Startups have to consider themselves as a structured and process-driven or a value-driven organisation to attain scalability: CitiusTech CEO Rizwan Koita at TieCon Mumbai 2022
Entrepreneurs learn from failures, not success, Dream 11’s Harsh Jain said, and advised them to focus on one problem at a time
Veteran investor Anupam Mittal said that an entrepreneur should not start a company just to raise a big cheque from a VC firm
The famous Indian ‘jugaad’, a flexible way of solving a problem with limited resources, might solve a problem in short-term, but can deter entrepreneurs from creating a sustainable business that can be scaled up, according to Rizwan Koita, cofounder and CEO of CitiusTech.
Speaking at TieCon Mumbai 2022, Koita said that startups have to consider themselves as structured and process-driven or a value-driven organisation to attain scalability.
Highlighting obstacles in the startup journey, Koita said, “One of the biggest impediments to success is ‘jugaad’ (a flexible way of solving a problem with limited resources) in India. Every time an entrepreneur does a ‘jugaad’, he practically takes a step back from creating a sustainable, scalable organisation that will thrive with or without him.”
Koita advised entrepreneurs that the foundation of their startups should be strong without any cracks to scale up the organisation. “If the foundation itself is not built to scale, then at one point, one of its pillars will crack,” he said.
Harsh Jain, cofounder of Dream11, who was also a part of the panel, said that entrepreneurs fail every year, some even every month, and that’s how they learn. Entrepreneurs rarely learn from success.
“One of the greatest learnings for entrepreneurs is to focus on one problem. All entrepreneurs would agree that we are excited to solve lots of problems at one time. However, an entrepreneur needs to say no to a lot of things that he can be good at,” Jain said.
The comments come at a time when the mood of India’s startup ecosystem has turned a little gloomy. The ongoing Russia-Ukraine war, high inflation, tightening monetary policies, and fears of an impending recession have made investors risk averse, with the funding in the Indian startup ecosystem drying up.
Owing to this, many startups have shut in the last few months. In June, edtech startup Crejo.Fun shut its business due to economic slowdown and impending funding winter.
Prior to that, edtech startups Udayy and SuperLearn, digital solution startup Protonn, and ecommerce marketplace Yojak shut their business in 2022.
Important to Perform Well In Economic Downcycle
Speaking at TieCon Mumbai 2022, BookMyShow CEO Ashish Hemrajani said that the success of a startup also depends on what the entrepreneurs do during an economic upcycle or downcycle.
“Whenever there’s an economic downturn, entrepreneurs have to take advantage of that and only then businesses can grow stronger and run for a long period of time,” he said.
Referring to entrepreneurial journey, Hemrajani said that just as sailing in high winds doesn’t make a good sailor, it is tough times that test an entrepreneur and bring the best out of him/her.
Despite the recent slowdown in startup funding, the funding in the Indian startup ecosystem has grown exponentially in recent years. According to an Inc42 report, a total funding of $41.4 Bn was raised by startups in 2021, which was higher than the cumulative funding ($37 Bn) raised in 2020, 2019 and 2018.
This rise in startup funding has made many new-age entrepreneurs opt for venture capital (VC) funding or angel investments to grow their startup’s valuation rather than focusing on value creation to expand the business.
Anupam Mittal, a veteran investor and CEO of Shaadi.com, said that entrepreneurs now think that they have to get a venture capitalist to fund their initiatives or else, they cannot start.
“I don’t think there is anything farther from the truth. Of course, if entrepreneurs are playing in a category that’s highly competitive and if two players raise capital then he should too raise funds, but that’s not the only category to penetrate into,” Mittal said.
He also said that if entrepreneurs are building a company because they think that they can raise a big fat cheque from a venture capital fund, then it’s the wrong path.
