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How we incorporated Deducely, Inc in the USA using Stripe Atlas

In our first blogpost, I’d like to talk about how we incorporated in US from outside the USA.

This is a version 3.0 post that is inspired from V 1.0 by my former boss Girish Mathrubootham and V 2.0 by Suresh Sambandam, CEO of KiSSFLOW.

This article can not be considered Legal advise, please consult a lawyer and/or accountant before incorporating.

US Incorporation 101

The US has one of the most mature banking and financial systems in the world. Owing to this many internet businesses prefer to incorporate in the US. In India the reserve bank of India does not allow businesses to automatically charge user’s credit/debit card’s; explicit user consent is expected via a second factor authentication like an OTP or a password. This hampers the smooth functioning of subscription businesses that charge users every month.

However A US based company can store its user’s credit cards and charge them automatically in a recurring fashion seamlessly. For the convenience of auto-charging credit cards many ‘Subscription As A Service’ (SaaS) companies based out of India have their headquartered in the US.

Deducely being a SaaS product, we wanted the ability to charge our user’s cards every month automatically without asking them to input their card number every month. Since we operate from India our options were very limited

We had 3 options in hand, but we had apprehensions too:

  1. Incorporate in a foreign country – Too costly, close to $2000
  2. Use 2Checkout or FastSpring – About 10% to be paid as commissions
  3. Use Paypal subscriptions – Developer un-friendly, average customer support

Enter The Atlas Program Stripe Atlas

Stripe atlas is a bento box for businesses to get up and running. Stripe Atlas grants the following for a flat fee of $500:

  1. US company registration (A Delaware C corp).
  2. Registering with the IRS for taxation purposes.
  3. A Zero balance US bank account in Silicon valley bank.
  4. Access to Legal and Tax consultation from PwC, Orrick and UpCounsel.
  5. $15,000 in Amazon Web Services Credits.
  6. A Stripe account ready to accept payments.

We were skeptical about this program, We even felt it was too good to be true but when we approached Avinash Raghava of iSPIRT and Suresh Sambandam of KiSSFLOW for expert opinion, we were advised to go ahead and incorporate via Stripe Atlas. It was totally worthwhile.

How to incorporate a Delaware C Corp in the USA through the Stripe Atlas program?

Step 1: Get an invite to the Atlas program

This is the most difficult part, as of now the stripe atlas program is invite only, you could try requesting an invite on the website or via their twitter account. Once you are successfully invited you’d get an email with a link that can be used to register an account at Stripe Atlas. Now You’d be required to create a new Stripe account.

Step 2: Enter detailed information about your business

Once you have signed up for the Stripe account you would be presented with the following overview screen :

stripe starting page

When we click on get started we are presented with a screen that asks a few details about the product and the business:

business details page

Step 3: Enter how you’d like to structure your company

There are two ways to structure your company when your business is not physically present in the US. This is a very crucial decision and should be taken after thorough deliberation.

  1. Setting up a US headquartered company with an Indian (or other non US country) subsidiary:Freshdesk’s model
  2. Setting up a US subsidiary for a non US parent company: KiSSFLOW’s model

Company incorporation screen

We had not incorporated anywhere yet and we went ahead with Freshdesk’s model , so we were asked to enter our company’s desired name, while entering the desired name please ensure that the name is not registered by any other entity, a simple google search could help you out.

Although we could have entered our local non US address, we went ahead and purchased a physical address in the US through virtual post mail for $10/month; virtualpostmail.com scan the physical mail that we get and email it to us. We received our ETPS(Electronic tax payment system) credentials through our physical address. Though the US address wouldn’t be of any other use in the immediate future, we wanted Deducely to be global and hence we invested in a US physical address.

We got a US phone number for free through Google Voice and entered that as our phone number, to get a Google voice number you need to know someone with a US phone number from a major carrier like Verizon, AT&T, T-Mobile or Sprint. Once the google voice setup is done you will be able to make and receive calls from your US google voice number through the Hangouts dialer app . You could enter your local number here as well.

If you choose to set up a US subsidiary with a Non US company as the parent you would be asked to present the Non US company’s tax ID and registration certificate. Please consult your local lawyer and accountant for any regulatory compliances that need to be met.

Step 4: Enter the details about the people in the company

In this page you’d be prompted to enter the personal details of all the people who would have more than 25% stakes in the company. Please have a scanned copy of your passport or any other government issued IDs.

Personal details about the founders

Now, in the same page, you will also be asked to select the company’s president, secretary, incorporator and directors.

Board of directors

Step 5: Enter the bank account administrator details and pay:

Getting a US bank account is the most difficult part for any non US entrepreneur , You either have to be physically present in the US or know someone in the US who could introduce you to the bank. These banks tend to have high maintenance fees and high minimum balances associated with them. However stripe atlas has partnered with Silicon Valley Bank(SVB). SVB provides a zero balance account with no maintenance fee for 2 years. In the following screen you will get an option to select the administrator for the SVB account

SVB administrator

Step 6: Enter your credit/debit card details:

You will be presented with a stripe checkout popup where you can enter your card details. You will we charged $500 USD only after the successful incorporation of your company. After the payment you’d get a prompt saying that your incorporation would be complete in one week.

Since Deducely was one of the initial pilot companies to be incorporated via the Stripe Atlas program we did not have to spend a dime to get up and running with a US company and bank account! Thanks a tonne Patrick, we owe you one!

Step 7: The application review process:

I am not sure if this is step would be applicable for everyone. A couple of days after we had submitted our application we received an email from stripe requesting us to furnish details like our estimated timeline, screenshots, Terms of service etc… and we showed them our screenshots and git account; after a few anxious days our application was accepted. I feel this is necessary steps to prevent abuse of this program.

Step 9: Digitally sign the incorporation documents:

After the review process is done and dusted, all the associated people in step 4 would receive an email with a link to a Docusign document. You can read the documents and sign. We would be able to proceed to the next step only when all the associated people have completed signing the documents.

Step 10: The AWS activate account:

After signing all the documents you’d get an email with a link to activate your AWS goodies. You’d get:

  • $15,00 in AWS credits valid for 2 years.
  • Access to AWS web based training (worth $600).
  • Access to AWS business support (worth $5000).
  • Access to AWS solution architects.

Step 11: Receive your incorporation documents:

After you digitally sign all the incorporation documents , wait for around 5-7 days to get your Delaware C corp incorporation certificate and your Tax ID(Employer Identification Number) from the IRS.

Step 12: Opening the SVB account:

Since we had given a PO box address in the US we were asked to give the physical address where our business is present. We emailed this to SVB and after 1 week we were granted access to SVB online banking.

This is the end of the incorporation procedure, here a few things to be done next

Next Steps:

1) Signing the stock plans: Stripe would email you a draft of a Stock agreements, get it signed by your board of directors. Stripe would also schedule a free 30 minute call with upcounsel – a law firm for clarifying any queries.

2) Sending funds to the SVB account: Ideally you can wire funds into your SVB account, but this is a tedious process involving a lot of waiting. We found square cash to be a convenient way to send cash into our SVB account. It takes 2 working days for the cash to show up in your bank account.

3) Getting a credit / debit card : You have funds in your SVB account and you want to pay for your hosting and other subscriptions, there are two options that I am aware of, the first method would be to apply get a business credit/debit card from SVB and get it delivered to your address. The second method is signing up at privacy.com. Privacy.com is a new age fin tech company that links with your bank account, through this service you can generate virtual VISA cards with fixed spending limits and close them whenever you want. We use privacy.com to generate virtual credit cards and track our spending. This service is free!

4) The Unofficial Stripe entrepreneurs Facebook group: If you are not based in the US and have a US based company , we have created an unofficial stripe atlas entrepreneurs group in Facebook . You are not alone here, if you run into any issues or need help you can ask other fellow atlas entrepreneurs for help.

Overall our experience with Stripe atlas was exemplary. Their support team always had our back; I’d like to give a huge shoutout to Anita from the Stripe atlas team, she was not only very knowledgeable but also very patient in replying to the barrage of queries that we raised every day! Ideally a service like this would cost you at least 800$ without the bank account and $15,000 in AWS credits. Stripe Atlas = A happy meal for company incorporation!

If you need any help or have any queries related to this post please reach out to me at aswin <at> deducely <dot> com

Guest Post by Aswin Vayiravan, Deducely

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India can’t afford the comforts technology provides. Here’s why

There’s a belief globally that we have a burgeoning middle class in India — and we’re following in the footsteps of China’s massive change from immense poverty to a stable middle class.

But that’s really not the case. There was a very interesting article onScrollsome time back explaining this.

According to the article, “China…saw its middle-income proportion go up from 3% in 2001 to 18% in 2011.” This growth in disposable income, coupled with technology, fueled growth in consumption, most probably with some visibility of profitability for businesses in the country.

In India this hasn’t happened.

“All those stories about India’s burgeoning middle-class have little to do with reality: India is, as it has always been, woefully poor.”

Instead, it seems that the major shift that’s happened is the really really poor are now just poor. And no where close to being determined middle class by any definition. The article does a good job of showing how middle class globally is defined.

Here are a couple of charts showing this move.

We don’t know how fast this low income bracket will start moving into middle income, but my guess is quite slowly. There is a lack of education, lack of opportunities, and lack of incentive for anyone in a position of power to do anything drastic about it. And even if we were motivated, these things take much more time in multi-party democracies like India vs countries like China.

If this is the reality, it’s going to be tougher and tougher for transactional business dealing with consumers (like ecommerce) that make money on delivery/logistics to grow in spite of this long term. Here’s why.

Today, the average take rate (the percentage of each transaction companies make to run their businesses) isn’t sufficient to cover costs related to the transaction. Yet, the take rate as a percentage of the cost of any one item is so high that it’s difficult to imagine most companies being able to increase it. On average companies charge a 10/15% take rate. How realistic is it that any consumer will be willing to pay 25/30/40% extra on top of the cost of an item? Probably not that realistic.

More woes

Photo credit: Lord Enfield

It gets worse. Logistics costs are going up. Believe it or not, ecommerce players have been lucky with overall delivery costs so far. They have spent on everything except their front line. And that’s showing. We’ve seen the repercussions of this at Flipkart already, and things are going to change really fast — starting with delivery staff salaries. So, even increasing take rates (as unrealistic as that sounds) will only help maintain present losses.

Seems like an impossible problem to crack, right? Well, it gets worse because scale doesn’t solve the problem. All these businesses need a substantial offline operational capability. As a result, they get little benefit from growing because they keep needing to add people, delivery centers and other logistics related costs.

And now, to top it off, they’ve been marketing to a middle class that is significantly smaller than was originally imagined. Most people can’t afford as much as online companies need them to — meaning the size of every transaction is only going to get smaller. And since take rates mostly work as a percentage, they’re going to reduce. In fact, it’s very possible that the take rate percentage itself will be under pressure to reduce. And all the while, customer expectations on quality service and delivery will remain the same.

So how do you make up the income? Ad revenue? How realistic is that ad spend in the country will go up any more than marginally anytime soon? How realistic is it that any ancillary revenue streams will make up enough of the short fall? Seems far fetched to me.

It’s actually really unfortunate. There are so many businesses that we truly need in India, but the majority of us can’t afford for them to be as efficient as they are today. How long will this gap in affordability and convenience be funded by private equity? My guess is — not long enough. (But as a consumers, I’m going to enjoy it while it lasts.)

From what I can tell, as bad as the margins are for these businesses, this is the best they will ever be. And that’s scary.

Guest Post by Sid Talwar, Partner at LightBox Ventures

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5 Signs you need a SaaS based Cloud Payroll Software for your Startup

Startups are natural transgressors, but payroll and HR is one area where a startup simply cannot afford to break rules. Entrepreneurs of startups may have to come up with disruptive ideas if they want their enterprises to be listed in Fortune 1000, but there is one particular area, where entrepreneurs of startups certainly would not want to break the rules: HR and payroll.

5-Signs-you-need-a-SaaS-based-Cloud-Payroll-Software-for-your-StartupStartups that fail to comply or neglect HR and payroll laws are often slapped with stringent financial and legal consequences. In fact, some penalties are so stringent that they can throw the entire business off track. With that being said, here are five common yet biggest HR and payroll mistakes that startups commit and why it’s time to embrace a mobile payroll app or cloud-SaaS based payroll software.

Mixing Business and Personal Finances

During the initial days, a business banking account may seem pointless for a startup. This is because a startup in its initial days hardly makes any money and for most of the entrepreneurs of newly launched startups, it is pointless to pretend that they are paying their employees with the company and not from their personal pockets.

Such a thinking in particular can have grave consequences in the long run. Eventually, a startup would need to separate all the expenses and repay taxes.

In case the startup is audited or sued, the blurry discrepancy of business and personal finances can render the entrepreneur’s personal assets vulnerable to seizure by the court. To make it worse, the startup might even lose its corporate status. Unfortunately, most of the startup founders are of the notion that this won’t happen to them, but it does and quite often.

Thus, to keep away from legal hassles during such untoward incidents, payroll software for startups is your best bet.

Relegating Employees as Independent Workers

Treating or misclassifying your employees as independent contractors or workers when in fact they ought to be legally regarded as employees is one of the gravest mistakes that startups commit these days. The major reason of doing this is that they don’t have to pay insurance, overtime or taxes for independent contractors. Also, they don’t have to bear other contractor benefits.

Misclassifying is quite common among startups, where several entrepreneurs practice the “try before buy” recruitment technique. It is one of the biggest human resource management mistakes that owners of many startups commit resulting in increased employee turnover rates.

Nevertheless, if you are still relegating employees as independent workers, then it’s advisable to have an automated SaaS based mobile payroll app or cloud based payroll software for startups that can sort out or distinguish payroll and all other independent contractor benefits from what is offered to employees in your company.

Attempting to Manage Compliance and Payroll through Spreadsheets

Payroll undoubtedly is a complex and tricky process, most of the businesses especially startups screw at it often only to be penalized for compliance violations by using spreadsheets. This is the reason many businesses resort to employing some or the other kind of payroll service.

However, startups require compliance such as compensation, healthcare, employment insurance, etc. These are mandatory in almost every state. Compliance overheads even in a freshly launched startup can escalate quite fast.

Thus, many tech-savvy startups make use of cloud based HRMS and payroll software for startups instead of spreadsheets to manage their payroll and compliance. A mobile payroll app helps to manage payroll for a startup including a range of taxes whilst ensuring compliance with all the necessary insurance and other stuffs as well as reporting.

Over/Under Paying Employee Benefits

With the startup competition getting fierce with each passing day, recruiting and retaining best talents has turned a lot more difficult and challenging. Thus, you must offer amazing employee benefits to retain the best talent pool that can drive your startup.

A cloud payroll software for startups can be of great help here, because a mobile payroll app with its excellent automation functionalities computes accurate figures to be administered as benefits thus, ruling out odds of human errors paving way for redundant and error-free benefits payouts.

Being SaaS based makes it scalable thus, startups don’t have to spend a fortune making it budget-friendly. It eliminates the cumbersome paperwork that goes into filings and benefits administration for your HR and payroll department saving them time and efforts.

Frustrating their Employees with Endless Paperwork

No one likes paperwork and startups are no exception. Yet, a number of businesses are still stuck in ice-age, as they use outdated HR practices or legacy software.

As we are living in the 21st century, gone are the days of asking your employees to filling out forms and email or fax them to the respective departments. Several businesses are making use of payroll software for startups to automate this entire process making it easy for both HRs as well as employees. A mobile payroll app helps a startup to go paperless when it comes to carrying out payroll and other key HR processes.

So these are five signs a startup needs to shun those legacy HR/payroll software or practices and embrace a cloud and SaaS based payroll software now.

Guest post by Anwar Shaikh writes about HRMS solutions and Payroll Software. A self-made, reared-up writer, Anwar is a wannabe Cloud evangelist and has a great penchant for cloud SaaS and automation technologies, SMAC, CRM, ERP and human resources. 

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When to open the purse for that Blockchain-y project of yours?

Blockchain, Blockchain ! The buzz continues to spread from coffee machines to boardrooms. Everyone I speak to nowadays is eager to know how to leverage Blockchain tech and what’s in it for them.

A key question in front of us as solution providers is when to choose Blockchain (and when to stick to relational databases) and more importantly which use case to fund/invest.

Based on my experience of Blockchain technology, if your use case meets all the conditions below, using a Blockchain makes business sense:

  1. A Shared Database: A Blockchain is a distributed ledger. The data contained in a Blockchain is replicated across all nodes within the network and is therefore shared. First step would be to determine if there is a genuine need for data sharing across the entire network.
  2. Multiple Writers: In a Blockchain, the database is written by multiple writers simultaneously. These writers could be a bank’s customers initiating payments, traders trading in a exchange, ATM/POS transactions, multiple companies updating their records in a government portal etc.
  3. Lack of Trust: Does your use case involves multiple users that trust each other? Let me ask it differently. Is one user willing to let other users modify the database entries it owns and is he/she blindly trusts the ‘read-only’ information provided by other users? If your answer is a clear NO, then Blockchain can be the answer. But everyone trusts a Blockchain as transactions are confirmed by ‘autonomous’ nodes (that do not trust each other) and considered immutable.
  4. No need for a central intermediary: If all we needed was a solution that let’s multiple non trusting writers update a shared database, then having a central intermediary that is trusted by all writers could have solved the problem. Everyday we interact with such central intermediaries e.g. Uber, commuter train companies, our banks, government etc. Govt issues us identity documents that are acceptable to all, a bank’s confirmation on a successful transaction is treated as a gospel of truth. Blockchain removes the need of having a central intermediary by its inherent design of immutability, block confirmations, distributed consensus. The transactions performed on a blockchain can thus be trusted by multiple writers who do not trust each other but trust a Blockchain. Do you really need disintermediation and does not having one makes it cheaper , faster , more efficient for your customers.
  5. Transactions Linkage: It means that transactions created by different writers often depend on one other. For example, A sends some money to B who in turn sends it to C. So, C’s balance is dependant on A. Because of this dependency, the transactions naturally belong together in a single shared database. Taking this further, one nice feature of blockchains is that transactions can be created collaboratively by multiple writers, without either party exposing themselves to risk.
  6. Authoritative Final Transaction Log: All nodes agree to the contents of this log. For a new node, downloading the entire previous blockchain is a starting point. If a node is down for some time, it can download the incremental blockchain to know the latest contents of Blockchain. In a peer-to-peer database with no central authority, nodes might have different opinions regarding which transaction to accept, because there is no objective right answer. By requiring transactions to be “confirmed” in a blockchain, we ensure that all nodes converge on the same decision.
  7. Guaranteeing the represented assets: Who stands behind the assets represented on the blockchain? If the database says that I own 10 units of something, who will allow me to claim those 10 units in the real world? Who do I sue if I can’t convert what’s written in the blockchain into traditional physical assets? Is it going to be a bank, a stock exchange, a mineral company? It all depends on the type of asset that is recorded on the Blockchain.

Conclusion: If your use case fulfils the all of the above criteria, using a Blockchain makes sense. Go ahead and invest in it, Blockchain is worth it.

(Disclaimer: Inputs from Gideon. Views expressed are personal and may not necessarily reflect views of my employer.)

Guest Post by Gaurav Singhai, Sopra-Steria

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India’s reverse Brexit: Passing the GST Bill will create millions of formal sector jobs

Imagine a warehouse of more than one crore square feet in Central India – around five times the size of the largest football stadium in the world. It would have an eight lane highway that is connected to all four corners of the country on one side. It would have one of India’s largest railway container terminals for handling enormous goods trains on another side. It would have an all-cargo airport terminal operated by a partner on another side. And on the fourth side would be a cluster of manufacturers supplying the warehouse in real time based on big data analytics of national demand and inventory for their products.

This warehouse is not even on the radar today but can become a reality with the GST Bill. Passing the GST Bill – India’s reverse Brexit moment that will end state-by-state rules and create a national market for goods to be supplied from anywhere to anywhere – will create millions of formal jobs.

Currently, supply chains for e-commerce companies are not optimised but distorted by regulatory cholesterol that prevents us from offering customers the lowest cost or fastest delivery. We are unable to supply goods worth more than Rs 5,000 to UP because our customers have to go to a tax office and complete paperwork. We are unable to keep goods from our 90,000 suppliers in our warehouses across Karnataka due to double taxation. We often face confiscation of goods and cash in Kerala because of their approach to tax domicile, which conflicts with supplying states.

With GST, all of this will be history.

A seamless national supply chain that is agnostic to supply or demand destination is urgent, important and overdue for three reasons. First, it is India’s development trajectory to reduce poverty. Second, it will improve enterprise productivity. Finally, it is about empowering consumers and producers.

Let’s look at each of them in more detail.

We need to evolve very differently from China as we do not have the same global manufacturing and trade opportunity China had in 1978. Plus, democracy imposed some very desirable but real fixed costs on infrastructure building and growth. Harvard professor Ricardo Hausmann suggests that the best predictor of sustained prosperity is “economic complexity” and India’s economically complex economy is a great opening balance for building on domestic consumption growth to reduce poverty. Essentially, instead of the traditional formula of large manufacturing, exports and large enterprises, i think India’s destiny lies in services, domestic consumption and small and medium enterprises.

The second point of enterprise productivity is important because poverty can be eliminated by improving productivity. We are thinking hard about individual productivity like skills and education, but we must recognise that India’s problem is not jobs but wages. Our official unemployment rate of 4.2% is not fudged. Everybody who wants a job has one, just not at the wages they want. India’s enterprise stack is largely informal, unproductive and built on self-exploitation. Of our 63 million enterprises 12 million don’t have an office, 12 million work from home, only 8.5 million pay taxes, only 1.5 million pay social security, and most tragically, only 18,000 have a paid-up capital of more than Rs 10 crore.

Drying this swamp is key. The US economy is nine times our size but only has 22 million enterprises. Ninety per cent of India works informally (this is the same number as 1991 and means that 100% of net jobs in the last 20 years have been created in informal enterprises). Many factors go into enterprise productivity but the main one is market access: connecting with buyers.

The final point is about consumer and producer empowerment. The majority of India’s 600-million-strong transacting consumers do not have access to quality products at affordable rates. Similarly, lakhs of producers are denied market access. Because of geographical constraints and artificial restrictions placed by the current tax regime, quality products are expensive and affordable products suffer from poor quality.

Here technology can come to the rescue post-GST. The ‘India stack’ framework for transactions (paperless, presenceless and cashless) is being first applied magnificently to finance but has huge implications for production and consumption once GST is passed. An unintended consequence of implementing the India stack across supply chains will be big data analytics for government that will not only improve compliance but greatly expand formal economic activity and create a virtuous cycle for credit, employment and wage rises.

One of the most remarkable books about India is The Integration of Indian States by V P Menon. It describes wonderfully how the 562 maharajas that administered more than 40% of India’s land and 25% of our population in 1947 were brought into the Indian state by 1951 in a project led by Sardar Patel, which secured the political unity of India. Passing GST will have similar impact on our economic unity. It will be a gift to first-generation entrepreneurs who don’t have connections or money but just the courage of their hearts, the sweat of their brow and the strength of their back.

Coming soon after Brexit – the UK’s economically baffling decision to leave the European Union – passing GST would also signal to the world that India’s economic ambitions have new rocket fuel. India’s regulatory cholesterol has been hostile to small entrepreneurs. GST rights that wrong and makes a new appointment with India’s missed tryst with destiny. This is one that she must keep.

Guest Post by Sachin Bansal, Co-founder & Executive Chairman of Flipkart

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7 SEO Trends Entrepreneur Should Pay Attention To

Anyone who has been in the business of SEO for long is well aware that this is one of the fastest moving industries in the world. You have to be able to pay attention to the latest SEO trends if you’re going to stay ahead of the competition and preserve your ranking.

This guide is going to introduce you to the seven primary SEO trends you have to pay attention to this year. And if you follow these trends you will be well on your way in being a better marketer who understands not only SEO, but how to effectively grow your business.

  • Higher Google Ranking Doesn’t Correlate to Organic Clicks
    Just because you have a number one ranking website doesn’t mean that you become king of the Internet. The number one spot still has to compete with visual ads and paid search results. It’s still a worthy goal to aim for, but it’s definitely not something that you should become obsessed with.
    There are other ways to promote your brand.
  • Rich Answers are on the Rise
    Rich answers are those webpages that provide a huge amount of information on a specific topic; usually general ones. Unfortunately, publicly available resources tend to form the bulk of rich answers, making it difficult for you to compete.

However, focusing on getting your site featured as part of a rich answer can be hugely beneficial. 2016 is the year to change direction on rich answers.

  • Page Speed is Becoming More Crucial
    With the rise of video content, a lot of site owners are investing in it. The problem is that they are slowing websites down. You need to remain aware of page load times because if they’re slow you’re going to start losing customers. And Google will penalize your website anyway.

A SEO optimized website must have the fastest load times possible.

  • Analytics is Getting Harder
    Dark traffic comes from a range of sources, such as from a non-secure site to a secure site, image searches, and the rampant use of VPNs. This traffic isn’t able to be tracked and Analytics reports are becoming less accurate than ever before. This is making it harder to make decisions.
    You can get around this slightly by creating direct traffic reports within Analytics so you can at least filter out the dark traffic.
  • Keywords are Alive and Well 

Despite what some people think, keywords are not dead. They remain alive and well, but what people have to be aware of is that Google is looking at them differently.

The post-Hummingbird world is one where Google can recognize meanings behind words. Your goal is not to focus on individually themed keywords but on the thematic groups behind them. Your keyword lists will be more varied than ever.

  • This Year You Will Be Removing Link Penalties
    Google penalties have always existed, but they have become more regular in the last few years. They have a zero tolerance policy on low-quality sites or sites that are attempting to game the system. You may have been hit with a penalty before, but it’s not the end of the world.
    Get in touch with Google and ask them about a penalty on your website. Make positive changes and tell them about it. Google has been known to remove penalties. No site is ever completely lost.
  • User Behavior is Becoming a Factor

Google deny that user behavior matters. The independent experiments say otherwise. Social signals are a ranking factor, and they are based on user behavior. It only makes sense that user behavior will become a ranking factor. What they do and how long they do it for will matter.

So what should you do?

Concentrate on enhancing engagement levels. It’s the only way to get ahead of the game before it becomes a factor.

With all this in mind, how are you going to change the direction of your SEO campaign?

Guest Post by Charlie Robinson, a marketer and interim VP of Marketing of multiple tech companies. He is currently heading marketing at Adling a digital agency in Cupertino.

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Crafting experiences, which are awesome. by design #DTSummitBLR

These are exciting days for us at Pensaar. The Summit, which we have planning for a while is right around the corner.

Here’s what you can expect from our Summit workshop (Phase1 on 15, 16 and 17 July hosted at Indian Institute of Management, Bangalore). The co-creation session is carefully designed to be a completely immersive and experiential 3 days. You’ll learn how to understand customers, articulate insights that will inspire innovation, ideate till you get disruptive ideas that you rapidly test with customers. The entire conference is focused on learning by doing. And, what’s more you will learn design thinking with a group of 50 people across startups, large companies and academia. We are envisioning creating change makers. You will walk away – empowered and inspired.

We are thrilled to be partnering with Indian Institute of Management, Bangalore (IIM, Bangalore) to bring the Design Thinking Summit. We are humbled by the tremendous response that’s already poured in.

Designthinking

Our mission is to raise the levels of awareness for Design Thinking in India and elsewhere. Particularly in India, where we think we’ve had a strong legacy of an engineering led culture. Sadly though that legacy is a big factor in India being perceived as an outsourced development center. The opportunity though, as we see in every challenge, is to bring about the perfect marriage of engineering & product development with a design thinking mindset – a mindset posited on a user first, design led solutioning

In our experience, many teams and organisations are deploying a tactical workaround – that of hiring designers. Merely hiring designers isn’t enough, its critical for leadership teams to harness the power of design thinking to create experiences for customers, which are awesome.by design

But I get ahead of myself here. Let me back up here a bit.

What comes to mind when you think of Innovation? Ever so often, it means it’s a flashback to one of three ways we experience the pursuit of innovation across organizations:

  1. The Eureka moment
  2. Start thinking out of the box
  3. BOHICA: Bend Over Here It Comes Again

DT2Not surprising that companies (of every shape, size and origin) are struggling with innovation. Good work is happening, the right interventions are being made but these interventions are happening in silos. One is left with the feeling that “some secret sauce is missing”. Is there a secret sauce? And is it missing?

Design thinking is the answer. It’s missing for sure. But it isn’t missing as an ingredient – it’s missing as a mindset within teams and across organizations.

So, what is Design Thinking (DT)? Design thinking or Human Centered Design is a process for solving problems. It’s a perfect blend of divergent and convergent thinking allowing for a wide exploration of possibilities vs. being fixated on a single solution (a uni-dimensional solution)

We approach DT as a “disciplined pursuit of disruption”. Let me explain the 3 key words there:

  1. Disciplined: It’s disciplined, because innovation isn’t about happy accidents and good fortune (serendipitous innovation). We believe in “engineering serendipity” to get to the future we want to create (note: we don’t say get future ready, which is an ever-shifting frame of reference)
  2. Pursuit: it’s a relentless pursuit with rigour. To fully harness the potential of DT, you have to anchor it within the DNA of the team / organisation. For organizations to realize the full potential of their innovation capabilities, they need to look at it holistically, from up skilling talent, empowering them with the right processes, values and decision making, allowing them to push the boundaries of what’s possible
  3. Disruption: This is an oft quoted (largely misquoted) and we make an effort to make that distinction. Disruption is doing new things that makes old / existing things obsolete. Innovation on the other hand is just doing new things.

We are super excited at how uniquely positioned we are. And the DT Summit is our chance to share this unique perspective with the broader audience. We love diversity and we embrace it wholeheartedly.

We fight educated incapacity, because we bring to bear the power of design thinking, which is domain agnostic in its approach and application.

So, what is that Pensaar way of Design Thinking? Our process: Discovery —> Insight —> Dream —> Disrupt is designed around some core principles:

  1. Co-creation: We love co-creating with our client partners (and in turn, encourage our clients to co-create with their users / customers). We love to share the ownership of problems (product or business or social) and solutions we co-create.
  2. Designing for Human behaviour: We love technologies (emerging and disruptive) but only as the means to the end. We believe humans are the best technology and our emphasis has always been on designing solutions for behaviour change – human-to-human interface. (No we don’t think apps are a business model)
  3. Problems & Goals focused: We are obsessed and fall in love with problems. Our approach has been carefully designed to avoid the path of least resistance. To be honest, it does make a lot of our partners edgy, because we spend a disproportionate amount of effort in building customer empathy, generating insights and carefully crafting that problem statement.
  4. Addressing a genuine human need: Most product / business failures come from lack of customers and NOT products. That’s really from NOT understanding customer’s evolving needs and yet trying to design a fancy product. Unless you’ve understood the customers real pain points and his/her hierarchy of problems, any product, no matter how good it looks on paper – its bound to fall short of its potential
  5. Assumptions test: It’s simple really. Any idea or thought you have, is a hypothesis, which needs to be tested. Without, rapid experimentation to test for assumptions and hypothesis you aren’t managing the risks in favour of success.

We can’t wait to meet you and co-create with you at the workshop. We hope to see you, both at the workshop (15 – 17 July) and at the Unconference on 12 Aug.

Please do share this event ‪#DTSummitBLR http://designthinkingsummit.com and help us spread the word on the summit. 

Guest Post by Venkat Kotamaraju – Growth & Strategy Leader, Pensaar

 

 

 

 

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The power of a question

A few days ago, while I was discussing a rather critical business solution with one of my colleagues, I noticed that there was a strange circularity to our conversation. I kept trying to convince him of the importance of deploying such a solution,but I seemed to fail at eliciting a sense of urgency or enthusiasm from him, even though he did not disagree with me.

It might have been slight vexation on my part when I decided to break the impasse with the question, “So, what’s stopping us from doing this?”

It was then that I discovered that he had concerns about how to go about the task while I was focusing the conversation on why the job mattered.

The communication fog was lifted. We had identified the roadblock.

We often assume that the best way to communicate anything — an idea, a challenge, a solution — is to perfect the art of explaining it to the listener to provide clarity.

However, we tend to overlook the possibility that the questions we are trying to answer are sometimes not the ones that exist in the others’ minds. This could render our efforts at providing clarity, completely irrelevant.

What might be another effective way to communicate, then?

Perhaps, asking questions?

Knowing the answers will help you in school. Knowing how to question will get you through life– Journalist and speaker Warren Berger — ‘A more beautiful Question.’

It turns out that I am not alone in my quest for questions.

A few months ago, the practice of brainstorming gained a fraught reputation, when technology pioneer and author of the book, “How To Fly A Horse”, Kevin Ashton kicked up a storm with his blog post provocatively titled “Why You Shouldn’t Bother Having Brainstorming Meetings”.

Brainstorming, of course, is a highly popular practice; as he noted, it’s the “go-to approach” for all types of organizations. A typical brainstorming session gathers groups of people to focus on collecting original, creative ideas on a set topic. But this apparently benign approach, Ashton goes on to argue, actually gives rise to ideas that are anything but original. That’s because the focus is on churning out answers.

But what if brainstorms were designed to generate questions, not just ideas for answers? It’s an approach that’s garnering support among many advocates around the world.

The latest champion of this approach is Matthew E. May, author of the book, “Winning the Brain Game”. His book describes a question-generation process called “frame-storming,” which uses questions to help in framing the challenge at hand. Several people have found it to be more efficient than traditional brainstorming in sparking fresh thinking in some situations.

What if we use questions as a method to drive home the thought behind an idea, to help the listener generate answers, instead of to generate questions?

Guiding people into answers through relevant questions surrounding a topic may seem counter-intuitive. It is more natural to try and get people to see the answers when we have them worked out. However, this question-based approach can lead to greater clarity than the usual method of having them ask questions for improved clarity.

It also helps to remember that a question triggers our brains to start serving up answers, almost on autopilot. The answers almost always reinforce the assumptions behind the questions.

Naturally, at this point how the question is formulated assumes paramount significance. A question could spark random divergence from the actual problem by introducing more assumptions, or could become a harbinger for radical solutions or ideas by shattering existing assumptions. Either way, the design of a question definitely begs a lot of attention.

For ages, questions have been at the heart of innovations in science, philosophy, medicine — why not extend the power of the question as a tool for sharpening and deepening communication?

About the Author

Shivku is usually found cracking PJs in the office and disrupting people from doing their job. A self-proclaimed foodie, he is the best person to get the local food scene advice from, irrespective of where you aretravelling to. This blog originally appeared on Medium.

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The SaaS Juggernaut: Advantage India

An Indian software company serving majorly clients in the US or Europe is not an unusual thing anymore. However, if anybody were to guess the location of the India office, a company that counts amongst its clients about 100,000 small businesses globally, they would most probably chose Bangalore or Hyderabad. However, Appointy, which is an advanced web-based scheduling software tool and has around 90,000 salons, spas, and dance and yoga classes as its clients in 100 countries does it out of Bhopal. Similarly Kayako, which sells support software to over 30,000 clients including NASA, Peugeot, Sega found its roots in Jalandhar, which as per their own website is “one of the least likely places to establish a technology start-up”.

The emergence of these companies from relatively smaller towns, highlight India’s comparative advantage in terms of ability to build high quality companies in the domain of Software as a Service (SaaS). The inherent model of the SaaS business does not require proximity to the end user. In the simplest terms, it is a software that can be accessed through a web browser, by paying a subscription, either on a monthly or yearly basis. The software is hosted exclusively by the provider, as opposed to being downloaded upon purchase and subsequently hosted by the client. The customer gains by spending less upfront, not having to maintain hardware and not worrying about upgrades & data security. Driven by such factors, the SaaS model is growing exponentially and the global market for 2015 stood at USD 31 billion (NASSCOM). The growth is expected to continue at CAGR of 18% to reach a market size of USD 72 billion by 2020. Another study by Google and Accel Partners estimates the 2020 market to be USD 132 billion.

The Indian SaaS landscape is expected to evolve even faster. The FY16 market is estimated to be USD 407 million, a 34% growth over FY15. This figure is expected to triple by 2020 growing at a CAGR of 27%, 1.5 times the global growth rate. It is easy to see why India is going to be a hotbed of activity for SaaS companies. The cost of product developers is one of the biggest items in a SaaS company’s P&L Statement. A software developer in India costs 25% of what a similarly skilled one based in the US would cost. India has an estimated 36,000 product managers, 25,000 SaaS engineers and 100,000 other engineers with the skills for building a SaaS product. Another critical factor is the adoption of mobiles as the primary device for accessing data. India being a mobile-first nation is well placed to ride this shift as its young companies are more flexible and can focus on mobile platforms.

Buoyed by these advantages, companies have been sprouting in every segment of the sector. NASSCOM estimates that there are around 150 Indian companies offering SaaS solutions. 40% of these companies have been incorporated after 2010. Customer Relationship Management (CRM), Content Collaboration and Communication (CCC) and Enterprise Resource Planning are the hottest segments accounting for more than half the market in FY16.

Screen Shot 2016-06-17 at 8.54.06 am

 

Growth in the domestic market is also expected to be a major boost factor for the Indian companies. A deeper dive into the key underlying sectors which are adopting SaaS brings even more attractive prospects to the fore. Healthcare, E-commerce, BFSI and education sectors have been the most targeted segments by emerging SaaS companies. Each of these sectors is expected to expand at a healthy pace in the near future riding on the overall economy’s consumption led growth. At 7.6%, India’s GDP growth rate for FY16 has been the highest in the last 5 years. Small and Medium sized businesses emerging in these sectors would be much more nimble and receptive of SaaS solutions to avoid upfront large capex on technology.

The investor community, financial and strategic, has also embraced the SaaS opportunity with both hands. A total of USD 650 million was invested in SaaS companies in India till 2014. The funding in 2014 is estimated to be between USD 170 million to USD 200 million. However, the funding skyrocketed in 2015 with USD 450 million in the first half of the year itself. Some of the most active investors who are backing SaaS companies India are as below.

  • Accel Partners (Freshdesk, Hotelogix, Mobstac, Mindtickle, Chargebee, Zettata,)
  • Blume Ventures (Zipdial, Hotelogix, Mettl, FrameBench, WebEngage, Mobstac)
  • Nexus Venture Partners (Druva, Indix, Unmetric, TargetingMantra, Genwi, Helpshift)
  • Norwest Venture Partners (BlueJeans, CRMnext, Act-On, Capillary Technolgies, Attune)
  • Sequoia Capital (Druva, Capillary Technologies, Knowlarity, Practo)

The investors will have their hands full the short to medium term as most of the companies move traverse from Series A to B to C and so on. With companies maturing and cash balances building up, the sector is also expected start throwing up M&A opportunities much faster than any other sector.

The SaaS story hasn’t quite meant curtains for the traditional software licensing business model yet. Currently, SaaS commands only about 9% of the over Indian software market which is estimated to be USD 3.1 billion. However, Indian SaaS companies have already been able to create a market perception of building great products at lower cost. Currently, a large number of Indian SaaS companies would lie in the revenue range of USD 1 to 2 million. However, there are enough cases of rapid scaling up companies (such as Freshdesk, Capillary Technologies and CRMNext) to help us believe that we will soon see companies with multiple billion dollars in revenue emerging from India.

 

Screen Shot 2016-06-17 at 8.57.35 amThis is a guest post by Arvind Yadav, Executive Team Member at Aurum Equity Partners LLP.

 

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1 Critical Analytics Mistake

Why some well funded/big companies miss business targets?

Companies tend to focus 80% of their analytics effort on analysing “Historic Indicators” versus identifying “Leading Indicators” to grow business.

This is biggest mistake I see wrt how some companies leverage Analytics.

3 Examples of how Analytics Numbers should be used:

  1. Spot Contrarian Points: Usually, consumer businesses experience low sales in January after Christmas in December. But I experienced a scenario where January revenue was more than that in December. February sales were even better than January. This defied all historic trends. Analytics diligence gave us some surprising leading indicators that helped grow business.
  2. Customer Buying Trend: To help increase sales, instead of focusing on just why last quarter revenue growth is below expectations, identify leading trends on what customers are likely to buy and how industry cyclicals may impact buying behaviour in future quarters.
  3. Product Innovation: Extrapolate and derive key leading indicators that dictate how your product or service should evolve for sustenance and growth. Kodak missed the digital indicator, Blackberry misread smartphone/Android leading signs and Google missed the Social indicator.

Bottomline: 80% focus on leading analytical indicators and 20% on historic ones… instead of the other way round will substantially increase your chances of meeting business targets.

Guest blog post by Palash Jain, Investor at inFeedo, 

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fluxday — the internal task management & productivity tracking app of Foradian is now opensource

A no-nonsense, free & opensource task & productivity management tool for growing startups

fluxday was developed by Foradian starting in 2013 and was a critical part of Foradian’s hyper growth and success as a B2B software startup in EdTech space. With a CAGR (compound annual growth rate) of 323 per cent Foradian was listed in Deloitte Tech Fast50 India consecutively for two years. We secured $2mm in funding and grew the company from a small town startup to globally recognized product company. Behind all these success and growth was a small internal app custom developed by our engineering team and adopted by all team members — fluxday

fluxday is engineered on the concepts of OKR — Objectives and Key Results, invented and made popular by John Doerr. OKRs and OKR tools are used today by many companies, including Google, LinkedIn and Twitter. If you are new to OKR read these article 1, article 2

View tasks and work logs for a selected day. You can switch between month and week views.

In fluxday, you can start by creating the departments of your organization and adding the teams in each department. Add users to each team and assign team leads. Each user in fluxday has an OKR that is created for a particular duration. Tasks are created by leads, aligned to an OKR and assigned to team members. A task could be a redesign of your product or trying out a new tool to drive more traffic to your blog. You can also add comments and subtasks on each task. Users log in work done for a task and number of hours put in each day. Team Leads can see tasks assigned to each team member and the number of hours put into it.

View details of tasks like assigned users, duration and priority. You can also add subtasks from here.

With textual and graphical reports from fluxday, get insights into the time put into each task, check the performance of your team members, calculate ROI on that new feature change, take quick decisions and grow your business. Fluxday is designed to provide a simple productivity solution for fast growing teams. Fork it, add features to it, tweak it to your liking and start using it.

Generate visual and textual reports to view performance of users. Chose between OKR, Worklogs, Tasks and Assignment based reports for an employee or employee groups.

fluxday is “your favorite task management system on steroids” with freedom of customization and private hosting

Checkout the official website and/or download and fork fluxday atgithub

Story of fluxday

We started Foradian in 2009 as first generation entrepreneurs without any experience in building and growing a company. First 3 years was about the usual startup struggles, surviving the startup-valley-of-death and establishing product market fit. By 2012 product-market fit was proven forFedena and certain predictable revenue stream was established. That is when we felt the need for a tool to coordinate the tasks of all the team members so that each and every task will be aligned to the goals of the company.

The best teamwork comes from men who are working independently toward one goal in unison. — James Cash Penney

That is when we learnt about OKRs (Objectives & Key Results) and other startups using OKRs. We started implementing the concept through spreadsheets and it picked up momentum. Next step was to choose an app for task management and productivity tracking so that we can reduce the number of daily interruptions to employees to check their work progress. We tried different apps available. There are thousands of apps for managing tasks and projects. But we needed something unique that matched with our culture and process. So we decided to develop a small custom app and fluxday was born. Sooraj T P developed the app based on the design byDeviprasad and guidance by Arvind(co-founder & CTO). I had observed this pattern in other successful companies also. Great leaders develop their custom app for their mission critical system. Read “How Elon Musk Approaches IT at Tesla”

Lessons learned

Implementing a productivity tool is not an easy task. You need a lot of discipline and motivation to use even a simple personal to-do list app daily. So making sure your team members use the productivity tracking system effectively is a herculean task. We understood it, accepted it and simply executed the implementation. That made all the difference.

There will be team members who will hate the system and will not use it. Let them be. But if you can get 90% of the team members to adopt it, you got the greatest law of universe in your favor — mathematics.

Productivity tools should match with your personality type. A planner and visualizer can’t use the same productivity tool to maximum potential.

Are you a prioritizer? A planner? An arranger? Or a visualizer? Once you know, you’ll be able to more effectively manage your work and home life and achieve your goals much more efficiently. Read this HBR article and try the assessment to discover your personal productivity style. Don’t force a productivity system on your team. Develop an organization habit of using a common system with patience, compassion and respect.

Next steps

Today fluxday is not foradian’s secret tool. It is freely available to everyone. You can use it, customize it, enhance it, build a business around it, learn from it or if you don’t like it you can dump it and build another tool from scratch. Fluxday is available under Apache License 2.0 — so that you have the choice to keep the customization done by you as private or public.Download and fork fluxday

“through discipline comes freedom” — Aristotle

Team Foradian

If you liked the story of fluxday, you must checkout what we are doing with Fedena and Uzity. We are always looking for ideas and partners to help us achieve our vision.

Guest Post by Unni Krishnan, Foradian Technologies

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Building Ecosystems, Not Just Products

When you analyze successful consumer and small business products, they succeed as a part of eco-systems and not just stand-alone products.

Consumers and small businesses don’t buy products, the engage in an ecosystem. Facebook is an ecosystem. It is a network of users, groups, businesses and advertisers. Email is an ecosystem, smartphones are an ecosystem, even computers are an ecosystem.

This is a very important question for people who are building technology products. What ecosystem do you belong to?

An ecosystem is a closed group of users or apps with a large number of connections. Once you identify your ecosystem, it is easy to find if your app has a demand. It is also easy to promote your app in an ecosystem, and crossing the chasm from early adopters to mature users is much easier.

Photo: Abhishek Singh

But this only works if you are not looking to be a dominant player in an ecosystem. For example, if you want to make a Facebook app and not a new Facebook.

If you are working on a product that will be the dominating part of an ecosystem, then you have to build your ecosystem. For example if you are planning to disrupt the ecosystem of a popular accounting application like Tally, you have to build a new ecosystem that has all the elements of the Tally ecosystem.

This is worth saying again, you have to build an ecosystem and not just a product.

It is easy to see why Tally is so popular. Accountants know it already. There are training institutes all over the country that teach Tally. There is a ready pool of people you can hire who already know Tally. It has a wide number of “partners” that can help you setup and configure Tally and there are a wide number of plugins available for Tally.

So if a new business has to select an accounting system in India, it is most likely Tally. For the United States, its probably Quickbooks and so on.

So how do you build your own ecosystem?

First, its important to identify the problem you are trying to solve. An ecosystem has at least an order-of-magnitude higher scope than just a product. Second, its extremely hard, time-consuming and resource intensive.

An ecosystem has so many parts that it is crazy to understand just the scope of it.

  1. The Product itself: With the features, user interface, technology stack etc.
  2. Ways to use the product: installers, cloud, virtual machines, docker, vagrant.
  3. Users: Potential users, trial users, paid users, free users, young users, old users, business owners, managers, system administrators.
  4. Contributors: Translators, enthusiasts, evangelists, helpers.
  5. Developers: Core team, bug reporters, third party developers, customization specialists etc.
  6. Service Providers: Consultants, developers, trainers, testers.
  7. Training resources: Videos, manuals, forum, articles.
  8. Developer Tools: Collaboration, continuous integration, platforms, libraries, documentation, videos etc.
  9. Promotion Tools: Website, blogs, case studies, social media accounts, advertising, PR.
  10. New user on-boarding: Domain specific features, defaults, setup.
  11. Localization: Translations, accounting, statutory rules, service regulation.
  12. Roadmap: Feature requests, technology shifts, strategy.
  13. Maintenance tools: Monitoring, releases, upgrades, deployment.
  14. Communication: Support, Email, Forum, Chat.
  15. Events: Demos, meet-ups, conferences, talks.

When you start thinking about all these factors, it is almost impossible to think and come up with a plan. You have chunk each factor one at a time and try and make some progress. This may seem hard, but there is no other way of doing it.

Core Values

I think to build an ecosystem, you must have a deep motivation on why your ecosystem is better than the existing one and why various stakeholders will switch from their ecosystem to yours.

Merely a better product will not do. Dvorak is a better keyboard layout than QWERTY, but the costs of unlearning QWERTY to Dvorak are very high, hence users and manufacturers are all locked in to the QWERTY ecosystem. The product and or ecosystem has to offer a lot more for users to switch and they must be complete.

Dvorak Keyboard Layout (photo: TypeMatrix)

Products are hard enough. If you are clear on your core values and stick to them, and have loads of patience, only then you should attempt to build ecosystems. Otherwise, its better to work within another ecosystem.

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Why Flipkart Taking Clients to Court For Non Payment Is A Big Deal

Flipkart_2673995f-300x175

What’s The Scoop With Flipkart?

 

“The digital industry is suffering because there have been several cases where advertisers default on payment… We do not have a strong industry body in terms of payment collection yet.” –  Amar Deep Singh, CEO, Interactive Avenues

 

(article originally posted here)

Between April and May 2016, one of India’s e-commerce leaders – Flipkart– filed cases against 20 of its clients for payment, to collect unpaid advertising dues.

 

Unlike Snapdeal and Amazon, who charge their clients ahead of time,Flipkart provided advertising services to clients on credit.

 

Though this move made sense as an advantageous proposition to attract more clients away from competitors, they have now initiated legal procedures against non-paying patrons who respectively owe them anywhere from Rs. 90,000 ($1,350) to Rs.1 crore ($150,000).

 

Is This Non-Payment A Common Problem?

The Indian business culture is infamous for the chaotic state of its payment practices. In fact, India has the longest average payment delays in the Asia Pacific region (Atradius Payment Practice Barometer).

 

Furthermore, 97% of Indian SMBs were paid late by their clients last year.38% of these businesses claimed that the late payment was an intentional move by clients. It was a means of using trade credit to finance their own working capital needs.

 

What’s more is that most of these companies will never enforce their contractual terms on overdue Accounts Receivables. Even when 1 in 2 B2B SMB invoices are paid late. And 1 in 7 B2B invoices are still pending past 90 days.

 

This is because enforcing a contract in court for non-payment by a client can take up to 3 years and 40% of the claim value to resolve (Doing Business India). By the time suppliers manage to get their money from the over-burdened court system, they’re already sinking under.

 

Which means that larger clients and buyers run pretty roughshod all over smaller SMBs in their supply chain. They even threaten to withhold payment altogether if their suppliers don’t give them unreasonable discounts to get paid faster.

 

Large buyers are well aware that their smaller suppliers are:

  • Either not aware of their legal rights in such situations;
  • Won’t act upon their legal rights because they would choose preserving business relationships over getting paid faster;
  • Will be tied up in an expensive legal case for years if they try to take matters to court.

 

This has created an environment where only the most exclusive businesses can demand payments upfront. While others are usually forced to roll the dice on the kind of client they land up with. Or have to face being ignored altogether by prospective customers.

 

To put this in perspective, for all the talk of “Why don’t businesses just demand payments upfront”, 98% of Indian SMBs extended goods and services on credit to their clients in 2015.

 

And if you think the situation is bad for regular Indian SMBs, it’s even worse for businesses which deal in digital services or mass communication products.

where in the world is that payment

So Why Does This Story Matter?

Because the Internet and Mobile Association of India (IAMAI) has used the publicity provided by this issue to push for the development of a payment recovery mechanism for their industry.

 

Several of the largest digital communication platforms and services are members of the IAMAI. And the organization is wisely using this move by Flipkart to justify enforcing meaningful out-of-court payment protections for the digital communication service industry in India.

 

The issue of late payment has been a given in the Indian business culture for a long time, to the point where it’s barely mentioned in mainstream media. Even according to law firms interviewed on the Flipkart matter by YourStory staff, this case has gained significance in the media only because a large brand like Flipkart was involved.

 

This is why, by this point, we’re sure you’re asking – How does this affect me as a small business? Of course Flipkart, a well-known brand, would be able to afford taking its clients to court. Yet if we, as small businesses, did the same – we’d probably be bankrupt by the time a verdict came in.

 

First, most late or non-payment situations can be addressed by integrating global best payment practices into your business – which Hummingbill’s Gmail plugin automatically does for you for free.

 

Second, Indian companies are gradually getting less court-shy in getting back money they’re owed by non-paying clients.

 

Third, the actions of the IAMAI shine a light on the necessity of out-of-court payment mechanisms.

 

Yet, none of the mechanisms put in place by the IAMAI’s committee will protect other non-member small businesses like you or us. Even though we need these defenses just as sorely.

 

With that in mind, we at Hummingbill are scaling up our war to break India’s late payment culture in the immediate future. The Indian business culture needs a concentrated effort to create better non-litigious protections which can be enforced. SMBs and startups need shielding from larger buyers who wish to exploit their position on the supply chain.

 

And for that effort, we will need the support of every single one of you. Keep an eye on this space for more information over the next few days.

 

In the meanwhile, let us know in the comments section below. If you had the ability to enact out-of-court enforceable protections against late paying clients, what measures (except straightforward mediation) would you put in place?

– Adam Walker & Aniket Saksena

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Design is about Love and Empathy towards the customer

The Design RoundTable last week lead by Deepa Bachu and Rajan, was not what I expected. By and large, design to me was either a part of an application (UI / UX) or a concept which i did’nt know much about. But, when we went in depth with Deepa, I realized that design is an integral part of who we are and what we see around us.

Through detailed discussions, we were made to think about what design is and what design meant to individuals, communities, startups as well as our customers.  The first task started with a a simple question, what is design? One can come up with several ways to describe it and the audience described it as – Design is something that solves a need, brings convenience, humanizes products (i.e. bringing human touch to products), explores empathy, understands customers and is about continuous learning.  What stood out for me was that design is all about Love and passion in order to bring out the best products/services to address a customer need, in a manner that creates value with ease and convenience. This would enable the users to be at ease and fall in love with what it represents. If a design is thought through with love, compassion and empathy, the user’s journey and experience improves.

The first task in the workshop was to work in a group and explore design features (good vs. bad designs) both within and outside a room. This enabled us to look at things from a design lens. The group came up with very interesting insights of how people dry their clothes in modern buildings differently from those who dry clothes on their balconies or how badly the electric poles in India are designed or how cobbled streets are an interesting design element than traditional tar roads.

IMG_20160409_145508This experience made us understand and be aware of the small and subtle difference between good and bad design. I was able to realize and conclude how crucial it is to be empathetic to customer needs and when, where and how they experience a product / service. Hence, it is essential to understand things from the customer’s perspective which eventually helps us improve the utility of the product and services that one offers.

This applies to all our products and services. We are all trying to build a product around enhancing the customer experience and thinking through each aspect from the users point of view is crucial. How does a user discover your product or hears about you? How do you ease the process of sign ups? How important is the design of your website or application? What does the product do for the customers and what are the benefits of it? These are just few examples of how we can think from the customer’s point of view. By allowing ourselves to think from the customer’s perspective, we are enabling us to re-imagine the product and user’s journey through various channels to engage and enrich with the user.

Another interesting insight was around humanizing products as consumers are humans. Adding a human touch to design can make an experience great. For example, addressing consumers in emails by their names or to have a real person to sign off at the end of an email.

There were many other aspects we covered in our conversations. We discussed the importance of elegance in design and a belief that “UI without UX is Superficial”. We also discussed the importance of creating that WOW factor or customer delight in making customers your brand ambassadors. For creating customer delight, one has to first answer what benefits a customer will get and how one can create customer experience through positive emotion. The combination of these simple three stage processes will help us to think through the various customer delight experiences that we can design.

Another tool that Deepa spoke about and is quite helpful is an Empathy Map. It is a 2×2 matrix to understand the journey of a customer. Four questions need to be asked.

1) What do customers say about your product,

2) What do they do while experiencing your product,

3) What are they thinking while they use the service and

4) How do they feel over all.

This is an experiment which should be done periodically with various sets of customers which can make each member of the team sensitive to the customer journey. An interesting point learnt is that every time we have an insight on one of the four touch points — Say, do, think and feel , we could use this as a starting point. For example, while booking a flight online, how is the customer journey when they first login, are they looking for the cheapest price if so what do they say about that experience, what do they think while looking for the cheapest price (will they get the cheapest price on this website and will the price change later) and what do they feel (lets pay it by it before it changes).

By following some basic templates we can rethink our products and imagine the customer journey in a manner that we could live it on a daily basis. The love / empathy towards our customers, which results in benefits for the customer and eventually helps in designing the WOW (delight) moments are what makes a lasting impact and creates a bond between the brand and the customers.

Hence, design is one of the main pillars of building a successful product and I hope we all can make design an integral part of the organization. Our thinking should bring compassion and love to customers through Design.

Thank you Deepa and Rajan for wonderful session on Design thinking

Deepa is a design and product leader who most recently worked at Intuit as the Director of Design and Product Management. Deepa’s passion is to transform customers’ lives by creating products that solve their biggest unmet needs.

Deepa has 20 years of experience in the Tech industry where she has played a variety of roles across Product Development, Experience Design, Product Management and General Manager. Deepa’s experience has given her expertise in creating and taking global products for both emerging markets as well as developed markets across multiple domains.
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What is Design (Iteration 1)

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What is Design (Iteration 2)

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What is Design (Iteration 3)

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What is design iteration4 ?

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Team-Designthinking

Guest post by Gaurang Sanghvi

Posted on

Of Cockroaches, Gazelles and Unicorns

We took a hard look at our company. Was it going to become a unicorn? No. Not close. Was it going to do the proverbial J curve in the near future? Not really.

I could sense the VC and the Angel instantly saying ‘Shark Tank’ style. “I’m out”.

I could sense the other entrepreneurs console us. “Don’t worry, there are other legitimate business styles out there. Nothing wrong in being a ‘lifestyle business”. The tone could be associated with ‘retire’, ‘personal savings’, ‘you’re on your own’ and almost a silent ‘are you crazy doing that when there is so many investors around?’ But the reality is that we don’t fit into a lifestyle business mode too! There must be something else to describe our business model.

A chance article on gazelle companies, gave some hope that there are alternatives. The investopedia definition of the gazelle  indicated that you are a gazelle if you were over a million dollars and grew at 20% for the past 4 years. Many of the leading tech companies in the 80’s and 90’s were actually gazelles.

A closer look at our financials indicated that we were not quite a gazelle in some parts of the definition since our growth rate was more random than the 20% figure.

Another chance article on ‘cockroach’ companies being an alternative to unicorns in these days of constrained VC money, gave some hope. You are a cockroach if you can survive nuclear wars even if you don’t do the J Curve.

Inspiring, I thought. We survived 13 years as an Indian software product company despite delayed payments, a dozen form of taxes, unclear laws, order cancellations, a crowded market, a government that does not care, and other forms of nuclear warfare. But we did not like to be branded as ‘cockroaches’, do we? At different points in our life cycle we could be cockroaches, gazelles and maybe switch to a unicorn, with a delayed J Curve?

An then it dawned on us – as a bootstrapped company, the only definitions worth going after were ‘customer delight’, ‘market focus’, ‘differentiation’, ‘customer value’, ‘growth’ and other forms of real business indicators, while continuously being in the ‘profit zone’.

With 50% growth last year and head above waters in terms of profits, we’re doing something right, and yet we still don’t want to be boxed into definitions. But such definitions test you, and keeps you on your toes. So it’s still worth the time reading up on such articles because when you are an entrepreneur you keep your eyes open 360 degrees all the time even when sleeping.

Gazelles, cockroaches, unicorns and other forms of exotic animals went back to their respective places in the animal world for now, and real business stepped right back into the focus.

Guest Post by George Vettath, Founder Kallos Solutions and KServeHRMS.com