WATBlog Panel Bangalore @ Proto.in – A Review

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.

7 Responses to “WATBlog Panel Bangalore @ Proto.in – A Review”

  1. January 27, 2009 at 7:15 pm #

    An interesting talk. But, I feel, some points are generalized without any thought(…!!).

    “Rohit felt that the earlier you spot failure the better it is” — How do u spot a failure? What due diligence we need to do before we say that its a failure?

    Not all companies can be successful in the early years even if the idea is right. There can be many reasons for that like immature market, technical limitations, government regulations an so on. But, if the entrepreneur believes in his idea, he need to be persisted with it(especially when u have taken money from others). Infosys is just nothing until it got its first real client reebok almost after a decade. Naukri took 6 years to realize its potential. So, persistence, confidence an vision are very important. Please don’t start, if u don’t have any of these qualities.

    The case with Rajeev is different.He started of jobs4freshers.com at a very young age with a very little investment (the site might have cost 400 USD). I believe, he learned a lot with that venture an realized his true dream an started off this WAT. I would like to request Rajeev not to shut this off, if it doesn’t give some returns in next couple of quarters..!!

    However, I don’t say that u should fall in blind love with your venture an ignore reality. Do proper research before u start off. Once, u start off put all your efforts to make it a success. Please don’t try an stop failure early. I believe, there is nothing called a bad business idea on this planet. Its just execution that makes even an average idea look great.

  2. January 27, 2009 at 11:27 pm #

    @Srini,

    This is Rohit. I agree. I would never recommend that one look for reasons for failure and decide to close. It’s difficult to describe details in a generic talk where not everyone is familiar with referral recruiting models. I did clearly mention that it was a very difficult decision, made after looking at all external and internal factors. Persistence is extremely important, but not in a vacuum. When companies like Infy and Naukri were being persistent, the outsourcing and job markets were in their infancy. In mature markets, when the hypothesis doesn’t get validated, and when you realize that even if the market did accept it 3 years later, larger players would have a distinct advantage – persistence may not be the best option.

    Yes, it’s more difficult when you’ve taken outside money, but a lot lot more when you have matched it with your own life savings in it. And it gets a LOT more difficult if one were to take even more outside money – wouldn’t you say? Rest assured that these aren’t easy decisions – too much at stake to simply decide. My point wasn’t to suggest to anyone to not be persistent, but to not latch on to something just to save face – we tend to do a lot of that in India.

  3. January 28, 2009 at 12:58 am #

    I have put a short summary of the same at http://blog.42signals.com/2009/01/fishes-swim-birds-fly-startups-fail/
    -prashant

  4. January 28, 2009 at 4:42 pm #

    @ Rohit,

    I have tremendous respect for you and have been following your venture very keenly. In fact, we celebrated in our office when techtribe featured in “Young Turks” program.

    If u remember, we also had a small e-mail conversation on 9/10/07 for a possible alliance.

    But, I am extremely sorry to say that some of your statements really taken us back. Like “Unless it’s a service that is a must have, it doesn’t work in Indian web” — Source: VC Circle.

    As, many budding entrepreneurs like me are looking up to you, please think through properly before making such general statements. These statements can create a lot of confusion in our minds. And I am sure, thats not great for our eco-system.

    Anyways, I heard that you are already starting with your new venture. Wish you all the best for that and for all your future endeavors.

  5. January 28, 2009 at 7:44 pm #

    Rajiv, it was a pleasure to hear from you guys. I enjoyed the next day’s discussion on setting started early, entrepreneur age and experience.

    I also liked how you both responded to audience questions and suggestions.

    Wishing you all the best. :)

  6. January 29, 2009 at 1:43 am #

    @Srini,

    Two quick points

    1. Please don’t form an opinion based on what you read in the media. The VCCircle story was based on a phone interview, and i’m sure you understand that some of these quotes look very different when taken out of context. It’s not the reporters fault – you shorten a story, and some of it is unlinked.

    2. When i said “Unless it’s a must have…”, what I meant to say was – one needs to figure out the value delivered to the member (user), and do it quickly. If the value delivered isn’t high enough, it won’t work in the Indian market. That’s a must have. A nice to have is something which the user may like once or twice, but when life gets busy, won’t use. Those plays won’t work in India. In India, we have plenty of social life with family and friends. The bar to get someone to use a service is high – service needs to deliver value. Unfortunately, as it is with most media interviews, they use soundbites :).

    And I don’t mean “value delivered” to be a tangible thing or monetary/business value. A bollywood portal like Chakpak can be of high value – like the Delhi Times paper I read every other day :). It’s entertainment. Alok Kejriwals’ Games2Win delivers high value to people who just love the brainless games.

    In the context of techTribe, it was a nice to have to a certain extent. Users liked the site, but didn’t get addicted to it.

    Hope that clears up some of the confusion.

  7. Bopaiah
    January 30, 2009 at 12:01 am #

    Hi Rajiv,
    The discussions on Learning From Failures was indeed a profound insight into how Failures have to be handled by experiencing it as also by learning it from others. I personally felt enlightned listening to the panel and analysing what they experienced. Such sessions bring inspiration to the determined soul.

    I must say, your presentation was brilliant.

    Cheers… :)

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