So we published the pictures but by popular demand by our readers here we are publishing the review of the WATBlog panel discussion on “Lessons Learnt from Failure of Startups” that took place at NIMHANS Bangalore post proto.in on 23rd January.
You know an event is successful when somebody else blogs about your event before even you do. This is exactly what happened to WATBlog Panel in Bangalore and we are lucky that someone did as we were so immersed in the Panel Discussion that we forgot to take notes for blogging. Nonetheless we would like to thank Theenmusketeers for taking notes which helped us put this review together.
The WATBlog Panel included Rohit Agarwal of techTribe, Suresh Sambandam of OrangeScape, Ganapathy Subramanian of Myduniya Networks and Santosh Dawara of Lipikaar.
The panel started with each entrepreneur introducing himself and narrating his experiences with failure:
Q: About yourself and your experience with failure?
Suresh stated that he started his first company when he was 19 which he felt was a little too early. He then went on to work for 7 years which gave him enough experience to start his current company Orangescape.
Rohit spoke about how he started techtribe 3 years ago and how he had worked on 5 startups before this. But even with experience behind him he needed to shutdown techTribe and even reject investor money since it didn’t make sense to accept it when the model (refferal recruitment) hadn’t been proven even after 3 years.
He went on to explain the indicators that told him that techtribe wasn’t working out:
1. Site statistics – There was no traction
2. Money wasn’t coming easily.
Ganapathy talked about his journey as an entrepreneur and as a VC with firms like ICICI Ventures and Jump Startup.
Santosh spoke about Bookeazy a movie ticketing startup which sold 60,000 tickets in the 1st year itself and they had a loyal userbase by since the first year the dynamics changed dramatically and multiplexes changed the way they dealt with their partners and who they distributed and sold their tickets to. This along with competition from big players put them out of business and then they were already working on an alternate project called Lipikaar which seemed more attractive. So they eventually decided to shutdown Bookeazy.
Q: What can cause failure? How should entrepreneur avoid it?
- Suresh stated that it was very important for entrepreneurs to learn from other people’s experiences.
- Ganapathy felt that lack of integrity was the fundamental reason that founders got too obsessed with their ideas and refuse to see reality. He felt one needs to constantly check with company numbers, employees and users to know where the company is headed.
- Rohit felt that the earlier you spot failure the better it is as according to him a startup is like marriage i.e. You have wife, then buy a house, have kids, etc. It gets messier as it progresses. So on should check early and if you are not doing well then quit early. One needs to accept reality and moving on may mean you could try something that can be successful.
Q: What are your learnings from failure?
- Suresh – I learnt that one needs to specialize in something so that you can understand that field in-depth before starting off.
I was of the view that In startups, entrepreneurs try to do much too soon and don’t delegate enough.
Suresh contradicted my point stating that Tech entrepreneurs think that somebody else will come and create the “go-to-market” strategy for them, which according to him is a mistake.
Q: What is a VC take on failure?
Ganapathy said that the relationship between an entrepreneur and a VC evolves over time and the conversations are ongoing. So it depends on the history and chemistry they share with the VC.
Rohit said that the communication with their VC’s was something that Techtribe did right i.e. the investors, senior management and top execs were always in the know of what was happening on a daily basis. So the eventual decision to shutdown wasn’t really a surprise.
Rohit also added that VCs usually spend around 80%-90% of there time hunting for new deals. However, right now it’s 50% reserved for their portfolio companies and 50% for new deals… On the other hand, an entrepreneur spends around 10% of his time thinking about money. So who should be chasing who? Why are startups worried about VC validation? If the product is doing good, then the VCs will definitely come to you. There is no reason to believe otherwise. If there aren’t any ethical issues, then past failures doesn’t count much and it’s all about current idea and execution.