TiE Entrepreneurial Summit – 1

“Who is an entrepreneur?” Scott Cook, Founder & Chairman of Intuit asks.
An entrepreneur makes something better or faster or cheaper or all three.
These words were representative of the Entrepreneurial Summit conducted by TiE (The Indus Entrepreneurs) – straight-shooting, practical and unblemished.

A grand event at the Hotel Lalit Ashok in Bangalore, the TiE Summit brought together leaders in business and budding men and women entrepreneurs eager to switch cards with the big guns.
The speakers covered numerous topics bringing forward solid, practical advice to all present.
Basic questions were asked leading to much discussion that revealed to a great extent, the bare fundamentals of business, and the secrets to success in the field.
Speakers were flown in from all over the corporate world to share their insights with an enthusiastic congregation.

Most points were however prefaced by the doom & gloom of the world economy.
Although there was some talk about this not being the “ideal” time to enterprise, this was quickly followed up by a core fundamental: If you’ve got a great idea, great enthusiasm and great persistence, the struggle for funding will be insignificant.

Innovation was a topic of much discussion. Martin Kleem, the keynote speaker of the second day of the summit, gave his path to innovative success. He introduced the one greatest source of invention as the violation of “Unquestioned Mindsets”. The unquestioned mindsets of the accounting software industry in 1991 were that more features were always better than fewer and that double entry accounting (credits and debits) was the sole supreme market need.
Quickbooks, Scott Cook’s  product had half the features of its competitors, was twice the price, was an unknown brand, had bugs in the software and within 1 month of its launch had 70% of market share.
This shocking success was a result of a change in mindset or rather a challenge to the established mindset.
As Prof. Theresa Amabile put it, “Entrepreneurship is finding and seizing opportunities that others miss.”
Quickbooks saw a large untapped opportunity in marketing simple uncomplicated accounting software. They noticed that many small businesses functioned much like a family where one of the partners took care of the finances without any real accounting qualifications. They needed a simple mechanism to maintain accounts.

How did Scott Cook notice this market and keep it? He “went there and saw”. Scott and his team went to the offices of local businesses, met with the “accountants” to figure out what they were missing. He solved “big customer problems”. And the “delight” that it brought customers was Quicbook’s marketing.

Operating values were a major theme at the summit that almost every speaker addressed. It starts with the employees. Give them a great place to work. They are the driving force of business, the one factor you can count on to give you more, if you give them more. Then come the customers. Give them better ways to live, making life simpler. Both these operating values need a quality that many expounded on: Empathy.
An old Indian proverb was quoted: “Empathy is not just about walking in someone else’s shoes. First you must remove your own.”
The key to being an entrepreneur is the ability to adapt. This was intricately tied in with empathy. The skill to change
Another key operating value that was noted by Mr. Raj Jaswa, President TiE Silicon Valley, was the fact that as an entrepreneur you can write your own rules. You don’t need to follow any rules, not even the values that seemed to have worked for these entrepreneurs. Only when you develop your own values will success follow, says Mr. Jaswa. Mr.Jaswa also recommends that budding entrepreneurs or those who are planning to upscale their businesses must first position themselves in such a manner as to first scale themselves and their skills up to size.
Top class management material available online was suggested. For example, the Million Dollar Club of Insurance Salespeople is said to be chock full of valuable information available online. Remember says Mr. Jaswa, “The company grows after you do.”
K. Ganesh, IIM graduate who founded and heads TutorVista spoke about his own operating values as well. The most inspiring story I heard at the summit as far as garnering venture capital is concerned was Mr.Ganesh’s value creation from $500,000 to $65 Million with no venture capital.
He prescribed a few questions that must be asked before starting to enterprise –
1.    To start or not to start – ask yourself “Why do it at all?”
2.    External capital or bootstrapping
Base this decision on
•    Capital needed to break even
•    Your own risk appetite
•    Non-financial benefits of VC Capital specific to your sector
3.    Profitability vs. scalability
4.    Built to last vs. built to flip
5.    Identify/ealuate greenfield opportunities

Innovation is key, says Mr.Ganesh. Be a pioneer and look for opportunities for a scalable business. Do not try and have a head on conflict with the big players.  His golden advice: Be prepared. Plan for every event.

Will Basil, CEO and founder of FabIndia spoke about the importance of the team.
He expounded on the theory of the “third dimension” in decision making.
“Future business books will be written about the third dimension”, he said.
When building a team, Basil says, it is important to include people with diametrically opposite means of thinking. When this happens and a conflict is seen between the two dimensions, a third dimension, one of a combination of ideas, arises. Again the primary operating value of FabIndia was, “Never bullshit the customer because sooner or later, you know, they can smell the bullshit”.

The retail sector was also a topic of much discussion. The sector was said to be young and the media was blamed for creating a perceptive lull in consumer spending. Mr. Arvind Singhal, Chairman Technopark Advisers, was clear about his thoughts stating that there was “no indication”, that consumer spending had fallen or that consumption was stressed. In absolute terms, he said, consumption would grow at 15%.
The main takeaway from this session was this: A retailer at this stage must not compromise on spending on the customer, because when we come out of this “perceptive” slump, you will have a large and loyal market share. While your competitors were cutting costs with the customer, you stood your ground.
Another important point for retailers – short-circuit the supply chain because cutting supply chain costs reduces the risk of losing customers.
A counterpoint to this suggestion was the fact that this required investment and that this is not necessarily economical at this point in time. It was argued that it would be easier to bring in discipline.
During the growth phase that we enjoyed, retail became prosperous and in effect inefficient. It “gathered flab”. In that regard, the slowdown was well-timed for this sector. There also appears to be a lot of opportunity at the lower end of the retail market with new formats, models, systems and markets.
In conclusion, do not make changes in consumer propositions – keep with it. Do not short-change the customer.

The BPO sector was another topic of great focus. After a barrage of statistics, Mr. Raman Roy concluded that there was still a massive market to be outsourced in the form of companies that were beyond Fortune 1000. Small & medium enterprises represent a large chunk of business that can be outsourced. He called it, “Moving away from dozens of companies worth millions to millions of companies worth dozens.”
Where is the industry? We are still growing at 7% which is a tremendous figure given the state of Europe and the US. Our industry is deep in terms of the number of companies. And our industry is tremendously flexible having gone through numerous downturns in the past and having come out much stronger.
We will see an experimentation with new business models and constant innovation as the industry manoeuvres itself into a revival.
The future however, appears harder to predict. The panel did predict though that the industry for the most part would have a bright future, given its depth.          Getting together at TiE to discuss the future of entrepreneurship provided 1700 budding and experienced entrepreneurs with an opportunity to share ideas, create opportunities and network.

There was a lot of disagreement among panelists at the summit, but there was one sole point that all could agree on.
We are in a remarkable period of economic history with very low visibility where finding funding will be difficult, but if you have the model and the passion, never let the entrepreneurial spirit die.
Those who succeed now, will be judged by history as true “economic warriors” of the 21st century, who fought with the weapons of prosperity.