The entrepreneurial wave has hit India and everyone wants to be one, everyone wants the freedom. An alternative to the frustrating and non-satisfying 9 to 5 job obviously seems tempting, but not without cons which many are unaware of. I believe entrepreneurship is a mental disorder, an affliction, and definitely not a choice, but a compulsion. Relationships, bank accounts, and mental stamina reach the extreme in an entrepreneurial journey; it is not meant for everybody. We surveyed hundreds of students and young entrepreneurs and the results were unprecedented. Students plan to start-up right after college when they fail to land up with a job and are left with no option. Moreover, more than 80% of the entrepreneurs do not have a prior experience or background knowledge in the sector they want to start-up in.
The Indian startup ecosystem is undoubtedly improving, with tons of incubators and co-working spaces coming up in almost all the cities across India, with startup meetups and workshops happening every weekend and obviously with millions poured in both by the government and by private angels and VCs. But, is the growth in the right direction and are the entrepreneurs really solving real life pain-points? Here are some problems I observed while working closely with over 25 early stage startups during my journey at Startify.
It’s easy! It is very easy to be called an entrepreneur these days, you just need to buy a domain name for under 100 bucks, and update your social media profile to “Founder and CEO”. Entrepreneurship is the latest fad; everyone wants this title. This is true and is happening. On paper, starting a company is very easy and this is exactly what I used to think when I started up initially. But when reality hits you in the face, it’s a bad fall.
Learning: Make sure you are not into business just because it is a new trend, and you think you can make money. Know the reality well and make sure you are ready for the hardships.
The first step. How did you come up with the idea? This is the question which is very critical and can give a good insight about the startup. Most of the startups today have become mere middleman and there is a lack of innovation. Every city has at least 10 food delivery startups and that is not a problem if one can find a better and an innovative way to do that task. Sadly, people end up copying each other or choose to solve a problem which either does not exist or they themselves do not believe in. In India still, most of the people think ‘startups’ are only app or web based. We need to encourage more food product companies rather than food delivery companies and this is true for every sector. The Indian ecosystem needs more products than services.
Learning: Do not be passionate about being an entrepreneur, but be passionate for the problem you want to solve. Solve a problem which you have yourself faced or have seen others face. Understand what your competitors are doing and do a good research on what your customers want. Solve a problem that really matters!
Brake or break? More than 35% of the startups shut down even before they get their first customer and one of the main reasons of this is the team. Even worse, there are a lot of people who are not starting up because they do not have a cofounder or a developer in their team. Apart from the team, many entrepreneurs end up building castles on paper but nothing in reality. Others, try to make a perfect product with all the features and end up launching too late or not launching at all.
Learning: Your startup is your ship and you are the captain. You need to figure out everything and get things done. Just planning about a startup and waiting for things to happen for long simply implies you are not dedicated towards your startup. Launch your alpha version as soon as possible. Someone rightly said, “If you are not ashamed of your first product, you probably launched it too late.”
Investors vs Customers. Unfortunately, the investors are winning this battle. Even before one is aware of his plans, they want to get funded. I strongly feel that online media is to be blamed for this mindset. With news of startups getting “x million” funded every other day, people consider their startup to be successful if they are funded. Everyone is trying to build a business plan which investors will like, not a one which would benefit their customers. Yes, investors are required at some stage of the startup, and the main journey starts after that. Startups have failed to understand this, therefore end up burning the cash too soon without planning or just keep running after investors without even a prototype.
Learning: Get your first 10 customers, have a proof that people want your service or product. Have a good roadmap to reach a stage you want to and investors will follow. Beware, early investment can be dangerous.
Article published in Udyami North East: UpStart January 2017
Himanshu Sikaria: Initiated Startify, an online incubation portal during his sophomore year at IIT Jodhpur which was recently acquired. Startify had over 100 startups on their platform and over 140 mentors, investors and incubators. Himanshu has also been involved in budding various entrepreneurial ecosystems in Assam and Rajasthan.