The US Consulate, Mumbai gave Pykih the opportunity to attend the Global Entrepreneurship Summit in Kenya. There, we got to meet / learn from the likes of Steve Case (AOL), Brian Chesky (Airbnb), President Barack Obama, Claire Lee (Silicon Valley Bank), Patience Marime-Ball (Mara Ventures), Faysal Sohail (Presidio Partners), etc. Below are some notes from the event.
Defining the Problem
Figure out a problem you face. See if another 10 or 100 people genuinely face it. Following are the properties that the problem should have:
- Fast growing market
- Large market
- Perpetual need.
- Global, not local
Ensure that the problem is faced by people across the globe (not a local problem). Note — The 19th and 20th-century entrepreneurs built countries as shown in the series — “The men who made America”. The 21st-century entrepreneurs are building the world. Never plan to build an Indian or American company. Build a global company. — Brian Chesky
Should you be worried about others copying your idea? If your idea is any good, people will ignore it (find it un-doable or stupid). Do not worry about copying.
Look for an intuition reset when finding a solution to how the market is currently addressing the market.
Team
- Entrepreneurship is a team sport.
- If 50% of your team is not on board, then you have a problem. — Obama
- Most teams that fail have a culture of “You win, I lose”. Until the idea of “You win, I win” creeps in, no one wins.
- Know what is negotiable and know what is non-negotiable. Give freedom and flexibility on the negotiable but any mistake in the non-negotiable is not acceptable.
- Never become complacent.
- If entrepreneur, team, sales people, etc. are not convinced that this is what I want to do for the rest of my life, then it does not work either.
Solution
- Hide complexity behind the curtains. Make it simple for customers to use.
- Understanding and leveraging human psychology is key to driving adoption.
- Show benefits in a way that people care about.
- Can you somehow bypass entrenched markets?
Prove the Solution
Focus on building a solution that makes those 10 or 100 happy. Always better to have 10,000 very happy customers than 1 million somewhat happy customers. Slowly increase the number of people you make happy. Do not try to make every one happy (not possible). It might eventually happen but not at the start.
- Main reason for start-up death is too much scaling / $ before validating idea. Before proving, do not scale i.e. hire too many people, raise big money, launch in new markets, etc.
Finding early adaptors
- Most people use products because other people use it. Most are not early adopters. E.g. Brain Chesky’s sister would not use AirBnb, when launched. Hence, find and build for early adopters.
- Early adapters are people with in arms length (metaphorically) since you will need frequent access to them.
- Go to Silicon Valley not for money or technology or employees or culture but for early adopters.
- Note — the one who pays might not necessarily be the one who gets the benefit.
Funding
- HNIs, corporates, countries, etc. have excess cash and they need to re-purpose that cash somewhere else it reduces it with time due to inflation. This is where most of the money for funding comes from. Once an idea is proven, cash will come. There is enough of it in the market.
Scale
- Perseverance, Partnerships, Product, Platform.
- Partnerships are critical to complete the loop for the end-customer and thus scale. Partnerships create momentum.
- Content Marketing: Think of all your mediums of communication as a 30 min TV series or a Radio Show. Now imagine, if there were 20 minutes of commercial and 10 minutes of entertainment, then would you like it? The best content marketing is one where 27 minutes is entertainment / training / learning / sharing and 3 minutes of commercial about yourself.
Prioritise markets
Once, your solution is proven in one market, then try to expand in other markets. The way to do it is to organise markets in a 2 by 2 matrix of:
- Market Size: Big < — → Small
- Urgency to crack it: Easy and at risk < — → Tough to crack E.g. for AirBnb, US is a big market and easy and thus at risk. That should be your first market. Then Europe and finally developing markets like India, China.
Localise (seed markets)
- Once you identify a market, then travel to those markets and study them (talk to people) well to identify how best to localise your solution to their specific needs e.g. integrating with local wallets like m-pesa in Kenya or payTM in India.
- AirBnb founders used to travel 10 cities in 3 weeks.
- Then slowly open offices in local markets and launch.
Culture
You must know what made you successful in the first go and then repeat it. In most cases, it is the agility (nimble) of start-ups that makes them successful. If you lose it, you stop growing / innovating. But then there are two sides of this coin. On one side, you want robustness i.e. more people, more processes, more customers, more predictability. And on the other side, you want to maintain the start-up culture and innovation. Run a big company as a collection of many start-ups in a functional fashion instead of a hierarchical fashion and let each start-up within the company have it’s own way of doing things. Till they are organised, they are fine.
Your culture must accept change and the resulting chaos as a fact of life. We are in the business of change since technology changes how the world operates. Change management / acceptance of change must be part of your DNA.
— Brian Chesky
Evaluating is your start-up on the right track?
- Focus on what is under your control.
- You are not a good start-up if you are not doing your best with the variables that are under your control.
- Better start-ups are the ones that increasingly bring more variables under their control.
All that an investor / customer / employee / partner is looking at is, is the idea good and big enough, can you implement it and grow the business?
Conclusion
Finally, none of this works. You have to figure out things for yourself. Things are very contextual based on where you are, what are you building, the complexity of your solution, your market, etc.
Every one has a plan until you get punched in the face. — Mike Tyson.
Ritvvij Parrikh runs a data design company in Mumbai called as Pykih.com This blog post was originally posted here.
@ritvvijparrikh @pykih