-05, we were starting newer operations in temporary staffing and then moved into Middle to Senior Management recruitment as well. We further diversiﬁed into booming sectors like Energy, Automotives, Logistics, Infrastructure, FMCG, Retail, Education and analytics, with the percentage of retained clients increasing. Three years later, we also added verticals like Manufacturing, Travel, Hospitality, Defense and Government Services to our offerings. I believe that the foremost ingredient for a company’s success is to continuously evolve both organisational structure and product offerings.
The biggest challenge to our business came because of our inability to learn a simple lesson: when you think big, stay on the right side of the law
The biggest challenge to our business came because of our inability to learn a simple lesson: when you think big, stay on the right side of the law. In 2006, our office in Kalkaji was sealed by municipal department ofﬁcials because it was running in a building where commercial activity was not allowed. Overnight our computers and data were sealed. We had scaled up to 100 people by then. And suddenly there was no space for them. We had an additional office in Okhla, with 40 people. We had no choice but to cram our entire staff of 140 into this office. Luckily, we soon found another ofﬁce in a commercial area in Kalkaji. According to government estimates, the workforce in the country is expected to grow from the current estimate of 520 million to 574 million adding close to 11 million workers annually in the next ﬁve years. With this industry holding such huge prospects in a well populated country like India, if any company like us has to grow, these challenges are inevitably going to be a part of its journey. Investment in training and processes and compliance with law will only help. DARE.CO.IN | OCTOBER 2010
PROCESS AND QUALITY SNAPSHOT
Name: Vrinda Rajgarhia Age: 42 years Education: MBA - William E. Simon Graduate School of Business Administration, University of Rochester Experience in business: 8 years with Sweet World (since 2002) Leadership Style: Leading by example Big Learning: Never compromise on the quality of the service and products
Sustaining process and quality is the key In a country where Kaju Barfi, Rasogolla and Petha are a natural choice, making candies a preferred sweet among children was difficult. But Sweet World has done it! By Vrinda Rajgarhia aking Sweet World a popular brand amongst children was not effortless for me. The challenge came in the form of making candies popular in India. The year when Sweet World came into existence, there weren’t many options available to children to choose from. There were hardly three or four candy brands available in the market. Therefore, the ﬁrst challenge for me was not merely popularizing my brand of candies but making can-
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People asked me if I would make candies in the morning and sell them in the evening
dies a preferred choice of children. I had to devise and strategise ways to do so. And I started by educating customers and internal staff. To people in India, sweet was synonymous to mithai (sweet meat). Candy wasn’t a very familiar term for many. They though candies were like mithais. People asked me, “If I would make the candies in morning and sell them in the evening-- Like the mithaiwalas do in our country.” But gradually I overcame that challenge successfully.
Name: Sweet World Domain: sweetworldonline.com Set up in: 2002 Turnover: Conﬁdential Headquarters: Mumbai
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No of employees: Over 100 Website: http://www. sweetworldonline.com
While, I overcame the initial hurdle, some technical challenges lay ahead of me. Being in the food industry, maintainence of process and quality of product emerged as a challenge for me. But I didn’t really see it as a challenge, to me process and quality mean hygiene, which is extremely important for any operator in this industry. And unless your customers are satisﬁed with the quality you provide, they wouldn’t come back to you. For me it was important to win the conﬁdence of mothers as my product was targeted to young children. And its their mothers who needed to be convinced about the hygiene of our product as they are always concerned about what their children consume. For that matter, being a mother myself I wouldn’t allow my children to buy anything that lacks hygiene. In fact, the reason behind the popularity of foreign candies and chocolates is the tremendous level of quality that they maintain. I wanted to the bring the concept and the candies from abroad to India. When I wanted to start it, the import rate was very high. It was only in 2002, when the import rate went down, I imported the product in the Indian market. Sweet World candies are manufactured
in the USA and dispatched in our Mumbai store. From the Mumbai store they get distributed to our different outlets. While it took to some time to combat these challenges, the most crucial of all was preserving the product. Candies are perishable in nature; they melt if not stored in suitable condition. They can’t be refrigerated either as by doing so the product will lose their normal texture and taste. The products need to be kept in an air conditioned room only ranging between 18-20 degree celcius. This is why we chose to retail our product through malls and not high street stores. For maintaining the quality we have our own chain warehouses. We also have air conditioned transportation that run across the country. In malls, as well, we take care of the power back up. To maintain our process and quality, we haven’t introduced selfservice in any of our outlets. But sometimes, it does get awkward when we have to stop our customers from picking the candies, while
Be obsessed with quality
they want to touch, feel or smell it. We have to take care of hygiene, we cannot allow our customers to touch edibles as that could transmit germs. And for the same reason, our sales staff is strictly instructed to use hand-gloves while picking the candies from the candy cabinet. Sweet world has carved a niche for itself in the market. Our candies are purchased by several ﬁve star hotels. Likes of Leela and J W Marriot form part of our clientele. And it’s not difficult to tell that customers are very ﬁnicky about the quality of product which makes it maintaining quality all the more important for us. Our customer base is growing with every passing day. But we don’t aggressively invest in ATL (above the line) and BTL (below the line) advertising activities. For us the product does it all. The quality of the product speaks for it self. In fact, we are yielding good with just word of mouth. We have come a long way from where we started. Our ﬁrst store was launched in Mumbai which was a stand alone store. Back then stand-alone store was the preferred mode. Shop-n-shop retail format was not even known. After our ﬁrst store, I was quite doubtful whether we would be able to take Sweet World any further. But eventually we did it! DARE.CO.IN | OCTOBER 2010
PROCESS & QUALITY
Process is the organisation, long live the process Being unreasonable is good for business. If one is wedded to quality they better tread a new path. By Prashanth Hebbar
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ANNIVERS ARY EDITION
hould process rule your business; should it be left to a set of rules which have been made by a committee or worse an individual; should we lose our human sensitivity and give in to dry rule book; what role does a manager have other than following blindly the process; should we sacriﬁce our creativity to process... Questions are galore when it comes to organizational process. Depending on whom you ask, the answer will be: “Yes, process is paramount.” “No, process stymies the work culture.” Or worse still: “Pro-
cess should be adhered to but exceptions have to be factored in.” The last one is the most popular. The problem, as we ﬁnd often, is that exceptions become the rule. Then the process falls by the way-side. That is why Compact Hometel’s Suresh Tota (read his insight) believes in the ﬁrst option: “Process is the king.” In fact, if process means better quality then process should be the ﬁnal word. Everything else should be subservient to it. A sentiment shared by Vrinda Rajgarhia of Sweet World, who found that even the slightest deviation from the process could lead to total loss of business. Rajgarhia talks of quality as if nothing but that exists for her. If one goes a level deeper then it becomes obvious that much of the process and consequential result of better quality is actually linked to the way an organizational structure is designed. Process and quality for some are a religion. Take the case of Idiom’s Jacob Mathew, who set up own factory to manufacture furniture designed by them since other manufacturer were reluctant to produce goods as per Idiom’s speciﬁcations. The easiest thing to do for Mathew was to compromise on speciﬁcations and adhere to what the manufacturers dictated. Idiom today is a trail-blazer because Mathew and his team refused to compromise. Being unreasonable is good for business. If one is wedded to quality they better tread a new path. One does not appreciate the need for a process simple as it may
What drives people to follow a process is the sheer love for their work. A thing of beauty is always cherished.
be unless s/he has seen things blow up and threaten the very existence of the business. We all want to lead a peaceful life without running ourselves to death when a crisis breaks out. However, more than this mortal fear, what drives people to follow a process is the sheer love for their work. A thing of beauty is always cherished. Be it a product or a service, the perfection gives an aura of superiority and the rest of the world wants to emulate it. It becomes a de facto standard. Every entrepreneur loves to set her stamp on the world's stage. We come across many concepts while dealing with process and quality. Here is a brief tour of some of them so that we understand what people are talking when they talk about their products and businesses.
You can’t manage what you can’t measure This is classic Peter Drucker mantra. A simple spreadsheet has done wonders to businesses simply because it can capture data and throw out some visualizations by way of charting and pivot tables. If I am writing this article against a deadline and do not know how long I should take to write and then edit it, I am working blindly. If a simple two line data is provided to me which says, deadline is 9 pm and I can send the ﬁle latest by 8 pm then I know when to stop obsessing over my copy. Without this data point, we are all working in darkness. People who have dealt with data know that it is important to generate data. An atmospheric scientist studying pollen particles in the air keeps a daily log of the observations. An ornithologist keeps a daily log of birds seen and heard of. A marketing manager keeps a daily log of campaigns in his domain. A sales manager keeps a daily log of client visits by each of his sales executives. A Parliament record keeper keeps a DARE.CO.IN | OCTOBER 2010
PROCESS & QUALITY Data needs to be looked up, read aloud by members of the team and necessary actions identiﬁed. We are mostly used to reviews which are more tame and routine. What Singhal meant by emphasizing review three times is that data needs to be looked more closely, in detail and discussed with the members of the team. Data showing both good and bad things needs to be detailed out. Everyone in the team has to be aware of the data to its minutest detail. Nothing should be glossed over.
Reduce the moving parts log of daily business of the law makers inside the Parliament. People participate in this activity daily and every minute. Only when we have enough data can we look at them for some patterns. So it is all about keeping a log and looking at them for patterns. Patterns give us the ability to measure things and ﬁne tune things if necessary.
If data were to be inside spreadsheets and looked up by managers in a glass cabin then it would not impact the factory floor.
Visibility is the key V A Ramani, a former TVS Industries quality executive told us about the practice of sunrise and sunset meetings on the factory ﬂoor. Data would be presented to everybody in a stand-up meeting on the factory ﬂoor daily. It would give them the schedules, impending delivery deadlines, problem areas and such data. It would be made available on charts and boards. The workers would see these data points twice daily, all together at their workplace. It would give them a clear direction on what they are working upon and how critical it is. If data were to be inside spreadsheets and looked up by managers in a glass cabin then it would not impact the factory ﬂoor. Data is actually for people who can be inﬂuenced by it and also who can change its destiny. 76 OCTOBER 2010 | DARE.CO.IN
Visibility to data is key in any business as you will learn in the articles by our CEOs. Everyone has talked about the importance of visibility of data to effective execution.
Review, review and review Last year, the Project Management Institute (PMI), executed a very large event close to perfection. There was all round praise for the execution team. Interestingly, all the members in the execution team were volunteers. When asked how they could pull off such a perfect execution, the head of the conference Project Management Office (PMO), Hirdesh Singhal said, “The secret is review, review and review.” Singhal couldn’t have said it better. No data or visibility is effective without reviewing the progress.
When Suresh Tota says that a process should be accompanied by a common Standard Operating Procedure (SOP) which can be achieved by everyone then it should be preferred to the method which describes what needs to be done and allowing everyone to take their own decision on how to do it. This way there is only one way to do something, and the possible points of error are drastically reduced. Take the case of the Internet. The architects of Internet decided that there will be only seven root servers and they will exchange a list of new domains registered with each of them daily. This exchange would take place in the night so that far less number of users would feel the service disruption during this MIS process. Present day Internet still works on this principle. Increasing the root servers would only increase the moving parts, increasing the complexity and thus the points of error. We have obviously not looked at concepts like FTR (First Time Right), Kanban, Quality Circle and such industrial strength practices. What we have done here is to explore concepts that can be started off by anyone with minimum investment in knowledge and tools. As they say, a leader is as good as his/her team and a team is as good as the process it follows.
HUMAN RESOURCES SNAPSHOT
Name: Allwin Agnel Age: 29 Education: MBA Experience in business: 8 years Leadership style: Walking and Talking Big learning: You need missionaries working with you, not mercenaries.
Flipside of Challenge:
Every business, big or small, medium or micro, faces challenges. It is only a matter of how they want to look at the challenges—domitable or indomitable! By Allwin Agnel or a start-up, challenges are galore so are the opportunities that can lead to success. To me success was more tempting than intimidating challenges that lay as ﬁxtures on way to success. I decided to start young; and embarked on my ﬁrst venture when I was barely 21. Fresh out of college, unlike my fellow batch-mates who desired well-paid jobs or higher studies, I dreamt to build something novel. And in the year 2002, with a friend, I started Neutral Web, an enterprise level web hosting service. Today, the company hosts over 8000 websites with clients in over 14 nations.
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Since then there has been no looking back. In the same year, in the month of September I started PaGaLGuY.com, an online platform that enabled discussion between MBA aspirants. The idea behind this first-of-its-kind venture was
I was struck with the unavailability of information on business schools
evolved in early 2002 when I was fiddling with the idea of joining a B-school. While I was trying to find some good options, I was struck with the unavailability of information on MBA colleges or courses available therein. The only source of information were the colleges which definitely wasn’t sufficient. I wanted to hear more from current students, prospectives and alumni as well. Looking at the gap, I decided to launch the first version of the PaGaLGuY. com website which was a simple discussion board for people interested in exchanging information about the B-schools and courses.
Name of the enterprise: PaGaLGuY.com Domain: www.pagalguy.com Turnover: Conﬁdential Set up in: 2002
ANNIVERS ARY EDITION
Building products that work for the MBA space and monetizing by allowing clients to advertise on the site.
Employees: 25 people Headquarters: Mumbai Website: www.pagalguy.com
And while I leaped into these ventures, I lacked entrepreneurship skills which magniﬁed the looming challenges that lay ahead. I had no formal education in the area of technology or media. I was a mere graduate—a Commerce graduate from the Mumbai University, who was not equipped with any real practical or technical knowledge. I just jumped in with the supreme belief that things could be handled as they came up. And it hasn’t let me down, yet. It was later in the year 2006, I got admitted to The Wharton School, University of Pennsylvania for the MBA course, where I got my formal education on entrepreneurship. Being an entrepreneur was all but an easy job; the very ﬁrst obstacle that came our way was lack of funds. For the initial period, I borrowed my father’s credit card for a couple of months. That was the only time I needed to access any external funds. As soon as Neutral Web went cash ﬂow positive, I invested my savings into PaGaLGuY. And in 2006, I incorporated PaGaLGuY as a company and started hiring. That’s when the real problem emerged—I got admission at Wharton which left me with no option but to handover over my
company to someone for sometime. And to ﬁnd that someone or a team to run PaGaLGuY.com in my place. I essentially had just a few months in hand. While I knew what kind of people did I want, to sculpt my dream, it was difficult to have them on board. Mostly, candidates preferred joining companies with a reputation, which could offer hefty salaries, numerous perks and much more. And all we could offer was a vision, a dream, a possibility. Soon we realized it was a wasteful exercise to struggle with MNCs which pick up candidates from campuses for attractive packages. They sure can afford for they earn in dollars. We couldn’t but that didn’t deter our ambition to get efficient people on board. We stopped hunting at places where MNCs were regulars. We
We recruited people for whom salary wasn’t a constrian but doing a new thing was the sole driver
sidestepped the problem and started looking out for people who wanted to do something different. We recruited people for whom salary wasn’t a constraint but doing something new was the sole driver. And thus we found some of the most extraordinary people to work with at PaGaLGuY. All of us were driven with the same values and intensity to build PaGaLGuY into a phenomenal company and a wonderful work place. When our values aligned, it was just a question of finding more people with similar values and things took off. Sure, we have had tough times—but when people are determined to build a world class product/company, most of the limiting factors are automatically taken care of. Today we have 19 dedicated employees with us who have made PaGaLGuY what is today the most preferred destination for MBA aspirants throughout the country. Like I said, challenges are galore so are the opportunities. And it is only a matter of perception and determination. Entrepreneurs have to believe that they can succeed despite the challenges. We s u r e a r e o n o u r w ay t o success! DARE.CO.IN | OCTOBER 2010
HUMAN RESOURCES SNAPSHOT
Name: Faisal Farooqui Age: 34 Education: Bachelors Degree in MIS and Finance, State University of New York Experience in business: 10+ years as entrepreneur, having started two businesses post college Experience in business: 10+ years as entrepreneur Leadership style: Process driven Big learning: Your people and employees are your biggest asset
Challenges of being a winner Self-belief is the key to overcoming all challenges. The journey is never easy for an entrepreneur. It requires great strength of will By Faisal Farooqui remember a television commercial featuring Hindi Cinema's legendary poet-scriptwriter Javed Akhtar. The commercial was for a pen and the makers wanted to project it as a weapon for winners. And Javed Akhtar was projected as someone who has emerged as a winner after going through a lot of struggle. So the commercial takes you through various levels of struggle, failure, despondency and ďŹ nally, victory. Every story has its own path of challenges failure and success in varying degrees and this is what makes life so exciting. For me the very idea of starting
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my own thing was a challenge, considering the fact that I was engaged in a comfortable job. And the fact that I wanted to begin my venture gave heebie-jeebies to my family members. But I knew I could prove their apprehension wrong.
I had a germ of an idea but that was it â€“ nothing more, nothing less
So one evening, when everyone was expecting me home for dinner I boarded a plane to India. That was the beginning. I had a germ of an idea but that was it - nothing more, nothing less. I knew the idea was workable and it was the conviction in my idea that saw me through. But there were many things working against me at that point. The Internet industry was going through a crisis. Dotcoms had gone bust and the idea of MouthShut.com was unusual. "A platform for writing reviews on products and services? Indians do not write reviews," I was told.
Name of the enterprise: MouthShut. com Domain: Internet and IT domain Turnover: Conﬁdential Set up in: 2000
ANNIVERS ARY EDITION
Ad-based revenue model. Subscription model for corporations, customized model for emerging social media
Employees: 70 people in various departments and functions Headquarters: Mumbai Website: www.mouthshut.com
Given the times, the idea seemed far-fetched and everyone was like, who the hell is going to talk honestly about the products they have used. Those days, there was no name, no logo, no office infrastructure, nothing, just an idea of a platform where consumers would be able to provide feedback to various products. And then my biggest challenge: I had to hire employee number one—I did not have a proper office. How was I going to hire him? I told him about my vision hoping he would buy it. He did and ten years down the line he is still with me. That ﬁrst employee believed in everything I said and was able to see through the concept I painted for him. Finally, few months later, after putting a great team together, I managed to kickstart MouthShut.com. Startups around us were crashing like nine pins and we knew what the problem was—most of them had gone on a marketing binge. Huge marketing and advertising promotions hit the market but since the market was at an all time low these strategies hit these companies very badly and most of them folded up in no time. Slow and steady was our motto. We lay low and concentrated on building a team of great professionals who in turn built a great product. We cut corners and thus survived.
What started off as a smallplatform for product feedback is now amongst the biggest Internet destinations and when someone says MOUTHSHUT, you know brands have started listening to consumers. This by itself is a great achievement. Before we took off, there was not a single platform for consumers to voice their honest opinions. Positive and negative opinions flood our site on hourly basis and brands take note of what is written about them. The basic idea was to build communities around brands. MouthShut.com provides consumers a platform to voice their opinions on thousands of products and services that are manufactured and sold to consumers the world over. Thousands of consumers
Startups around us were crashing like nine pins and we knew what the problem was—most of them had gone on a marketing binge
gather online everyday and speak their mind on their real-life experiences with products and services. Over the years MouthShut.com has diversiﬁed its product offerings and encompasses a range of Social Media features though the focus remains the same—consumer empowerment. MouthShut.com's biggest achievement is that it started a debate by consumers on brands and the fact that the feedback mechanism has been accepted by consumers and brands alike. It is the ﬁrst choice of consumers looking to voice their opinions on products and services. The reviews written by the end-users are taken into serious account by brand managers who scout the web site for honest opinion and feedback. It has not been an easy journey. I have had my shares of ups and downs. All I can say is that it has been possible only because of my unﬂinching devotion to the belief that I carried with me and passed it on to the great team of people around me. This is in fact is not just my story. It is the story of every entrepreneur who decides to miss his family dinner and board a ﬂight that takes him to his dream. Being an entrepreneur involves belief in the self. The journey is never easy. It requires great strength of will. 'What will people think?' should never be the main worry 'What are the current trends?' is a thought that should never deter an entrepreneur. Have a solid vision and back it. That is the only mantra. I never had an immediate team to back the vision. That happened over the course of time. My vision fuelled me and then the team that has stood with me steadfastly over the past many years. All this is extremely gratifying. So when I remember that television commercial of Javed Akhtar, I always feel it was designed for entrepreneurs and for the bunch of guys who shared a dream called MouthShut.com! DARE.CO.IN | OCTOBER 2010
HUMAN RESOURCES SNAPSHOT
Name: Jacob Mathew, Co-Founder Age: 49 Education: PEP in Product Design from NID Experience in business: 25 years as a design entrepreneur Leadership Style: Collaborative Big Learning: Power of holistic multidisciplinary teams
Idiom’s design meets business shops Differentiation from competition and integration with the consumer is the magic a designer brings to a business and serves as the raison-deetre stay afloat By Jacob Mathew e are a design strategy and services company that has a mix of people from design, architecture, engineering and arts background along with people with business education background thereby marrying business strategy, design thinking and design implementation for our clients. Idiom currently can handle all needs of a business or institution from strategy to branding and communication, to architecture, interior design, product design, packaging design encompassing what we call Business Design. The ﬁrst company that I co-founded
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Tessaract Design in 1985 with three other college-mates from NID Ahmedabad did what in retrospect we could call the Business of Design. In 2005 Tessaract merged
In 1985, the biggest hurdle was the lack of awareness about impact of design on a business
with Esign a branding and graphic design ﬁrm, to form Idiom Design and Consulting Ltd. What we now practice is the Design of Business. At Tessaract we were a fresh start-up. A partnership of four college mates with two of us still in our ﬁnal year and two with a couple of years experience each. We turned out to be torchbearers for an entire generation of design entrepreneurs. Design was very new when we started out in 1985, the biggest hurdle in the market being the lack of awareness about design and the impact it could have on business. A lot of time was spent educating
Name: (Business) Idiom Design and Consulting Domain: Business Design Set up in: Tessaract Design 1985, Esign 1995, Idiom Design and Consulting 2005 Employees: 100 plus Turnover: Conﬁdential Headquarters: Bangalore
ANNIVERS ARY EDITION
Consulting and implementing solutions in the areas of: Business design & strategy Branding and Communication Design Experience Design Design for Social Change New Product Development
our clients about design whenever we could get their ear. It also meant a lot of time spent in office lobbies waiting for appointments on cold calls and doing spec work that would demonstrate before and after a design job. A few successes enabled us to then showcase projects to clients. As there were very few independent design offices in the country, there were no benchmarks or signiﬁcant demonstrations of successful work till then. As the ﬁrst few projects were retail, we built a reputation for retail design and retail design continues to be a signiﬁcant part of our portfolio. An important learning from the time was that if we could not ﬁnd the people with the skills we needed we could train them they had an attitude to learn. In the initial years we could not ﬁnd manufacturers who were willing to make what we designed, so we set up a factory initially operating it ourselves and then training unemployed youth (from the inner- cityvillage we had located ourselves in) to make furniture using a combination of wood and steel. We could not afford to hire trained engineers or ITI gradu-
ates so we had two retired army mechanics who trained our young workforce alongside us. We also collaborated with other young professionals like architects and engineers to make up for what we did not know. Today the factory is an independent proﬁtable unit. The single most critical area was integrating the people from two different ﬁrms to work as one especially when they are from different disciplines. The integration of multi disciplinary teams is perhaps the largest challenge and the most rewarding as well. A multidisciplinary team that starts ﬁring together is wonderful, productive, effective and fun to work in. The other big problem is: ﬁnding the right people from the
When manufacturers were reluctant to pick our designs, we set up our own factory
people educated in our massive but ﬂawed education system. In April 2005 we were a team of 35 people, by 2007 we were 265 people with a fairly high rate of attrition. On studying the attrition we found that 90 per cent of the people leaving us had worked less than 90 days with us which pointed to a flawed hiring process. We tightened up our hiring process. Today anybody who joins us goes through at least four rounds of interviews with peers, juniors and seniors before we take a decision. Our numbers have now stabilized to a little over a 100 people who work more effectively, with our turnover with a 100 people being higher that with 265!!! Flexible time, self-regulation, intrapreneurship and such concepts were experimented with. Today we approach our solutions from a cultural perspective. We study consumer behavior through what could best be described as design ethnography to arrive at key insights that then drive the brief and the solution. Understanding behavior and culture and using design to transform it to a desired state is key to our success today. Keeping an ear to the ground and the countless conversations we have with extremely dynamic and astute businessmen alerts us to possibilities. We were at the crest of retail design when organized retail started to take off in the country, today we work in many other sectors like healthcare, education, hospitality and social entrepreneurship. Our luckiest breaks are our meetings with extraordinary people with vision and conviction in their enterprises. The company was founded on the premise that we would have to move on and the next generation of leaders have to be nurtured from within the organization. Leadership training and coaching are very much part of the agenda. DARE.CO.IN | OCTOBER 2010
HUMAN RESOURCES SNAPSHOT
Name: L.H. Manjunath Age: 50 Leadership style: Ideas & process Education: MVSC Big learning: Handhold people to help them realize what is expected of them
Organizing rural manpower We organized most of the 400,000 women households, who were manufacturing bidis into Self Help Groups (SHG). Our aim was to give the SHGs alternative work and ensure that the products manufactured by them are marketed By L H Manjunath he ﬁrst challenge we faced was in 2002 when SIRI Gramodyoga Samsthe was started. We wanted to actually provide additional employment to rural folks who wanted to migrate to Andhra Pradesh and Madhya Pradesh in search of livelihood. There were 400,000 women households, engaged in bidi manufacturing. We organized most of them into Self Help Groups (SHG). Our aim was to give the SHGs alternative work and ensure that
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SHGs were only doing labour arbitrage where they were basically comfortable doing labor for a speciﬁed cost
the products manufactured by them are marketed. The ﬁrst biggest challenge that we faced was the technology know-how. We had identiﬁed a variety of product line that can be manufactured by these SHGs. These include readymade garments, sweets, confectionery and personal care products such as toilet soap. In the beginning, we did not have the right kind of know-how and technology to produce any of these. For instance, we did not
Name: SIRI Gramodyoga Samsthe Domain: Social Entrepreneurship Turnover: Rs 15 crores Set up in: 2002
ANNIVERS ARY EDITION
SIRI procures products developed by SHGs and sells them through its own outlets and third-party retailers.
Employees: 500 SHGs Headquarters: Dharmasthala, Karnataka
know the standard formula to make soap or to get the standard odor. Such things were a major challenge for us. Knowledge was not readily available. We started hiring technically qualiﬁed people from the chemical business and the soap industry. It was difficult even for the experts to come up with speciﬁc formulae because all the formulae they were exposed to belonged to different companies with proprietary rights. That turned into a bigger challenge. However, over a period of time these people learned what kind of formulae they could apply. With their own formulae, each group started launching the products. That’s when we hit our next challenge. The SHGs were not ready to accept this as an enterprise. They were only doing labor arbitrage where they were basically comfortable doing labor for a specified cost. So we had to think hard on how to convert these SHGs into the entrepreneurships where they could start producing their products and sell it in the market. We had to introduce to the SHGs the entrepreneurship model of producing and the con-
cept of micro-credit. SIRI started extending micro ﬁnances to the SHGs. Eventually, with the help of micro ﬁnance they were able to commence production in their chosen domain. Then the SHGs hit the next natural challenge—quality. The quality of the product from the various SHGs became an issue because they were not able to maintain the same quality. There was no uniformity in the quality across locations and groups. We got professional trainers to train SHGs in quality processes and appointed quality personnel to check the quality of product
We did not know the standard formula to make soap or to get the standard odour. Such things were a major challenge for us. Knowledge was not readily available
before they were released into the marketplace. The real test was in the market. Both the distributors and the retailers were demanding extended credit periods. We did not have people who understood the market and the product well. When we wanted to hire good marketing professional we hit the high salary barrier. As a result we tried out different marketing teams and different kinds of marketing channels. We dabbled in direct sales through our own outlets called the SIRI Outlets. We also started selling through line-sales where our people would go in a van and start distributing the product. Today SIRI is a successful experiment with a turnover of `15 crore and we are making a proﬁt of around `1 crore. One of our most successful products is agarbatti (Incense sticks). Today, we export agarbattis to the tune of `34 lakh per month. However, our last challenge remains unsolved. Finding good people who can go to the clusters, work at the grassroots level and take the organisation to the next level is still the biggest challenge that we face at SIRI. DARE.CO.IN | OCTOBER 2010
HUMAN RESOURCES SNAPSHOT
Name: Parichay Upadhyay Age: 37 Education: Chartered Accountant Experience in business: 15 years Leadership style: Delegating work, works. Big learning: In service industry, customer satisfaction and contentment is the most important factor, for which the owner should continuously strive for, especially when your venture turns into a brand.
A skinny on the cosmetics business! Want to figure out how a finance professional cracked the appearance business? Read on... By ParichayUpadhyay n the face of it I shouldn’t have even been in the cosmetic industry. Imagine a chartered accountant, with years of experience in tax planning, ﬁnancial accounting, pensions, portfolio management and so on, dabbling in skin care and that too with laser! Yet, here I was in the thick of a cosmetic business and loving every minute of the work I was doing. We opened our flagship store, named New Look Cosmetic Skin Laser Clinic (now a national brand) in 1997 in Mumbai and since then it has been one incredible journey.
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I wouldn’t like to exchange this experience for anything in the world. Surprisingly enough, my being a CA has served only to enhance my experience. Within two years of our entry
The three words for entrepreneurial success in my mind are: Determination, Persistence and Hard Work
into the business, we opened outlets in Delhi, Bangalore and Kolkata. Today there are 19 New Look centres, spread across the country, from Mumbai, Delhi, Kolkatta and Bangalore to Jaipur, Indore and Dehradun. Most of this expansion has been fuelled by internal accruals or funding. With the increasingly appearance-conscious middle-class recognizing laser treatments as being among the most effective means of skin care the market size itself has grown at a fast clip. Alongside there has never been any dearth of people wanting to invest in this fast-growing business segment; a
Name: New Look Cosmetic Skin Laser Center Domain: Cosmetic Laser Skin Care Service Industry Turnover: 10 crores Set up in: 1997
ANNIVERS ARY EDITION
Operates through 18 centers pan India, offering treatments for various hair & skin ailments and cosmetic treatments, botox ďŹ llers, dental cosmetic treatment, hair transplant, liposuction etc, through advance laser and other machines.
Employees: 150 Headquarters: New Delhi Website: www. newlooklaserclinic.com
number of investors offered to ride with us. As a result we have set up our centres in many cities like Bangalore, Noida, Ahmadabad and Mumbai as joint ventures. Given the enthusiastic response thus far and the fact that there is still a huge market left to be tapped, we have no doubts that we will grow rapidly in the years to come. We plan to grow both jointly with other players and through the franchise route. The two big challenges we faced when we set off were in the areas of acquiring the right technology and skilled manpower. When we entered the market, laser technology was still new in India and there was as a result a massive opportunity beckoning us. We could clearly see the advantage of being the first to introduce advanced beauty treatment in such a market. However, since we were into a very specialized niche that was focussed on providing unique treatment involving advanced technology, staffing turned out to be a daunting task. Although we have always had a strong training procedure in place, retaining staff was still a problem given that most of them were women bound to family commitments.
Among our successful retention strategies has been to generously reward staff that had spent signiďŹ cant time with us and had as a result acquired the necessary technical knowhow. However, as we are expanding fast, the opportunities for professionals are growing all the time. In general terms too, the wellness industry is growing in India at an impressive 15 per cent year on year. Since the beginning, we saw the health and wellness industry to be among the most promising in India, a belief that has been borne out over years. Today, the industry is worth 12000 crore and growing, reason why there are so many players entering the turf. The job opportunities in this industry are massive. However, since we were among the first entrants in the high tech-
Today, the health and wellness industry has touched `12,000 annual turnover and growing
nology end of the market, it was possible for us to establish an edge. So far we have catered to more than 300,000 and that number is obviously growing even as you read this. Initially, yes there were obstacles, since laser was something people were not very familiar with. We, therefore, had to expend a great deal of time educating the market. Other than that we ensured that the standards of service remained uncompromisingly high. It is for this reason that getting the right people has always been a key factor in our business. But over years we have evolved systems that help us get the people we want. Apart from problems relating to sourcing the right technology and reaching out to minds of people, we have fortunately not faced any major hurdle so far. All our 19 centres are doing well and this is a proof of the fact that the ride thus far has been relatively smooth. I would say that this being a service industry, the behaviour and conduct of staff assume the greatest importance. I can only say that determination and persistence along with hard work are the key to success. I manage time and change with a positive attitude, right stratDARE.CO.IN | OCTOBER 2010
HUMAN RESOURCES SNAPSHOT
Name: Shamit Khemka Age: 36 Education: B.Com (St Xaviers, Kolkata) Experience in business: 16 years Leadership style: Hands-off Big learning: Being process oriented may not help you get more clients but it helps you to retain employees (internal customers) and thus the customers.
The making of a worldclass organization The success of Synapse, a CMMI-3 company, shows that you do not have to “think” small just because you are small By Shamit Khemka y ﬁrst brush with business after I ﬁnished my B.Com at Xaviers, Kolkata and moved to Delhi in 1999, was a real estate dot com venture, sampatti.com. I set this up with funding from a few friends and relatives, no VC. But it didn’t go anywhere and within 6-8 months we decided to wind it up. Before this, I had run a Bulletin Board Service – a small internet offering in 1994, within the city of Kolkata. It was networked with BBS services in cities like Delhi and Chennai. I had a background and keen interest in computers, software development and communications networking, which helped me understand the market and what people really wanted. Our failed
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real estate dotcom venture helped us understand the intricacies of business functions like salaries and manpower. Ironically, the dotcom venture failed though we had a business plan while my next venture, Synapse has been a success although we went into it without any such plan. Synapse came to us as a ‘what to do next’ idea.
As entrepreneurs, you mitigate risks, and not take them head-on. Mitigating risks would make you successful, just assuming them won't
After the dotcom shutdown, we were left with ﬁve employees and ﬁve computers with which we started Synapse in 2001. I had been in IT for a long time, since 1993-94 and knew a lot of people in the industry around India – that helped. We started by creating websites. We got our ﬁrst client, a California- based company called Startup Founders with an Indian CEO, through a reference. Since he knew that we were trying to get into software development, he wanted us to create a business networking site for startups and entrepreneurs looking for Venture capital, employees, funding, business ideas - in short a community for startups. That was our ﬁrst purchase order worth USD 5000 and we were able
Name: Synapse India Domain: IT solution provider Turnover: 15 crore Set up in: 2001 Employees: 300
ANNIVERS ARY EDITION
Offshore web and software application development, online marketing, mobile application development and web design solutions that help small and medium-scale businesses.
Headquarters: Noida, UP Website: http://www.synapse. co.in/
to manage it end-to-end without a hitch. This was a good start and it gave us the conﬁdence that we could do well in this market. Then, he referred us to a few more clients, which helped us put in place our marketing and sales team. Slowly we moved on to doing complex projects. We have grown organically but with solid support from organizations like Nasscom and TiE. We were initially a part of them and this helped us greatly in understanding the Delhi market. Then we moved to bigger software ﬁrms. We have been Gold partners of Microsoft since 2004 and a CMMI Level 3 company since 2007. For managing ﬁnances, we took lower salaries and did not take any at all when we didn’t have projects. It was difficult for the ﬁrst year. The biggest differentiator for us has been moving to Noida in Feb 2005. From a team strength of 60 we grew to 120 and subsequently to 240 employees very quickly. In the last six months alone we have added 60 people. So, surprisingly our Eureka moment was the move to Noida where we got access to improved internet, communication facilities and staff, which enhanced our services. The Noida facility freed us from worries over infrastructure and allowed us the time to tend to hiring, training and building our human resource, which is key to the knowledge industry.
In last four years we have grown from 100 to 300 people. A big credit for that goes to EO- Entrepreneurs’ Organization, an international organization with 7500 members worldwide and a very active Delhi chapter. It has helped us grow by telling us how to leverage peer network, best practice sharing, forums, deal network and such nuances. We also became a part of the Software Technology Parks of India (STPI). On my travels outside India, I learnt a great deal about different cultures, which helped us grow in the US and UK. Currently, we have about 200 clients, 85 per cent of which are US based. We work in Dot Net and Open source (PHP) environments. Over the last three years we have also moved into the SEO and Mobile Apps (Blackberry and iPhone) areas in step with the market trends. HR has been a problem for us as attrition is an issue in the indus-
The key to success: We just kept hiring and growing even through a slow-down. Result: we grew at about 10-15 % during Aug 08- Sep 09
try. However, we have been able to manage this problem to a large extent by adopting a process-oriented approach. The road to the CMMI certiﬁcation was highly educative; what we gained on the way helped us take our staff to a different level, make them process oriented. Also, it allowed us to experience a large company within a small company. It helped us become a more efficient organization more capable of retaining its people and delivering greater value to its customers at lower cost. We realized that our advantage over bigger companies for employees was the kind of training we could give them in CMMI and similar softwares. Around 2005, our attrition was about 25 per cent while in last six months it has declined to about 11 per cent. Incidentally, it was also a result of our taking on CMMI accreditation. By comparison, the rate is around 15 per cent in good CMMI Level 3 companies and 25 per cent for non CMMI companies. However, being process oriented has not helped us get more clients, who really are concerned about the value they are getting. Is it helping them save money? If no, then for them it doesn’t really matter. Another game changer for us has been that we wrote all the 12 processes of CMMI into a software for our internal use and put it online. So, everybody here is trained in CMMI as part of their induction. The environment allows our employees to stay within the realms of CMMI and follow the processes without having to continuously learn the details. In technology we have been cutting-edge throughout with a backend based on stuff like the Microsoft’s HyperV, MS 2008 server. Sales are a challenge because we don't have ofﬁces abroad - while all our clients are outside India. Small IT companies in US and UK outsource projects to us. Besides, we market a lot through SEO as well. DARE.CO.IN | OCTOBER 2010
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HUMAN RESOURCES SNAPSHOT
Name: Vaibhavi Thakkar Age: 29years Education: Masters in Commerce with specialization in Business Administration Experience in business: 7 years Leadership style: Process & Relationship driven Big learning: Courage to dream coupled with hard work, determination and integrity is the key to achieve what you aspire to be.
Hardwork works! People always doubt a woman’s ability to succeed. But you can prove them wrong with just one thing: a big dream By Vaibhavi Thakkar started with many handicaps. But all of them were set aside by the biggest asset I had—the desire to become a successful entrepreneur. I came from a modest background. I had inherited neither money nor ﬁnancial acumen. But the journey towards my dream taught me that what I did not have was inconsequential. What really
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mattered was my belief that I could achieve anything with three things: the courage to dream, desire to work hard and unassailable integrity. I knew I had all of them. But the journey itself was by no means without its trying moments. I still remember the early days of struggle, the long, lonely journeys in local buses and trains. To add to my misery, the cruel world
scoffed at a 22-year-old woman who dared to think big. "She’ll never make it," people sniggered. Those memories will stay with me and keep my feet firmly planted to the ground. But I had a more difficult critic to please—myself. I had raised the bar by swearing that I will not be one of those faces in the crowd, living in oblivion. Also, I set very high stan-
Name of the enterprise: Blend Financial Services Limited Domain: Financial Services Turnover: 36 crs Set up in: 1997
ANNIVERS ARY EDITION
Blend Finance offers the end to end advisory and consultancy services for successful syndication of fund raising needs of the Indian and Overseas corporates.
Employees: About 165 people in all Headquarters: Mumbai Website: www.blendﬁnance.com
dards of performance and considered anything less a crime. The learning curve of ever-growing new ﬁnancial instruments, the ability to read a client’s mind and the pain of successfully executing a deal took its own toll. But with these experiences in the pocket, I was ready for a lifetime of challenges. And then, there was the real differentiator, my team. I was lucky to find professionals who shared my thoughts and dreams. Together, we would spend sleepless nights thinking about our clients and how we could fulfill their dreams and, in turn, generate revenue for our company. For our clients, most of them small and medium entrepreneurs, everything we said was a litany of jargons. Terms like external commercial borrowings, factoring, commercial paper, subsidiary fi-
nancing made very little sense to them. All they wanted was the money to finance their business. Gradually everything changed. I already had the conviction and passion to serve my clients. To all these I added the ability to hold the hand of my clients and walk them towards their dream.
Challenge The biggest challenge was of getting the right people at the right
We decided to attract people with the only thing we could offer—a dream. A dream to become an integrated ﬁnancial power- house
time. We did not have anything to offer to the staff. Our office was not swanky, so we could not have given them a great work atmosphere. We did not have a brand name and to complicate matters, we were unable to pay big money. So, we decided to attract people with the only thing we could offer— a dream. A dream to become an integrated ﬁnancial power-house that offers end-to-end solutions to small and medium enterprises. The challenge was to turn ordinary workers into extra-ordinary professionals. Fortunately, we sold our conviction to all our key people even when we had nothing to promise them. Today, they are our business partners. Like our business, they too have grown bigger. We ﬁrmly believe that the best CEOs evolve within the organization. I am glad that all our ordinary people have been instrumental in making our company Blend grow multifold with their extraordinary efforts and innate drive. During our early years, people who came for job interviews were skeptical about us and doubted our future. Today, when I see a lot of veterans from the industry in our organization, I think of that initial struggle and realize how far we have come together. The distant dream has turned into a robust reality.
DARE.CO.IN | OCTOBER 2010
HUMAN RESOURCES SNAPSHOT
Name: Varun Mirchandani Age: 27 Education: BSC. Economics Experience in business: 5 Leadership style: Learning from the Best Big learning: hire people who are smarter than you .
Challenges related to manpower in Onicra We take care that our employees work thoroughly and find synergy in teams. It is extremely important that we find people who are a perfect fit our organization By Varun Mirchandani nicra Credit Rating Agency of India Ltd. is a path breaking innovative individual and SME rating solutions organisation that analyses data and provides a 3-dimension rating.
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The chief confront related to manpower is to make out the right talent pool
Onicra is empowering rural India through technology by assessing and rating quality data on an individual/SME which transforms the enormous amount of data collected daily into decision-ready insight.
Name: Onicra Credit Rating Agency of India Limited Domain: Credit Rating Set up in: 2001-2002 Employees: 4000
ANNIVERS ARY EDITION
Onicra Credit Rating Agency of India Ltd. is a path breaking innovative individual & SME rating solutions organization that analyzes data and provides a 3-dimension rating on them.
Headquarters: Gurgaon Website: www. Onicra .com
We provide a single 360-degree view of all business entities, such as customer, product, representative, employee, supplier or business unit. Knowledge is the key driver here as this model is predominantly fresh design in India. Rating is a highly intellectual business and technology plays an important role in this area to facilitate the process of transmitting and exchanging information. We believe in constant innovation. We have created a ﬂexible work model, within which people have the opportunity to realize their potential. We make certain that the supreme thoughts are used, exploited and incorporated into new products, new services and new businesses for utmost gain and return on investment.
To carry out the processes effectively, it is indispensable that the available talent should deliver on its strategic objectives. The chief confront related to manpower is to make out the right talent pool. The most imperative question is that does the applicant possess the essential skills, experience, and
Fit with organisational culture is a particularly delicate concern, especially when bringing on someone with formal experience
temperament to ﬁt in a particular position and the organization. An individual must bring a futuristic and positive deportment to deal with the organisation’s task I have experienced that ﬁnding the absolute ﬁt is particularly challenging yet critically central. We need the candidates with a right ﬁt between our business’s requirements, culture, and headship on one side and an individual’s aptitude, interests, and persona on the other. Fit with organisational culture is a particularly delicate concern, especially when bringing on someone with formal experience. Apart from the competency in a particular subject matter, calculated judgment, dedication towards organization’s mission, and resourceful analytical approach are the key areas which must be looked upon. Our business is people. People should share the same vision for innovation. They should work thoroughly and ﬁnd synergy in teams and to ensure this we currently, and in the foreseeable future should engage the right people. We need to make our people think like entrepreneurs and give them a platform to innovate . I ﬁrmly believes in the mantra of thinking “Out of the Box”. This organization culture will help steer Onicra towards becoming a par-excellence rating company.
DARE.CO.IN | OCTOBER 2010
HUMAN RESOURCES SNAPSHOT
Name: Vineet Bajpai Age: 33 Education: BA (Hons) Economics, MBA Experience in business: 11 years Leadership style: Passionate, transparent and ambitious leadership style that believes in active empowerment of people and fanatic follow-up on performance Big learning: Invest in capable people with the genuine intent of creating a team of lifelong business partners who can collectively overcome every challenge. This is the ﬁrst and deﬁning step towards building a winning company.
Talent Retention as a Challenge Recruitment of human resource and its retention is a perennial problem with Startups. So was it with Magnon but we overcame it successfully By Vineet Bajpai he team with the best players wins”, said Jack Welch once. This is something we at Magnon realized very early in our business lives. One of the integral parts of our belief system that has made us one of the largest digital media companies in India today is our undivided commitment to talent retention, leadership development and continuity. It is only the presence of a broad spectrum of quality leaders that has enabled us to emerge as the most broad-based interactive solutions company in the country. We not only offer Web based technology, creative, marketing and digital media planning services to large
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and SME clients in India, we have also been able to create Magnon International—one of the fastest growing global digital outsourcing companies in India.
One of the most gruelling challenges was to hold back quality people in the face of stiff competition
We are convinced that this valuable framework has been made possible only under the stewardship of our ‘intrapreneurial’ and loyal leadership at various levels in the organisation. However, it was not always so. One of the most gruelling challenges of organisation building at Magnon was to hold back quality people in the face of stronger and larger competitive sharks in our early years. We started a little over 10years ago, when I was only 22 years of age, after completing my MBA. With no business back-ground to support us, we started in the pureplay guts and glory manner with two rented computers in a genera-
ANNIVERS ARY EDITION
Name of the enterprise: Magnon Solutions Private Limited Domain: Digital Media and Web Solutions Turnover: Approx. 15 crore Set up in: 2000 Employees: About 125 people Headquarters: New Delhi Website: www.magnonsolutions.com, www.magnoninternational.com
tor room. Today we employ over 120 professionals, have worked with over 1500 clients across 16 countries and have been ranked among the Top 25 most promising Internet companies in India. Like most smart entrepreneurs would agree, the key ingredient towards this growth has to be quality human resources that shares a collective vision with the Management. We were lucky to have recognized the importance of developing and retaining a loyal and capable line of leadership within the first one or two years of our existence. However, once we were thick into the corporate battleground, we realized we were extremely vulnerable to poachers and competitors who were ever ready to take our best people away. And since we were a high-quality, high-skills organization and had valuable intellectual capital, we soon became a favourite hunting ground for hunters. We would hire people. We would train them. And then, they would be snatched away by a larger company! We almost felt like a training school where we would hire good people, groom them personally and then lose them to giant corporations who loved picking up professionals trained in an entrepreneurial set-up.
We are a full-service digital agency that has assisted over 1500 clients across 16 countries in deriving maximum value from the Internet. We offer solutions across the digital spectrum creative, technology, search and interactive marketing.
We have lost our people to almost every large technology and media company in the country. The reasons were simple. While we were a growing company and were very committed to developing our people, we had nothing else to offer in terms of tangible value. Our brand was nearly unknown at that time. We could not pay hefty salaries and perks. And we did not offer a world-class working environment either. People also viewed issues of future growth ladders within a small company as an issue. But sometimes retention is not a difficulty only in the face of competitive threat. Sometimes certain other aspirations of your people need to be met. In 2006 one of our star Client Support Managers wanted to move on. She was doing very well with us and had seen
We would hire people. We would train them. And then they would be snatched away by a larger company! We almost felt like a training school
stellar growth in the two years that she spent with us. However, on enquiring about her decision we discovered that she wanted to pursue a management degree. While we respected her reason to leave, we also knew it would be a blow to our Client Support department. We decided to work hard on ﬁnding a solution. On spending several hours together we bumped into a win-win situation. We not only elucidated our sincere vision for her growth and her role in the company, we also made her realize that she would grow faster with us than if she spends two full years in sabbatical. And to support her dream for further education, we decided to sponsor her for an evening Executive MBA program with one of the leading institutes in New Delhi. Today she is with us and leads a crucial SBU. So the challenge to retain quality people can present itself in various forms. But we had committed ourselves to combat every such hurdle. To retain our human resource in this knowledge-driven industry, two things helped us. One, our 100 per cent year on year growth enabled us to reinvest in the business and see incremental improvement in our ability to hire and retain. While the second and more proactive effort that worked for us was that we collectively decided to make people and leadership development a mainline priority for the Management. I personally spent (and continue to spend even today!) hundreds of executive hours on talking to people we want to retain and groom. Together we are working towards becoming the deﬁnitive digital media leader in India. And perhaps, in the digital outsourcing space we will achieve that within the next three to ﬁve years. But what is important is that we as a team are together and believe that our story has only just begun. DARE.CO.IN | OCTOBER 2010
Manpower Management Entrepreneurs have been experimenting with a surprising level of success in the area of HR motivation. Less control and more flexibility has worked for many while self motivation and driven workforce is the underlying factor for everyone By Shradha Mohanty 98 OCTOBER 2010 | DARE.CO.IN
ANNIVERS ARY EDITION
otivate. Engage. Retain. This seems to be the mantra that every entrepreneur should keep in mind if he wants to keep his best employees in his organisation. However, in our interactions with various SME CEOs for our anniversary issue, we found out that it’s not just three elements but a lot more goes into retaining employees. An analysis of the likely problems and challenges that one faces with regard to human resources are given below. Vaibhavi Thakkar from Blend Finance shares her experience saying “The biggest challenge
while we started this enterprise was getting appropriate human resource i.e. right people at right time at right place. We neither had a swanky office which would have enabled us to offer them quality work atmosphere nor brand nor colossal packages. We only had 'A Dream'. A dream to become an integrated financial power house offering end-to-end solutions to SMEs & MMEs.” She adds that she was lucky to be able to sell her conviction to people and pursue them to work with her. Today she believes that her company is doing well because the people at Blend Finance maintained a a proper set
Challenges that SMEs face when dealing with Human Resources • Lesser packages offered by SMEs • MNCs provide better offers to the employees • Employees not motivated by business idea • No change in work process • Failure to understand the employee’s needs
of fundamental values, ethics and transparency at the core. For an entrepreneur of a small and medium enterprise, which has been recently set up, it becomes extremely important to recruit people who are motivated and driven by the business idea. This ensures a high sense of professionalism in the work environment because all the employees ﬁne tune their own style of working to achieve greater synergy among each other to convert the ‘dream idea’ into a reality. The biggest threat to any SME in procuring or retaining its best human resource is that there will always be bigger companies which will offer better pay packages. In an effort to escape the competition that MNCs posed, Allwin Agnel of PaGaLGuY.com decided to stop hunting for people at places where the MNCs were regulars and started looking for people who wanted to do something different. “Sure, we have had tough times—but when people are determined to build a world class product/company, most of the limiting factors are automatically taken care of,” says Allwin The entrepreneur has to keep changing the work trends within the organisation which will make the employees feel that what they are being offered here is way better than what they will receive in a bigger organisation. These can be anything DARE.CO.IN | OCTOBER 2010
“We neither had a swanky office which would have enabled us to offer them quality work atmosphere nor brand nor colossal packages.” — Vaibhvi Thakkar CEO, Blend Finance
“The biggest threat to any SME in procuring or retaining its best human resource is that there will always be bigger companies which will offer better pay packages.” — Allwin Agnel
“An appropriate training program which equips the employee with appropriate knowledge and skills helps in employee retention.” — Shamit Khemka CEO, Synapse
like introducing ﬂexible working hours to a change in delegation of work which puts the employee in a responsible part in the organisation. “We have created a ﬂexible work model, within which people have the opportunity to realize their potential. We make certain that the supreme thoughts are used, exploited and deciphered into new products, new services and new businesses for utmost gain and return on investment,” says Varun Mirchandani, Director, Onicra, a credit rating agency. The work environment should encourage discussions thus allowing the employee to speak his mind freely. This gives room for a steady exchange of ideas and strategies and makes the employee realize his worth. The work culture should be such that the employee knows what is expected of him and what are the targets he needs to ﬁnish each and every day. This gives him a sense of accomplishment. Work appraisals following the successful completion of these daily targets motivates him further. A proper and constant feedback system is essential as it shows 100 OCTOBER 2010 | DARE.CO.IN
that the CEO keeps himself involved with the employees and has a keen interest in their well being. “There were times when I spent more days and evenings with my teammates than with my family. Moreover we made sure that people who performed and were attitudinally in tune with the company’s culture were offered not only radical growth but were also consistently made aware of the larger goals and ambitions of the company,” says Vineet Bajpai from Magnon Solutions. The entrepreneur himself should make the people working under him think like entrepreneurs and take control of the organisation’s functioning. Another step towards retaining HR is by process orientation. “When we gained the CMMI certiﬁcation and went through the learning processes, it helped a lot in educating our staff, allowing them to grow, being more process oriented and experience the environment of a larger company in a smaller company,” says Shamit Khemka, Synapse. An appropriate training program which equips the employee with appropriate knowledge and skills helps in
employee retention. This is something that bigger companies can do for their employees in bulk as it becomes expensive for the company. After the CMMI certiﬁcation program was implemented Khemka says, “Around 2005, our attrition was about 25 per cent, while in last 6 months it has been about 11 per cent.” Other factors which should be kept in mind when handling employees is making sure that all the employees are treated fairly and that proper opportunities are given to them to grow. After all this, the leader should have complete belief in his team to take the next step forward. “It has not been an easy journey. I have had my share of ups and downs. All I can say is that it has been possible only because of my unﬂinching devotion to the belief that I carried with me and passed it on to the great team of people around me,” says Faisal Farooqui from Mouthshut. com. It all boils down to the fact that CEOs need to identify what is it that keeps the workers engaged in their work and use that information to their beneﬁt.
Name: Gurvinder Pal Singh Age: 47 Education: 3 year polytechnic diploma Experience in business: 17 years Leadership style: Empowering employees to let them take decisions, making leaders out of them and maintaining transparency in the organisation. Big learning: If you believe in yourself and your team, you can take on all challenges with enthusiasm, stand against all odds, ďŹ ght against them and turn the situation around.
Head on with technology challenges One of the toughest challenges was to standardize the process of making a coil in house, which required estimating the defects and overcoming the quality problems By Gurvinder Pal Singh he famous quote by Nobel laureate Rabindranath Tagore became a crucial part of the philosophy of life for me. It was fascinating to work on new technologies in air conditioning as we were committed to providing this to our customers. It took a great deal of clear thing and tons of hard work to get where we are today. Fortunately, we were blessed with a team that never complained about going that extra mile. There have been phases when many of us have done 20-hr days for weeks on end and traveled tirelessly around the world to bring in the lat-
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est in technology. We, that is, Advantec Coils Private Limited (ACPL), aim quite clearly to emerge as the name behind a new generation of
Our team takes each of the quality issue as a challenge and applies techniques like quality circle to come with a solution
air conditioners that are effective and extremely energy efficient. We are determined to get there. I have been fascinated by technology from the very beginning of my entrepreneurial journey and, therefore, have made innovation the very basis of our business model. It was my resolve to pursue a business in the technology space and stay well away from commodity products. So, primarily, I was drawn to the HVAC (Heating, Ventilating, and Air Conditioning) industry because it involved technology. This belief has always guided our busi-
ANNIVERS ARY EDITION
Name: Advantec Coils Pvt. Ltd. Domain: Manufacturing Indoor Units of Split ACs Turnover : 180 Cr Set up in: 1993
ADVANTEC manufactures Indoor Units of Split Air-Conditioners for a wide range of models, marketing its products to almost every leading Air-Conditioner Manufacturer, both in India and abroad.
Employees: 800+ Headquarters: New Delhi Website: www.advanteccoils.com
ness strategy. Innovation has consistently motivated me to stretch beyond the ordinary and the satisfaction of offering a new product to the customers has been the most precious reward. I have a ﬁrm belief that survival in this competitive market depends on technical superiority and operational excellence. Guided by the above principles our company, started moulding indoor units or IDUs of split air conditioners in India (others were importing the indoor units at that time). Owing to this early start we are now able to offer a wide range of aesthetically crafted IDUs. In addition, we have built an in-house capacity to mould blowers for the IDUs. Our latest foray is into micro channel heat exchangers (MCHX), a cutting-edge technology that is likely to deﬁne and dominate the future of the HVAC industry in India and around the world. The aluminum-reliant MCHX technology is highly efficient, lighter and compact as compared to the conventional coil-based units. That means products made with MCHX coils are more energy efficient and environment-friendly. They consume less quantities of the R-22 gas that is traditionally used in air-conditioning and refrigeration applications. They are also more amenable to recycling.
We have established the ﬁrst comprehensive production facility in Himachal Pradesh to offer MCHX coils in India. The project was established in a very short time of six months including land acquisition. We have always believed in opting for in-house production of all our key inputs as compared to importing them. That is the reason we have set up a vertically integrated facility. Introducing MCHX in India was a tough challenge. As we were the pioneers there were no existing standards, processes or learnings that we could draw upon for setting up and managing the facility. There were in fact no established supply chains either. On the other hand, there were unique challenges to be met. For, example the product had to be customized to suit the
I was very clear about not getting a business that deals in commodity products. Technical niche is my litmus test for venturing into HVAC industry
unique characteristics of the Indian market, which was completely based on the older technology. But tough as it was, we found the experience to be extremely edifying and exciting as it yielded so many new learnings. One of the toughest challenges was to standardize the process of making a coil in house, which required estimating the defects and overcoming the quality problems. Our team took each of the quality issues as a challenge and applied techniques like quality circles to come up with solutions. We believe in keeping ourselves constantly updated with the latest advances in technology and, therefore, travel a great deal, particularly to China and Korea. Every piece of data and intelligence collected from our travels, is then carefully and critically analyzed to help us absorb the most efficient and advanced practices. The analysis involves me and the operations and development team. The essential motto of our business is to work at the cutting edge of technology and to introduce new thought, innovation, processes and practices that would help the growth of the entire industry. We believe in delivering optimum value to customers by marrying our own strengths with the best the world has to offer. DARE.CO.IN | OCTOBER 2010 103
Name: Hema Malini K. R. Age: 41 yrs Education: B.E. (Mech) from UVCE, Bangalore & M.Tech from GTTC, Bangalore Experience in business: 10 years Leadership style: Design & Development, State of the Technology Big learning: Face challenges before you and you shall see the light at the end of the tunnel.
Surviving a global recession One of the biggest problems of SMEs is lack of awareness of just how much one could do by talking to financial insitutions during a tough time By Hema Malini K R and Srikala Bhashyam he year 2008 was probably the toughest year for most small and medium enterprises in India. It was no different for us at Incite Cam Centre. What made it tougher was the capital investments made in the preceding years through bank loans. My copromoter Radhika and I had committed even our personal funds for the expansion as was the case with many SMEs. But the downtrend during 2008-09 was one of the tough periods for our 10-year old company. But entrepreneurship is all about managing business cycles and chal-
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lenges. More so in the early days of business as tough economic environment at different points of time also teach business practices which even biz schools donâ€™t teach. So it was no different for us. In fact, having seen the tough environ-
Entrepreneurship is all about managing business cycles and challenges
ment and pulled through the recent downtrend, we are looking to take our business to the next level. To get back to the story in the downtrend period, Incite faced a numerous obstacles in 2008. Our client base revolved around healthcare and auto but the latter had its own problems. In fact, for the auto sector, the trouble had begun much earlier, as early as 2007. As many would recall, even during the economic boom in 2007, the second half of the year witnessed a lull period for the auto sector. In fact, a big saving grace was Toyota Motorsâ€™ decision to pursue
Name: Incite Cam Centre Domain: Design and Manufacture of Pressure Die Casting Dies, Jigs & Fixtures and SPMs Turnover: 3.5 crores Set up in: 2000
ANNIVERS ARY EDITION
Incite CAM Center Manufactures Injection Molds, Diecasting Dies, Prototypes & Checking Fixtures in 'Tool Room'; Manufactures and supplies rubber components, plastic components, precision machined parts and Aluminum castings in ‘Production Unit’ and provides Engineering Services in the areas of CAD/CAM and Die, Mold, Jig & Fixture Design.
Employees: About 55 people Headquarters: Bangalore Website: www.incitecamcentre.com
its small car project despite the economic conditions. Being a tier-one vendor to Toyota, our order book was steady and production capacity was running without much trouble. Spurred by Toyota’s grit, we took a conscious decision not to cut down on our human resource. To keep the show going, we pushed up the focus on business development and increased the focus on projects that demanded innovation and smart solutions. We took up a number of projects to sustain volumes and used them as an opportunity for future selling. The biggest help came from the bank which allowed restructuring of debt so that we could pay up only the interest component of the loan which in turn reduced cash outﬂow. The rest, as they say, is history. The downtrend has been forgotten by both large and small players and every company is sporting a healthy order book. In fact, there is again the need for second round of capital investment, expansion of resources. Companies have been forced to scale up in quick time to meet the growing demand. So we took a step back and thought about our options. Should we repeat our actions of 2007 when we expanded rapidly? We had learnt a few lessons from the last economic cycle
and carefully put down a strategy to avoid the pitfalls. Though we have a long way to go in implementing them in totality, here are some takeaways for other entrepreneurs from our turnaround story: • Be aware of funding options: One of the biggest problems of SMEs is the lack of awareness on the ﬁnancial resources front. For instance, during the downtrend, the Government and Reserve Bank of India had mandated banks to restructure loans for all corporate borrowers. This enabled borrowers like Incite to repay only the interest component on loans during 200910 thus reducing the burden on cash ﬂow. For some reason, SMEs don’t have the knowledge on these issues and banks too don’t inform them proactively. We could come out of tough times mainly because our cash outﬂow on our loans came
We negotiated with the banks so that we can pay only the interest component. The banks agreed
down considerably during choppy market conditions. • Keep your human resources: Laying off personnel is an easy option for any enterprise struggling to its operating cost low. But acquiring relevant talent is a bigger challenge for an SME than a large corporation. Hence, keeping the trained staff pool adds value in the long term as it enhances employee retention. Incite, for instance, didn’t resort to job cuts and that proved a big advantage when the economic recovery came about in quick time. • Decide whom you want to deal with: Every business cycle forces the management to restructure its strategies and it is a necessity not luxury. If initial years are all about customer acquisition and volume growth, the second phase should focus on revenue per customer. Incite has taken a conscious decision to deal with the big and the best in the industry as not only does it ensure stability but also addresses the problem of receivables. Today, Incite boasts of some of the biggest names in the auto and healthcare sector. But, Tt wants to move away from a few activities that it offered a decade ago. Today, the company wants to position itself as an integrated player in the components segment using CAD-CAM. DARE.CO.IN | OCTOBER 2010 105
Taking technology global Technology is always a challenge to handle. It is one area which requires continuous attention and investment in R&D By Nimesh Sharma "This is perhaps the most beautiful time in human history; it is really pregnant with all kinds of creative possibilities made possible by science and technology which now constitute the slave of man - if man is not enslaved by it." –Jonas Salk
echnological changes have had a major impact on the way business is conducted. We witness the impact of these changes at different levels. If Intel invents a new chip, it is known to the whole world immediately. If Facebook
uses a new application, it is ‘liked’ and ‘shared’ immediately through the Internet the world-over. However, if a passionate grassroot level entrepreneur invents a ‘remote-controlled tiller’ in some far corner of the country, it is not
“Technology adoption remains a challenge for SMEs as many haven’t been able to overcome the obstacles of reliability, adaptability and total cost of ownership (TOC).” - Pratik Chube GM-Product, Emerson 106 OCTOBER 2010 | DARE.CO.IN
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“Our technology boosted assessment test now remembers its last state and resumes from there.” — Varun Aggarwal CEO, Aspiring Minds
The business challenges for which we expect technology to help us 1. Speed – Every business wants to spend minimum time on each business process and transaction, so that it can do more of it in available time and make more money. 2.Collaboration – Its a challenge with every organisation to have their team members and clients collaborate as easily as possible, and in as much real time as possible, so that customizations, changes can be discussed, known and implemented in minimal time. QUICK ANALYSIS
known to the whole world immediately, but takes a lot of time. All these inventions have had a lasting impact on our business and personal lives, doesn’t matter if they were high-proﬁle or not; whether we knew about them or not. From an invention point of view, we were happy at the sobriquet of “Serviced from India” and not “Made in India.” We wouldn’t want to do products. A myth went around that India is not good at products and just as they say, our businesses came close to proving our own prophesies true. Not entirely. You will read about a dozen businesses in these pages who have deﬁed odds to be in the business of products. They are not the typical Tatas or the Infys. They are much smaller but mightier in their resolve. They have been shunned in the global market for lack of R&D or adequate domain knowledge. You will read about how their perseverance paid the dividends in the end. The message one gets from this is: ‘Taking one’s technology or products to the global arena is the best test an entrepreneur can face.’ However, domestic enterprises also face equally tough situations. Consider the issue faced by Varun Aggarwal, CEO, Aspiring Minds,
3.Access – Businesses have faced the challenge of crossing boundaries. Everyone wants to expand their market, beyond their locality, city, state, and country. This becomes more imperative if the same-industry and cross-industry rivals are doing it. 4.Multi-channel interaction– Days are over when businesses interacted with clients over just ‘snail mail’ and phone. Customers now demand for faster and more channels of interaction for organizations to listen to them, while the latter want to spend more time on getting more business. The time crunch on part of both requires more channels like email, fax, chat, conferencing, blogs, Facebook and now even Twitter. 5.Process Automation – Businesses need to multi-task more and more. In the heat of competition, they want to spend more time on improvising quality of products and services or other productive pursuits within the same available time. Taking help of technology becomes indispensable as it saves the precious time. So, processes need to become automated and more streamlined.
a start up engaged in creating candidate assessment tests for companies. Aspiring Minds faced problems in running assessment tests on institutional infrastructure in colleges, universities and schools because of lack of power-backups, network issues, and viruses. “We have been able to solve this technologically, after which we have run tests at more than 700 institutions with a setup time of 20 minutes and no glitches. Even on power failures, the test remembers its last state and resumes from there.” Technology does not stop at R&D alone. The environment one builds around and the processes followed to nurture skills and talent matters a lot. Take the case of Shamit Khemka, CEO, Synapse India. He obtained the CMMI Level 3 certiﬁcation for his ﬁrm and got the
processes in place. Once done, he realized that he is experiencing a big company within his small company. “The added beneﬁt was that apart from helping us in getting company processes in place, the process-orientation ended up helping us in curbing attrition." Similarly, Vipul Prakash of Elixir Consulting has extensively invested in processes and systems to streamline their procedures and to be able to offer a unique experience to their clients, different from any other HR consultant. You will also read the stories of how entrepreneurs met challenges with the aid of technology. Vibhas Prasad of Leisure Hotels faced the problem of geographical remoteness concerning reservation by guests in his resorts/ hotels. “We used Central Reservation Office, a DARE.CO.IN | OCTOBER 2010 107
TECHNOLOGY “For scheduling transportation in our BPO, we created an IT workflow tool that could let people choose a time of their choice and a back-end to assign cab which has worked well for the company’s cost and employees’ morale”. — CS Pandey Ex VP, Recruitment & Resourcing, Steria
product by IDS, which interfaces with Property Management System, and shows real time availability of accommodation, details of rates, instant allocation, etc.” For Parichay Upadhyay of New Look Cosmetic Laser Clinic, the
“We do a lot of R&D to customise the treatments for our clients in India and overcome our challenges as there cant be any mistakes and retakes in our industry”. — Parichay Upadhyay New Look Cosmetic Laser Clinic 108 OCTOBER 2010 | DARE.CO.IN
challenge is to customise treatments for brown skin (Indian people) while machines that can only be imported are manufactured to be used for white skin people. “We do a lot of R&D to customise the treatments for our clients in India. Sample this: White skin can bear laser of 30 joule/sq. cm, but its only through R&D and practice that we decipher that brown skin can only bear 15 joule/sq.cm and develop the expertise. And that is how we overcome this challenge as there cant be any mistakes and retakes in our industry”. In every sphere of business activity and in every industry, technology has helped us, be it marketing, HR, finance, strategy, operations. For marketing, we have various technologies like SEO, SEM, statistical softwares for MR. In HR, we have now complex HRIS, employee management software, electronic attendance systems, salary calculation softwares and so on. In Finance (BFSI), there are softwares to calculate insurance premiums, calculate NAVs, complex banking softwares from companies like Oracle and Wipro,
stock market beta calculators and many others. Companies like Capital Market Publishers offer softwares such as Capitaline, while Prowess is offered by CMIE which help organize huge information about other companies, to help in strategizing for M&A, stake sale and private placement of equity, etc. Information Technology itself has helped businesses collaborate, communicate, organise people and manage tasks more effectively. ICT in education today holds such a huge scope that it is poised to be a billion dollar industry in next 10 years. The problem it is solving is making education available in ways far more interesting than current teaching pedagogy, and to a wider and more geographically spread audience. For instance, Educomp is using higher technology in its Educomp Leap centers outside Delhi, where it intends to virtually provide veteran teachers to learners in remote areas, in class sizes as small as 50. How else could this be done? Technology, whether it is developed or used, is the cutting edge of human mind. As John Bronowski says in Ascent of Man, it is this cutting edge which determines the maturity of man and ultimately society or in our case the business.
INITIAL CHALLENGES SNAPSHOT
Name: Sandeep Parekh Age: 38 Education: Masters of Law Experience in business: 11 years as lawyer, 2 years as regulator, 2 years as academician before starting my law ﬁrm Finsec Law Advisors in 2010 Leadership style : Inclusive leadership. Big learning: If you don’t dream you don’t get.
To be or not to be For every successful entrepreneur there would be many who tried and failed but the rest of us try in any case By Sandeep Parekh
ntrepreneurs face many challenges. But the biggest one has to be the existential one, whether to be an entrepreneur or not. That is the question. This question, of course, hides many other issues and problems faced by a person who is thinking of taking the plunge. It is clear that many of the most successful entrepreneurs are those who have little to lose in life and take entrepreneurship by diving at the deep end of the water because the hardships in life leave them with little other choice. A careful analysis of risk and returns—if there are alternative sources of returns—always reduces the chance that a person becomes an entrepreneur. It is no wonder that few people from the IIMs actually become entrepreneurs be-
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cause the degree not only gives you a comfortable job with certain revenues but also makes you over-analyze the risk return proposition. I would rank my father as a true entrepreneur, who walked into Delhi with a hundred rupee note; with a mediocre school education from a small town and a will to succeed; to compete in the rather intellectual area of being a lawyer in the Su-
The best time to start an enterprise is yesterday
preme Court. He became a sought after and respected lawyer within just a few years despite his initial shortcomings. He took the deep end, because there was no shallow side for him. I was placed at the other end of the spectrum. With a good education at an English speaking Delhi school and then a foreign education, except for the ﬁrst few years having led a comfortable life, fate presented me with an equally, in some ways, more difficult choice. A comfortable predictable life with known income, a well-built corporate structure where you walk in at 9 AM, work hard on your legal skills and lead the ordinary life. Or a life with little predictability. A life where there was a possibility of complete failure, uncertain
Name of the enterprise: Finsec Law Advisors Domain: Financial sector boutique law ﬁrm Turnover: NA Set up in: July 2010
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To create a professional ﬁnancial sector law ﬁrm which attracts the best talent and gets not just money but satisfaction from working at the ﬁrm.
Employees: 3 people in all Headquarters: Fort, Mumbai Website: www.ﬁnseclaw.com
income and certain expenses. A place where not only must I do legal work, but pay the electricity and phone bills, keep records of correspondence and answer my own calls. But there is something about entrepreneurship which attracts us. In fact, for every successful entrepreneur there would be many who tried and failed, but the rest of us try in any case. I was faced with the crossroad just a few months back. I had an offer from a large law ﬁrm which I nearly accepted. But the process of working on the ﬁne print from the law ﬁrm’s end took so long that it gave me pause for thought. Waiting for the ﬁnal offer to materialise helped me introspect and think about the choices I had. I made six phone calls one ﬁne morning to people I respected, including my father and shared my choice with them. It so happened, that all six voted for the new venture, a professional ﬁnancial sector law ﬁrm of my own. One person whom I called, an entrepreneur himself, said, "The best time to start an enterprise is last year." Clearly, I was going to get more risk averse as time passed. I took the plunge. There are payoffs, of course. Besides the possibility of success and the chance that there will be enough
money to run the house, there is an inﬁnite upside in terms of success. If you start from zero, there is a good chance that you will be more than a zero in a few years' time. The personal and professional high that you get out of creating and nurturing your creation is the real reward more than anything else. For me, it was this and more. I was looking forward to professional growth and personal freedom. I have always had the dream of creating an organisation where people would be really happy to work, where there would be no office politics and where people would give credit and not snatch it from colleagues. I wanted to create a ﬁrm which provides the very best of services to its clients, a ﬁrm which is a complete meritocracy,
The personal and professional high that you get out of creating and nurturing your creation is the real reward
where ﬂattery has no place. Here was a chance to create that place. I have also wanted to create an organisation which has a material impact on society. My exposure to IIM, Ahmedabad as a faculty also helped create the person that I am. IIM-A is a place which sets few targets and which helps you draw your own goals and targets and give yourself appropriate debits and credits. In short, it prepares you for entrepreneurship. Another aspect of IIM-A is that it helps you think in terms of output rather than input. So Finsec, my ﬁrm, would be a place which will deliver the best service to the client, but remain wholly agnostic to the fact that the work was done from either the office or from a Barista coffee shop. Finsec will hopefully never have attendance registers and other measures of input, but measurable outputs with modern management techniques used to maintain the entrepreneurial spirit alive even when it is much bigger. Finally, the many networks that I have developed and the people I have come to know from my professional contacts at law ﬁrms, SEBI and IIM-A besides networks like the World Economic Forum of which I am an active part, gave me the conﬁdence to go for creating a new venture. These are some rather unique and valuable networks when put together. Having said that, the decision to be an entrepreneur must also be rational. To enter a ﬁeld which is full of competitors or which has few entry barriers, is not a good idea. Entrepreneurship must not defy economics and steps which are taken towards beginning something new must understand the hard facts of a competitive landscape. I certainly did calculate the various factors at play in the legal market before I decided to take the plunge, and I do know that I am still aﬂoat. So that is a good sign I guess. DARE.CO.IN | OCTOBER 2010 111
INITIAL CHALLENGES SNAPSHOT
Name: Hanuman Tripathi Age: 49 Education: MBA in Marketing from Jamnalal Bajaj Institute, Mumbai. Diploma in Marketing & Sales Management, Bachelors degree in Science Experience in business: 28 years Leadership style: Passionate, people-oriented and knowledge-driven Big Learning: Plan gestation period funding and build support organization
Taming gestation period funding Planning for support oranization upfront is essential for scale. Investing in HR, accounts and facilities upfront is good in the long term By Hanuman Tripathi had a long professional career before I founded the present day InfrasoftTech 15 years back, along with three other founder colleagues and our angel investors. Prior experience was extremely useful in creating a methodically structured business plan for commencing an entrepreneurial organization, with scalability built to suit the needs of banking industry that we were planning to serve. Going by my some past experience, I knew that exclusion of HR, Marketing, Finance, Facilities & Systems in a start-up organization can save costs but can spell com-
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plete disaster. These costs have to be seen, not as indulgence but investments for building a scalable organization with manifold beneﬁts in the long run. An integrated organization built this way deals much better with people’s aspira-
Detailing each line item for each major action in the business plan came in handy.
tions, creates a strong fabric of policies and procedures that help to imbibe a corporate culture, creates a process driven organization and above all it creates an environment of setting business goals, individual KRAs and boundaries and ﬁnally build a review mechanism for meeting organisational goals. With no illusions that all will move smoothly in the inception stage, we tried anticipating hurdles and we were prepared to ﬁnd solutions as we go forward. What came handy was detailing of line items for each major actionable element in the original business plan, that
Name of the enterprise: InfrasoftTech Domain/Industry: IT products, services and solutions for BFSI sector Turnover: Forecasted 120 crores in organic revenue
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The company specializes in IPR driven product development for the BFSI sector. One of its current focus areas is to develop software solutions for microﬁnance institutions and small banks with the end objective of building mass-scale-ﬁnancial inclusion, globally.
Set up in: 1995 Employees: ~500 Headquarters: Mumbai Website:www.infrasofttech.com
probably led to more successes and less failures over time. Undoubtedly, there was stress to handle and some failures to rework around from time to time but the end result was achieved as desired. In the beginning, the integration of support functions as business partners to the operations team was a challenge, with the operations team seeing the corporate organization members recruited from outside as an avoidable cost. However, I could make everybody see each others value and over short period of time the corporate organization was beginning to be seen as one of the most valuable business partners to pre-empt failures, tie open issues and induce success in all aspects of the organization. My biggest challenge came in when the original committed investment came to us in several installments, whereas certain upfront investments were essential in infrastructure, people, equipments, software, etc. Hence, we were compelled to accelerate our Go-To Market program to start generating cash faster and close the gestation period early. The solution lay in building our products faster at lesser cost. At this juncture, it was important to
ﬁre the spirit of entrepreneurialism in each team member which I am happy to say was received well. Secondly, it became a time-bound priority to position the company as a commercially viable option and thus, the focus on sales was intensiﬁed and expedited, whereas usually sales and marketing is invested upon by most entrepreneurial organizations much later. In the end, we became commercially viable in half the time owing to a wonderful team work and some luck. In hindsight, the core beneﬁt of this experience has been that we have learnt to stay proﬁtable and cash efficient throughout in the last 15 years. My belief is that to create a successful entrepreneurial venture, it is important to plan your gestation period funding properly and also build corporate support organiza-
We accelerated our Go-To-Market program to generate cash and close the gestation period.
tion to ensure that ops team is not loaded with pressing problems of cash ﬂows, recruitment and onboarding of new people and building and maintaining infrastructure. It is also critical that the sales organisation is built early in the life cycle with high level of result orientation and integration with delivery teams. Lastly, it is with transparency and equitable work that an entrepreneur can draw greater commitment from the core team members who form the backbone of the organisation. Critically, utilisation of optimal resources and reduced 'time to market' is the mantra, as market realities change very fast, both in terms of demand and new competition. Our operating philosophy has helped us dream big. We want to be $100 Mn company in next 3-4 years. We are focused on latest generation core solutions in global markets. We are covering AML and Islamic Finance sectors in a big way. Much of our growth will emerge from these two sectors domain-wise. Geographically, we expect growth from Middle East & South East Asia and US. We already have a strong presence in the UK. DARE.CO.IN | OCTOBER 2010 113
INITIAL CHALLENGES SNAPSHOT
Name: Vibhas Prasad Age: 31 Education: B.Com, M.Com, Exec Prog from ISB Experience in business: 10 years Leadership style: Democratic Big learning: Life is what you make of it! You can choose any option for yourself in life for good or for bad. However, your success will depend on your passion for your chosen option.
If you build, they will come I was born into a business family but it took much more than that to build my business By Vibhas Prasad arly on in my career, soon after I completed my M.Com from Mumbai University, I remember debating long and hard between whether I wanted to be a professional or an entrepreneur. However, it took me less than two years of working with a large finance company to realize that this was a no-brainer: business it had to be! It simply had to be. Hailing from a family that had for more than a century run a sugar mill out of Pilibhit in Uttar Pradesh, it was not difficult to see why. I had spent all my growing years watching a live business in operation, which
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obviously and almost imperceptibly had honed my instincts for business. I was born to a business family and now I was ready to do it on my own. I could sense fairly early in my life that I was a 'natural' when it
I worked in a large ﬁnance company to realize that I had to be in business
came to analysing risks and returns and identifying potential business opportunities. My limited role working with an Asset Management company could only provide me with so much. The adrenaline rush that comes from running one’s own business in ﬂesh and blood is irreplaceable for those who have tasted it. And so I joined my family business—not the sugar but the hospitality business in early 2003. Over the previous years, I had seen the Indian hospitality industry, up close and personal. Other than our sugar business our family also happens to run the largest hotel chain
Name: Leisure Hotels Ltd Domain: Tourism and Hotel Sector: Resorts & Luxury Camps Set up in: September, 1989 Employees: 500
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Operating resorts and organising luxury camps in across 20 odd properties in Uttarakhand. About 15 per cent of the properties is actually managed under ‘management contracts’ on others’ hotels/ resorts.
Turnover: Conﬁdential Headquarters: New Delhi Website: www.leisurehotels.co.in
in the state of Uttarakhand by the name of Leisure Hotels Ltd, with more than 20 properties across 15 locations. There are another 10 in the pipeline across the state and elsewhere. We tweaked the old model of running only owned properties and forayed into the areas of managed properties and short duration camps, which have a small gestation period. While initially, human resources and brand visibility were an issue, we realized soon enough, that—if you build, they will come. Since we were unable to fund new projects from internal accruals alone, we decided to aggressively raise debt to build some new large properties. Sure enough, this saddled us with debt servicing burdens that could not at times be fully met by the cash flows. However, even as we chased growth, we never lost our balance. In other words, our aggression was always within limits, tempered by prudence. Therefore, while plenty of debt was available, we heeded the advice of our finance managers about the importance of ensuring that we stayed within the safe limits and adhered to sound business principles.
There is enormous potential in the hospitality sector, even as India realizes its full economic potential and breaks out of the shadows of the past. We want to be one of the players leading the charge in this exciting sector, be right there among the leaders. With this in mind we are steaming ahead and pushing to take our hotel business to the next level. There is no doubt that this will call for deep pockets and even deeper resolve. But we have reasons to believe that we do not lack in either. Experience has proved that with thorough planning, strong conviction and drive anything is possible. We have a plan for getting there. For this I am working closely with our advisors: we are essentially identifying the most effective ways of raising funds that can help us stay ahead of the growth curve
Divesting non-core activities, raise PE or entering into JVs help in raising funds
that we have set for ourselves. Various options are being considered to fuel the growth including divesting non-core assets, raising private equity, entering into joint ventures and even bringing in investors for different projects rather than at an enterprise level. Other than raising ﬁnance to fuel our growth as outlined above we are emphasizing on two crucial areas: aggressive marketing across print, outdoor and the Internet media, to increase visibility and human resource planning to ensure that we attract excellent talent for key leadership positions. Given the business we were in we realize that visibility and quality of service are critical for us to stay on top of the game and make our growth sustainable. My background and interest in ﬁnance are of course helping me separate the ‘wheat from the chaff ’. The philosophy of “total guest orientation & satisfaction” has been the guiding force behind the organization’s growth in the last 21 years; we are proud of our rich heritage and even more excited about making a difference in Uttarakhand; “Atithi Devo Bhava” or simply, “Guest is God!” DARE.CO.IN | OCTOBER 2010 115
Contributors GK Pramod
G.K.Pramod known as “GK” is a first generation entrepreneur. Born in a small village in Gorur (Hassan District) in Karnataka, he did his BE and MBA before co-founding Yindusoft Technologies India. GK has now started a new professional organization which primarily focuses on facilitating Micro Entrepreneurial community to grow the business in a systematic way. He has authored a book, “The Second Gear”-Strategizing Business Growth Plan for Micro Entrepreneurs.
Srikala is an investment consultant and an entrepreneur. Prior to being an entrepreneur, she has had a 15-year stint as media professional. Her last assignment was with The Times of India as Special Correspondent. She is currently a columnist for DARE, Economic Times and MSN India.
Vimarsh Bajpai Manoj Chandran Manoj Chandran heads marketing at Ashoka in India and is part of the global leadership team of the organization. Manoj brings in 16 years of experience in communications and marketing. He was until recently Senior Director–Marketing in MindTree Ltd. Prior to joining MindTree, Manoj was the head of content at CyberMedia India Online, the largest technology portal in India. Manoj began his journalism career with The Times of India in Mumbai. 116 OCTOBER 2010 | DARE.CO.IN
Vimarsh Bajpai is the founder of Samvad Sutra, a Content and Communications Consulting and Training Firm. He works closely with organizations and individuals to help them communicate better. Vimarsh has been a business journalist for 10 years and worked with DARE from its inception till June 2010. His other areas of interest are marketing, funding and intrapreneurship. He has written on business opportunities in rural tourism, waste management, franchising, publishing, salvage management, robotics, etc.
For a franchisee, life begins at 60 Retirement from job could be the ideal time to chase your dream. The good news is, many settled brands might be looking just for you an entrepreneur. For them, there are few better options than a franchise business.
Your cup of tea
tereotype has always associated enterprise with youth. But here is a business opportunity where it pays to be old. For evidence, here is a typical scenario torn off the pages of the franchise business. Ramesh Jain has retired from a government job and everybody in the family thinks that he would ﬁnally settle down to a peaceful life at home. But Jain’s mind is whirring with an idea that he picked up some years back. During a trip to Europe, Jain had been fascinated by the numerous
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coffee shops he saw on the sidewalks and boulevards. Aware of an average Indian’s weakness for a hot steaming cuppa, Jain had decided that one day he too would open a series of cafes. But his beverage would be tea, not coffee. And a few days after his retirement, Jain decides that now is the time to bring his simmering idea to boil. There are many like Jain for whom life begins at 60. They are still full of energy, have plenty of time and dreams of becoming
With the Indian economy growing at a torrid pace, loads of foreign brands have landed in its crowded markets, all jostling for the eyeballs of its booming, nouveau rich middle-class. And then there is already a long list of settled businesses, eager to spread its reach across the market in the face of increasing competition. These trends have created a giltedged opportunity for the franchise business, particularly for the elderly, just-retired people. The trick is to ride with the right brand and become a franchisee for a business that is, well, your cup of tea. Jain, for example, approached a well-known Indian tea-brand looking to set up shop in his city. A few months later, he became the proud owner of High Tea at Jain’s— his own business and dream. There are a number of franchise business consultancy services
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across the country that advises the elderly on opportunities appropriate to them. For example, though the market is replete with franchisees of luxury brands, apparel and electronic items, these may not be ideal for 60-plus entrepreneurs. It may be better for them to instead consider moving into franchises in the business-to-business consulting service space, because these are likely to bring into play their single biggest asset—their experience. Then there are the recession-proof franchises that seldom go bust, in categories like food, beverage and education franchising.
Franchise starts at 60 In the franchise business life literally starts at 60 and the reason, for that is clear. Instead of any exceptional physical vigour, this business demands experience, maturity and perseverance, which are often the strengths of senior citizens. Moreover, by 60 many people these days rustle up substantial personal savings—money they can spend pretty much as they want, since they are free from most liabilities. So, that takes care of the toughest part of starting a business—funding. Also, a senior can draw on his wide circle of contacts, an important advantage in a business that thrives on good networking. Finally, senior citizens enjoy several tax exemptions, meaning that they can save a good part of their earnings. Rajeev Manchanda, Vice President-Northern Council, Franchise Association of India sums up the age advantage: “The elderly are more mature, possess hands-on experience and have access to funds required for initial capital expenditure. The risk of exploring the entrepreneurial aspiration for the elderly is negligible in franchising as the business model is proven and time tested.” If you do not have the money to go into the business on your own,
then you may try any one of the following options: a) Approach the banks for a loan. This works particularly if your franchisor agrees to stand guarantee for the loan. The franchisor also usually helps with the business proposal to enhance the chances of it being approved by a bank. b) Join hands with people known to you who too may want to enter the business. c) Check with your franchisor whether he would be willing to directly assist you with funding on the basis of sharing the proﬁts from the franchise. d) Finally, you may get your franchisor to guide you to a thirdparty lender.
How small is big enough? It is crucial to ﬁnalise the size of the business and accordingly decide on the quantum of investment required. However, unless you have deep pockets, it is advisable to start with relatively small brands and move up from there.
Manchanda explains: “Depending on the industry, big brands usually have a high initial capital expenditure as their model is based on volumes and reach. Thus, the business proposition, though successful, is out of reach for the majority. The investment required for starting a franchise business varies from Rs.5 lakhs to Rs.5 crores depending on the industry and the brands involved.” Running a franchisee business essentially involves adopting and managing the models and guidelines deﬁned by the franchisor as these are usually proven and timetested. This starts from the nuts and bolts of setting up the business, its physical structures and operational details to driving its functional areas. What needs to be understood is that in a franchise the real boss is the brand not the franchisee. But it is precisely because the business largely involves honest implementation of tested models with the support of franchisors that it lends itself perfectly to the elderly who are unwilling to settle down to a boring, non-productive retired life.
5 cheers for 60
“The investment in starting the franchise business varies from Rs.50,000.00 to Rs.5 crores depending on the industry dynamics viz. capital intensive or labor intensive” - Rajeev Manchanda Franchise Association of India
Why the franchise business is ideal for the elderly 1. Success hinged on experience and maturity not youthful energy 2. Senior citizens often have substantial expendable savings— funding not an issue. 3. Does not involve hectic physical activity 4. Entails detailed and honest implementation of existing guidelines 5. The elderly enjoy tax beneﬁts
Sources of Funds a. Personal expendable savings b. Franchisor-assisted bank loans or third-party loans c. Partnership with friends or contacts d. Funding from franchisor based on proﬁt-sharing model. DARE.CO.IN | OCTOBER 2010 119
Inspiration and Insights Knowledge, Ideas on starting up, online / affiliate marketing, funding, and product demos By Binesh Kutty ven though it being Ganesh Chaturthi and Eid, Startup Saturday had many entrepreneurs and aspiring entrepreneurs turning up with their irrepressible spirit. Startup Saturday (SS) Mumbai’s theme was ‘Kick-start Your Dreams’. Aditya Mishra, India sales ops, Core Banking Products, TCS – discussed about key concepts and clear answers for FAQs on B2B sales quoting from his personal experiences. How to start your startup? - was the next session. Rahul Agarwal, CEO, Ideal Insurance catered to the most common challenge of identifying the right structure and understanding legal compliance while starting up. Sanjay Mehta, Jt CEO, Social Wavelength spoke on team expansion. Later, the event ended with lightening pitches by - Cycle Chalao, Travela and Minkle. In Kolkata, Nitesh Ambuj presented a web based tool – ContextMine which can be used by startups, bloggers and professionals to track their markets, product niches and competitors, and has been developed in India by US based - eForce.
This tool is used to track keywords in the world of social media. It was followed by a open house discussion on various topics. SS Bangalore showcased the theme - Making Money Online. Suresh Babu gave some tips on ‘Maximizing returns on the web with minimum investment’. by sharing how free online tools like Google Places and social media tools can help businesses gain more visibility online. He discussed about how we can set up a website for a company through a blog. The next talk ‘Affiliate Marketing’ by Raghavendra Satish Peri, an affiliate marketer, was about the huge potential of affiliate marketing (AM) of businesses online and about various money making AM networks like ShareASale and Affiliate Curry. The session ended with 3 lightening pitches by – Breakthrough Venture Consulting, Saarthi Consulting and MentorSquare - platforms for the startups to gain support & mentoring. SS Pune was based on the theme - funding. The ﬁrst talk was by Ganesh Natrajan of Zensar technologies who spoke about clarity and
conﬁdence required in value proposition to get it across the table. Apoorv Sharma of Indian Angel Network (IAN) spoke next about IAN. This was followed by a speech by Vikas Kumar, co-founder of Brainvisa who emphasized upon writing down a crystal clear, investororiented business plan. Lastly, Kaushik Gala, BDM for venture centre, NCL spoke about the friendly schemes run by government to nurture entrepreneurs, like the SIDBI Risk Capital Fund and CGTMSE. In SS Delhi, Vinay Chadha of GVC Systems gave a demo of his products in electronics and mobile communications which include a device for the train drivers, to turn on the lights at a yard just when the train comes in, and turn them off when they leave. The next talk was by Rabi from iDubba which is trying to create a social network around the TV viewing habits of people. Then there were lightening pitches and networking sessions. Hope you enjoyed this brief roundup. Do reserve the second Saturday of every month (9th October next) and be there! Startup Saturday is an initiative by HeadStart to provide entrepreneurs in each city with a monthly community driven forum that is structured in agenda but open in discussions. A Startup Saturday provides a forum for entrepreneurs to discuss, present, network and learn from peers, prospective customers, adopters, partners and investors. Currently SSs are held in Bangalore, Delhi, Hyderabad, Pune, Kolkata, and Mumbai, on the second saturday of every month. http:// headstart.in/ Inputs from Chaitannya Mahatme, Himanshu Chanda , Ramanuj Mukherjee, Ritesh Goel & Swati Ramnath
120 OCTOBER 2010 | DARE.CO.IN
CLOUD COMPUTING II
Cloud computing is the key that opens the doors for enterprises to a more efficient and cost effective IT infrastructure. Everything can be served through cloud computing, and we discuss the various models you can choose from By Madhur Chawla n 1960, John McCarthy predicted that someday computing would be organized as a public utility. And then, in the early 90s, the term ‘Grid computing’ was coined by Ian Foster, which talked about technologies that would make computing power available ‘on demand’ to consumers. Now, both these statements suddenly make sense when we hear the word cloud computing and the technologies that have made it a reality. Just about every organization today is interested in using cloud computing, but doesn’t know how. Without knowing, it’s impossible to make an informed decision about how to move to it. Simply put, cloud
122 OCTOBER 2010 | DARE.CO.IN
computing is a set of technologies that allows computing applications and data to be exposed as a set of services from a pool of underlying resources. The user doesn’t have to worry about the technologies in the pool. This is similar to running an electrical or electronic device by plugging it to a wall socket. You don’t have to worry about how the power is generated in the power plant. You just want the right voltage to be made available so that you can power your device and use your device. Similarly, in Cloud Computing, users simply focus on the services they would like to use, and not worry about how to implement the software that provides these
services. Even the IT staff that provides these services can easily pull out the resources required by the users from this pool of resources, and put it back when the services have been consumed. The foundation of cloud computing comprises of data centers (servers, storage, networking), the business applications and middleware, virtualization software and of course operating systems. This foundation provides all the applications to the users on a ‘pay as you go’ basis. So the entire workload shifts to the cloud, i.e. local computers are not burdened with running hundreds of applications anymore. All that users need is a
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A typcal cloud computing model.
system interface software, like a simple web browser to be run on their side.
of resources, it reduces wastage and improves resource utilization. It also cuts down the downtime.
Cloud deployment models
The promise of cloud computing is to provide all that most organizations have been wanting for years, but haven’t been able to achieve. Scalability: Cloud computing allows an organization to scale up or down their IT requirements quickly and efficiently, without hampering productivity. It cuts down the time involved in buying & setting up additional hardware, software & other necessary resources everytime a new service is required. Lower infrastructure cost: Pay as you go is the mantra of cloud computing. You pay only for the duration that you use the service for. This helps cut down unnecessary capital expenditure. Since the resources can be pulled out and restored dynamically, a lot of cost related to maintenance, administration, etc is reduced. Better utilization: As the IT infrastructure is nothing but a pool
Most of the time, the term cloud computing is confused with the Internet cloud. It’s very important to understand this difference if you want to be able to use the cloud more effectively. There are basically three types of cloud—public, private, and hybrid.
PUBLIC CLOUD: This is what people normally end up talking about whenever the term cloud computing comes up. This is essentially an external cloud, provided by a service provider. It refers to the resources (hardware, software, applications) that a service provider offers you over the Internet. Email, if hosted with an ISP is the most basic and oldest type of service offered on the public cloud. Now, just about every kind of service you can think of is available in the public cloud (whole list of these services is provided elsewhere in this story). The public cloud follows the ‘pay as you go’ model. You only pay for the services you consume. The beneﬁts of moving to a public cloud are many, with the key one being that you don’t have to worry about managing the underlying IT infrastructure—no security patches or updates to apply, no software upgrades, etc. All these are the service provider’s headache. PRIVATE CLOUD: A private cloud refers to having your own, private cloud computing infrastructure. So instead of relying on an external, public cloud service provider’s infrastructure, you would have your own. A private cloud is more suited for a large enterprise because it has already invested heavily in
The three different types of clouds & the relationship amongst them.
DARE.CO.IN | OCTOBER 2010 123
CLOUD COMPUTING II
The three components of a cloud computing network.
its IT infrastructure, data center, apps, etc. A private cloud typically involves optimizing the existing IT infrastructure, so that it can deliver services to the users faster and more effectively. A private cloud would allow the IT team to provision for new hardware, software, and services for users as and when required. It would provide better control over the entire process of information processing. This helps reduce costs, improves response time, and provides greater ﬂexibility. HYBRID CLOUD: As the name implies, it is a cloud computing environment that consists of internal/ external providers, viz. a mix of private and public clouds. Secure and critical applications are hosted by organizations in the private cloud while not so critical ones are hosted in the public cloud. This combination is known as a hybrid cloud. The cloud infrastructure remains as a unique entity which is bound by a standard technology thus enabling data and application portability. A very good example of this is cloud bursting, wherein the organization for its normal us124 OCTOBER 2010 | DARE.CO.IN
age uses its own infrastructure but moves to the cloud for peak loads.
Types of cloud services Whether it’s public, private, or hybrid, you could run a range of services in a cloud computing environment. These can be divided into three parts—SaaS, IaaS, and PaaS. SAAS: This is the most familiar and proliﬁc cloud service of all. As the name suggests, it provides any software application as a service through the cloud. We’ve all been using software as a service for years in the public domain, with the free email services being the most classic example. Today, there’s a whole range of software applications available through SaaS, be it ERP, CRM, workﬂow systems, document management, and much more. The cloud service provider offers these services, and the users pay as they use the same. This could be on a subscription model, wherein they pay an annual or a monthly fee for the services. Everything is accessible from a web browser, so the users don’t need anything more than that.
INFRASTRUCTURE AS A SERVICE: As the name implies, IaaS is a service delivery model in which an organization is given control over different resources and applications. These resources comprise of storage, hardware, servers, networking components, etc. The consumer need not manage or control the underlying cloud infrastructure in this service model. On demand principle is used in this case as the infrastructure is provided to the user as per his requirements. It often takes the form of virtualized computing environment thus giving freedom to consumers wherein they can conﬁgure & deploy the applications in a virtual image locally. Then without the need to worry about the network infrastructure they can also execute it within the remote environment. Some of the prime examples of it are Amazon’s Elastic Compute Cloud [EC2] and Simple Storage Service. PLATFORM AS A SERVICE: This component of cloud computing can be deﬁned as a set of software and product development tools that allows developers to create applications on the provider’s platform. In other words it allows you to build applications that are delivered to users through the Internet and are run on the provider’s infrastructure. Cost effectiveness is one of the prime beneﬁts of PaaS as organizations don’t need to spend extra bucks for buying and managing the underlying hardware and software. PaaS offerings include facilities for application development and design, testing, deployment and hosting. Web service integration, database integration, security, storage, etc that comes under application services is also included. The prime examples are Salesforce.com’s Force.com and Microsoft’s Azure. The content for this article is sourced from PCQuest Visit their website: www.pcquest.com
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How to Move to the Public Cloud? zHow
Some words of advice before you move to a Cloud service provider By Shikhar Mohan Gupta DC predicts that worldwide Cloud services market will be worth about $43 billion by 2012. And Cloud service adoption will grow at 27% CAGR, which is almost ﬁve times that of the traditional on-premise IT expenditure model. Moving your data or services, applications, etc on to the public Cloud is a conscious yet difficult decision to take. The preceding article on what to move to the Cloud will help clear the air to a large extent. After deciding what you want to move to the Cloud comes the next big challenge —how to go about it? Though the procedures and practices involved in moving to the public Cloud infrastructure are different for each vendor or Cloud service providers (CSPs), there are some common basic steps to follow. Here, we guide you
to cut through the initial hiccups you might face in procuring public Cloud offerings.
Moving to the SaaS Availing Software as a Service may be the most difficult job to decide, because it has the maximum number of options to choose from. There are some very popular SaaS providers out there, including Salesforce.com with its CRM offering, Google and Microsoft with their entire Apps portfolio. Deciding to use the services of such established players may only be a matter of choosing the right partner to do it for you, deﬁning the SLAs, and of course negotiating on the rates. Here again, you would want to calculate the savings that would result from moving to a SaaS provider. A few things to consider here are:
much are you paying for the software licenses locally and how much would you end up paying by moving to the SaaS model? zHow much additional Internet bandwidth will you need for the new service? Your bandwidth requirements would most certainly go up by moving to the SaaS model. How much would they go up by depends upon the number of users and the service itself. On top of that, you’ll need to factor in the cost of providing QoS and backup links, so that the users get uninterrupted and quality service. z Many SaaS service providers provide their services through a partner, and not directly. So, while the SaaS service itself might be from a reputed brand, but if the partner isn’t competent enough, you’ll be in for trouble. Hence, after choosing a SaaS service provider, you’ll need to choose the right implementation partner as well. z How easy is the service to use? Does the SaaS provider offer a free online demo to give you a look and feel of their offering before you decide to use their services?
Ramco’s on Demand ERP We tried Ramco’s on demand ERP solution from their website, ramcoondemand.com. The company offers a 7-day trial to give you a look and feel of the solution and its performance. To register, it requires you to fill out a basic online form to give Ramco an idea DARE.CO.IN | OCTOBER 2010 125
CLOUD COMPUTING II line ﬂash demos to give you a look and feel of the various modules.
The user needs to provide basic information about the company and usage to avail the free trail period from Ramco.
of your organization. You need to specify your industry, number of locations, and your contact info. Registration doesn’t directly take you to the 7-day trial, instead, the company gets back to you to discuss your requirements, post which a demo is set up. The on demand ERP currently caters to engineering, automotive, travel and transport, industrial & manufacturing, power generation, wholesale distribution, and dairy industries. It offers an extensive range of modules, ranging from ﬁnancial management, accounts receivable/ payable, manufacturing, inventory management, cost planning and control, CRM, sales, purchase, business analytics, reports, human capital management, ﬁxed assets management, logistics, and service management. There is also the option of getting to know the solution, its offerings, etc through the info available on the website. The website offers to contact the desired for which you have to provide the contact number. Once you provide the contact number, the people from the Ramco company will contact you and you can take the deal forward by negotiating your terms and conditions.It would have been nice if the company had provided a live online system to the users to play around with. Currently, they have some on126 OCTOBER 2010 | DARE.CO.IN
This company doesn’t need an introduction, as it’s one of the most popular SaaS based CRM service providers. We tried 30-day free trail of their services. Registration was pretty simple and straightforward. Moreover, unlike Ramco, here the company offers a live demo to give users an actual look and feel of the solution. After registering, it makes your email id as your user name and prompts you to change your password. After this, it allows you to set up your email to work with Salesforce. The demo supports Gmail account or MS Outlook. You can even import your contacts from Gmail, Outlook, etc. Besides, it has online video tutorials built in so that you can view them anytime to understand it better. Sales Cloud, Service Cloud, Chatter and Force.com are some of the offerings by Salesforce, being offered as a service for different price points.
Moving to PaaS Some of the most talked about entities in the Cloud space comprise big CSPs providing various platforms on to the Cloud for the user or developer community to develop their applications on the Cloud. Microsoft Azure , Google AppEngine and EC2 are some CSPs providing PaaS capabilities to developers and enterprises. Google AppEngine enables you to build and host web apps on the same systems that power Google applications. AppEngine offers fast development and deployment, simple administration and you don’t need to worry about hardware, patches or backups and scalability. To use the PaaS services from the Google AppEngine provider, you need to sign up for an AppEngine account, download the SDK and proceed further by read-
ing the getting started guide which provides the user basic info about developing and hosting apps on the Google infrastructure. Microsoft Azure works in a similar manner. The user needs to sign up using his Windows Live Id, download the SDK tools and register to gain access to services to the Microsoft platform. We have a separate article on how to develop on MS Azure platform in the developer section of this issue. To read more about how to use AppEngine, you can go to this link: http://ld2.in/hu.
Moving to IaaS As we know that any new IT initiative from an existing enterprise or a startup involves a analysis of the cost and manageability of the IT infrastructure which is required to host the hardware. Though IT hardware infrastructure is getting greener and meaner but is not getting any cheaper. The huge costs associated with procuring and managing the infrastructure may often lead to many startup ideas vanishing in the air. This is where IaaS (Infrastructure as a Service) model comes in. Using IaaS has various beneﬁts like almost zilch fund required for setting up the IT infrastructure which generally amounts to more than 80% of the initial cost. Subscribed and scalable IaaS from a renowned vendor can help an organization function effectively. CSPs providing IaaS offer consultancy and help set up the server requirements for an organization. Dedicated virtualized storage and servers as a service just mirror the idea of an outsourced data center with the organization having to worry least in their performance and maintenance. Maximum usability and on demand scalability are some of the features being provided by these CSPs which make the deals rather lucrative. The content for this article is sourced from PCQuest Visit their website: www.pcquest.com
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NASSCOM’s Product Conclave 2010
Coming up in November The Indian business industry couldn’t have thought of a better time to enter the updated technology and software arena but now. With new innovation and technology evolving with every passing day, the time is just perfect to think of adopting technology in businesses eeping in pace with India’s technology development, NASSCOM announced that the 2010 edition of India’s premier event Product Conclave for the software product industry will be organized in Bangalore on November 10 and 11, 2010. The event’s primary focus will be on 'Scaling new heights from lean start-ups to cloud adoption'. This year the event will focus on ways of managing and scaling a product company in an extremely complex environment. The event will discuss emerging areas like cloud computing and new business models that will bring practitioners' views from technology, business and implementation perspective into the event. Deﬁning the objective of the Product Conclave 2010, Sharad Sharma, Chairman, NASSCOM Product Forum shares, “The NASSCOM Product Conclave brings the entire software product ecosystem together under one roof to introspect and look ahead at the evolving landscape and the next set of chal-
lenges. This year’s conclave promises to be a landmark one with a clearly deﬁned agenda for companies of all sizes.” The Product Conclave will be graced by the presence of speakers like Amitabh Srivastava (Microsoft), M.R Rangaswami (Sand Hill Group LLC), Polly Sumner (salesforce.com), Naeem Zafar (Concordia Ventures), Prof. Vivek Wadhwa, Bharat Goenka (Tally Solutions), Subash Menon (Subex Ltd) and Dr. Sridhar Vembu (Zoho Corp). The discussions will be on practical advice on Lean Start-Ups Models and dwell on topics like product design and ideation, customer development process, solution/market ﬁt, operations, deliveries, marketing and insights on how to successfully build a software product business. It can be assumed that the event will be a great success. Over the past couple of years the event has earned a reputation for offering best learning and networking opportunities to its attendees. The event can be rightly described as a hub for connecting with the Indian
Software Product Ecosystem. NASSCOM’s Product Conclave 2010 event will have attendees like aspirant entrepreneurs. The event will focus on building a software product business out of India as well as an extended ecosystem of C-suite executives, system integrators, venture capitalists and mentors. Last year the event was attended by 1,000 delegates from 600 companies across India and abroad. The software product space is in its booming phase. As per the projection, the software product space in India is about to reach $ 12 billion by 2015 which reﬂects the importance attached to such events. There are more than 370 product companies in India, 38 exclusive product incubation centers and in the last three years more than 100 product companies have been established. So this year the focus is on how Indian product companies can take leadership in their market by leveraging opportunities created through cloud computing and following lean start-up models. DARE.CO.IN | OCTOBER 2010 127
Your Perfect Website Finally! I get to write about something I know. Kidding, there’s no such thing our Perfect Website
I’d begin with some obvious questions. Do you like your company’s website or your own website, for that matter? Are you happy with it? Do you like your competitor’s website better? If so, why? In the light of these pestering questions, if you’re contemplating re-designing your website or getting one for your business, I hope the following paragraphs help in some way. Some are tips, some are facts, some are just plain info. Read through, and maybe you’ll ﬁnd something useful.
Random Info For some reason, a trait that I see in a lot of people talking about their website is that they seem to think the user is browsing through their site. And only their site. With undivided attention. Reading through all the text, happy to ﬁnd ‘creatively’ placed images that match the text and clicking more and more buttons. Just what they want him to do. Apologies, on behalf of all users. Nobody does that. At least, not anymore. The problem with the website is, the user is there by choice. Unlike a paper ad, where it is right in front of him while he’s reading other stuff, or a TV commercial which interrupts him while he’s watching a movie, this one is there all the time. All day, every day. And the user is there because he wants to be. So you’ve already won. Now just make sure the site does what it’s supposed to do. In other words- Don’t mess up!
Interactivity This single term has been used and misused a lot. A lot. “My site has to have a high interactive quotient.” Of course, clicking buttons or anything to do with the mouse is interactive, right? But here’s the problem— evey website is. Users will click buttons. If they dont like what they see, they’ll click more buttons. They will also open other sites, which probably have more ‘interactive quotient’ than yours. Stop trying to force in128 OCTOBER 2010 | DARE.CO.IN
formation down the throat of your user. But just make sure it is easily accessible in case he wants it.
Stop Competing for ‘Stickyness’ ‘Stickyness’ is another term. Why but? It is not about ‘how long’ someone stays on your site. It has never been. I recently went to a website of a service company. It convinced me about the service right away. I went to the contact section. I took the number down and closed the page. The site is a success! How long did I spend— less than 30 seconds. How was the site a success— it convinced me. It looked authentic. It looked honest. There were no catchy taglines aimed at manipulating my mind into buying the service. There weren’t images of happy people smiling at me. There was no boring text about how great the service is. Sometimes, you’ve to let go of the regular ideas and present yourself in a different way.
ANNIVERS ARY EDITION
If I see one more website with a hand holding a globe, I will judge the company for lack of thinking
But not for everything. If your business is local or you already know who your customers are, do not struggle to get your website on the ﬁrst page. Understand the difference between ‘search engine visibility’ and ‘search engine optimization’. Evaluate the percentage of business that you’d get out of someone searching for you online and reaching out to you for your product or service. If you don’t see much, do not walk that path. Focus on other more important things that you could do online.
Let People Do the Talking
Your visitors are the ambassadors of your site. This is where an ‘experience’ works, a good one at that. A bad one will ensure a lot of lost visitors. Unlike the other mediums, web is fast. Give your users a pleasant experience and they will do the rest for you. There are one million blogs, communities, and other good places, where you can’t reach but they can. If I like the way a site looks or the way the information is delivered or if it simply makes me feel good, I share it with other people. So do a lot of others.
The above example. Stastics would show that I ‘bounced’. Reality would say something else.
How to deliver? Flash or HTML? IPads or netbooks? Optimize for broadband or data cards? Should the site be visible on mobiles? Here’s the catch. You cannot compromise and still be awesome. Do not worry about all these, understand your visitors ﬁrst and deliver accordingly. Make sure you deliver good content and in the right way. Do not worry about getting people to your site. People would get to know. Worry about what you should do after you get them there.
I swear, if I see one more website with a hand holding a globe, I’ll judge the company for lack of thinking. Same with a girl wearing headphones and smiling, a rotating globe, a lot of ‘people-like-ﬁgures’ holding hands, a graph showing progress, a quote from the CEO stating the ‘mission & vision’ of the company in annoyingly long meaningless words. Think better!
The writer is an entrepreneur, designer, digital artist, wannabe musician and a jack of all, who thinks black & white photography is very cool.
SEO (aka Search Engine Optimization)
To write to the author, please send an email to firstname.lastname@example.org with the subject line 'Rajaram Rajendran'.
Now, before you go ahead and spend a fortune on this, evaluate the need ﬁrst. Yes, Google is our best friend.
DISCLAIMER: The views expressed here are that of the author and do not represent the magazine's.
DARE.CO.IN | OCTOBER 2010 129
INDEX Ad Roll .....................................139 Adsert Web Solutions Pvt Ltd .34 Advantec Coils Pvt. Ltd..........103 Affiliate Curry .........................120
ORGANISATIONS EO- Entrepreneurs’ Organization .............................89 exchange4media .......................34 Facebook .................................106
Leisure Hotels Ltd ..................115
Logix Info Security ....................46
Magnon Solutions Private Limited ......................................97
Alchemy Book Shoppe............139
Federation of Indian Exporters ...................................51
Finsec Law Advisors ..............111
Matrix Cellular ..........................71
Aquilonis Technologies Pvt. Ltd. .....................................42
Freshrank SEO Consultancy Pvt Ltd .......................................63
Max Ateev .................................71
Social Wavelength ..................120
Gau Grass Sewa........................30
SportzConsult and EduSportz ..................................65
Aspiring Minds .......................107
Gensol Consultants ....................3
MindTree Ltd ..........................116
Attero Recycling .........................3
Suzlon Energy .............................3
Greynium Information Technologies .............................37
Morgan Stanley ...........................3
Sweet World ..............................73
Moser Baer Photo Voltaic...........3
Synapse India ............................89
Moser Baer Projects....................3
TA Associates .............................3
MSN India ................................116
Blackstone ...................................3 Blend Financial Services Limited ......................................93
GVC Systems ..........................120 Hanuman Tripathi ..................112
SIRI Gramodyoga Samsthe ......85
Startup Founders ......................88 Steria ........................................108 Subex Ltd ................................127
Bombay Stock Exchange ............3
Harish Bijoor Consults Inc. ......58
Harvard Student Agencies, Inc. ...........................................138
Tessaract Design ......................82
HDFC bank ................................22
The Carlyle Group ....................53
Hostel Kits ...............................139
ICICI bank .................................22
IDBI Bank Ltd ............................46
New Look Cosmetic Skin Laser Center..............................87
Triveni Group ............................51
Cacobean Chocolatier ................4 Cadbury .......................................4 Canaan India .............................47 Canaan Partners .........................3 Capital Market Publishers .....108 Cartridge Junction ....................47 CGTMSE ....................................47 Chatterbox Café ......................139 CII...............................................51 Click.in .......................................37
Ideal Insurance .......................120 IDFC PE .......................................3
TPG Growth ................................3
Nomura Holdings ........................3
Turtle Limited ...........................48
Idiom Design and Consulting .................................83
TVS Industries ..........................76 Twitter .....................................107 U Town ....................................139
Compact Hometel India Private Limited..........................67
Onicra Credit Rating Agency of India .........................95
Concordia Ventures ................127
Times Private Treaties ...............4
IIS Infotech ................................70 Incite Cam Centre...................105
Oracle.......................................108 PaGaLGuY.com .........................79
Union Bank of India ..................44 United Breweries Group ..........22
PHD Chambers of Commerce ..51
V Mart Retail Pvt Ltd ................38
Polly Sumner ...........................127
Van Heusen ...............................22
PSG Tech .................................138
Venture Intelligence ...................3
Quantum Fund ............................3
Viom Networks ...........................3
Rabindranath Tagore .............102
Saarthi Consulting ..................120
Whyte & Mackay ......................22
Sadhbhav Infrastructure Project ..........................................3
JAFCO Asia .................................3
Jaipan Industries ......................47
Yindusoft Technologies India 116
Jindal Steel ................................51
Samvad Sutra ..........................116
Zenith Stationery Shop ...........139
Elixir Consulting .......................71
Johnson & Johnson ..................22
Sand Hill Group LLC ...............127
Zensar technologies ...............120
Kundan Rice Mills Ltd. .............40
Sanjay Mehta ..........................120
Zoho Corp ................................127
ContextMine ...........................120 Creamz.....................................139 Credit Suisse ...............................3 CyberMedia Group ...................46 CyberMedia India Online .......116 Cycle Chalao ...........................120 Dr. Lal PathLabs .........................3 Draper Fisher Jurvetson India .47 E Store .....................................139 Educomp..................................108 EduSportz ..................................65 Elitecore Technologies Pvt . Ltd .....................................52
130 OCTOBER 2010 | DARE.CO.IN
India Collections Management..3 India VP .......................................3 IndiaMart.com ...........................50 Indian Angel Network ............120 Indian Angels Network ............46 InfrasoftTech ...........................113 Intel ..........................................106
ANNIVERS ARY EDITION
Aditya Mishra .........................120
Hirdesh Singhal ........................76
Peter Drucker ............................75
Albert Szent-Györgyi ..................4
Hrishikesh Damle .....................54
Pradeep Garg ............................40
J N Agarwal ..............................46
Pradeep Gupta ..........................46
Allwin Agnel .............................78
Amit Ladsaria ...........................48
Javed Akhtar .............................81
Pradeep P. .................................69
Vaibhavi Thakkar .....................92
Amitabh Srivastava ................127
John Bronowski ......................108
Priti Hariharan ........................139
Vara Prasad ...............................44
Anshu Gupta .............................60
Puja Sundar .............................139
Jonas Salk ................................106
Apoorv Sharma .......................120
Raghavendra Satish Peri ........120
Atul Tibrewala ..........................47
Kaushik Gala ...........................120
Rahul Agarwal ........................120
Vibhas Prasad .........................114
BG Mahesh ................................36
Kawal Kumar Grover ................30
Rahuldev Rajguru .....................42
Vijay Mahajan ...........................69
Bharat Goenka ........................127
Kiran Sundaram ......................139
S C Kalia ....................................46
CS Pandey ...............................108
Lalit Agarwal ............................38
Sandeep Parekh ......................110
LH Manjunath ...........................84
Sanjay Jhunjhunwalla ..............48
Dinesh Agarwal ........................50
Manoj Chandran .....................116
Sarin Patrick ................................4
Vinay Chadha .........................120
Faisal Farooqui .........................80
Mark Twain ...............................58
Saumil Majumdar ......................64
Shamit Khemka .........................88
Ganesh Natrajan .....................120
MR Rangaswami .....................127
Sharad Sharma ........................127
Govind Agarwal ........................62
Naeem Zafar ............................127
Sridhar Vembu ........................127
Vineet Rai ..................................68
Gurvinder Pal Singh ...............102
Nitesh Ambuj ..........................120
Srikala Bhashyam ...................104
Vipul Prakash ............................70
Harish Bijoor .............................58
Nitin Patil ..................................46
Sriram Hebbar ...........................37
Harish Gandhi ...........................47
Nooh Saba Ansari ...................139
Subash Menon ........................127
Hema Malini K. R. ...................104
Parag Patki ................................44
Suresh Babu ............................120
Hemal Patel ...............................52
Parichay Upadhyay ...................86
Suresh Tota ...............................66
T R Bajalia .................................46 U R Tata .....................................47 V A Ramani ...............................76
Varun Aggarwal .....................107 Varun Mirchandani...................94
Vikas Kumar ............................120
Vineet Bajpai .............................96 Vineet Kanaujia ........................57
Vivek Wadhwa ........................127 Vrinda Rajgarhia .......................72 Winston Churchill .......................4
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On the Bookshelf
License to Live Priya Kumar ‘I felt weary and indifferent at the end of this rather long day as I had felt weary and indifferent from the start’. Quite a lot of us are familiar with the feeling voiced out by the protagonist in the novel. Motivational speaker, Priya Kumar introduces the protagonist of her story facing mid life crisis. Also known as an inspirational thriller, License to Live is based on a seven day seminar which spreads across three continents. The book promises to help the reader discover the greatness within oneself and take control over one’s own life. The reader is also likely to pick lessons from the radical methods used in the seven day seminar which bring about life changing discoveries within the protagonist herself.
Publisher:Embassy Books Price: Rs.250
Publisher:Westland Price: Rs. 295
Small wonder: The Making of Nano Philip Chacko, Christabelle Noronha, Sujata Agarwal A success story to tell us about how one of India’s largest automobile company TATA was successful in making the cheapest car run on Indian roads. It is a run up on how the one lakh wonder came into being after a long journey which involves a lot of struggles. Ben Sherwood It also talks about how the company faced challenges in terms of using the limited Right below the name of the book it reads ‘The Setechnology available to them and used crets and Science that could save traditional methods of manufacyour life’. Now everybody wants to turing to craft a car which ultisurvive in the big bad world and this mately became a convenient book has managed to grab the attention buy for the middle man. of the two types of people who live in it: the
The Survivors’ Club
Publisher: Michael Joseph Ltd Price: Rs. 930 134 OCTOBER 2010 | DARE.CO.IN
skeptics who will look at science of everything and the believers who will seek the riveting secrets that this book might hold to bring out the survivor in them. Rather than acting as a self help guide, the book triggers in you the survivor instinct with the help of many survivor scenarios which is suitably or rather unsuitably graphic. It also comes with an access code to an internet based test called the Survivor Proﬁler, which will give a comprehensive result on the person’s Survivor Type and Strength.
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Notes & Sightings
Entrepreneurs In The Making
e are all aware that entrepreneurial development programs are conducted at B schools to encourage students to set up businesses with their own innovative ideas. To demonstrate such entrepreneurial spirit SRM B School conducted the B school Bazar on the 2nd and 3rd of
September 2010. Over 4000 visitors attended the bazar which sold accessories, handicraft, clothes, nailart, laptop, food etc. The Bazaar was inaugurated on 2nd September 2010 at 11.30 a.m. in presense of Guests of Honour Mr. B.Gopinath, CEO, SKP Silks, Kanchipuram and Mr. M.Lokesh
Giri, MD, Giri Furniture, Chennai. Prof T.P. Nagesh, HOD, SRM B School says “The conduct of the BSchool Bazaar brought out the hidden entrepreneurial skills of our students. We are very sure that majority of the stall holders learnt about the nuances of doing business.” The Bazar was a two day platform where the students could implent their skills practically. For example, when setting up a food stall J.Anto Roy Milton, a second year MBA student realized “Our main motto was quality rather than the price because quality food sells by itself. We also had a tie-up with the vendor that the raw materials which are not being used can be returned back, thereby helping us in making better proﬁts.” Some even say they were able to breakeven in their two day stall set up. Mohammad Sarjun’s team was involved in making in the Bazaar a hit by making the stall owners their customers. Sarjun says “The idea is that we were offering promotional and marketing services to the exhibitors at an attractive and affordable package by means of vocal ads, events sponsors, feedback forum etc.”. Now that’s innovatively raking in the money.
Mentors For Agri Business Development Agri Business Incubator – International Crop Research Institute for the Semi-Arid Tropics (ABI-ICRISAT) has invited mentors from across the country for their Network of Indian Agri Business Incubators (NIABI) Mentorship Program which will be held on the 28th of September. Around 70 mentors were chosen from 300 applicants who will be a part of the Business Planning and Development (BPD) units set up in various established research and agricultural universities of the country. This will help the entrepreneurs get proper guidance on running about their agri business. Mr. V.R. Muthu, CEO, Idhayam Group of Companies, Chennai is the chief quest of the orientation program who will also be delivering a seminar on “Opportunities and Challenges in Agribusiness,” as part of NIABI seminar series –Best practices in Agri-Business. The program seeks to ﬁnd a mentor-mentee match through one to one interactions between the two parties and also ﬁnd out the areas in which the BPDs and entrepreneurs require attention. This way the mentors will also gain a clear idea about what is expected of them from the entrepreneurs and their role in bringing about development in the the farming community as a whole. DARE.CO.IN | OCTOBER 2010 135
Movies To Suit The Entrepreneur’s Mood
ou’re standing on a road that stretches into the darkness. And you’re hearing voices. Somebody’s telling you ‘Your legs are getting heavy, you’re too slow’ (The Cinderella Man), somebody else is saying ‘Hope is a dangerous thing. Hope can drive a man insane.’ (The Shawshank Redemption). You are feeling exactly the same. You are an entrepreneur and you are going to have an affair with uncertainty for all time to come. A little inspiration is all it takes to pull yourself together. Movies like Coal Miner’s daughter and The Pursuit of Happyness , which center around real life people, are all about the grit and determination one has to have to become big, even if it seems like one does not have the make for it. If you are the kind of person who
136 OCTOBER 2010 | DARE.CO.IN
enjoys watching movies based on sports, Rudy is the best pick. Now Forrest Gump may come across as something that happens only in the movies but one must remember what Forrest’s mother has to say ‘life is like a box of chocolates, you never know what you’re gonna get.’ Startup.com is more along the along the lines of innovation as it narrates a story of how two friends develop a website for people to conduct businesses with municipal governments. E-dream and Triumph of the Nerds are other documentaries which showcase innovation and the rise and fall of these in the dotcom space. October sky explores the creative zeal among a bunch of youngsters to develop a rocket in the small town of Coalwood in the late 50s. More along the informative lines lies
The Pirates of Silicon Valley which is a docudrama on how Silicon Valley has become what it is today. In one week, all except the top two executives of the ﬁrm where you are working are going to get ﬁred. What are you going to do? Glengarry Glen Ross is all about what not to do as an entrepreneur. At the end of the movie you are more likely to reﬂect the values you should maintain in any business environment. Wall Street and Boiler Room are other movies that will get you thinking along the same lines. Jerry Maguire lost his job when he started having second thoughts about the ethics involved in business of being a sports agent. This leads him to lose his job. A huge dip in his career chart. He plans to go solo. How do we catch up when the same happens to us? The movie
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Shape-up is entertaining and moving at the same time. Well, the Ghostbusters also suffer a dip in their business and catch up soon enough when they look for business in the right places. Deﬁnitely a must watch for a fan of ﬁction. Lying, cheating and conning are not going to get you anywhere, except maybe for Frank Abagnale Jr. in Catch me if you Can. Entrepreneurship is all about raking in the money with your own innovative business idea right? The takeaway from the movie is not the illegal activities Abagnale indulged in but more about the presence of mind and business vision an entrepreneur should have when running his show. If you are going through a phase where you are just plain bored of your work space and you just want to watch something you can relate your workspace with Officespace is the movie for you. For businesses that basically run on the goodwill of the customers, Barbershop is the movie you can relate to, which would deﬁnitely get you hooked to the sequel of the same as well. There are also movies like The Bucket List which makes you feel good about having a to-do list of things you want to do in life and reinforce the reason why you have decided to be an entrepreneur. Sightings and Notes: Bringing in entrepreneur news, pan India.
Discover the new you, by following newer tips on productivity. aying no: We have all been told to act as the Yes Man at office so that it helps in creating an air of optimism in the workspace among other employees. With this kind of one sided thinking imposed by our superiors and peers, we often forget to take into consideration the ramiﬁcations of a decision before agreeing to something.
- Learn to say no to something if you genuinely feel you are not up for it. Avoid situations which make you say ‘yes’ to any task out of guilt, or because the colleague is a friend of yours, or because you are worried of what people will think about you as a performer. - Everybody wants to be successful as well as popular. This involves acing at your own work as well as living up to everybody’s expectations. So, when you actually want to say no, it becomes very difficult. This is where you should put aside your misgivings and egos about others’ opinion about you when saying a no - If you are really worried about hurting your relationships in the office, learn how to give explanations around your reasons for saying no. Make suggestions as to who can do the work better because of better understanding of the work at hand and thus making the whole process run faster. Commit to something else you can do instead of the task at hand. - You become less stressed out if you have lesser obligations under you. That way you can make sure that the tasks that you take up is well within your capabilities and you become sure you can carry out that particular task effectively. - At the end of the day, you have not only been honest to yourself but you have also helped in getting the work delegated to somebody else who might be able to do the work faster and properly - In the long run, by saying no you learn how to balance the amount of work as well as the amount of rest you get. Keeping yourself work-free and stress free will keep you calm and increase your overall productivity.
Quotes “I’d rather be a hammer than a nail.” - Simon and Garfunkel Singers
“Money and success don’t change people; they merely amplify what is already there.” - Will Smith Actor
“Luck is a dividend of sweat. The more you sweat, the luckier you get.” - Ray Kroc Corporation fouder, McDonald’s.
There is only one boss. The customer. And he can fire everybody in the company from the chairman on down, simply by spending his money somewhere else. -Sam Walmart Founder, WalMart
DARE.CO.IN | OCTOBER 2010 137
Of the By the For the
Students Low on investment and risk, high on customers and margins, students crack the code with ‘campus companies’
n 1957, rising tuition fees at Harvard University spurred some entrepreneurial students to set up the world’s ﬁrst campus company: Harvard Student Agencies, Inc. HSA evolved to meet almost all on-campus needs – from laundry to publications to logistics! Today, HSA has become the world’s largest campus company, with a turnover of $ 6 million, over 500 employees and eight highly-successful agencies. Relatively risk-free, low on investment and with a ready market, usually in its own campus, campus companies are startups attached to institutes, founded and run by students.
In India, however, the concept of a ‘Campus Company’ was unheard of until ﬁve years ago. But today, catalyzed by the National Entrepreneurship Network, a non-proﬁt organisation that inspires, educates and supports India’s new and future entrepreneurs. Campus companies have become a rage among the 400strong student-run Entrepreneurship Cells across the network. More and more students are exploring campus companies as a means to practice their skills and knowledge and get real-world experience in entrepreneurship. The companies begin small – a stationery shop, a vermicompost, a café or a website – but, as
Karthikeyan M of PSG Tech’s campus company, ‘Thirsty’, a juice shop, puts it: “The learnings are immense”. “Our E-Cell conducted several skill-building workshops and entrepreneurship talks on campus, and this made us eager to gather practical exposure. Thirsty tested us on our communication, marketing, management and team building skills. Most importantly, it taught us common sense,” Karthikeyan adds. Students experience the ﬁner details of venture building, from preparing the business plan to fund raising to succession planning, often with the support and guidance of faculty and management. For example, for raising fund, students are
CAMPUS COMPANIES VS STUDENT VENTURE A campus company is a company attached to the institute. Students launch and run the company, gather hands-on experience in entrepreneurship and upon graduation, hand over the reins of the business to the next batch of students through a structured succession plan. The Harvard Student Agencies is an example of a successful campus company. A ‘student venture’ is attached to an individual. The venture is launched by the individual or a group of individuals when they are still in campus. The individual can decide whether to carry forward the venture or shut it down upon graduation. Facebook is an example of a successful student company.
138 OCTOBER 2010 | DARE.CO.IN
Vermicomposting unit at Indira School of Business, Pune
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CAMPUS COMPANIES: • Bishop Cotton Women’s Christian College, Bangalore E Store, formed 2009 Gives talented students a platform to sell their produce – from paper bags to jewelry to even pickles. The store recorded a turnover of Rs 15,000 last year. • College of Engineering, Pune Empressario.org, formed 2010 Website that matches students to scholarship programs, based on the eligibility criteria, and sends out mailer updates. Also showcases college information and news. • Durgapur Society of Management Science, Durgapur Creamz, formed 2008 Has tied up with leading bakeries in town to sell cakes, pastries, patties and other bakery items on campus. The E Cell now plans to expand beyond the campus to open branches in other locations. • Institute of Business Management and Research, Bangalore Chatterbox Café , formed 2010 A snacks bar that offers food on the go. USPs include combo offers, a variable product menu and special packages for parties. Daily sales touched the Rs 2,000 mark in August. • Indira School of Business Studies, Pune Vermicomposting Unit, formed 2010 Collects waste from four canteens and a popular restaurant in the neighbourhood, and converts it into valuable manure. Six nurseries have signed up as customers for the manure, which is priced at Rs 40 per kg. • Jyoti Nivas College, Bangalore: Green Store, formed 2009 Sells notebooks, greeting cards, stationery and jewelry on campus. For two weeks in a month, it puts up a stall in a neighbouring shopping mall. Conducts workshops on block printing, candle and soap making, aqua culture and bag making to sustain supply of products. • LN Welingkar Institute of Management, Development and Research, Bangalore WEKalp, formed 2010 Provides management consulting services to small and medium scale companies. Till date, it has worked with eight companies, including logistics company Meru Cabs and mystery shopping startup Red Quanta.
either sell equity shares on campus, or get their institute management to provide seedfund, or raise money from their E Cell programs. Running a company on campus also provides students an opportunity to leverage talent from across mul-
• Maharashtra Institute of Technology, Pune Hostel Kits, formed 2010 MIT E Cell runs multiple campus companies. Hostel Kits offer essentials like mattress, pillows, bedsheets, bucket, mug and soap case to outstation students. In addition, the E Cell also runs a food stall and sells old books. • Mount Carmel College, Bangalore Myriad, formed 2008 Deals with three independent products: chalks that are brand named Scribbles, a book binding company called Extent and newly-launched candle manufacturing unit. It has 62 employees and 525 shareholders. * PSG Institute of Technology, Coimbatore Thirsty, formed 2008 Sells fresh juices, ice creams and kulfi. With daily sales hovering around 150 cups, Thirsty has made a profit of Rs 90,000 in 22 months. Another campus company, Journey, was launched recently to facilitate booking of air, bus and train tickets. • SRN Adarsh College, Bangalore Alchemy Book Shoppe, formed 2010 Collects old text books from senior students and sells them at 50% discount, or rents them out to first-year students. Alchemy E Shoppe is a campus-based stationery-cumfood store. • St Philomena’s College, Mysore Zenith Stationery Shop, formed 2009 Sells stationery items on campus. With the college located in the outskirts, and the closest stationery shop 4 kms away, Zenith has been a crowded store from Day 1. • Symbiosis Institute of Computer Science and Research, Pune U Town, formed 2009 Merchandising company that sells sweatshirts, cups, caps and other paraphernalia on campus. U Town posted a turnover of Rs 18,000 last year. • Velammal Engineering College, Chennai Ad Roll, formed 2009 Rents out digital advertisement boards to educational institutes on a weekly basis. Ad Roll is being used for publicizing technical events, coaching classes and department news among VEC students.
tiple streams, including marketing, ﬁnance, technology and more. “We have representation from Finance, Operations and Marketing, which enables us to provide better and more comprehensive solutions to our clients,” says Kiran Sundaram of
‘WEKalp’, a campus company focused on providing business consultancy services at LN Welingkar Institute of Management, Development and Research. Incidentally, Kiran runs his own student venture ‘Myriad’ and often falls back on the WEKalp team to solve his own startup’s problems. Campus companies are also a safe playground for students looking to test business ideas in its infancy, as in the case of Symbiosis Institute of Computer Science and Research student Priti Hariharan. She used her campus company ‘U Town’ to test her prize-winning business idea of a merchandising store, and discovered some surprising twists along the way. There were vendor issues, payment delays and ﬁnicky customers. “I now realize that entrepreneurship was only an abstract till I actually got my hands dirty with U Town,” she says. There are other gains too. The newly-launched website startup at COEP, Pune, has opened up several job opportunities for its students. "There are openings for website management, documentation, data mining, alumni networking, marketing and research," reveals NEN E Leader Puja Sundar of COEP. At Bishop Cotton Women’s College in Bangalore, Nooh Saba Ansari ﬁnds her ‘job’ at her institute’s ‘E Store’ giving a new direction to her career. “I come from a conservative family where women don’t work. But today, I feel empowered to create my own job and become economically independent,” she says. “I am witnessing a transformation among students who have worked for Myriad, our campus company,” says Sr. Albina, Principal of Mount Carmel College. “Earlier, entrepreneurship for them existed only in theory. Today their experiences have made them mature, creative and ready to take on the world as serious entrepreneurs,” she adds. More articles on www. nenonline.org. Content provided by NEN DARE.CO.IN | OCTOBER 2010 139
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On a Chocolicious Journey Movies To Suit The Entrepreneur’s Mood The 3 Milestones of Business Models ANNIVER SARY EDITION `50 / ISSUE 1 / OC...