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India Stack takes the Digital India campaign to a whole new level

India is the third largest smartphone and mobile internet user market in the world with over 200 million internet users in 2013. The figures are expected to touch a staggering 500 million users by 2017, including 314 million mobile internet users according to a report by IAMAI and KPMG. Clearly, mobile phones are the ‘computing device of choice’ for the country. To keep up the momentum, the Government of India is keen on developing the digital infrastructure of the country under the Digital India program.

Digital India is a revolutionary program that will empower the masses and leapfrog India into the next generation of government services. Fortunately, the lower level of investment in earlier generation technology means India has skipped the legacy era and waited for the right technology to arrive at its doorstep. To kick-start and empower the Digital India program in a very democratized form and involve the great innovation talent of the nation, the Government of India has launched an open API policy. An open API, often referred to as a public API, is a publicly available Application Programming Interface (API) that provides programmers with programmatic access to a propriety software application. This set of open API is known as the India Stack and these would enable the ease in integration of mobile applications with the data securely stored and provided by the government to authenticated Apps.

India Stack is a complete set of API for developers and includes the Aadhaar for Authentication (Aadhaar already covers over 940 million people and will quickly cover the population of the entire nation), e-KYC documents (safe deposit locker for issue, storage and use of documents), e-Sign (digital signature acceptable under the laws), unified payment interface (for financial transactions) and privacy-protected data sharing within the stack of API. Together, the India Stack enables Apps that could open up many opportunities in financial services, healthcare and education sectors of the Indian economy. What this essentially means is that developers and tech startups can now build software and create businesses around the readily available infrastructure offered through India Stack, thus opening a huge potential to tap into the booming smartphone market in the country. Since the consumer market in India is very large, such startups could also hope for institutional funding and gain from the early mover advantage.

Through the digitized elements like e-KYC, e-Sign, digitized Aadhaar information and digital locker, the entire ecosystem has now become a presence less, paperless and cashless based system. A Digital Locker enables users to have all their legal documents in a digitized format that is stored online and can be accessed from any part of the country. The e-Sign makes it simple for people to sign deals, contracts and legal documents through their phones and the Unified Payment Interface lets people make payments with ease through their smartphones from anywhere.

India Stack makes a user base of over a billion people readily available through its API. This means that startups and tech companies can build over this to be able to integrate various functions for their businesses or for larger enterprises. Every bank or telecom operator scans through tons of paperwork every day to be able to verify customers and generate KYC documents. Now imagine the impact if this entire process could be digitized by building an application which would integrate India Stack and the user base of over a billion Indians!

With the technology, documentation and sample code available, entrepreneurs and startups can get started with innovating, prototyping as well as building India Stack enabled applications. The commercial applications are endless with multiple opportunities, as the large user base opened up by India Stack is nascent, solution-hungry and largely untouched by technology. Now even a local vegetable trader can take an intra-day loan almost instantly through his mobile phone and pay it back the very same or next day without even physically visiting the bank or wasting any time (time is money when earnings are proportional to time spent)! With their e-KYC documents and digital signatures, a loan can be processed almost instantly and the money transferred through the Unified Payment Interface. Long queues at banks, telecom offices and all other government and non-governmental processes should be the thing of the past, through proper integration of India Stack.

The nation is looking for “a transition from technology-poor to innovation-rich society” and entrepreneurs have a good role to play. The problems (read opportunities) in financial services, healthcare and education are all so large that only the right technology can cost-effectively solve them. Solving these scale problems would mean great business sense too.

iSPIRT, the non-profit software product industry think tank powered by industry veterans, has been actively involved in the development of India Stack and is helping entrepreneurs make the best use of business opportunities provided by India Stack, while building their startups. iSPIRT believes that India Stack creates a whole new generation of business opportunities around the mobile phone and early movers would have tremendous market advantages.

On a recent visit to India, Bill Gates commented on India Stack saying, “India is on the cusp of leapfrogging!” And it truly is; considering it is the only country in the world offering such an open and secure API, India is certainly looking at taking the Digital India campaign to a whole new level.

The future is here and now is the time to act.

 

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The last list – the final 25 #PNgrowth companies.

This is it, then. The last announcement of #PNgrowth 2016 is here. We have now the entire 200 companies who will get together in January for the inauguration of what is the most ambitious mentorship programs for startups ever put together in India. We now have about half a month to go, and it would be great if the companies talked to each other, think about what they want out of this, and discuss stuff. We have set up a Facebook group just for this, and we will be taking pointers for program design from on there, so be sure to get on it.
 
For further announcements, you can follow us here or on the Facebook group itself. 
 
25-founders-collage-8th batchSo here we go, the last 25. #Pngrowth 2016 is well and truly on!
 
Sivaram Subramaniam of CavinHR
Puneet Sharma of Bugclipper
Satish Kamat of Jambuster
Jay Thaker of sumHR
Salar Bijili of Cuecontent
Hari PK of Bigfoxx
Dr. Shikha Suman of Medimojo
Sanjay Shah of Zapty
Nikhil MS of Clusterzap
Sumesh K Menon of Winds Business solutions
Vinay Simha of Amiya
Kavita Khandadia of Mytripkarma
Vivek Beria of Whizzwifi
Dharam Mehta of Wedwise
Saurabh Saha of Talentpegs
Ish Jindal of Hellotars
Arvind Batra of EventsHigh
Satish Kashyap of AlgoEngines
Subrat Kar of Vidooly
Vishal Singhal of Artzolo
Nitin Chadha of Sride
Suraj Goyal of Printbindaas
Sarang Lakare of Intouchapp
Rittvij Parekh of Pykih
 
See you all over there!
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Design thinking Playbook Roundtable by Deepa Bachu

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The core idea of a startup is to tap into the previously unexplored markets, identifying unsolved problems and bringing to the market innovation that disrupt the existing eco-system. It’s about understanding complex problems and coming up with innovative, disruptive solutions…a process that requires understanding the consumers’ requirements and behavior patterns to create a well-thought out solution for the customers’ benefit.

While most entrepreneurs spend weeks brainstorming about the idea, they often ignore the key ingredient to innovation : design.

Design /dɪˈzʌɪn/ (noun) – do or plan (something) with a specific purpose in mind.

The Design thinking Playbook Roundtable organized by iSpirit and conducted by Deepa Bachu from Pensaar helped startup founders understand the importance of design thinking and integrate design into their workflow. Here are some key takeaways from the Playbook Roundtable held at the head office of Instamojo in Bangalore:

Design thinking is not just about the graphic elements, UI or tools. It is a creative approach to a problem. It is a problem solving methodology – whether it is blueprints for a building, a beautiful graphic design for a brochure, a sleek UI for a website or a comfortable piece of furniture, design helps to solve any problem, visual or physical.

While it is important to engage a professional, it is crucial that everybody on the team thinks DESIGN. Entrepreneurs should be able to step away from their immediate environment to look around and view their idea from the perception of the consumers, a process that requires creative thinking.

As a good product manager, a startup founder should be able to connect the dots in non-obvious ways to come up with a unique and innovate solution for the consumers. It is crucial for entrepreneurs develop a deep insight of the problem they are seeking to solve and be passionate about it before coming up with a solution. More startups focus more on the solution and forget the initial problem statement. You must never lose sight of your problem, constantly revisiting it while fine-tuning and tweaking the solution.

A product is valuable only as long as the consumer users it. It is thus important for entrepreneurs to understand customer behavior in order to make their product user friendly. Usability studies though interesting, aren’t always reliable. Startup founders thus have to seek out customers and work with them closely to understand what they need, what they think, how they use the product and how they feel about it.

Customer behavior v/s customer intent – it is important to understand the difference between the two. While a user may want to do something in the ideal world (intent), she may not be able to do it in the real world (behavior). As entrepreneurs it is important to differentiate intent from actual behavior. If this is geographically impossible, startup founders should not hesitate to use data analytics to tap into the users’ behavior patterns and modify the product.

Design thinking allows entrepreneurs to look at their idea holistically and come up with the best possible solution for their users. Design after all enables people to create and come up with the unimaginable and unexpected designs.

 

 

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Open Source and SAAS

While open source software is a fairly well understood in concept, I am always surprised how little it is understood in practice. At a round table of young product companies last month, there were a lot of raised eyebrows and questions when I explained our open source way of working.

Jordan Hubbard, co-creator of FreeBSD and open source veteran, spoke on this topic at this year’s ERPNext Conference, and he basically said this, open source business is all about people. Since the product is free, you sell services around the product, which is your people. This is mostly true for the very large majority of businesses that have mushroomed around open source projects, providing installation, hosting, customization, maintenance and other services around the product.

But there is now a new variable in the equation, SAAS (or Software-as-a-Service). It has been already accepted that SAAS is the way software is sold today. Listed companies like SalesForce, Xero, Zendesk, Workday, NetSuite, Hubspot, Shopify are testimony to the success of SAAS products and the billions of dollars that get spent on SAAS products each year. What does the future hold?

As on-premise is slowly moving into SAAS, I believe that SAAS itself will move into open source. Since the unevenly spread future is already here, there are companies already successfully doing open source + SAAS like WordPress, Ghost CMS, Magento, ERPNext (disclaimer: that’s us).

Open source + SAAS makes a great combination.

Benefits to the user:

  1. Open source products allow virtually unlimited possibilities to deeply integrate the product.
  2. There is a lot more risk in a closed platform, like price increase and slow pace of development.
  3. There is no vendor lock-in
  4. Free!

Benefits to the publisher:

  1. Not everyone wants to host their own infrastructure, this opens up opportunity to build a SAAS platform
  2. Provides word-of-mouth marketing
  3. Vibrant community attracts more users
  4. Community contributes by providing feedback, support, features, fixes, integration, testing, documentation
  5. A lot more incentive to write good code and documentation
  6. Much easier to find and on-board new developers to your team

Going open source is not easy. Business are built on the premise of transactions, and in open source, you have to be very open to giving and communicating without expecting immediate results. But once you cross a certain threshold, community participation can be extremely rewarding.

I am not advocating you open source your product today, but as Wikipedia has shown us, its only a matter of time before someone builds a mature open source product that might replace you.

Then there is no going back.

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Traction Trumps Everything – How to get traction for your SaaS product

A wise and successful entrepreneur once said, “Traction trumps everything”.

Indeed, traction is the only thing that brings you customers, VCs, and energy to keep going.

iSPIRT in partnership with PuneConnect & SEAP organized a playbook roundtable on “Getting traction for your product startup”. It was focused on peer to peer learning and taking away real feedback, rather than just typical “general gyaan”. The playbook roundtable was moderated by two very successful SaaS product entrepreneurs Niraj Rout of Hiver (earlier known as GrexIt), and Rushabh Mehta of ERPNext. Both are building highly successful SaaS products bringing very different approaches/strategies yet finding great synergy in their thought processes. Hiver is a simple-to-use product for business workflows, fast growing, young, funded and profitable startup whereas ERPNext is a highly complex, very stable, bootstrapped, profitable, world’s second opensource Saas ERP product.

The RT discussion was attended by founders building SaaS products in Innovation, eCommerce, business communication, personal customer loyalty, education, personal finance, recruitment, fashion and technology domain.

SaaS Valley of Death: Rushabh got our attention right away by asking “Do you know SaaS Valley of Death?” Its like your product is complex to use and cheap at price. Its very very difficult to sale. You can be either very simple to use and cheap or you can be highly complicated and pricey. You can’t be cheap and complicated. But ERPNext falls in that category. Rushabh briefly shared his long haul journey of 8 years of building a product out of his own need and making it open source for people to use/modify it. ERPNext gives it at fairly low price to host it and charges additional for product consultancy.

Open-Source strategy: Rushabh realised that if such a complex product has to have innovation, then hiring talent is quite difficult. Instead making it open-source brings immediate advantages such as your users brings innovation, it is easy to hire from the developers community which already knows your product code, less efforts needed to support the product as your community is your biggest support structure. Recently, this trend has started by major tech companies like facebook, google and others by making their api’s open-source for community to play around and bring true innovation. Also interesting to say here that open source is more than a marketing strategy, you have to believe in it to work. Also companies are open sourcing not just APIs but also entire projects (Apple just joined with Swift)

User Onboarding:  It is very easy to get signups, but what happens after signup is the crucial one. The real game begins from sign up onwards. Rushabh at ERPNext created a great user onboarding workflow for various categories of users. At signup, ERPNext asks its user several questions to understand user and his/her needs. Accordingly, it customises the rest of the onboarding flow. This “personalized” flow helps user to connect and understand ERPNext quite easily. There are several videos created for user to educate about product features and uncover true benefits. “Founding/Core team has to take product to a initial revenue level, until then one should not make a mistake of hiring a sales person”, insisted Rushabh. This helps you build and quickly tweak/change onboarding flow as your know your users better. This also helps in positioning and marketing the product better.

Product Market fit:  Niraj of Hiver (GrexIt) shared his journey of conceptualising the product as knowledge management place (for enterprises) to pivoting to tap a SME segment where quick workflow matters. Its all about finding a product-market fit. On a lean methodology which suggests to work with your customers and tune the product, Niraj shared a good observation. If you talk to your customers, they will always suggest small incremental improvements/suggestions, customers can never give you extraordinary (or 10X) innovation. Its your vision that defines what your product could actually do. However it’s essential to understand how users are using the product and what key activities they are doing repeatedly.

Buyer’s mindset:  For a product, you have to understand whether it helps user generate money or save money. Does your product falls into cost center or revenue center, accordingly you have to create your marketing campaigns and positioning.

Simple Growth hacks:  Startups don’t have big pockets to spend on marketing/sales. Simple techniques like Your domain specific keywords, Search Engine Optimization, Influential bloggers write about your product, your customers talking and referring your product are a few simple growth hacks every startup can try. Always get real customer’s/brand’s testimonials and showcase them on key pages.

Critical choices:  In the initial days when you don’t have traction, its an important call whether you want to give it to a few people and learn and tweak the product or you just throw it in the space for thousands to use and let them figure out. Both have their own pros-cons.

Post Lunch session, Niraj and Rushabh encouraged every startup to showcase their product’s landing page and quick onboarding workflow. Duo and other founders provided critical feedback to individual founders with immediate actionable takeaway. It was a great peer-to-peer learning exercise. Below is a summary of what came out of the discussion that generically applies to most SaaS product startups.

Landing page:  Product’s landing page is the most critical real estate. Be innovative and build it wisely with new/current trends. A few examples of well designed landing pages were discussed. Products from 37Signals (Basecamp and KnowYourCompany) were highlighted for their innovative approaches. Like Steve Jobs once said, “Good artists copy, great artists steal”, you need not to always reinvent the wheel, just see the best products in your category and steal (find inspiration)!

A few tips for a well designed landing page –

1) The main image and punchline should be appropriate for user to understand your product quickly. Thats where user decides whether I should scroll down (to know more).

2) Always talk about benefits user will get, nobody cares about features.

3) More than 3-4 scroll is overdone. Have only essential information upfront so that user is not overwhelmed with information overdose.

4) Testimonials from real user/brands works great, people feel more comfortable.

5) Less verbose, more visual is always better.

After Signup (User onboarding):  Engaging with user for first few days and making personalized communication helps build rapport as well as improve stickiness.

1) Build a user friendly Quick tour with an option to quit and restart

2) Let user experience your product as quickly as possible

3) Videos or user guides “How to” are essential and helpful

4) Website and user behavior analytics tools like Google analytics, KissMetrics, Mixpanel provide good data know your users better and make appropriate changes in your product

5) Intercom like products helps you build user behavioral based engagement

6) Provide triggers/incentives to appeal user to perform certain actions. Nir Eyal’s HOOK framework  (Trigger, Action, Reward, Investment) was briefly mentioned to emphasise the point.

7) Your product is a leaky bucket, user may fall off anytime. Identify such holes and fill them up with creative solutions

7) You don’t have to be too generous with free plan. Start asking for money (plan upgrade) for valuable/exclusive features

8) Track analytics daily to know traffic to trial to paid customers journey

9) Always do A/B testing of every change/tweak you make to understand how its working.

10) Understand, there is always a churn. Account for that

11) Always promote long term (annual payment) plans, it gives you better visibility on your revenue. 

As traction book says, “Almost every failed startup has a product, what failed products don’t have are enough customers (traction)” and “Traction is growth. The pursuit of traction is what defines the startup”.

This playbook RT was first of its kind where only real stuff was discussed and critical feedback was provided to every startup on their product traction leaky bucket. All startup founders walked out with several actionable takeaways.

There are great SaaS product startups coming from India. The successful entrepreneurs like Niraj and Rushabh have vigor to share their learnings and help budding entrepreneurs to avoid mistakes and leapfrog their journey. This is a movement to build a product nation, one roundtable at a time.

Guest post by Abhijit Mhetre founder at Canvazify – a structured innovation platform for teams to collect, brainstorm, and act on ideas. Abhijit is passionate about startups and collaborative innovation. Follow Abhijit @abmhetre

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One more list to go. The last #PNgrowth companies are here!

We are at the end of the announcements of shortlisted companies for #PNgrowth 2015. There’s only more to go after this, and we want to thank all those who applied. We put this event together for you, and you have responded. We are working hard on the programs so you get maximum benefits from Mysore and the subsequent interactions.

So here you go, the second-last list of #PNgrowth companies. Congratulations to the finalists, and there’s only one more to go.

25-founders-collage-7th batch

Sharan Madawal of Inzaxis
Suneil Chawla of Influencer
Alan DSouza of Vavia
Paul Mathews of Nethram
Sidharth Wadehra of Terrabees
Rashmi Padhy of Koove
Rahul Reddy of Nutrifi
Nishant Pandey of Getgreaser
Ankit Dudhwewala of Softwaresuggest
Anil Gupta of Smart Buildings
Abinash Saikia of Enclouden
Vaibhav Lodha of FTcash
Abishek Ballabh of Extraaedge
Abishek Humbad of Nextgenpms
Abhijit Choudhury of AzureAiken
Ashutish Verma of Paymateexpress
LN Mishra of Adaptive processes
Navin Chandra of Mavsocial
Barbara Main of Minsh
Suvodhoy Sinha of Adnabu
Abhijit Mhetre of Canvazify
Krupesh Bhatt of Legaldesk
Rani Paruchuri of Dreamtekis
Akshay Gautam of Heymojo
Manik Mehta of Linkmysport

Congrats to the chosen ones!

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#PNgrowth – The first of the next 100 companies are here!

So here we are with the next batch of 25 companies who have made it to the #PNgrowth program. We had actually said that we would be announcing the last 100 in one go, but we’ve decided not to, so to give each of these amazing companies their place in the sun.

We will be announcing the rest of the companies in this week, keeping only the last 25 up our sleeves, which will arrive in the next week.

So here we go, and congratulations to those who’ve made it!

25-founders-collage-5th batch

Amarnath Shankar of TastySpots
Amit Mishra of InterviewMocha
Raghavendra Singh of Intellileap Solutions
Sanjoe Jose of TalView
Saurabh Arora of Airwoot
Sesadri Krishnan of Trip 38
Ishwar Sundararaman of Furdo
Srivatsan Laxman of Scribler
Manoj Agarwal of Giftxoxo
Krishnan RV of Waybeo
Johny Jose of Playlyfe
Bhaskar Krishnamoorthy of Cavintek
Utkarsh Apoorva of Clusto
Amit Mahensaria of Impartus
Sumit Goswami of Xploree
Chandrasekhar O of ProductDossier
Salil Agarwal of Queryhome
Sachin Bhatia of InsideSalesBox
Kartik Mohla of Masteroapp
Remesh Kurupath of Netvarth
Rajiv Mukherjee of IncubateHub
Arvind Krishnan of Swymit
Rangarajan S of Immilife
Gopal Kulkarni of Resumefox
Anand Prabhu of Infilect

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So how do you measure the health of your business?

Business model & “LTV” – Life time value

  • Develop the business model that is “realistic” by clearly defining revenue sources, keeping the interest of customers and shareholders
  • Match pricing consistent with revenue streams/goals
  • Define what kind of promotions/discounts are needed and for how long
  • Consider how this leads into recurring revenue streams (for SaaS businesses) or repeat/new orders for traditional businesses
  • Develop a  “model” for customer LTV that is comprehensive (includes cumulative profits and not just simple revenues)
  • Show how LTV will evolve both short and long term

LTV defined – what is the “Value” of an acquired customer?

  • In early stages probably first year Profit could be computed as expected revenues minus expenses (to develop the business)
  • The second and third year it needs to be more realistic with real revenues plugged into the numerator
  • The CC (Cost of Capital) is an estimate of what it costs venture firms to invest in a business. The rate ranges from 35 to 75 based on the risk profile of the entrepreneur(s).
  • The “t” is the denominator indicates # of years as in year 1, 2,3 etc.

GTM (Go-to-market) & CoCA defined

  •  Develop a CoCA or some call it CAC (Cost of customer acquisition) model for your product/service. Its different than LTV.
  • The GTM should include model of lead generation and closing sales (choice of models like direct, indirect, use of outsourcers, online etc.)
  • Map the sales process (sales funnel) to the different people/parties involved from lead generation to closing to collection of money. This might vastly vary based on the type of business you develop.
  • State clearly assumptions you make as the leads move through the “sales funnel”. Its important to get “hunters” involved in the early stage of the business
  •  For the CoCA calculations use – marketing and sales costs, make reasonable assumptions of life of customer, retention rates, and closure rates. Exclude COGS and other fixed costs
  • Map how GTM will evolve over time – short, medium and long term
  • Explore and define where the use of word of mouth (WOM) falls (if any) in the overall GTM. Very important.

CoCA Calculations:

How do you figure if the business is “viable” via CoCA/LTV?


Courtesy: HubSpot

  • SaaS businesses LTV:CoCA ratio needs to be atleast 3:1 and time to CoCA recovery less than 12 months for it to be a viable business.
  • For SaaS businesses the CoCA needs to be anywhere between $1 – $3 per customer
  • As regards unit economics – customer churn should be between 3.5% to 1.5%

What do you track particularly for SaaS businesses?

  • For SaaS businesses – track LTV, CAC, LTV:CAC ratio, CAC recovery etc.
  • The are many more parameters to track. More later…..
  • Importantly track revenue churn vs. customer churn. Why are they different?

Imagine customers paying per month $10 for “basic” services and $100 for “bundled” services (upsell) & you had 5 of each in the early stages. If you lost 2 customers after couple of months, the customer churn would be 2. Imagine losing both customers in the basic category, then your churn is only $20. But if both are from the bundled category, your churn is $200. Big difference.

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iSPIRT Meeting at PMO – Stay in India Checklist

An important policy agenda for iSPIRT is to reverse the exodus of technology startups. About 75% of the funded technology startups are redomiciling outside India due to regulatory irritants.

iSPIRT has a Policy Expert Team – called Stay-and-List-in-India – working only on this area since December 2014. This is the policy team that worked closely with SEBI on the “startup bourse” that was notified earlier this year. Mr. Mohandas Pai has been an important guide and mentor to this team.

The Stay-and-List-in-India Policy Expert Team has developed a Stay-in-India checklist. This has 36 items that need to be addressed by Ministry of Finance, Ministry of Corporate Affairs, RBI and DIPP.

After PM Modi’s Silicon Valley visit, Mr. Amitabh Kant, Secretary DIPP, has been pushing hard to make progress on the Stay-in-India checklist. Towards this end, he had organized a cross-ministerial meeting with iSPIRT that was chaired by Mr. Nripendra Misra, Principal Secretary – PMO. The meeting was attended by Secretaries including Mr Madhav Lal, Ministry of Micro, Small and Medium Enterprises; Mr Ashok Lavasa, Ministry of Environment, Forest and Climate Change; Dr. Hasmukh Adhia, Department of Revenue, Mr Shaktikanta Das Department of Economic Affairs, both from Ministry of Finance; Mr. Tapan Ray, Ministry of Corporate Affairs; Mr Ashutosh Sharma, Department of Science & Technology and Mr Krishnaswamy Vijayraghavan, Department of Biotechnology both from Ministry of Science & Technology.

Others present included, Mr Shatrughna Singh, Additional Secretary, DIPP; Ms Snehlata Shrivastava, Additional Secretary, Department of Financial Services, Dr. Renu Swarup, Sr. Advisor, Department of Biotechnology, Mr U S Paliwal, Executive Director, Reserve Bank of India, Mr Hemang Jani, OSD to PM and Operations Officer from the World Bank.

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There were three parts in the meeting. The first part was a showcase of 6 technology startups. This was curated, as usual, by Shekhar Kirani, Fellow, iSPIRT (Accel Partners) and Avinash Raghava. The purpose of this session was to highlight that tech startups are key to transforming India at large. They are setup by entrepreneurs from middle class backgrounds who parley their skills into sweat equity to build valuable businesses. The showcased companies included CRMNext, Foradian Technologies, Eko India Financial Services, Snapdeal, Uniken, ForusHealth and Team Indus. They all made carefully prepared 3 min presentations and answered questions.

The Stay-in-India Checklist was discussed in the second part of the meeting. Sanjay Khan (Khaitan Associates) of the Policy Expert Team made the presentation. This was a technical discussion on specific issues. At times, it was very detailed.

In particular, Mr. Shaktikanta Das, Secretary, Department of Economic Affairs, Ministry of Finance and Mr. Amitabh Kant, Secretary, Department of Industrial Policy and Promotion (DIPP) were very proactive in taking suggestions. Mr. Kant did say that they are trying to create a single window to deal with startups.

In the third part of the meeting, there was short discussion about teaching entrepreneurship as a minor in engineering education. This was led by Sanjay Vijaykumar of Startup Village. His talk was very passionate and impactful.

It was cleart that all the officials were determined to make quick progress and were truly concerned by the exodus of tech startups from India. We all ended the meeting with a group photo. One of the senior officials remarked that this moment is important to capture so that we can look back and remember where it all started!

Guest Post by Abhishek Sinha, CEO, Eko India Financial Services 

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The next 25 is here making it 100 successful entrepreneurs – #PNgrowth. Application closes by Nov 15th 2015

The next 25 #PNgrowth people are here, and this time, even we are excited by the sheer breadth of the domains that are coming in. The three-day residential launch camp at the Infosys camp in Mysore is what we are looking forward to, most, though. There’s still a slim chance that you might get in, though; you can apply here.

The last 100 will be announced as one list, and will complete the 200 for the program. So we implore you to apply now, and not come back to us later. 🙂
So here you go, the next 25 participants of #PNgrowth
25-founders-collage-4th-batch (1)

Arvind Pani from Reverie Inc

Ashish Belagali from Kommbox

Harshal Katre from Profitbooks

Prakash Vishwanathan from Gradatim

Praveen Singh from 99tests

Sreepriya Koppula from PixterPro

Aseem Marwaha from eLitmus 

Kaushik Panchal from Travelcarma

Vaibhav Kakkar from Rankwatch

Ashish Tulsian from Posist

Manu Madhusudanan from Cooey

Naman Sarawagi from FindYogi

Rajesh Bernard from SmarterBiz

Shankar Krishnamoorthy from Synergita

Shashi Bhushan from HealthMacro

Mohammaed Ali from Primaseller

Vinod Muthukrishnan from Cloudcherry

Ajay Chauhan from SalezShark

Sanmaya Kumar Dhal from Slickaccount

Dixit Chopra from Truggo

Mahavir Chand from XLapp

Vinod Jeyachandran from AnuntaTech

Navneet Sharma from Snapshoppr

Hemant Sahal from CollPoll

Rohit Shroff from Holidify

Congratulations, and wait for the last list!

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How to Incorporate in the USA: US Inc. as a Subsidiary – v2.0

Setting up your headquarters in the US and a subsidiary in India is a tested model. Here’s a blog post by Girish Mathrubootham – founder of Freshdesk, very clearly articulating the process.

Well then, what’s this all about?

The setup we follow at Kissflow is the model in reverse.

Kissflow is headquartered in India, with a subsidiary in the US.

I couldn’t find much information on this model, and thought this might be something worth considering as an option for lots of startups that operate from India. This is not a post on the pros and cons of setting up your headquarters in the USA. That is a complex question and calls for another blog by itself.

This model gives you the option to retain the Intellectual Property (IP) outside of USA and still take advantage of the flexibility that comes with having a US Delaware C-Corp entity.

Also, you will be paying income taxes in line with income in both the countries. In the other model where the HQ is in the US and the subsidiary in India, you may set up the subsidiary as a service company with a transfer pricing model that requires you to have a profit margin of 12% to 15% in line with the services industry. And you will be paying 30% taxes, in the case of India, on that “perceived profit”.

So, here is an alternate model for your consideration that is compliant with the laws of the land in both the countries of operation.

The basics of setting up a company in the US remain the same:

1. Incorporating in USA as a Delaware, C-Corp.

You don’t have to be present in the USA for the incorporation. Instead, you can use one of the many service providers.

Here are a few recommended ones:

The cost for this would be approximately $1000, but you can pick and choose packages depending on the services you would require. I would highly recommend that you complete the entire documentation at a stretch including the formation documents, share allocation, etc.

Leaving out some of these may seem cheaper initially but might hurt you in the long run. So complete the entire procedure as part of the incorporation package to get the basic setup done right. You know what they say about being penny wise and …

2. Getting an EIN

This is similar to the Social Security Number. Each business has a unique tax ID number called Employer Identification Number that you will have to register for.

Ask for this service to be included as part of your incorporation, or, with your legal firm’s guidance complete this step immediately. Having an EIN is essential to deal with banks and pretty much everything else in the USA.

3. Getting a US Address

To receive business documents, it is mandatory that you have a US Address.

You can use a service like virtualpostmail.com which starts at $20 each month to collect the receipt of letters via emails; they scan and upload documents for your review and also ship them to any part of the world, if required, for an additional cost.

Besides this utility, it also serves as your local billing address for your credit/debit cards, etc., which becomes essential when you start paying for services with a US bank account.

We use Regus for this service. They provide a bunch of secretarial services including physical mail scanning and emailing among others. You can choose a package that is appropriate for your business. It is very important for your finance/admin team in India to know if there are any statutory mails from the government, bank, etc. and a service like Regus helps you achieve that.

4. Getting a US Bank Account

You would require a bank that allows remote processing of account opening and operations. We use the services of Chase Bank. Silicon Valley Bank (svb.com) is also an alternative, but requires a reference and a minimum balance of 25k USD. Chase Bank doesn’t have any minimum balance requirement.

Before applying for a bank account, it’s mandatory you have an EIN.

5. Getting a Merchant Account / Payment Gateway

Apply for a Stripe or Braintree account. The fee may be on the higher side, but the increased transparency in pricing, support, and the ease of doing business with them makes up for it.

6. Acquiring a Business Credit Card

It is harder to get a regular business credit card without building a credit history. You can use the debit card for all transactions to start with, until you have enough money in bank to get a secure credit card.

A secure credit card is nothing but a credit card with a spend limit secured by the money in your bank account / deposit.

7. Getting a US Phone Number

You can get a toll free number from any of the service providers like phone.com, Google Voice, or Skype.

That was a quick checklist of things you need to get started with the US company.

Once you have your company set up in the US, here’s how the relationship between the two companies (your Indian HQ and the US subsidiary) would work:

1. Distributor License

Make your US company the exclusive worldwide master distributor of your SaaS product. Set up a distributor license agreement that assigns an exclusive license to the US company, to host and sell your products in the USA. The Indian entity now holds the entire Intellectual Property (IP), by providing a hosting and distribution license to US companies for a 20% price cut per customer. If you look at it, 20% margin is a fair market value even if you had to engage a third party for this service.  Also, the US company has to cover all its expenses related to hosting, sales & marketing, and other operations.

2. Terms of Service

The terms of service of your website and product has to be owned by the US entity, as a distributor of your software. Preferably, all the legal recourse should be made available with your US entity.

3. Earnings and transfer of money

If you are just starting up, my best wishes to you for ramping up your revenue faster. 🙂

You can retain 20% of the revenue earned by the US entity and transfer 80% of the revenue back to your parent company as license fee.

When you start making enough money, you will be liable to pay taxes on the profit made on the 20% margin after all the operational costs are subtracted. Note that you will be paying other taxes such as franchise tax, State tax, etc., which have to be paid anyway to operate a company regardless of whether or not you make profits.

That’s pretty much it.

Statutory warning: As mentioned earlier, do not consider this as legal advice. Just sharing an alternate model than following the traditional model of US HQ. You should definitely consult a lawyer and an accountant to ensure that you stay compliant with all the laws in all the countries that you operate in.

Good luck with your startup and feel free to drop a note to suresh-at-kissflow.com to say “Hello”.

This blog was first published on the ChargeBee blog.

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“How to position your product” is the biggest question.

“No matter how many times you explain, customer just doesn’t get it”

“We expect user to use our product in X way, but they use it in Y way”

We do ‘this’, but they think we do ‘that’ and starts comparing us with something ‘that’.

If this is your Kaifiyat (frustration), then you are not alone. Most of the startup entrepreneurs and marketers face this challenge every day.

“How to position your product” is the biggest question.

Shankar Maruwada, brand builder for Aadhar (UDAI project) and P&G products ran a very intensive round table discussion at TouchMagix office Pune. With Twelve entrepreneurs, primarily building global standard technology products to solve business and/or consumer problems echoing same problem – How to position my product without ambiguity.

Beginning of the session, Shankar made it clear that its not a “Gyaan” session, no checklist, best practices or a formula. There is no one pill to solve everybody’s problem. Infact, Shankar insisted, “You’ll walk away with more questions than any answers.”

Bob’s Story: Very first thing Shankar asked all the participants to write a brief story of our “Bob – The Customer”.

Imagine Bob is your most prominent customer. Bob has a problem, Bob uses your product, your product improves Bob’s life.

Rest of the day, Shankar used the “Story” as a base to have each participant pitch/sale their product to everybody in the room. As a participant pitches his/her product, rest of the group critiqued it as a customer. Since most entrepreneurs come from a background and/or experience where they could imagine a use of the pitched products, they were able to provide valuable inputs.

While one entrepreneur pitched his enterprise communication product, while someone else pitched their idea to implementation services business. Rest of the group found it difficult to understand “what exactly does it do”. Thats when Shankar helped with his expert probing questions to highlight the core problem these entrepreneurs are trying to solve. The group also helped highlight a critical situation where the product could make the most impact.

This exercise helped to understand “Although your product might be solving 10 problems or your may have 10 different features, it is important to understand which is THE MOST BURNING PAIN/PROBLEM your product help solve. Focus only and only on that. This helps creating a “Good positioning” in customer’s mind as he is looking for a solution for the same.

DSC_4659Curse of Knowledge

At this point, Shankar introduced a concept of “Curse of knowledge” which works in both ways. To prove a simple yet profound point, Shankar made us perform a group exercise. (I won’t reveal the details as it will spoil the fun and learning if you happen attend the session in future)

This exercise helped realize two things –

  1. What you think is easy for customers to understand, may not be that easy. So work hard at it.
  2. Once you “Know” something, it is difficult to Not know it. – Curse of knowledge.

Curse of knowledge may work in two ways. Based on what words you are saying in your pitch, your customer starts connecting dots in his own mind with his pre-knowledge and starts comparing your products against it. If your pitch helps tap into right knowledge, customer quickly gets the point. However, if your pitch distracts him on different line, then you face a challenge of not being able to convince him. Most importantly if your product is expecting to change his existing habits, then you face a real challenge as customer (in his mind) will always try to defend his own working habits and will be reluctant to accept/understand what your product does. Here Shankar gave an example of if someone try to change our deep rooted email behavior, will face a significant challenge unless you bring a real value proposition that customer cares about. Here one of the participants shared his experience of how people are looking at website updates as a “job to be done” whereas same users are perfectly comfortable in updating their status on social media.

“The hook” and “The Golden Circle”

At this point Shankar introduced the “Hook or Nail” concept by showing DropBox Product video. In this video, Lee Lefever has identified a common hook from day to day real life of need to organize things in one place. How this hook helps in relating to the need of organizing your digital assets in one place accessible anytime, anywhere. Followed by this Siman Senek’s Golden Circle emphasising on importance of “WHY” and how order of WHY-HOW-WHAT of could change the way people perceive you. The key message here was that “People dont buy what you do, people buy why you do it” and how this is at core of Apple’s success. Shankar also showed another video where complex concept of differential gear was explained with simple analogy of pared bike riders.

Now was a time for us to re-write our Bob’s story by identifying “Hook” and techno-jargon less clear messaging. A few more pitches/product-videos were reviewed and critiqued. This time, Shankar steered the discussion to gain more clarity by drawing mind map of every pitch. With his expertise in digging deep into core emotions, he helped participants to identify keywords that could help them refine their pitch to drive clarity. In this exercise, you want to identify all objectives, emotions, and needs related to your product. Now, arrange them in their priority, connect them with relevance, and eliminate those that add no value or create confusion. Here, asking “Why” is an important aspect of finding the truth and getting clarity. To supplement his point, Shankar shared couple of stories from his efforts while establishing Aadhar brand. How interactions with rural population simplified Aadhar’s positioning (“Pehechaan hi Jindagi ka Aadhar hai”) and help achieve massive adoption.

Framework to think: In the last spell, Shankar summed it all in a simple framework. Every concept has three parts.

Mindset (Belief) – A mindset or accepted/known beliefs of your customer

Benefit – The solution or value your product creates

Support – Social proof or reason to believe

Example: Afraid of wearing a black suit (Mindset) in a party as dandruff could expose you? Worry not, use our solution to get rid of (real benefit) stubborn dandruff and be confident (emotional benefit). Endorsed by these celebrities (Social proof), our dandruff solution builds the confidence to make you hero.

In five hours of intense group discussion, all of us had good understanding of what might be going wrong. Everyone has different product, different customer mindset, different challenges and different situations; but each one will be searching for one “Hook” around which a pitch can be built.

Product positioning starts in Customer’s mind. You need to find a hook where you could position the product with utmost clarity. Next time you struggle with “How come they don’t get it”, ask yourself – Did I find the right hook or have I tapped into wrong zone of knowledge?

 

Useful videos:

Guest post by Abhijit Mhetre founder at Canvazify – visual platform that helps entrepreneurs and design thinkers drive innovation through collaborative ideation. Abhijit is passionate about collaborative innovation and loves everything about running a startup.  

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Month on Month, Quarter after Quarter, there is only 1 thing a startup needs to do.

“Grow at a rapid pace!”

Meet Shashank ND, Founder and CEO of Practo.

Practo is a hyper-growth healthcare startup which has managed to raise $125M in three round so far, from the likes of Tencent, Sequoia, Google Capital, Altimeter Capital, Matrix Partners etc.

Below is short video where Shashank shares his 7 year experience of running Practo in a nutshell.

Shashank speaks about the challenges he faced while building a company for the local ecosystem and why rapid growth is essential for every startup.

Shashank also speaks about why an initiative like #PNgrowth is import for an eco-system like India and how it can play a pivotal role in facilitating growth for startups within India.

Watch the 3m43s video below.

#PNgrowth is an iSPIRT initiative in collaboration with Stanford’s Graduate School of Business and Duke’s Fuqua School of Business for growth stage entrepreneurs.

To know more about the program

To know more about the agenda

For people who still haven’t applied, we have ONE last batch to select. Apply here.

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When we learned to crack US sales from India

October 24, 2015. A Saturday after Dussehra, and 59th roundtable of awesomeness in lively office of Zapty.

Not only Sanjay (founder of Zapty) was great, offices of Zapty welcomed us with a lot of natural light. Then, introductions happened and people started to get comfortable around each other.

It was Samir, founder of Shop Socially, who flew from Pune a day before, was going to share the things that worked (and didn’t work) for him at ShopSocially when they built a team to sell to US companies from India.

PS: He also has sales people in US, but we will get into that as well.

We were scheduled to start at 11:00 AM, but kinda waited till 11:15 to start. I call this Bangalore Standard Time (not really late, but a little late)

Then I clarified certain things about Round Table and set the context to make sure everyone understands it’s more like a discussion than a lecture session. Also, it was clarified that its a safe place to share and nothing that is sensitive will leave the walls of that room. That made everyone attending it comfortable and also people were ready with their discussion hats on.

Then Samir shared some great processes which he has developed over 20+ years of experience.

Ohh man, if I could only describe it in words, you should have been there to feel the transparency we saw in an Entrepreneur. The goal of each function inside organization was clear, more like crystal clear. Tons and tons of questions were asked and we all shared some great insights.

Well, here is my attempt to put some of the learnings we had in words:

    • Marketing is Lead Generation: From beginning, Samir made it clear. In his business, marketing is Lead Gen. Branding is a byproduct of marketing, but marketing is for one thing and one thing only, Lead Generation. So, all efforts are measured on this parameter.
    • A simple Motto – Get conversations going: Samir pointed this out multiple times during discussion, getting conversation going is the single most important step in a sales cycle. Do whatever it takes to get conversation going, if your prospective customer is not responding to product/service/problem A, show them B, then C. Do anything to get conversation going.
    • 5 min callback to warm leads: So, this is a 2 part lesson. Number one “define” as clearly as you can, what is a “warm” lead. And then making sure 5 minute callback to warm lead. Now, both of these tasks are important, and success of your “sales” department depends on this. You can define “warm” leads too loosely and your sales team would end up wasting a lot of their time. Or you could end up defining your “warm” lead to tightly, and end up leaving a lot of money on the table. So, constant feedback is super necessary and should be part of the process.
    • For a product, IT HAS TO LOOK STUNNING..PERIOD: I don’t think this needs any explanation, but when he said this, he was really clear on one thing. No compromise on this, its HAS to look stunning.
    • Where to start? Email List: We spent quite some time on how to do this in a scalable way and what are great do’s and don’t around it.  
    • Quora and LinkedIn Pulse are great places to start for B2B sales. If you can get one of your articles on LinkedIn Pulse, that can do some wonders in early stages.
    • For inside sales – warm leads only: Samir was very clear on another thing, how anyone in the team spends their time. And inside sales team should be spending their time on “warm” leads only.
    • Text only emails are best: You can surely try more formats, but whole group agreed on this, as pretty much everyone had experience with sending a lot of emails.
    • For calling, make a script: If you get a chance to get on a call with customer, don’t go without a script. It’s like going to war without a plan..don’t do it. Make a script and rehearse it.
    • Optimize lower end of funnel first: Samir made this super clear that it’s super expensive to lose sales at lower end of the funnel, so if you are optimizing start from bottom of the funnel.
    • Case studies, no…Stunning Case Studies, YES: We according to Samir, anything that you put in front of potential customer (PPT’s, Case studies etc.) has to look great, nothing less than “stunning”.
    • Retargeting – FOR EVERYONE: It doesn’t matter what kind of product you are selling, retargeting ads are for everyone..
    • Video testimonials: If you can get video testimonials, they are the best. You can even put them on landing pages..they are expensive, but might be worth it

Tools / Service companies that we discussed:

  • BuiltWith
  • Datanyze
  • DataCall (a company in Bangalore)
  • Benchmark
  • Yesware
  • Pipedrive
  • Localphone
  • Ringo
  • Express Writers – Bangalore
  • Discover.org
  • AgileCRM

Now, it’s quite possible that you want to know more about the process we learned in the RT, but may be that’s the reason you should attend next Round Table in your city..

PS: Here is another post about Samir’s round table in Pune..

Guest Post Contributed by Natwar, Around.Io

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SaaS India struggles with Inbound Lead Response

As Indian SAAS companies are aspiring to make a global footprint, the sales growth can make or break their goals. Companies who respond fastest as compared to competitors always have first mover advantage to close sales. According to the Harvard Business Review, companies that try to contact potential customers within an hour of receiving queries are nearly 7 times as likely to have meaningful conversations with key decision makers as firms that try to contact prospects even an hour later.

We surveyed 90 funded SAAS companies; the observations were quite shocking as far as their inbound lead response is concerned. Only 26% companies (24 out of 90) companies cared to respond to inbound leads. Given the kind of investment companies make in their digital marketing, money goes down the drain if the inbound leads are not tapped efficiently. Even if the leads are contacted, the time to respond makes all the difference.

Inbound Digital Marketing – A must for Generating Leads!

Organizations rely significantly on inbound digital marketing for their businesses. B2B companies invest from $25 to $500 for generating an inbound lead while B2C companies invest from $5 to $25 for the same. The money spent goes down the drain if inbound leads are not responded in an efficient way. The important questions for you to answer are – How many of your inbound leads are never contacted as they get lost during data transfer to sales team? How many inbound leads are loosely passed on to Sales reps to contact with incomplete or wrong information? How many of them are contacted when the prospect have lost interest in you or chosen a competitor?

The answers to these questions will define the ROI of your inbound marketing efforts. However, the good news is that if you are effective in inbound lead response management you are on the top of your business as chances are pegged on higher side in converting inbound sales leads rather than outbound leads for which investments are even on a much higher side.

Time is all what makes a difference!

We (Texo Team) conducted a research on funded B2B SAAS companies in India to analyse the inbound sales readiness. 90 SAAS companies were identified as funded. Web forms on the websites of the identified companies were filled and the responses were logged. We made an analysis on the data and have come out with an interesting insight on the current state of inbound sales processes in these companies or any other B2B company which may be used as a reference point for improvement through process, people and/ or technology.

We found that 8 companies choose to directly call the prospects and 4 companies choose to directly send personalized emails without sending an auto response. 4 companies sent personalized emails along with an auto response. Overall, only 26% companies (24 out of 90) responded to inbound leads out of which 67% (16) adopted calls as the mode of contact and 33% (8) used email as the mode of communication.

Only 4 out of 90 companies responded in less than 10 minutes. And only 7 companies responded in an hour. Click here to download TEXO SAAS Inbound Lead Response Report- 2015 for free and get deeper insights of the research report including the best SAAS companies in India who scored high in lead response research.

Way to Efficiently Manage your Inbound Leads

Inbound Leads are the prospects who have shown any kind of interest in your products/services by making a contact at any of the buyer stage. Marketers and sales reps have to align their engagement strategies with respect to the buyer stage. But what can they do about the 70% of the buyer’s journey that they’re missing out on? They are not able to correctly judge the prospect’s buying stage when they make a contact and hence not able to employ an effective engagement strategy.

And how can a tool like Sales Engagement Hub integrated with Marketing Automation Tools help marketers and sales reps keep pace with their buyers? The level of interest may vary depending on the buying stage the prospect is in, and hence different prospects need to be addressed differently. Factors to be considered for engaging with inbound leads are Response Time, Mode of Communication, Information to be shared, and Frequency of follow-ups and so on. A prospect in the consideration stage would prefer information about products, solutions, services, and case studies, and would need longer follow ups over email (preferably) or call. However, a prospect in the decision stage would be more interested in having information on solutions and pricing, and would need consistent follow-ups (shorter) over call (preferably) or email. Sales Engagement Hub integrated with marketing automation tools help the sales reps and marketers in effectively engaging with prospects.