From Up-start to Start-up: Lessons from a serial entrepreneur

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A few months after I started Contests2win.com — my first startup(in 1998), I got an offer to sell it. I called up my lawyer for advice. He sounded excited and said, "Alok, sell your business and buy yourself a new car." Thankfully, I did not follow his advice and have the honour of writing this column for you.

The past 14 years have been fun! While starting up, executing, operating and exiting my companies, I have learnt the following 5 immortal lessons:

1. Hire Soldiers, Not Rock Stars

Some of the people I employed way back in 1998 are still with me. They are the best-performing professionals I know. When I hired them, they were passionate, anxious to learn and ready to go. They were soldiers ready to march. They were not qualified with acronyms or degrees or 'work-ex' and all that jazz.

The mistake I made was that I also hired some 'Rock Stars'. These were spoilt corporate professionals who came on stage to sing their own song. These guys added no value; instead created disruption.

Lesson: Hire ungroomed, hungry people to work with you when you start digging the trenches.

2. Understand the Biz Model

A lot of entrepreneurs I meet are quick to blurt out, "Sir, my revenue model is X or Y." When I ask them what is their 'business model', they seem flummoxed and mumble, "Isn't that the same thing?" Well, it's not!

A business model is what will make your business valuable. A revenue model may or may not be a part of the business model!

Let's take Google as an example. The business model that the founders had in mind was to make searching the Internet easy. Just type and go. The founders intuitively knew that if they could make search easy and simple, Google would become a major habit of everyone in the world, and that habit would create 'value'. Well, it did and how!

Lesson: Business Model is what will ultimately create value. Get that right first.

3. Don't let a VC choose you

I developed clinical blood pressure owing to a duel between a VC and my co-founder in Mobile2win. Both of them hated each other. The VC was so vindictive that they wanted to close down the business just to teach my co-founder a lesson!

This was entirely my fault. I allowed this VC to enter my company just because they wanted in. It took a good two-and-a-half years to keep Mobile2win running. I even managed to prevent my co-founder and VC from committing murder. Later, I let go of my co-founder, hired a CEO and turned the company around. That business was acquired by Disney!

Lesson: Conduct due diligence on VCs. Talk to entrepreneurs who have been funded by them before.

4. Think Like a Founder

A startup founder is like God. She takes care of everything and everyone. She can see things coming and can prevent disasters.

CEOs on the other hand, are execution folks. They get things done. They are ruthless, cursed people who behave like excavation truck drivers in a cemetery.

Pierre Omidyar, the visionary entrepreneur who created eBay, was a great startup founder! He set up eBay and made it a very useful and scalable business.

But when the time came to take eBay to the ultimate level, he turned it over to Meg Whitman — a professional CEO.

Lesson: Start your company and then quickly decide if you are CEO material or not. If you aren't, hire a capable CEO and feel proud about your decision.

5. Don't be Silly.

If 'Titanic' was to be made into a Bollywood movie, I can visualise these scenes: The 'hero' would rush into the boiler room and try to stop the water from gushing in by using his strong, muscular shoulders! All along he would urge his love to escape. Then in the end, he would swim out, meet her and dance to a song on a lifeboat.

Source- http://economictimes.indiatimes.com/news/emerging-businesses/entrepreneu...

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