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Managing The Money Men Money, it’s a crime. Share it fairly but don’t take a slice of my pie —Pink Floyd. They might as well have been singing this song for professional investors who invest seed capital in businesses that are now ready to bloom. But to bloom, these businesses need more capital and these investors are not excited about it as they do not want to get diluted and lose control. They also don’t want professional investors into the business as it dilutes their stakes. This affects the business models and many times companies with good business models simply fold up. RK Reddy, when he moved out of Fractal Analytics blamed the fallout on this phenomenon. “It is happening everywhere in India. Getting funding for new ventures for young businessmen is not easy in this country. It is not like the US where even venture capitalist help you in your funding requirements before you are even a graduate. India in this respect still has a long way to go,” he says. Mr Reddy is the co-founder of Fractal Analytics who moved out to start on his own along with another partner due to the difference with the investor in Fractal Analytics. When Mr Reddy passed out of IIM-A, he and his friends thought getting professional investors to invest in their ideas will be easy. They were from the same batch of IIM-A and had enough work experience to get seed capital. But that was easier said than done. He and his friends had a tough time talking to investors and then finally ended up with a professional investor who invested the initial seed capital to start Fractal Analytics. No venture capital or institutional investor was interested in putting the seed capital. Another services firm founded by a group of professionalsturned-entrepreneurs thought they had solved their one of the most pressing problems when they finally found a business group willing to fund their start-up. But like any relationship that goes through different phases, this one hit a rough patch a couple of years into its existence. On one hand the entrepreneurs had everything they asked for — investors who were on the board but did not interfere in the daily functioning and the strategic decisions were taken by the management team. “This is one of the biggest nightmare for an entrepreneur. But we were very lucky in this,” recollects one of the founder-promoters. However, on the other hand, a passive investor was not the ideal recipe for growth. As the entrepreneurs soon found out as they grew bigger. Now they needed more management bandwidth and from professionals who could bring in more than money to the table. The choice was a difficult one. Either the founders or the investors had to dilute their stake and make a compromise. Expectedly, the investors were unwilling to dilute their holdings. At this stage, the company could’ve gone the Fractal way with the founding team and the investors going different ways, and one of the members of the founding team chose to do exactly that. Frustrated by the slow pace of growth when its peers where growing much faster through acquisitions, one of the members moved out. A solution was reached a year and many months later when the investors finally agreed to sell part of their stake and the company was able to get in an investor who would take the firm to the next level. “Had we done this earlier, we could’ve probably grown much faster. But sometimes you simply have no choice but to be patient. Indian culture is different from the American culture,” says one of the founders who stayed on. Venture capital firms face these problems on a regular basis where they see a clear conflict between the promoter and the investor. These firms though invest in companies at the seed capital levels, they do it only if that sector is in vogue. In many cases these firms do not want to take a contrarian view and prefer to go with the trend. “Many venture capital firms will not have issues investing into a firm that is into social networking but will not invest into a business that is based on knowledge or hard skills,” says an entrepreneur who has moved out of a firm to join the competitor. VCs on the other hand do not like to be tagged based on trends or any other parameters. Each and every venture capital firm operates differently and works in terms of domain expertise. If they do not understand the business they simply want to avoid the investment. In general they prefer businesses that are already on a growth path than be the seed investor. “Individual investors work well when it comes to seed capital or absolute start-ups. Their requirements and expectations are different. But when the company is on a growth path, institutional investors work better for the firm. These new investors are in a better position to help and guide the firm as compared to individual investors,” says Alok Mittal of Cannan partners, a firm that provides venture capital. When there is a VC there is a healthy board process which is absent in the case of an individual professional investor. Getting the VC funding at initial levels or seed levels is not easy in a country like India. Good business models will suffer in the hands of individual investors and this may kill entrepreneurship in India. Though VCs are saying that they are looking at good business models which require seed capital, these firms are more interested in how fast a company can be taken public and latch on to market capitalisations while the trend is hot. Like Mr Reddy says: “Before I start something on my own, I will first look at the quality of investor. Everything else comes later.” Article Resource: The article appeared in The Economic Times, Mumbai in one of their successful columns on Entrepreneurship/Start-ups called "Starship Enterprise". From around 10 people in the first few years to 200 people in two centres at Mumbai and Bangalore, Cross-Tab has come a long way to carve a niche for itself as a market research outsourcing provider. During its seven-year-old history, Cross-Tab had enough brushes with fate to turn into a failed dotcom venture or a small outfit operating from one of the bylanes in Mumbai. But, Cross-Tab successfully negotiated both these challenges to scale up and re-invent itself as a market research outsourcing (MRO) provider. Today, the firm founded by three entrepreneurs — Kedar Sohoni, Ruchika Gupta and Praveen Gupta — operates from one of the spiffy new buildings which have sprung overnight in Malad, the BPO hot spot of the city. “The entry barriers in this business are not high. But to grow and scale up — that is a high barrier,” says Mr Sohoni, about the firm’s journey from a start-up that wanted to leverage the internet for market research to a domestic market research agency to its current avatar as one of the leading third party MRO players in the country. From around 10 people in the first few years to 200 people in two centres at Mumbai and Bangalore, the company has come a long way. Not only have the entrepreneurs made this business transformation, but they have also worked with two sets of investors in the process. The initial investor, ICICI Venture, sold its stake to the Mittal group in 2003 and the new investment in some ways also catalysed the growth of the company in terms of getting another board-level person who could provide strategic inputs to the firm. Kedar, Ruchika and Praveen were IIM and BITS, Pilani graduates with experience in marketing and research, while Ashwin Mittal, who joined the board as one of directors representing the Mittal group, was a former strategy consultant from Cap Gemini in the US. “The turning point for the company came in 2002-03. Till then, the firm was into market research for domestic firms,” says Ashwin, who after a year of being with the company as an investor was inspired enough to join it full time in 2004. The story goes like this: One day, when Cross-Tab was making a presentation to one of its clients, a senior executive in the audience from the client’s multinational parent was so impressed that he asked Cross-Tab to also work for them. Around the same time, the company also became a member of the European Society for Opinion and Marketing Research and started getting a lot of enquiries for doing outsourced market research. The bulk of the work in outsourced market research involves processing information obtained from market research surveys, analysing it and generating reports. Conservatively, the opportunity in this space is estimated to be a quarter or $5 billion of the $25-billion global market research pie. Cross-Tab has already successfully made this transition. It has also gone a step ahead in doing end-to-end work for corporates that comprises the full spectrum, from designing the survey and managing it to processing the end-results. “For global surveys, we also have tie-ups with partners in other countries,” explains Ashwin. The challenges it now faces are those that come with scaling the business up to the next level — creating process and systems and also positioning itself in the global market for high-margin business opportunities. At this stage, the company does not have many of the resources that a larger organisation would have — such as a CFO or a human resources head. It also does not have a sales team, which is important if wants to address the corporate market directly. Its board also currently consists only the founders and three directors from the Mittal group. Some of the initial steps in this direction are just being taken. A few months ago, the company recruited a global CEO with about 13 years of experience from no less a company than Microsoft. It also appointed Simon Chadwick, former CEO of market research company NOP World and who has worked extensively with the WPP Group, as a strategic advisor. It now plans to set up a global advisory board that will guide the firm, and also give it contacts and credibility. But the journey ahead will not be simple. For one, the firm will have to compete with other MRO players in India (all the top players are estimated to be growing at about 80% annually) as well as global market research agencies, in some cases. Also, a few leading global market research firms have set up captives in the country enabling to compete on price points with Indian players. But the untapped market opportunity is huge and growing. And Cross-Tab’s entrepreneurs have shown the stomach to emerge successful from tough situations, and the ambition to thing big when the opportunity presents itself.  Ashwin Mittal (L) & Kedar Sohoni Directors, Cross-Tab About Cross Tab: An Overview Philosophy and Vision Their vision is to provide our clients with market research, data collection and data analysis solutions through an open and transparent relationship, aimed at achieving common goals and establishing long-lasting co-operations. Article Resources: ‘UNLOCK INNOVATION’ I am a 45-year-old businessman from Gujarat. Currently, I have a trading business operational out of Mumbai and Gujarat. However, it is not performing as well as I had hoped it would. Moreover, my worries have multiplied as I have had a string of unsuccessful business ventures before starting this business. This has started affecting my decision making. I am worried that I might fail in this business as well, as I did in my previous experiences. How do I deal with this phase in my entrepreneurial venture? Please advise.  Captain G. R. Gopinath INDIA today is a country abounding with opportunities and optimism. The 9% GDP growth rate of the past few years, coupled with rising incomes and progressive liberalisation, has inspired a wave of first generation entrepreneurs to the fore. Newage entrepreneurs, both small and big, are making a foray into diverse sectors and pioneering new opportunities and potential. How Social Networking Sites Help? Web offers a platform to engage professionals and tap key talent for new ventures. ASOUND adage to know is the one that says it’s not what you know but who you know that counts. Skill and grit can get you far, but it is only networking that will take you far enough. For entrepreneurs, it is the lifeline that fuels their startup aspirations. Until recently, social networking meant daylong seminars which meandered aimlessly or evening tuxedo events, where one waited for the first opportunity to leave gracefully. But it has taken on a whole new meaning in the internet age. Executives at companies of all sizes, but especially in startups, are connecting with professionals around the world through social networking (SN) sites to learn strategy, hire the best people and form alliances.  Keeping up with the competition demands cultivating contacts at warp speed, and that means working your shtick online. There are plenty of tools — many of them free — and more are on the way. Social networking sites are all the rage these days. Younger people may use such sites for dating and hobbies, but there are other sites devoted to professional collaboration. LinkedIn and ZeroDegrees are two of the more popular services that facilitate business-oriented connections, and some argue that these and similar sites are now doing a better job at connecting entrepreneurs than any other medium before. Remember Metcalfe’s Law — coined by the inventor of Ethernet — which states that the power of a network grows in proportion to the square of the number of its nodes? That’s a geeky way of saying that networking technologies nobody uses are of little value. As the popularity of social networking sites grows, so does their value, because a larger number of users means better odds for productive connections. A look at the sheer number of start-ups getting online shows how their popularity is increasing among entrepreneurs. LinkedIn, for instance, had 40,000 users in mid-November 2003, and is now up to over 5,50,000 users, who have uploaded more than 25 million contacts from their address books. Many of those 25 million will soon be getting e-mails asking them to join LinkedIn and participate in the network. And LinkedIn is not the only social network out there, of course. It is not even the biggest one, although it is the largest business-oriented network. Others, like Friendster, are oriented more toward easing the way for personal relationships and more popular ones like Orkut and Facebook have recently started professionals getting online to connect with peers. And new ones seem to pop up every day. And then there is Techtribe, which brings together technology entrepreneurs through social networking. “Connections are of prime importance to any entrepreneur. And there can be no means cheaper to get to know people than creating a profile on an Orkut or LinkedIn,” says Rohit Agarwal, who operates TechTribe. So how does all this affect entrepreneurial firms? Says Avinash Agarwal, founder of RouteGuru, “SN services offer a cheap platform for entrepreneurs to connect with experts who can offer mentorship and help shape business ideas. It can also prove to be a starting point for such connected entrepreneurs to get in touch with a few venture capitalists as well when they raise money.” Mr Agarwal himself has used SN to great effect for his startup RouteGuru. Before starting his company, he started a discussion group on TechTribe about his business idea. He placed his idea about an India GIS (geographic information system) service on the internet for feedback from industry gurus. He says: “I blogged about my idea for RouteGuru using the website’s platform. This way, I got to connect with experts. And not just getting feedback, I also got to know a few people interested in my domain and eventually ended up hiring them for my company.” And now that his company is looking to raise venture capital, he says that he would once again turn to many more sites such as Facebook and Ryze to connect with the right people both in India and abroad. The world of venture capitalists, however, may still be slow to embrace social networking. Many VCs prefer face-to-face interaction with startups. SN sites, at best, can be a secondary means and not the primary means to connect to them, VCs say. Also, the biggest concern for many is the amount of spam that an account-holder can face. Suvir Sujan, managing partner of Nexus India Capital says he had to close his account with a popular social networking site after getting an enormous amount of unsolicited messages. Such a tactic could undermine the credibility of a startup, he says. “For instance, while using social networking websites for sales pitches, if one sends out countless unsolicited advertisements to unsuspecting users, chances are that his account might get banned for that network. At the least, you will chase off potential customers and earn a negative reputation for your business.” In fact, spam generated by social networking has come to be known by its own term: snam. Employees within a startup who are often motivated to join these networks for personal or professional reasons often end up exposing themselves, and their Rolodexes, to the outside world. This may lead to them being head-hunted when they are not actively looking for jobs, pitched products or services they might not want, and waste working hours dealing with contact requests from “a friend of a friend of a friend.” According to a research by comScore, employees tend to spend, on an average, 186 minutes on Facebook per session. “This definitely affects productivity,” says Mr Sujan. So, what should companies do? Probably, the best policy is the one most commonly used for instant messaging and e-mails: allow certain, secure networks for business use and set policies about how contact data can be shared. Says Mr Agarwal, “I do not think that networking in the cyberspace can be stopped; one can waste a lot of money trying to stop and control it; but I think what they have to do is learn how to deal with it and learn how to live with it.” Find a COO without spending a bomb WHEN Bikram Dasgupta of Globsyn Technologies bought out the Mumbai-based Synergy Log-in Systems, he learned a few hard lessons. Dasgupta had acquired the promoter’s stake by making an upfront cash payment. But soon after, Dasgupta discovered that relations between the promoter and his management team had been strained and two key executives left taking their business and contacts with them. Dasgupta was faced with the task of finding a person who could take on their roles and also the revive the loss-making banking products software company. Because of the differences between the promoter and the senior leadership of the firm, business was slipping and many client orders were unserviced. These customers were considering moving to a different software provider. The need of the moment was a chief operating officer who would lift the company from the morass. “I couldn’t pay too much money, and I wanted someone who was willing to take on the risk and who had experience in working in a leadership role in a technology firm. If we could turn Synergy around, the rewards would be good,” says Dasgupta. There was no money to hire a professional executive search firm. Thinking about it one night when he was online, Dasgupta decided to advertise on LinkedIn, the professional networking site. “It was only $160. So, I thought I have nothing to lose,” he recollects. The response was tremendous. And Dasgupta struck gold. One of respondents, Prakash Seernani, became his COO. “Prakash had excellent references. He had been an entrepreneur and had worked in several senior positions in IT firms,” says Dasgupta. Dasgupta is based in Calcutta; so although he travels frequently to Mumbai, Seernani has a big hand in running the venture. For Seernani, LinkedIn was another way of networking. “Most senior-level appointments at this level happens through networking or through a professional executive search firm. So, it is not really unusual from that point of view,” says Seernani. The opportunity offered by Dasgupta was one of the many that came his way on the Internet. “Where I started, in Hinditron, we still have an alumni network on Yahoo Groups. It’s great way to network and the personal benefits are tremendous,” he says. Article Resource: Author: Ritwik Donde is the Chief Editor in the The Economic Times, Mumbai and the article appeared in one of their successful columns on Entrepreneurship/Start-ups called "Starship Enterprise". Life is a never-ending game Last year, Indiagames, the Mumbai -based gaming company, hit the jackpot when China's Tom Online acquired 80 per cent stake in a multi-million dollar buyout. Coming soon from Indiagames are the legendary adventures of Emperor Ashoka and an exciting game-based movie on the Jurassic Park. Meet India's 28-year-old gaming king, Vishal Gondal, CEO, Indiagames, who has come a long way from his humble beginnings in the backyards of an eastern Mumbai suburb, Chembur. Many startups have their origin in a hobby. Most game development companies come under this category. Developing a successful business model for such companies can be a challenge, especially if you’re a rookie entrepreneur. Vishal Gondal, who founded Indiagames and still runs it after selling a majority stake to UTV, recalls how his business model fashioned itself when he still didn’t know the meaning of the term:  I was totally into games since my childhood, be it volleyball or online. I still play games all night long. I created my first game at 14, it was a Pacman clone. In 1993, I started FACT (Futura Academy of Computer Technology) at a garage in Chembur, Mumbai. I was just 16 then. There were only three computers and I taught students software programming, multimedia, etc. In 1997, I started ADVER Gaming i.e. games built around advertisements. My first project was for Pepsi. The game was programmed to shoot Coke cans with Pepsi. I used to go to companies and ask for themes for creating games. For Pepsodent, the game was designed to kill germs. I have also designed the scoring system for Femina Miss India, in which his algorithm helped calculate the scores of the contestants. Then came the Kargil war and I thought a game where you can shoot the terrorists who are trying to cross the LoC would be very appropriate. ‘I Love India’ was an instant hit. Then I realised that there’s a lot of demand for India-based games. And so in 1997 Indiagames.com, a website focused on games for India, was launched. It had games like Ravan Vadh and Dusserah. It was still a small venture with only five people until PricewaterhouseCoopers stepped in. One day in 1999 two investment bankers, I had no clue what it meant then, walked in and told me that they can provide me with venture capitalists. I had no clue what they meant, first investment bankers then venture capitalists. They explained that VCs will give me big money to expand my company and they will take stake in it. The best part was I would not have to return the money they’ll put in. Great. Now, when I look back I think had I been aware of all that I would have been able to take the plunge and reach were I stand today. Ignorance can sometimes be a bliss, you see. They asked me my business model and when they realised that was reacting to it as if they were speaking in Greek, they made one for me. PwC said they will only charge me success fees, that is, if they succeed in getting the funds, then only I will pay them. I agreed. They arranged Rs 3.5 crore from VCs and got their due. With the new money, my office expanded and I hired around 40 people. But, I was quite conservative in spending, don’t know why. After the dotcom bust, I wanted to shut online gaming and move over to mobile gaming. But, the other board members were not sure about it and wanted to go with providing services to foreign software companies. So, I had to also act as IT service provider for some time. But, I had faith in my gaming abilities and as there were not many players in this segment then I managed to get assignments for mobile gaming from Disney, Universal, Sony Pictures and Nokia. And so came games for Lion King, Finding Nemo, Hulk and Wheels of Fortune. I always had the feeling that something more was needed to besides these, I needed a few products. I need to license a character, make a game and distribute it. But, it was very difficult to choose such a character because if it fails we will lose big time. In end 2003, Spiderman 2 was to be released and I decided to go for him. Got in touch with Marvel Comics and managed to get a worldwide licence for Spidey. The game was released in 60 countries and in 6 languages. Later I acquired licences for Bruce Lee, Jurassic Park, Buffy the Vampire slayer and Mask. Mobile game publishing increased our revenues 10-fold. I am happy that I have proved that you can do a product story in India. Now, I have a team of 300 people which include gaming programmers, graphic designers and gaming testers. Everyone in my team love gaming and that’s the common thread that binds us. When we are not creating games, we are playing one. My offices are in Mumbai, Beijing, London and Los Angeles. I also outsource some work to Eastern Europe, US and China. My dream is to give games or e-sports, as I call it, the recognition of a sport. It is never business for me, it’s just gaming. The other global players in mobile gaming are EA, GLU and GAMELOT. Besides, companies like Yahoo and Indiatimes also have mobile gaming facilities. My recent favourites are Resident Evil 4, Gears of War and WiiSports. It keeps on changing. With the growing market of pirated games it is becoming very difficult for gaming companies to maintain margins. So, I have made a pact with major gaming providers including Microsoft where I deliver a gaming package to people via broadband and charge them monthly. The companies are paid according to the usage of their games. So, when there’ll be easy and cheap availability of legal games, people won’t go for pirated products. Recently, UTV has taken over a major stake in Indiagames.com. (the stake held by Tom Online). To budding entrepreneurs, my advice is that you should have a good original idea and the capability to execute it. Have faith in your product. And always give preference to business sense than legal sense. Gaming's dark side Are games addictive? Do they cause violent behaviour? Gondal says, "NO!" "With low penetration of gaming in India, I think violence is not perpetuated through gaming. There is more violence on television. You can get addicted to worse things in this world, so it's better to get addicted to a game! And he explains the positive aspects -- games sharpen reflexes and knowledge. Strategy games -- like King of the Empire -- and social games help increase tactical insight. Also, the theme that is amongst the most popular in gaming is 'Good must triumph over evil.'" Wanna go gaming? Being a part of the International Game Developers Association, it has been Gondal's endeavour to promote game development in India, especially because not many companies are looking at this segment. "We have a shortage of trained manpower, as there are no institutes to really train people in this field. We take people at a trainee level and train them for 6 to 8 months." "The good thing about the gaming sector is that an employee can even be a school dropout. To be a 'tester,' you just have to be passionate about gaming. Testing is a very important part of gaming, as we cannot launch games unless they are tested well. For game designers, we have a varied set of people: artists, programmers, people from tee arts, science, and commerce fields. "We have trained about 80 per cent of the people working here. Indiagames is the only place, which has the largest number of team members in one place. Interestingly, we have foreigners keen to work for us. Our US operations are headed by an American, while in Europe we have hired a former Vodafone head. Techie's interests Gaming is Vishal Gondal's first love, but he also loves travelling and trying out new cuisines ("I have been to many countries," he says). He is also a gizmo man; he likes to have all the latest gadgets. He dotes on his Blackberry phone. His home is wi-fi ready. Future perfect Optimistic that gaming will boom, Gondal explains that the company will set new targets and grow. "We have about 60 per cent of the market share in India. We are growing at 150 to 200 per cent. The priority is to stabilize and tap the more markets and capitalise on the tremendous mobile growth and increased broadband in India." "We have just launched Jurassic Park. It is a very interesting theme where we put you in the park and how you go about to escape from the park. We will also be working on 3D games and expanding the console gaming project. Another project will be a console game on Emperor Ashoka -- all about him and his wars. Indian stories have global appeal as well. We hope Emperor Ashoka games will reign over the games space." With the Indian mobile gaming market set to generate $336 million in annual revenues by 2009 and the number of mobile users to go up by 2 million every month, Indiagames is certain to ride the wave. "The next two years are critical to us as mobile users are going to increase in number and broadband is coming up in a big way in India," says Gondal.  Estimating Startup Costs ONE OF the toughest things in starting a business is, well, figuring out what it’s going to cost you to start. It’s tough because startup costs are a moving target, easy to underestimate and almost always subject to change. Here are five rules that can help you start figuring the cost of starting. Have a solid plan — then change it. Most business startup stories say that you have to have a business plan. And you do. But that’s not the beginning and end of figuring out your startup costs. Jeff Shuman, professor of management and director of entrepreneurial studies at Bentley College, says, “The conventional wisdom is that an entrepreneur sees an opportunity, comes up with a business plan to capitalise on it, determines the capital that needs to be raised, raises the capital and then applies it to building the business described in the business plan.” There’s one major problem with that model, says Shuman: It all hinges on getting the business right the first time, and that doesn’t often happen. “In reality, it’s likely that some of your initial assumptions are pretty good and others aren’t going to be worth the paper they’re written on,” he says. Shuman and others say that figuring out your startup costs means regularly reviewing your assumptions and changing your initial business model. Writing a business plan is good because it forces you to write down literally everything you are going to need to start your business — legal help, tax help, office supplies, equipment, postage, office space, employee salaries, insurance and so on. But that initial plan is likely to change repeatedly as you learn new things and incorporate them into the plan. Be willing to pull back. It’s tempting to add up everything you need for the fullfledged business you imagine, and decide that that’s what you need to start out. But pulling back and looking for a smaller model can give you a way to get started while also preserving capital. Shuman uses the example of someone who calculates that the total cost of starting a retail business in a local mall is going to work out to $150 a square foot. “You could start that way and write a business plan based on that amount,” he says. “But maybe you’d be better off putting a pushcart in the mall and testing what the demand is for your products at that location. “This consumer testing reduces your initial startup costs. The result is that the initial cycle of your business is dedicated not so much to generating profits as to generating information. With this, you can fund your business on a cycle-by-cycle basis,” Shuman says. “When you go for the second cycle and for expanding your business, the numbers are now based not on focus groups or surveys but on real-world experience.” Calculate prices, time correctly. Calculating your initial cash flow is part of figuring out your startup costs. It’s an area where businesses are sometimes less optimistic than they should be. “Small-business owners may under-price their product or service, thinking they have to come in at as low a price point as possible to compete,” says Barbara Bird, chair of the management department at Kogad School of Business at American University. “They don’t necessarily need to do that.” Correctly estimate your startup time. Yes, when beginning a business, time can literally be money. Let’s say you’re going to have fixed costs such as a monthly lease. If you have to make improvements to a space before you can actually open for business, those fixed costs are going to be additional startup costs until you can actually open for business. I’ve watched many entrepreneurs draw up a timeline for their ventures and get tripped up on the zoning, safety and inspection requirements imposed by local agencies. For that reason, I think one of the first places a prospective new business owner should go — even before approaching a lender or leasing agent — is to the local government planning or license department. Construction permits and inspections can push a startup’s prospective opening date back by months. If you fail to figure in the cost of this additional time, you could be short of working capital right out of the gate. Be realistic about the cost of money. Many small-business owners self-finance their ventures by running up big balances on their personal credit cards. Others tap the equity in their homes. But self-financing isn’t a practical option for larger ventures. Carnegie Mellon’s Emerson says that startups should figure in the cost of capital when determining initial expenses and cash flow. “The cost is usually based on what the interest would be that similar cash invested in something with similar risk would command on the market,” Emerson says. “It’s usually a figure that is a few percentage points or more above the prime rate.” Adapted from Microsoft’s Small Business Center website. Birth of a Salesman: Selling Learning to Solve Business Issues Perceptions about the learning function may be learning professionals' greatest frustration, but changing those perceptions is one of the most promising opportunities for impact. Moving learning to business-partner status requires an investment in yourself. How many times have you seen the potential for a critical integrated learning solution overlooked until the deployment of a new operating process, a systems implementation or the launch of a new product or service - or worse yet, totally ignored until something goes wrong? Learning need not be forced to limp in and turn lemons into lemonade, though. It should move beyond the role of a firefighter dousing the flames of poor planning and circumstance to the more proactive role of a building inspector to help make sure the house doesn't catch fire in the first place. To assume this role, however, learning leaders must sell the value of development programs. Selling has several connotations. If you find yourself selling learning to a line-of-business head, promoting a packaged solution that fits in your current budget or asking for precious budget dollars and finding apathy or limited excitement, you likely are too late and have missed the opportunity. Selling your solution is about selling yourself and your team's ability to execute - to build trusting relationships based on previous initiatives' success and indisputable data. Selling is about business partnering, not pushing your solution. This requires a continual cycle of developing the relationship and educating decision makers about learning potential and performance. This kind of selling is key to building the kind of institutional trust and relationships that will be required to win support for learning's up-front involvement in the next critical endeavor that will require collaborative initiative. It's important to remember that relationships are earned, and if organizational perceptions about learning's role are not taken seriously or shaped by creative and innovative solutions, they can remain a serious drag, damper and de-motivator to the entire learning enterprise. Consider the sales process: It is not your one-size-fits-all idea in a box that should be accepted by any prospective customer you pitch it to. It is determining the business issue, drivers, potential of the solution, how the solution comes together, investment in dollars, satisfaction with the executed solution and return on investment. If you have been attempting the first with limited success, let's discuss how we get to the latter. Rolling Up Learning's Sleeves Given the demands on our time these days, it's easy for any learning professional to get mired in an unceasing cycle of process meetings in the learning organization. But this unfortunately comes at the expense of not moving our learning organizations forward to become better business partners - easily said, but not easily achieved. Relationships with line of business leaders are never static. They either are gaining momentum and moving forward, or they're moving backward. If a business leader does not know your group, then you do not know your customer. That's why knowing your business, building critical relationships, understanding how decisions are made and why they are made are so important. If you bring creative solutions and new ideas to shape the overall business, you can reshape perceptions about learning and add value to your organization. In sales, there are "high-value questions." In the learning leader's situation, some of these may include: a) What are the perils and challenges between our current state and our goals? b) What does success look like? c) What does failure look like? d) Does a performance solution need to be part of the overall solution, and why? e) Which performance indicators will inform the business about its early progress? f) Which piece(s) of the implementation plan might require us to stay closely connected moving forward? OK, so you have asked the questions. Now what? From here, it becomes similar to a learning analysis. You understand the problem, but do you understand the gap, the challenge? Would the decision maker agree with you? How does your approach distinctly map to the needs and fulfill the gaps? Can it be demonstrated? Is it logical and simple, or convoluted? Can you explain it in less than a minute? And the big question: Can you prove that you can execute the solution? Once key decision makers understand the big-picture impact of the learning enterprise, they're far more likely to forge a relationship through which they can discuss the tools or capabilities the learning organization can bring to help solve the issue or increase the business' overall chances of attaining its desired objective. Practical Advice on What Works Sonserae Toles, director of the U.S.-based Learning Campus for Siemens, a global leader in industry, energy and health care, said there are two things any learning leader can do to help advance effective corporate learning. First is to look at where your key clients reside structurally within the organization and to become well-versed in their specific body of knowledge to establish credibility and increase the chances of a more meaningful engagement. Learning professionals who already have expertise on a particular business line usually have a much greater chance of being perceived as a trusted partner than those who do not. A second, albeit underutilized tactic is to reach out to the communicators supporting the lines of business. "That communications person can be an extremely valuable resource. He or she knows what's happening within the organization, what the trends are and what other parts of the organization support the operations. Don't underestimate their role," Toles said. Building relationships with other support services within the organization not only gives learning key allies in selling itself across the organization, but also puts learning closer to the business operations that drive results on a more regular basis. Sheri A. Lamoureux, human resources executive for Energy East Corp., a super-regional energy services and delivery company based in the northeastern United States, said earning the support of the company's senior vice president and chief administrative officer, in addition to its human resources team, has been key to building the business case for enterprise-wide learning. That was critical, she said, because for some time, the company wasn't managing or tracking the kind of training its employees got from external sources, so it wasn't really in tune with how learning was impacting its business. Had that situation continued, the organization might never have recognized - from either a business or succession-planning perspective - how important its learning objectives were to achieving its goals in the short and long term. Before it could renew its impact, learning had to enlist the support of human resources and senior management by creating evaluation tools to measure the success of training and demonstrate a direct impact on financial performance, Lamoureux said. It also had to win the backing of skeptical business managers who had gone so long without significant employee development support that they wondered why their future performance hinged in any way on learning. "The leadership of the organization is the most important component of this to be successful," she said. Beyond that level of organizational sponsorship, the Energy East learning team had to not only understand its internal clients' business but also be capable of selling the benefits of engagement with learning in their language. That's the wellspring of trust between business managers and learning professionals. "It's being able to deliver on what you say you're going to deliver on and showing them the results and doing it in the timeline you promised," Lamoureux said. "It's really as basic as that - and developing those relationships where they understand that you fully understand the business drivers and that you have the business acumen and can gain the trust and credibility. It's focusing on results." Those organizational assets were evident in the execution of a workforce respect program that the learning team expected would drive an increase in employee complaints in the short term, but in the long run would actually create a more equitable working environment for employees. The learning team delivered the program, acknowledged both the pain and gain, but in the end, demonstrated not only a decrease in complaints but also a broader slate of benefits to the company. Lamoureux said the practice of simply talking to business partners and being open to their suggestions and also being flexible and open-minded in terms of learning solutions can effectively demonstrate the kind of reciprocity required for meaningful partnerships. It's also important for learning professionals to understand relationships are one-half of a critical success formula for selling learning and earning the trust of decision makers and business partners. "Relationships can go a long way, but quite often we need to show the business rationale for what we're doing and how we're moving forward," Lamoureux said. Successfully selling learning across the enterprise requires one to define the business case, gain consensus about it, execute the work and then measure and reflect the impact to build trust and win support for the next collaborative initiative with a line of business. "There's both a trust and a data piece to that," Lamoureux explained. "Business partners can really only convince themselves. If you show them data and show them facts, it's hard to argue with that. And if it's coming from trusted source, that can seal the deal." In summary, if you want to sell learning, you'd better know your customers, understand their pain and map valid solutions that have proven that they can solve that pain. Demonstrating the capabilities and relevance of yourself and your team as opposed to merely promoting an off- the-shelf solution will help you close that sale. Reference: Anthony A. D'Agostino and Joseph Daniel McCool [About the Authors: Anthony A. D'Agostino is a vice president and principal in the learning practice of ACS. Joseph Daniel McCool is an author and an online columnist for BusinessWeek.] Bose Phenomenon. Entrepreneurship is the midwife to innovation. Yet, how many businessmen have the courage of conviction to build enterprises that are based on principled ideas of what companies should be? Last fortnight, on a raw autumn day, I met an exception to the rule: 72-year-old Amar C Bose. The story of how a young MIT grad’s quest for the perfect stereo system led to the creation of Bose Corporation in 1964 is business lore. The privately-held company went on to become a sound (sic!) transnational, with a turnover in excess of $1.2 billion in 2002 and a reputation of building the world’s best audio systems. What is less well known, I discovered, is that the Bose Corporation is not the brainchild of a canny business strategist, but an ongoing experiment by a brilliant scientist who knows how to use logic to move from assumption to conclusion. I had wanted to meet Dr Bose from the time I first stepped into a Bose showroom many years ago. Each retail outlet comes with its own demonstration room. Walk-in customers are urged to take in what can only be called a Bose son-et-lumiere. You sit in front of a bank of impressive-looking stereo equipment including awesome speakers that thrum life-like sound at you. At the end of the show, the salesperson removes the large speakers to reveal that actually, all this while, the hi-fi sound was coming from the tiny Bose speakers. At this point, the audience gasps.  As I drove towards The Mountain, the Bose Corporation’s headquarters in Framingham, MA, I was very curious as to what kind of a mind had come up with a marketing strategy that changed the customer’s mindset and convinced the customer about its own product attributes. Turned out it’s a teacher’s mind. As a electrical engineering professor at MIT, writing textbooks forced Dr Bose to think like a student. “It caused me to project myself into the mind of someone I am addressing”. So, in 1968, when the Bose Corporation came out with its first breakthrough product — the 901 Direct/Reflecting Speaker which reflected 89 per cent sound off walls and brought live concert-like sound into homes — Dr Bose also decided to come up with a breakthrough marketing strategy to sell the product. “I knew this speaker was better than anything in the market. But, if I had left it to the salesperson, he wouldn’t even try to explain the attributes. So, I came up with the idea of a 7-minute demonstration. It was like teaching or writing a textbook”. Welcome to the Bose school of entrepreneurship, which teaches only two lessons. One: Passionately, madly and deeply, believe in how you want to run your company, and ensure your actions are designed to follow your beliefs, no matter how illogical or non-businesslike it may seem to anyone else. Since innovation is all, it’s ideas and not hierarchy which determines the direction of research. Since Dr Bose is a fierce believer in ethics, every employee learns the p’s and q’s fast — salespeople are sacked on the spot if they are caught criticising the competition. Two: Passionately, madly, and deeply, avoid doing what you do not believe in, no matter how logical it seems to everyone else. Since he wanted to ensure that the Bose Corporation was driven by research and not financial results, Dr Bose refused to take the company public and be bullied by Wall Street. Since he did not start the company for personal wealth, Dr Bose’s salary is fixed by the HR department just as it is for every other employee. None of his children work there nor will they inherit it — instead, it will, most likely, pass on to an education trust. Is Dr Bose always right, has he always made smart choices, were resources always efficiently employed? He will be the first to admit, no, no and no. “I would have been fired at least five times if I had been the chairman of a public company”, he says with a grin. Then, he leans forward, his eyes burning with intensity: “For me, the profits that come in are like the blood in the human system. However, the real excitement is the way the body works.” That’s the thrill of enterprise — despite 38 years of being in business. When did you last feel the rush? Article Reference: The article appeared in the Financial Express dated: Tuesday , November 12, 2002. The first Indian to get a gold medal in Olympics in an individual event. Background Abhinav Bindra comes from an affluent Sikh Khatri family. His parents, Dr. Apjit and Babli Bindra, are promoters of the Hitech Group of companies which has a turnover of Rs. 300 crores (US $75 million). The group has interests in agro & dog food processing, computer gaming, livestock genetics and pharmaceuticals. He was born on September 28, 1982 at Dehradun. He studied at the Doon school, Dehradun till the 8th standard (topping the difficult entrance exam) and then left for St. Stephens School Chandigarh to pursue shooting. He earned his BBA from the University of Colorado. He did his shooting training in Germany. He practiced for 12-14 hours a day at the shooting range that he owns at his farmhouse near Chandigarh. International performance. He won six medals at various international meets in 2001. In the 10 m Air rifle event at the 2002 Commonwealth Games, Manchester, he won Gold in the Pairs event and Silver in the individual event. At the 2004 Olympic Games, he scored 597 in the qualification round and was placed third behind Qinan Zhu (599 - Olympic Record) and Li Jie (598). In the finals, Abhinav finished with 97.6 p oints, last in the field of eight and was the only player below 100 points. His sub-par finals dropped him from third to seventh. At the 2006 Melbourne Commonwealth Games, he won the Gold in the Pairs event and the Bronze in the Singles event. He missed the 2006 Asian Games at Doha because of a back injury. He received the Arjuna award in 2000 and Rajiv Gandhi Khel Ratna (India's highest sports award) in 2001.  Winning Shot Bindra booked his place in the 2008 Olympics by winning the gold medal at the 2006 ISSF World Shooting Championship with a score of 699.1 At the 2008 Beijing Olympics, Abhinav Bindra won the gold for the Men's 10 meter Air Rifle final after shooting a total of 700.5. He scored 596 (fourth) in the qualifying round and out-scored all other shooters in the finals with a round of 104.5. In the finals, he started with a shot of 10.7, and none of his shots were below 10.0. Bindra was tied with Henri Hakkinen heading into his final shot. Bindra scored his highest of the finals - 10.8 (A Bull's eye) while Hakkinen came with 9.7 to settle for Bronze medal. This was India's first individual gold medal at the Olympics, and the first gold in 28 years, since the Men's Hockey team won the gold at the 1980 Moscow Olympics. Bindra is rewarded by various Indian state governments and private organizations for his achievement. These include the state governments of Punjab - Rs. One crore, Harayana - Rs. 25 lacs, Maharashtra Rs. 10 Lacs, Karnataka Rs. 10 Lacs, Tamilnadu - Rs 5 lacs, Madhya Pradesh - Rs. 5 lacs, and Chandigarh 5 lacs. Other organization that rewarded Bindra include Chandigarh civic administration - Rs. 5 lacs, BCCI Rs. 25 lacs. and Samsung Rs. 20 lacs. Indian Railways has rewarded him with lifelong free pass for himself & one companion in First AC. Spicejet Airways has offered him lifelong free flight. Have you ever gotten to the end of a "busy" day and then realized that you didn't really get anything significant done? One of the biggest causes of this common problem is what Peter Drucker calls "drifting into trivia." Getting so caught up in all the small stuff that you forget to do the big, important stuff. There are many opportunities during each day for you to drift into trivia: remembering a phone call you need to make, coming across a piece of paper reminding you of some other project, getting an email asking you a question, a call from a colleague, a drop-in visitor, etc. Before you know it, the important task that you were working on is hijacked by a much less important errand. If you find yourself routinely working on unimportant things or not accomplishing as much as you want, you may be drifting into trivia more often than you think. Drifting into trivia is not always easy to spot. Sometimes the work that you drift into seems important, but if you take a step back and reflect on what you are really trying to accomplish, you realize that the work doesn't really serve your objectives and is merely distracting you from what you really need to do. The best way to avoid drifting into trivia is to have clear priorities and objectives. When your priorities are clear, you will be able to tell when that tempting distraction is less important. You will realize immediately that by doing it you would be drifting into trivia. Setting Clear Priorities Effective time managers quickly realize that they simply cannot do everything. They have to be selective with their limited amount of time and consciously choose to spend it on what is most important to them. This is why it is so important for you to be the one choosing, rather than just going with the flow and allowing circumstances, interruptions or other people to choose for you. Prioritizing means taking conscious control of your choices and deciding to spend more time on the projects and tasks that are important and valuable, and less time on the ones that are not as important or valuable. This may sound obvious, but the fact is that the vast majority of people don't put much thought on how they spend their time. They just flow through life doing whatever grabs their attention next, or repeating the same things day after day out of habit and routine. How to Prioritize The ABCD prioritization method is a simple, practical and powerful technique you can use to prioritize your projects and tasks. You should start by prioritizing your projects (which represent your outcomes) based on their importance. I normally assign an A priority to ongoing projects that I'm actively working on, as well as important long-term projects that I want to continue moving forward. Your A projects represent outcomes that you have decided are important enough to commit time to on a regular basis. So, if you think you should be making progress on a project right now, give it an A priority. I assign a priority of B to projects that are "under review." They may very well be worth moving forward, but they are not important enough to devote time to them this upcoming week. You can then revisit your decision during your next weekly planning session. One common mistake while prioritizing is to automatically assign an A priority to urgent things, and to push back important long-term projects to B or even C priority. If a long-term project truly is important, you should make it an A and commit time to it on a regular basis. I usually leave urgent but non-important projects/tasks as either B's or C's, which helps me to productively procrastinate on them until I can truly determine if they are worth doing. Since I review them regularly, I don't have to worry about them falling through cracks or becoming a crisis. The C priority category represent projects that I may want to do at some point in the future, but definitely not right now. Once I've decided that a project is a C, I won't even consider committing any time to it during the upcoming week. Finally, I reserve the D priority for projects and tasks that I'm not planning to do at all. They are simply not worth my time right now. Prioritize Your Tasks Prioritizing tasks is slightly different than prioritizing projects. In general, projects are things that you are going to work in parallel during the week, so the project priorities help you decide which projects to work on, as well as how much time to devote to them. On the other hand, you normally work on tasks for a given project sequentially. You work on the most important thing first until completed, and then you move on to the next most important thing, and so on. Task priorities help you decide the ordering of tasks within a given project... which task to do first, which task to do second, etc. You don't need to worry about any other projects or tasks you may have, just consider how important the task is for its project. When prioritizing tasks, I usually start by categorizing them into one of the ABCD labels without providing a rank. Ranking the Items Once I have assigned a priority label to all tasks, I focus on the A's and assign individual priority rank values to the top five to ten tasks: A1 for the most important, A2 for the next most important, and so on. You can usually tell which of two items is more important just by looking at them. If you are having trouble deciding, just ask yourself: "If I could only complete one of these but not both, which one would I choose?" If you think two tasks are equally important, just assign the same priority value to both of them. If you have more than ten tasks for a project, you don't have to assign rank numbers to all of them. Just rank the top five to ten tasks and leave the others with their general labels (A, B etc.) One important benefit of prioritizing is that it allows you to focus on your most important tasks without getting overwhelmed by everything that you need to do. That's why I suggest you only rank five to ten tasks: it allows you to focus on a small number of tasks at any given time. Achieve Planner makes it super easy to filter your task list by priority so you can stay focused on your most important tasks. If you still find your large task list overwhelming or distracting, simply move more of your tasks to B or even C status. Working with Priorities The key to making the ABCD method work for you is to develop the habit of using your priorities to guide your work. Whenever you start working on a project, start with the top priority task and work on it until it's done (or it's time to work on some other project). If you consistently choose to spend your time on your most important projects and tasks, you'll be making great use of your time and you'll feel much more productive. Here's What You Can Do Now 1) Look over your projects and categorize them into A's, B's, C's and D's 2) If you start working on a project and you haven't prioritized your task list, spend a few minutes prioritizing your tasks and then get to work on your most important task first. 3) Whenever you start working on a project, start with the most important task first - develop the habit of using priorities to guide your work. Here are some additional resources and tools that you might find useful... 1) Achieve Planner Software Achieve Planner software for Windows helps you get organized, increase your productivity, and make better use of your time. Here's what one user had to say... "After trying Achieve Planner for nearly two months I can honestly say that it has revolutionized the way I work. I have an incredibly busy schedule so I need something that can cope with a multitude of tasks, projects and appointments whilst at the same time keeping me focused on what is most important. Achieve Planner does all of this and much more besides. Over the years I've tried pretty much every system on the market and nothing, absolutely nothing, comes anywhere close to this. It looks great, works superbly, comes with excellent instructions, is a pleasure to use, but most important of all - IT REALLY WORKS! For anyone who wants to get organized and take their productivity to the next level Achieve Planner is an absolute must. It's one piece of software that I'm certain I'll be using for many years to come." Paul Smithson 2 ) The Journal" Diary Software Keeping a journal or diary on your computer has never been easier! If you've ever wanted to start a journal or keep a diary, take this opportunity to get started today! "I just wanted to thank you for writing such a useful program. I use it daily to record my thoughts, which I later review as I write my poetry. The easy reviewing of my previous thoughts from other days has alleviated much of the writers block I experienced in the past. Thanks again for the great software!" Gregory Allan Clark It’s just the age for first love, first vote and first drive in father’s car. But it can also be the age for your first company. NOT YET out of teens and already dreaming of being an entrepreneur? You have an idea to fix a problem and believe you can make money from it? It might have been unthinkable in the golden age of lathe machines and steam engines, but in the featherlight economy of internet and mobile phones, it is not just real, but an inviting precollege career option. Imagine Google being founded by a 60-year-old business patriarch! Both Larry Page and Sergei Brin were 25 when they started what would become synonymous with web searching, but the age of entry for startup businesses is coming down. More and more workable business ideas are coming out of campuses, often from abroad but occasionally from India too. Fearlessness, exploratory mindset and self-confidence — all ingredients of youth — are becoming business assets. Teenage startups offer a unique proposition; if you succeed, you make it big. If you fail, you are wiser by the experience that college education couldn’t have given. Never was time so ripe for the country to warm up to this interplay of youth and entrepreneurship. But then, success stories are often hyped up and failures, larger in number, ignored. The road to entrepreneurial success is hard and unpredictable even for veterans, and can be quite daunting for a teenager. There are so many things that one must get right from the start, if the venture has to take a professional step forward. Here are a few tips that can show the light, but the journey is all yours. Studies Or Business? So, your parents have told you to finish college and do whatever you want only later. The good news is that internet has eased so many of the business functions that go into firing up a startup, that you can run the business in your spare time. When the Aggarwal brothers, Raghav and Abhinav, started exampapersonline.com, one was in college and the other in school. Peak season visits on their web site have touched 10,000 a month, but the business hasn’t affected their education. They plan to continue their study and qualify themselves better for business, but they also have plans for expanding the site and offer new services. With a bit of time management, it is possible to ride both the horses. That said, big education is not essential for successful entrepreneurship. An MBA, for instance, is fancied by kids looking for a career in business, but business experts say you don‘t pick up the art of entrepreneurship from the degree itself. “MBA, by itself, imparts very few skills that are really valuable in a startup situation,” says Alok Mittal, a venture capitalist with Canaan Partners. “The uncertainty and non-linearity of startup businesses is something that most MBA courses shy away from. What it does provide is an allround theoretical view of how businesses function, but it’s not very difficult to pick that up in any case.” Want to hear what an IIM entrepreneurship professor has to say when asked if it is better to get an MBA before trying out a new business? “Certainly not. MBA makes students more risk averse,” observes Anil K Gupta of Indian Institute of Management, Ahmedabad. Everyone Says It Won’t Work The single biggest hurdle that young entrepreneurs report is that elders do not take them seriously, at least initially. Let us hope the grown-ups will grow out of this attitude as news spreads about more successes, but till then you have to learn to live with dismissive comments. Even friends can be sceptical. “People tend to have this natural tendency to want to put down an idea however good it is. We saw some of this from our peers and sometimes, they even throw you off track,” says 17-year-old Abhinav. But then, “If you are convinced, then that’s all that matters.” Canaan’s Mittal likens entrepreneurship to new world exploration. “I would take an analogy of an explorer who has a vision which is seldom shared by others.” The traveller must have the courage to face unexpected obstacles and find his way around in an unknown land. A deep knowledge of what you do, a professional attitude and focus on solving your customer’s problems will gain you recognition in due course. Do I Need Prior Work Experience? There are those who think it would be useful to have some work experience and others who feel such experience can actually make people timid. But hardly any expert suggests work as an essential qualification for entrepreneurship. “It is a myth that experience is a must for entrepreneurial success,” says R Satyanarayan, founder of Career Launcher, which is training 55,000 business school aspirants this year. TechEnclave, an online discussion forum for computer hardware issues, enjoys the patronage of 20,000 users today. Its founders, Ajay Datta and Sumit Chaudhary, were teenagers going to engineering college and picked up some experience working informally for their friends’ web sites. “Work experience is not needed. If you just have a good idea, that’s it,” Mr Datta says. It is important to know the importance of business operations, finance, marketing and negotiation and these skills can be picked up while working for somebody else. It is a matter of personal choice whether one must work before starting up a business or just take the plunge. “If one has an entrepreneurial spirit, he/she will do it either ways,” says Manish Vij, co-founder of Quasa Media. Do I Need A Partner Or A Mentor? A partner who brings complementary skills, experience or money can be valuable, but of utmost importance is “alignment of objectives and high degree of trust in each other,” says Mr Mittal. A single leader startup might have its own value though. It would be easier to impart focus to the business and maintain the vision. But if you must get a partner, choose someone you know and respect, says Abhijeet Virmani, founder of Positron Advisory Services. The same thing goes for a mentor. Young people benefit immensely from mentors, who can shorten the learning curve and help in making decisions at crucial turning points. However, having a mentor is no alternative to the hard work required to make a business successful. “A mentor is not needed to solve a business problem as much as to solve a dilemma in the head,” says Mr Satyanarayan. The guide can help you decide if and when you need to raise money, hire people or form collaborations. You should not turn to the mentor for day-to-day problems. If Something Goes Wrong? Two hours of sleep should improve your head, says Mr Satyanarayan. All businesses, big and small, hit low points. The ability to remain calm and make logical decisions during such a phase is critical. “I remind myself that this is a hole that I need to climb out of and I sleep it off. Never make a decision at the top most or bottom most of your game.” Early troubles can actually teach an entrepreneur valuable lessons in business. Exampapersonline, run by Aggarwal brothers, saw a slump in student visits to their site immediately after the annual examinations. They say this forced them to think of ways to spread out the traffic to the whole of the year. They have come up with new ideas to keep the site relevant for periods far from exams. They are now planning to launch internship listings, campus reporting and project work forums. My Idea Needs A Lot Of Money An expensive idea can still be a great one to pursue if it can provide commensurate returns, says Mr Mittal. “As a first-time entrepreneur, understanding how to phase the capital raising process is a key. Progressively, as you establish the opportunity better and address the risks in the business, you can raise more capital and fund expansion.” Services based businesses that leverage the power of technology and Internet can be started at a fraction of the cost of manufacturing businesses. Mr Satyanarayan says, “True entrepreneurship is about making sure that a business model is mortally dependent on capital.” So, here goes. Entrepreneurship is like a game of chess. The starting move defines your position, the middle game shows your grit and staying power and the end game determines your fate. It takes both a bit of daring and bit of careful approach to make the winning move. Article Resource: Author: Jacob Cherian is the Chief Editor in the The Economic Times, Mumbai and the article appeared in one of their successful columns on Entrepreneurship/Start-ups called "Starship Enterprise". DREAM BIG, ACT FAST, BE DECISIVE I am a 25-year-old mechanical engineer based in Lucknow. I have started a business aimed at setting up a network of movie exhibition units in villages, using low-cost projectors. I wish to create a chain of 10,000 movie units across rural India in a span of seven months. After nine months of experimentation, my projector now works fine for a 120-inch display, but I have having a tough time trying to raise the required capital of Rs 1 crore. My parents say they have spent enough on me and friends say they need money for houses, cars and bringing up kids. I tried banks and venture capitalists. Banks ask for income tax returns for three years, while VCs insist on a track record. Is it possible for me to get seed capital or will the money come only after my business begins to bloom? Should I slog for several years before I get basic capital. Please guide.
THE creation of a large capital is undoubtedly a critical requirement for entrepreneurs across the board, at every stage of their growth. To get an idea off the ground, however, the critical factor is not money but passion and commitment for your vision, which for the truly committed, is inexhaustible. From Dhirubhai Ambani to Narayana Murthy, the success stories of Indian businesses are rife with first generation entrepreneurs having no prior business education, funding or even experience. Indian entrepreneurs now have the advantage of a dynamic and robust economy acting as a fertile ground for their innovations, experiments and success. Software Products to Fuel Air Transportation V. K. Mathews is the founder and CMD of the IBS Group of companies. Mathews founded the International Business Services Group in 1997, which has grown to being a leading global provider of new-generation IT solutions to the Travel, Transportation and Logistics industries and whose solutions today manage the mission-critical operations of the best airlines, the busiest international airports, top oil & gas companies and most luxurious cruise lines around the world.
Equipped with a Master’s degree in Aeronautical Engineering from IIT Kanpur, Mathews started his career in 1979, teaching computer science to army officers. In 1981 he joined the IT division of Air India and played a key role in the implementation of their computerised passenger services systems world-wide. Subsequently, Mathews joined The Emirates Group, where he contributed to the growth of the airline in various capacities, over a span of fifteen years from 1983 to 1997. As General Manager-IT of the Emirates Group, Mathews was responsible for formulating and implementing Information Technology strategies for Emirates’ global operations. ArcelorMittal: Speaking the Language of Business Mobility of people and ideas is central to success at ArcelorMittal. Thus, the company is emphasizing the importance of business English as a competency to ensure ideas and best practices can be shared throughout its global operations. When you create one of the largest companies in the world via merger, integrating new people and ideas becomes a significant challenge. This is exactly the situation faced by ArcelorMittal. This company is a major player in the global steel industry, with current production equivalent to about 10 percent of the world's steel output and a clearly defined brand promise of "transforming tomorrow." With 310,000 employees in more than 60 countries, however, communication poses a challenge. In the global steel industry, mobility of people and ideas is critical to success. To effectively manage this large international organization, ArcelorMittal is placing an emphasis on the need for its executives and managers to speak English, the all-but-official language of business around the world. "In our aim to become the world's most admired company, many things need to be improved," said Lakshmi N. Mittal, president and CEO of ArcelorMittal. "A priority is the fluent command of the English language. Our business long ago evolved from being local to being global. To help drive the business forward, we need a common language. The ability to speak English is not only a priority for our company, it is a valued asset that may expand [employees'] career opportunities."  "Global management requires a shared language," said Alejandro Gardella, ArcelorMittal human resources manager for the Americas. "Without good communication skills, employees have a limited ability to contribute to the new global company. We have already had situations where managers have had to travel with interpreters in order to participate in our global meetings. "Within our company, we have a wealth of talent and knowledge. But we need to be able to access this from across our group in order to position our company where we want to - as the best," he adds. "When Arcelor and Mittal merged in 2006, it was clear to me that in order to gain full advantage of the employees and expertise in the Americas, English business language skills would be essential." Two Companies, Many Voices After the merger, the ability to share information across the organization's expanded international operations became critical. Thus, the company quickly saw the advantage in having employees in high-level positions speaking English. This presented a challenge, as only 15 percent of the ArcelorMittal workforce was comprised of native English speakers. Previously, ArcelorMittal has provided classroom-based English language training, but this yielded inconsistent results. The company's production facilities often are located away from large metropolitan areas, and the result was a limited and unreliable approach to English language training. In order to efficiently and rapidly provide employees with the business English communication skills they needed, a new approach was necessary. "Prior to the merger, we had conducted a very successful pilot scheme with GlobalEnglish at Mittal Steel," Gardella said. "The implementation was very collaborative. The rollout was not just a test of online language training but represented the first-ever e-learning initiative by the company. We were very interested to see how it would be received, as that would indicate to us how we could use e-learning in other areas in the future." The pilot scheme proved highly successful. Ninety-eight percent of the participants indicated they would recommend the method of training to a colleague. In fact, news of the program spread quickly via word-of-mouth. Additionally, 83 percent of the participants were able to directly apply what they were learning on the job. "The product satisfied a specific need for our employees, and one that they recognized," Gardella said. "There was no lack of clarity. Having the interface in an employee's native language proved the perfect bridge to speaking English, and this is one of the keys to success." Following reports of high satisfaction rates from users, ArcelorMittal rolled out the service to managers, engineers, specialists and high-potential candidates around the world. Management targets those employees who need to use English in their current jobs or in preparation for future positions with the company. Enrollment rates have taken off as managers around the world have found out about the program and assumed responsibility for distributing it locally. The ArcelorMittal Corporate University conducts many leadership and high-potential courses only in English. This has been a factor in driving participation in the program, as employees must meet a certain English level proficiency in order to attend these programs. "Supporting our employees as they developed their skills was clearly an important factor in the success we have seen," Gardella said. "We provide regular encouragement and recognition to keep our employees motivated. Those who are making great progress are acknowledged in our newsletter, as well as with e-mails from senior executives. We have also planned for employees to have access through computer labs so that they can spend focused time on their learning. We are now looking at creative ways to build on the initial enthusiasm in countries where we have already had tremendous success." One Company, One Voice The service has been rolled out to more than 5,000 people in the organization, including 1,600 employees in Latin America, but there is significant need for more. ArcelorMittal has more than 35,000 people in leadership and management roles, so the bulk of English training has not yet taken place. "We are already seeing the benefits," Gardella said. "People who before could not be considered for global projects can now be accessed for their knowledge and experience. Employees in Brazil, for instance, have been working with Japanese production and quality techniques for decades, and now ArcelorMittal can bring that expertise to facilities right across the company. Understanding communication from the company headquarters is easier, and we are able to share learning and best practices across all employees in the shared language of business: English. In the longer term, succession planning and high-potential development is also improved. We can now include people from around the globe without the limits of a language barrier. "When you are a leader in an industry, you must always be developing and improving your own best practices. At ArcelorMittal, we are committed to providing the leadership that will transform tomorrow's steel industry. Having a common language allows us to get the best out of everyone in our company. That contribution is what allows us to continue to move forward in our aim to be one of the most admired companies in the world and to continue to lead the industry." Article Resource: Christian Standaert [About the Author: Christian Standaert is the general manager of ArcelorMittal University.] Keep the Spark Alive. Excerpts Inaugural Speech for the new batch at the Symbiosis BBA program, Pune - 23rd June, 2008.By Chetan Bhagat.  Good Morning everyone and thank you for giving me this chance to speak to you. This day is about you. You, who have come to this college, leaving the comfort of your homes (or in some cases discomfort), to become something in your life. I am sure you are excited. There are few days in human life when one is truly elated. The first day in college is one of them. When you were getting ready today, you felt a tingling in your stomach. What would the auditorium be like, what would the teachers be like, who are my new classmates - there is so much to be curious about. I call this excitement, the spark within you that makes you feel truly alive today. Today I am going to talk about keeping the spark shining. Or to put it another way, how to be happy most, if not all the time. Where do these sparks start? I think we are born with them. My 3-year old twin boys have a million sparks. A little Spiderman toy can make them jump on the bed. They get thrills from creaky swings in the park. A story from daddy gets them excited. They do a daily countdown for birthday party - several months in advance - just for the day they will cut their own birthday cake. I see students like you, and I still see some sparks. But when I see older people, the spark is difficult to find. That means as we age, the spark fades. People whose spark has faded too much are dull, dejected, aimless and bitter. Remember Kareena in the first half of Jab We Met vs the second half? That is what happens when the spark is lost. So, how to save the spark? Imagine the spark to be a lamp's flame. The first aspect is nurturing - to give your spark the fuel, continuously. The second is to guard against storms. To nurture, always have goals. It is human nature to strive, improve and achieve full potential. In fact, that is success. It is what is possible for you. It isn't any external measure - a certain cost to company pay package, a particular car or house. Most of us are from middle class families. To us, having material landmarks is success and rightly so. When you have grown up where money constraints force everyday choices, financial freedom is a big achievement. But it isn't the purpose of life. If that was the case, Mr. Ambani would not show up for work. Shah Rukh Khan would stay at home and not dance anymore. Steve Jobs won't be working hard to make a better iPhone, as he sold Pixar for billions of dollars already. Why do they do it? What makes them come to work everyday? They do it because it makes them happy. They do it because it makes them feel alive. Just getting better from current levels feels good. If you study hard, you can improve your rank. If you make an effort to interact with people, you will do better in interviews. If you practice, your cricket will get better. You may also know that you cannot become Tendulkar, yet. But you can get to the next level. Striving for that next level is important. Nature designed with a random set of genes and circumstances in which we were born. To be happy, we have to accept it and make the most of nature's design. Are you? Goals will help you do that. I must add, don't just have career or academic goals. Set goals to give you a balanced, successful life. I use the word balanced before successful. Balanced means ensuring your health, relationships, mental peace are all in good order. There is no point of getting a promotion on the day of your breakup. There is no fun in driving a car if your back hurts. Shopping is not enjoyable if your mind is full of tensions.  You must have read some quotes - Life is a tough race, it is a marathon or whatever. No, from what I have seen so far, life is one of those races in nursery school, where you have to run with a marble in a spoon kept in your mouth. If the marble falls, there is no point coming first. Same with life, where health and relationships are the marbles. Your striving is only worth it if there is harmony in your life. Else, you may achieve the success, but this spark, this feeling of being excited and alive, will start to die. One last thing about nurturing the spark - don't take life seriously. One of my yoga teachers used to make students laugh during classes. One student asked him if these jokes would take away something from the yoga practice. The teacher said - don't be serious, be sincere. This quote has defined my work ever since. Whether its my writing, my job, my relationships or any of my goals. I get thousands of opinions on my writing everyday. There is heaps of praise, there is intense criticism. If I take it all seriously, how will I write? Or rather, how will I live? Life is not to be taken seriously, as we are really temporary here. We are like a pre-paid card with limited validity. If we are lucky, we may last another 50 years. And 50 years is just 2,500 weekends. Do we really need to get so worked up? It's ok, bunk a few classes, goof up a few interviews, fall in love. We are people, not programmed devices. I've told you three things - reasonable goals, balance and not taking it too seriously that will nurture the spark. However, there are four storms in life that will threaten to completely put out the flame. These must be guarded against. These are Disappointment, Frustration, Unfairness and Loneliness of purpose. Disappointment will come when your effort does not give you the expected return, if things don't go as planned or if you face failure. Failure is extremely difficult to handle, but those that do come out stronger. What did this failure teach me? Is the question you will need to ask. You will feel miserable. You will want to quit, like I wanted to when nine publishers rejected my first book. Some IITians kill themselves over low grades - how silly is that? But that is how much failure can hurt you. But it's life. If challenges could always be overcome, they would cease to be a challenge. And remember - if you are failing at something, that means you are at your limit or potential. And that's where you want to be. Disappointment's cousin is frustration, the second storm. Have you ever been frustrated? It happens when things are stuck. This is especially relevant in India. From traffic jams to getting that job you deserve, sometimes things take so long that you don't know if you chose the right goal. After books, I set the goal of writing for Bollywood, as I thought they needed writers. I am called extremely lucky, but it took me five years to get close to a release. Frustration saps excitement, and turns your initial energy into something negative, making you a bitter person. How did I deal with it? A realistic assessment of the time involved - movies take a long time to make even though they are watched quickly, seeking a certain enjoyment in the process rather than the end result - at least I was learning how to write scripts, having a side plan - I had my third book to write and even something as simple as pleasurable distractions in your life - friends, food, travel can help you overcome it. Remember, nothing is to be taken seriously. Frustration is a sign somewhere, you took it too seriously. Unfairness - this is hardest to deal with, but unfortunately that is how our country works. People with connections, rich dads, beautiful faces, pedigree find it easier to make it - not just in Bollywood, but everywhere. And sometimes it is just plain luck. There are so few opportunities in India, so many stars need to be aligned for you to make it happen. Merit and hard work is not always linked to achievement in the short term, but the long term correlation is high, and ultimately things do work out. But realize, there will be some people luckier than you. In fact, to have an opportunity to go to college and understand this speech in English means you are pretty damm lucky by Indian standards. Let's be grateful for what we have and get the strength to accept what we don't. I have so much love from my readers that other writers cannot even imagine it. However, I don't get literary praise. It's ok. I don't look like Aishwarya Rai, but I have two boys who I think are more beautiful than her. It's ok. Don't let unfairness kill your spark. Finally, the last point that can kill your spark is Isolation. As you grow older you will realize you are unique. When you are little, all kids want Ice cream and Spiderman. As you grow older to college, you still are a lot like your friends. But ten years later and you realize you are unique. What you want, what you believe in, what makes you feel, may be different from even the people closest to you. This can create conflict as your goals may not match with others. And you may drop some of them. Basketball captains in college invariably stop playing basketball by the time they have their second child. They give up something that meant so much to them. They do it for their family. But in doing that, the spark dies. Never, ever make that compromise. Love yourself first, and then others. There you go. I've told you the four thunderstorms - disappointment, frustration, unfairness and isolation. You cannot avoid them, as like the monsoon they will come into your life at regular intervals. You just need to keep the raincoat handy to not let the spark die. I welcome you again to the most wonderful years of your life. If someone gave me the choice to go back in time, I will surely choose college. But I also hope that ten years later as well, your eyes will shine the same way as they do today. That you will Keep the Spark alive, not only through college, but through the next 2,500 weekends. And I hope not just you, but my whole country will keep that spark alive, as we really need it now more than any moment in history. And there is something cool about saying - I come from the land of a billion sparks. Thank You!!!  Jitendra Singh with son Lokendra STEPPING STONES FROM SCRAP YARD TO SUCCESS This serial entrepreneur went through a roller-coaster ride in a career spanning three-and-a-half decades and learnt some survival lessons on the way STEEL ingots, magnets, flowers and film-making — these disparate interests hardly hold a connection for most of us. But for Jitendra Singh, they mark the turning points of a long entrepreneurial journey that began in the early 1970s and continues to this day. In these years, Mr Singh says, he tasted success and failure in good measure and each experience left him with rich experience and lessons in business leadership. It all started on a tour to Japan in 1968. Young Jitendra had gone there along with his father, whose metal scrap business had a few customers in the land of the rising sun. A nationwide strike had given this engineering student an impromptu vacation and he used that to stay and learn his first lessons in business from Japanese workmen. “There was a cluster of furnaces in Japan’s Kansai region (known as a steel hub). India’s steel industry had never seen that kind of growth. I realised that there was space in India to set up similar facilities, especially when we were just developing and I predicted huge demand for steel,” says Mr Singh. He found a willing venture capitalist in his father and the family applied for government licences to make steel ingots in the country. Indian Steel Corporation (ISC), the Singh family’s new firm, obtained three licences and by 1973, had set up two plants at Kolkata and Mumbai, each with 12 tonne arc furnaces. Industrial units making small steel items were the customers and soon, the business started gaining ground. Demand was growing and Mr Singh decided it was time to scale up capacities. The first hurdle came in the form of high interest rates. The proposal was not only turned down by many banks, but the high cost of borrowing made it unaffordable for the family to take loans for expansion. But Mr Singh had resolved to expand capacity five times and looked for options. “That’s the second thing that one should do to cement a new business; expand. Unlike now, it was tough to raise mone |
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