Archive for June, 2010

How to become a millionaire in 3 years?

Monday, June 28th, 2010

Axis: Bold as Love cover Jimi_HendrixI was reading an interesting thread on Hacker News where the poster wanted to find out how he can become a millionaire in 3 years. One of the commenter has replied beautifully sharing his pearls of wisdom. Blatantly copying / pasting the bullets I liked (ignore this and go straight to the source, otherwise), here’s what the commenter said you need to have / look for to become a “success” and not necessarily a millionaire:

  • Market opportunity – a million dollars isn’t a lot in the grand scheme of things, but it certainly is a lot if the market opportunity is not large enough. Even if you put Bill Gates and Steve Jobs as founders in a new venture with a total market size of 10 million, there is no way they could become too wealthy without completely changing the business
  • Inequality of information – find a place where you know something that many undervalue. Having this inequality of information can give you, your first piece of leverage
  • Leverage skills you know– You can go into new fields such as say Finance, but make sure you’re leveraging something you already know such as technology and/or product.
  • Look in obscure places– We’re often fascinated with the shiny things in the internet industry. Many overlook the obscure and unsexy. Don’t make that mistake. If your goal has primarily monetary motivations, look at the unsexy.
  • Surround yourself with smart people– smart people whom are successful usually got there by doing the same and have an innate desire to help those do the same.
  • Charge for something– Building a consumer property dependent upon advertising has easily made many millionaires, but it isn’t the surest path. Build something that you can charge for.
  • Go with your gut and do not care about fameballing– Go with what your gut says, regardless of how it might look to the rest of the world.
  • Be an unrelenting machine– Brick walls are there to show you how bad you want something. Commit to your goals and do not waver from them a one bit regardless of what else is there. I took this approach to losing weight and fitness. I have not missed a single 5k run in over a year. It did not matter if I had not slept for two days, traveling across the country, or whatever else. If your goals is to become a millionaire, you need to be an unrelenting machine that does not let emotions make you give up / stop. You either get it done with 100% commitment or you don’t. Be a machine.
  • If it’s a “trend”, it’s too late
  • Be a master of information– Many think it might be wasteful that I spent so much time on newsyc or read so many tech information sites. It’s not, it’s what gives me an edge. I feel engulfed.
  • Get out and be social– Even if you’re an introvert, being around people will give you energy.

When I first saw the cover (probably in my 8th grade) of Jimi Hendrix’s album ‘Axis: Bold as love’, I was like WTF, how can he do it to the deities? Hendrix is depicted as two Vedic deities, with the multiple hands of Durga and as avatars of Vishnu.

As a startup entrepreneur one has to embody multiple incarnations in one single lifeycle and that pic above is very relevant. What the commenter mentioned above is a lot of things to be done in a short span, but yeah, not every startup gets there, unless you have multiple hands and heads.

The status quo of payments in India

Thursday, June 24th, 2010

I still do not have a valid credit-card in India. The KYC (due-diligence mandated by the government aka ‘Know Your Customer’) norms require that Coin of Alupas of Udipiyou have an office (or fake it) but must have a land-line at office. If you work from home then you are out of luck! Does not matter how much money you have in bank or a few international credit cards to carry around. I have a debit card which is not accepted by any online portal (Thanks to Hongkong bank).

Net, net. I’m just like the other 88% Indian population which does not have a debit card or the other 98% who do not have a credit card. But, the good news is that I’m part of the 500m population who has a mobile phone.

As a result, I’m not able to show my purchasing power to the various portals selling books, gadgets, t-shirts and other trinkets online. I’m not able to show my fickle mind by making a purchase of Rs. 300 and being happy about it.

Prepaid or “stored value” card (or cash card) may be the solution, but they have a very poor distribution and I have to go out and buy a card from a travel agent; if you are lucky to find an agent carrying the cash-card.

Banks in India are busy in shoring up their mobile banking offering a la check your balance, make fund transfer, etc. I don’t know why there is so much push for mobile banking as the urban population; the users of mobile banking via a GPRS connection, already have access to ATM and Internet which can be used to do the same functions in a larger form factor.

Though Reserve Bank of India (RBI) has been raising the transaction limit of moving cash from the mobile; the problem is that the whole thing is tied to a bank or a credit card, which makes the installed base the same 2% for card holders and 12% for debit card holders or netbanking customers. So much so that RBI has allowed transactions to happen without using the traditional encryption techniques used in issued card-based transactions, but there has not been much uptake.

RBI does not want the operators to become banks, which is very valid as it would give rise to money laundering and of course operators then would disintermediate the banks. However, most operators are already making tonnes of money on VAS like premium SMS, ringtones, downloads and such. Why there aren’t any instruments which allow me to do a payment transaction which is not attached to a card or a bank account for things which are not sold by the operators? The lack of the same led to the downfall of mchek, they are on 100m phones but then only a fraction of the owners have a credit card or a bank account.

What is needed here is innovation to allow purchases to The mud road aheadbe done through the phone directly and billed to my monthly statements or debited from my top-up.  Banks are too big to be worried about longer tail of small value transactions, operators do not have the teeth, nor the desire to deal with the complexities of 3rd party purchases flowing through them. The laws are falling in place, consumers are ready to make those purchases — missing is the technology piece and a desire to experiment in these areas. This is a space to watch. The potential is beyond imagination when convergence of commerce and owners of mobile & users of internet takes place.

PS: So how do I buy tickets for the travel I do? I call up a few good friends to get it done and pay them cash later.

The coin shown above was used by a minor dynasty in coastal Karnataka called Alupas. Pic courtesy of Reserve Bank of India (RBI).

Pic from the road to startup gurukul.

Four days of Naach-Gyaan: Morpheus’s 1st startup gurukul

Tuesday, June 8th, 2010

In the summer of 2007, the moment Sameer & Nandini’s last startup Madhouse got acquired, another one started brewing in their heads. This time the plan was bigger and the idea was beyond running a startup, but kick-starting several of them. One year later after the acquisition, Morpheus was born with Instablogs as the first company in the portfolio, with other kick-ass companies being added to the “gang” in the subsequent 18 months.

The Morpheus

Aptly, Morpheus was named after the greek god of dreams; to a more real (fictional to some) world captain of Nebuchadnezzar who brings the dreams back to the residents of the last human city.

Then in the 2009 summer, I joined. This summer we are adding another 7-8 startups (names to be announced on 10th June) which brings further variety in our portfolio from automotive, eco-textile, health-care to touch computing.

This weekend from 10th – 13th we are doing our 1st ever startup gurukul on the outskirts of Bangalore, where we are bringing the founders of our portfolio companies under one roof and kicking it off with “Apuroop” — a demo day. At Apuroop, Morpheus companies will be doing 5 minutes show & tell to investors & media.

We are also delighted to partner with Sequoia Capital who are supporting us in our initiative and sponsoring the gurukul.

We have come a long way since our nimble start where we were doing just mentorship to now where we are also investing a small amount of INR 5 Lakhs in each of the startups. There are more exciting things coming out of our bag, controlling my excitement, we would unravel them as time passes.

Thanks for participating with us!

The cycle of Business and the importance of Team

Monday, June 7th, 2010

On Saturday, I did a presentation to the Jain International Trade Organization (JITO) at their Annual Growth Summit. I spoke on the topic of ‘Building Winning Team’ (presentation to be uploaded). The following was part of the talk.

While internalizing the topic, a wonderful chart depicting the ‘cycle of business’ got scribbled in the notebook, the final version of which came out as shown below.  The importance of a team in a business can be visualized by looking at the chart.

The cycle of businessThe chart shows four tangible entities which are the main constituents of a business. Each constituent is in it’s own quadrant.The inbound arrow depicts movement or  utilization of a resource. As owner/CEO, you create the business. The Team which you hire creates the product or service. This is consumed by a Customer which brings Money to the business. The Money in turn funds the Team.  If the Team is weak or inefficient it would impact the product or service. Even more, an incompetent team may consume the money unwisely thus hampering the overall cycle of the business. Though the business revolves around the presence of the Owner/Founder/CEO, the continuum of the business is maintained by the efficiency of the team.

The upper right quadrant is the most important one — more than customers, if you build a great team, great products would come out with efficient use of capital. So, build a great team, manage them well and sometime later you probably don’t need to “actively manage” the business no more.