Bengaluru, March 26, 2016: 90% of tech-startups eventually fail – it is a statistic which raises many eyebrows. Yet, every year we see a lot of entrepreneurs pitching their unique idea or product to investors. Interestingly, the most common cause for failure of startups is reported to be a lack of market need for their ‘unique products’. It is not rational to expect success from half-baked business models build upon products with questionable value. One can perhaps sell a “unique idea”to some ignorant investor, or might even raise funds via crowd sourcing, but it’s not easy to sustain it in the long run.
My own experience tells me that an entrepreneur has to be always ready to accept failures and if possible, also be able to predict them in advance. One should know the right time to move forward. It is only this approach which has allowed me to make progress and eventually reach a stage where people recognize me as a successful serial entrepreneur. I would like to mention here that people at different times have also called me an ‘accidental genius’ and someone who ‘just got lucky’; in the following passages I will try to remove this misconception.
My journey as a tech-entrepreneur started in the US. The mid 90’sInternet boom in the US prompted me to launch an ISP business. A master’s degree in Computer Science and experience of working with technology giants like AT&T and Amdahl Corporation provided me the confidence to enter this field. Hence, I launched IceNet from Puerto Rico. IceNet was my first major startup; it was also a major failure.
However, there were several lessons to be learnt from this failure. Even though there was a market need for a venture like IceNet, it could not compete in the market due to deficiencies in its billing solution; customers had better plans available from IceNet’s competitors. Attempting to operate a retail business remotely was another big mistake. This failure made me realize that to ensure success of any start-up, it is very important to design and execute a relevant go to market strategy. It could be summarized that bad business execution led to failure of IceNet, which is a something that aspiring entrepreneurs could make a note of.
If you have read the famous “peanut butter manifesto” from Brad Garlinghouse,you will understand how important it is for businesses to focus on their key strengths.A ‘hazy business focus’ is what leads many entrepreneurs to failure; and I am not counting myself out. In the early days of my entrepreneurial career, it was difficult for me to ignore the success of Patels running motels in the US.Without having any experience or understanding of the hospitality sector and simply banking on my “Patel” credentials, I risked myself into this business, launching a motel with five of my friends (all from the IT industry). It didn’t last long – which taught me an important lesson that following trends and culture in business and venturing into alien territories can be financially hazardous.It is okay to wear many hats while running a business, but never launch new businesses at whim.
After these two failures, I came back to India, and in 1998 relaunched IceNet; this time ensuring that mistakes aren’t repeated again. Recognizing the need for secure internet browsing, we gradually moved into the security domain. This led to the launch ofElitecore Technologies in early 2000. Elitecore faced a minor crunch during FY 2007-08, when we failed to achieve our numbers. I realized that the strategy to hold all departments responsible for driving sales and incentivizing everyone based on the sales targets achieved, was not working.This experience helped me in steering India’s first homegrown UTM brandCyberoam, which received a lot of attention wherever it went. Cyberoam registered phenomenal growth in India and soon became a global brand. It is important for startups to register high growth numbers as otherwise they are likely to run out of steam.For entrepreneurs seeking later stage VC funding, achieving high growth becomes even more critical.
To conclude, I can say that though a strong focus, and ability to correct mistakes in time are big positives for an entrepreneur, one also needs the ability and confidence to stay the course. Also, there is no shortcut to success and luck is unlikely to help you when you need it the most.
Hemal Patel has been a serial entrepreneur and currently, he is member of the senior management team, as senior vice president IT & operations, at Sophos.
Corporate Comm India (CCI Newswire)
