Being an entrepreneur is cool. Glorifying mistakes is the norm. Being profitable is boring! Always look out for the bigger picture! Work to get funding, then it’s a smooth drive!
In my 5 years of entrepreneurial journey, these are some of the common misconceptions that do the rounds! Having worked with over 400+ start-ups (At an average of 1.5 new clients a week), I now think that many companies have got the basics so wrong that they end up closing down and in some cases don’t see daylight at all.
Let me list some of my observations/comments from the many businesses we have interacted with!
1. Common Sense is extremely uncommon!
We have met many people who wanted to be entrepreneurs, who were completely clueless about why they even want to do what they are doing in the first place. This was not just lack of awareness but sheer lack of common sense. They have been dumbstruck when bombarded by us with questions that bring out the lack of common sense in their approach! For instance, in a world of BigBasket and Amazon, someone wanting to start an app for grocery delivery while working full time in an IT company, what do you call it?
2. ‘No’ is not a swear word!
Very often, entrepreneurs seem to have this problem! They just can’t or don’t know how to say No! This leads to a lot of wastage in terms of money, efforts and time for everyone! Saying No, while could be offensive in the short run helps everyone tremendously in the long run. In the kaleidoscopic world of start-ups, saying No is considered a blunder! Well, No, it is not! It is absolutely fine for a company to say they are not okay with spending X amount on a logo design at some point or it is okay for them not to agree with something that we are suggesting. Saying ‘No’ encourages transparency that will take us all a long way
3. Ever pending invoices and never existing ethics!
In the madness of running with the herd, many companies seem to forget the importance of ethics. Ignoring pending invoices, staying deaf to the constant reminders, copying ideas from other companies blatantly, avoiding taxes, lack of marketing ethics, having no ideals whatsoever are some of the many issues we have faced and continue to face every day!
4. Profitable is boring?!!
“Amazon, Flipkart, Ola and Uber are all losing money you know, so there is no hurry to be profitable. We just need to get THERE!” This is something we hear so often! But, let me get this right, I might sound old-fashioned, but isn’t the whole reason for running a business is to make money (apart from solving all the problems in world and all that, keep that line for the investors)? Well, can’t just blame the entrepreneurs here, must blame the investors as well. They consider being profitable as boring!
One of our clients, is so focussed on doing the right things, not wasting money on unnecessary things (like fancy office, travelling only in Business Class or unnecessary marketing gimmicks). Unlike most, they had common sense. They prioritised sales over everything, grew steadily and are profitable in a good scale! But, guess what! They are unable to sign an investor on board! No one wants to trust a company that is already showcasing a 3x or 5x return, they would rather invest on mere words of promises of 50x / 100x returns on their investment! Should we call this greed or what?
Being in debt apparently is important especially in the audit books! This whole fad seems to be misleading a lot of people who invest almost all of their savings, get a huge loan and continue to be in debt, hoping for an investment in an idea that is not new/needed to solve an important problem! Sigh, the vicious cycle seems to be going on forever
5. Romanticising Failure!!!
This is perhaps the most irritating trend amongst the wannabe entrepreneurs. Instead of analysing what is going wrong with their company/work, they think failure is a quintessential part of a company’s path to success! Because, Bill Gates and Steve Jobs were college dropouts. Well, they dropped out of Harvard and Reeds, not some random Sri Krishna Engineering College or Matha College of Arts in the outskirts of the city.
Yes yes, failures can be the stepping stones of success, no doubt! But, we should stop somewhere, analyse and correct our mistakes, right? Not happening! Some entrepreneurs just seem to be in a deep slumber dreaming that their endless mistakes would lead them to success at some point! What happened to learning from mistakes, correcting the course of action or at times? They are waiting for the failure to turn to success by itself overnight!
So, what exactly is wrong in the ecosystem?
Here is data for you to digest: More than 90% of startups close within the first year and more than 75% of venture-backed startups fail. But we don’t get to hear these things from the media. We hear of companies that get funded. We hear the nonsense of companies operating on the scale of Flipkart and Snapdeal being referred to as Start-Ups. Brilliant businesses who are operating on a small/medium scale, being profitable, making a difference are just ‘not interesting enough’ to be featured in the media!
What is with people in IT with a spare couple of lakhs becoming ‘investors’? Are we building a breeding ground for entrepreneurs with just visions but no on-ground knowledge/skills to get it across?
I am a second generation entrepreneur and could be called a tad too old-fashioned to be running a company today while having such thoughts! Perhaps I might never grow my business to a scale that is considered the norm for ‘success’ in today’s world. But, I would never regret running this business this way! After all, we have been in the industry for 5 years, running primarily through referrals from existing clients who are happy with what we are doing for them. We are obviously doing something right!