85 Things I learned being a CEO

  1. It is going to be an extremely hard job. No amount of preparation or education is going to prepare you for what it demands.
  2. You will feel like quitting at so many instances. Don’t, just persist.
  3. It’s a lonely job. There will be no one who you can tell everything about your work.
  4. Uncertainty is the hallmark of entrepreneurship. You have no guarantee that you will last a year, at times a month and sometimes even a week. Learn to embrace this uncertainty.
  5. You will wake up crying at times. Don’t fret about it, deal with it.
  6. If you are married, your spouse will play a very crucial role. They are going to be the only person who you can tell everything. They can give you the third-person view to take unbiased decisions. They are going to be your rock when you are the lowest.
  7. Being a CEO is all about transitioning from doing everything in the early days of the company to delegating everything as the company matures.


Key Responsibilities

  1. You are going to make a lot of decisions in the company. If you are overly careful in your decision making you will slow down the growth, if you are too impulsive you will end up taking the wrong decisions.
  2. Setting the vision and talking about it is your responsibility. You cannot crowd-source the vision from your team. You must listen to everyone but at the end you set the vision.
  3. You define the culture and most importantly you guard it. People will ultimately emulate what you do.
  4. As a founder-CEO it’s your number 1 duty to ensure that the company never runs out of money.
  5. CEO should always be involved in the product. You can go away from any other function but not product.
  6. The success of your organization depends on how well your team is equipped. No one comes knowing it all at the job, it’s your responsibility to ensure that you train everyone.

Decision Making

  1. You will never have the complete information that you need to make decisions. Your gut/hunch will play a big role in such situations.
  2. It may sound counter-intuitive but gut-thinking can be developed. Great founders take right decisions not because they have all the information but because they have vast amount of knowledge. That’s what constitutes the gut-thinking.
  3. You will be wrong more often than you will be right. The trick is to detect your mistakes early, learn from them and never repeat them.
  4. You must stand by the wrong decisions you make. People will respect you if you are willing to accept your mistakes.
  5. Take time to explain your decisions. People around you need to know what is the thought process behind your decisions.
  6. Don’t fall in the trap of over-deliberation. Most of the times speed is more important than the right decision. You will always get time for course correction later. Good is better than best.
  7. There will be times when you are going to take decisions that nobody will believe in. If you have 100% confidence in yourself, go forward unabashed, because no one else has the full picture other than you.
  8. When taking strategic decisions, step out of your day-to-day operational work. Decompress completely. Swipe the board clean. Forget everything that’s going on currently. And then think about whatever you want to think. Think, how your future will change if you take this decision and not what benefit your present will get out of it.
  9. There will be some decisions that can significantly alter the direction of the company. You can’t always white-board a conclusion out of them. At times, you need to mull over them, you need to let serendipity happen.
  10. All good decisions seem obvious in hindsight because it’s easier to explain a chain of events, rather than predict one. Don’t mistake yourself in believing that you have found a pattern.
  11. For decisions like letting a misfit go, shutting down a product line etc. it’s always better to do it sooner rather than later.

Culture

  1. You are the guardian of the culture. You define what is to be appreciated and what is not acceptable. If you don’t do it ardently you are fucking up the culture.
  2. It’s always easier to hire people who believe in your culture than to try and convince non-believers. If someone doesn’t fit your culture, don’t hire them no matter how good they are on skills.
  3. You have to speak, shout, repeat, chant, recite and roar about your culture. Culture becomes culture only when it’s spoken about all the time.
  4. There is no definition of what a good culture is. More than being Utopian it has to have universal resonance.
  5. Your culture is never set in stone. The basic tenets will be defined but the shape and form of culture will rapidly evolve as the company grows.
  6. A good culture must breed 2 things — respect for each other’s work and open communication.

Leadership

  1. Soon you will realize the impact you can create through your individual contribution is meaningless when compared to the impact you can create by leading people.
  2. The best way to lead is to lead by example. A good leader tells you how it’s done, a great one shows you how.
  3. As a leader, the biggest thing that you can give your team members is your time. A lot of them will go through a bad phase or will be clueless about what to do. At those times, they need to know you are there.
  4. People will look up to you. At times, even for things in which they are far more skilled than you. You don’t have to take their decisions, just provide them your confidence so that they can take their decisions.
  5. Good leadership is when people are not afraid of bringing bad news to you.
  6. Politics starts at the top, if you start taking sides, everyone else in the company will too.
  7. In no situation can you afford to shout at your people. Things will go wrong, you will loose your calm, you can be stern with them but not disrespectfully shout at them.
  8. People need inspiration. To be a leader you will have to inspire them and it’s best if you do it by story-telling.
  9. Talk to/address the entire team at regular intervals. The format and frequency depends on you. It could be for 30 mins every week or 3 hours every month. I do an ‘All Hands’ every month. It has been 3 years and the All Hands has always had above 80% attendance.
  10. Very few employees are going to critique your decisions, particularly if you are a vocal leader. It’s very easy to get blindsided because you will rarely get a critical feedback. There are two ways to mitigate it a) have a close network of advisers who can say harsh things to your face b) consciously create a culture where people are not afraid of you.

Self-Management

  1. The first thing you need to learn is how to manage your time. Your time is a scarce resource, you must be very protective about it. Say no to anything that doesn’t add value.
  2. Learn to manage emails. No matter what communication tools yor organisation uses, you cannot escape emails. This particular trick has been extremely useful for me in managing my inbox — https://blog.hubspot.com/sales/email-multiple-inboxes#sm.000a54r0d14a2ct5r3d1yoluod5vf
  3. Manage your calendar — every Sunday spend 30 minutes analyzing your calendar for the week.
  4. Learn to manage your cash-flow situation. You need to keep track of the following every month — cash outflow in the month, revenue collected in that month, money spent on salaries and money in the bank. Setup a process so that you receive this information regularly.
  5. Every thing that goes on in the company will come to you. Very soon it becomes over-whelming to manage this information barrage. You need to learn to deal with it.

People Management and HR

  1. Hire a HR early in your company. 30 employees is the right stage to hire a HR.
  2. The sooner you introduce an objective performance management system, the better it is. In the early days you know about what everyone is doing, but as you grow you will loose control. The right stage for introducing a formal process is when you are 40–50 employees.
  3. One on Ones are absolutely critical. Ensure that you do one-on-ones, at least once a month, with everyone who directly reports to you and so do the other leaders in the company. In his book ‘High Output Management’, Andy Grove talks about the right way of doing one on ones.
  4. Set Goals — Every employee needs goals in order to contribute effectively. Most of the time people don’t under-perform because they don’t want to work but because they need direction. A quarter is the right time frame to set goals.
  5. Providing Feedback — Provide both negative and positive feedback with the same demeanor. It’s very important to come prepared when giving feedback. Provide negative feedback not based on your feelings but based on facts. Don’t use the Sandwich Approach, discuss the positives and the negatives as is.
  6. Just providing negative feedback is not enough, it’s your duty to also provide them a direction on how they can improve. If you are feedback is not accompanied by how they can improve then you are wasting their time.
  7. Appreciation — Everyone needs appreciation, do it often. Appreciate people at the time they do well (don’t save it for later) and be genuine when you appreciate.
  8. People don’t leave because they are underpaid, they leave because they feel you haven’t been fair. You are not supposed to compete with the best paymaster out there, but you do the best you can and they need to know that you are being fair.
  9. Setup an on-boarding process. When the company is small it’s easier for people to understand everything happening in the organization. Once you are beyond 30 it can be daunting for a new employee. Setup an on-boarding process where they get introduced to the product and people.
  10. Set a rigorous reporting process: Having access to the maximum amount of information across organization is going to be your biggest asset. As the organization grows you will find extremely hard to get all the information. You need to set up a rigorous process of updates with your direct reportees. Every function head should share updates with you in-person as frequently as every 14 days.

Meetings

  1. Whether you like it or not, you will have to do meetings. The point is how to make sure that your meetings are productive. There are only 2 types of meetings that you should attend — a) where you have to take a decision b) where you get updates/information. The productivity of the first depends solely on you and the latter on how you have trained your team. Step out from any meeting where you are not going to take any decision and you are not getting information you already don’t have.
  2. In his book High Output Management, Andy Grove talks about the concept of ‘Chairman of a meeting’. This is the person who is going to lead the meeting, facilitate discussions and take decisions. You will be the chairman for a lot of meetings as a CEO. If you are not going to prepare for these meetings you will waste everyone’s time. As a rule of thumb for a 1 hour meeting, you must spend at least 30 minutes in preparation.
  3. You don’t have to take charge of every meeting. As founder, you would be tempted to do that in any meeting you are part of. Refrain!
  4. Explicitly ask people if you are needed to be part of a meeting. Wherever you are needed, ask them for an agenda and also ask what is expected from you in the meeting. Else say no.

Hiring

  1. No matter how careful you are, you will make wrong hiring decisions. There is no definitive science for interviewing so don’t beat yourself up for wrong hires.
  2. Add a layer of objectivity in hiring. Every role should have some form of objective evaluation, like a task.
  3. Don’t interview people on what they have done in the past, interview for the role they are coming in for.
  4. Go prepared to interviews — put down a list of questions that you definitely need to ask. You don’t have to ask them in any specific order but you must ask all the questions.
  5. Ask your interviewers to give a Yes, Weak Yes or No. If there is a single No then don’t hire. There should be a majority of Yes in the verdict.
  6. Ask people where they screwed up in the past. Their failures will tell you more about them, than their success.
  7. Set an interview target for yourself — commit to doing at least 15 interviews per week in the first 2 years.
  8. Don’t look for patterns, there are none. Some people are good at giving interviews some are not.
  9. You need to create a circle of people (not necessary everyone in the company) whose loyalty is unshakable. These are the people you will rely on when shit hits the ceiling. Look for this trait when hiring key people.

Fundraising

  1. Whether you like it or not you are always fundraising. Practice the pitch incessantly, so that you can pitch anytime, anywhere.
  2. Fundraising is not a milestone, it’s not an achievement, it’s just a necessary evil.
  3. Fundraising is about story-telling. More than facts, investors are interested in your story.
  4. Choose your investors carefully. These are the folks with whom you are going to take some of the toughest decisions for your company, you want someone you can play with.
  5. Choose friendly terms over extra money. It’s okay to get half a million less in the bank if you can get less restrictive terms.
  6. You don’t raise money when you need it, you raise money in the good times, and as soon as possible.
  7. Raise as much as possible. Your company can fail because of reasons completely out of your control. Having a war chest at that time could be invaluable.
  8. Become immune to rejection. Most of them will turn you down not because you are not good but because they don’t understand what you do. 99 rejections are worth it for that one who says yes.
  9. Don’t let fundraising get over your head. It’s your number 1 duty but not your only job. You can’t compromise with running the company just because you are fundraising.

Things you should do

  1. Read voraciously, set a target to read at least one book a month.
  2. Network — In the early days of the company meet as many people as you can. In the later days of the company, choose who you want to meet and reach out to them.
  3. Take holidays — don’t feel guilty about it, you need it more than anyone else. Take spontaneous and frequent holidays, you will be amazed at the kind of thoughts that will come to you when you are relaxed.
  4. You will have to do a lot of public speaking — internally to your employees and externally to the world. Rather than being forced to do it, do it consciously. Practice before every major speech.
  5. Your job is to protect the downside of the company. The upsides will anyways take care of themselves. You should be constantly sniffing for what can go wrong.
  6. Exercise — Being a CEO will take a massive toll on your mental health. One way to keep your sanity is to exercise. Make it a habit to exercise at least 5 days a week (you can pick a sport).
  7. You are always negotiating — negotiating with your investors, your clients, your employees, prospective hires and everyone else. Master the art of negotiation, at the end it’s all give and take.
  8. Every time you say ‘Yes’ to something, you will be saying ‘No’ to something else. Choose your ‘Yes’ wisely.

Guest Post by Sachin Gupta @ HackerEarth. Original Post can be seen here

Action For India’s 6th Annual Forum invites FinTech startups

Action For India’s 6th Annual Forum invites FinTech startups
Just about two months ago, the nation attempted the massive ‘demonetization’ initiative at an unprecedented scale to clean-up illicit money and move towards greater economic equity and justice. As a consequence, the realm of digital money management and transactions saw a burgeoning growth and needless to say, this accelerated the vision of ‘Digital India’, the India where technology and digitization makes every facet of life for a common man, easy and empowering. This is becoming a global phenomenon as a recent report from Accenture found that global investment in FinTech has skyrocketed from $930 million back in 2008 to over $12 billion by the beginning of 2015.
Alongside digital payments, the nation also takes pride in harboring FinTech initiatives working wonders on the ground, in the areas of banking for the unbanked, micro-loans, credit-free schemes, micro asset-management, and a portmanteau of other technology-powered solutions/models that are serving the unreached. Recognizing these FinTech entrepreneurs, the 6th edition of Action For India Forum, is on a mission to help Indian social innovators overcome barriers to scale and achieve greater impact.
Though this exclusive invite-only event (taking place on January 24th & 25th, 2017 in New Delhi) that brings together 100 leading social innovators (with FinTech as one of the six sectors of focus) along with 100 “influencers” (from the realms of impact investment, philanthropy, government, technology and public policy), it aims to bring together a stellar set of handpicked start-ups and provide them with a platform to further partnerships, investment and growth. The applications to be a part of the esteemed Forum, are still open for all the promising FinTech startups.
The form can be found here: goo.gl/9xdqfn
It is at this event that the most promising social entrepreneurs are selected to be a part of a two-week all-expense- paid trip to Silicon Valley through the Silicon Valley Challenge (SVC).
You can find a post-event update on AFI’s 5th Annual Forum here: http://bit.ly/1U35zdE & details of the upcoming AFI Forum 2017 here: http://actionforindia.org/afi-forum-2017/.
You can reach AFI via email at [email protected]actionforindia.org or call +91-72040-24529.

 

Simplified Incorporation And Documentation Procedure

Simplified Incorporation And Documentation Procedure

Ministry of Corporate Affairs (MCA) has further simplified the ease of doing business in India by introducing SPICe forms to further digitize the company registration process. The form INC 29 was originally used to incorporate companies within a couple of days. Though this form simplified the process of incorporation, key stakeholders and professionals felt that this was a risky form because a rejection in a particular section or subsection would result in the entire form being rejected. It was because of this most promoters/founders (about 65%) used the INC 7 Form to file for incorporation. To fix this drawback, the MCA created Simplified Performa for Incorporating a Company Electronically or SPICe Form.

SPICe Forms

Simplified Performa for Incorporating a Company Electronically (SPICe) form is a single multi-purpose form that handles multiple applications such as reservation of the company name, allotment/application for Director Identification Number (DIN), incorporation of a company, etc. This was launched by the MCA to fast track the Incorporation process for companies in India.

The form INC 32 is similar to INC 29 because it helps fast track the incorporation of a company in India with the only exception, the former form has a provision for name approval, thereby assuring the name, while the latter has no such provision.

How to Incorporate a Company?

There are two ways to incorporate a company, namely:

  1. INC 7, DIR 12 and INC 22
  2. INC 32 or SPICe Form (replacing INC 29)

Types Of Companies That Can Apply Through SPICe

  1. Part 1 Company
  2. Producer Company
  3. Section 8 Company
  4. New Company – One Person Company (OPC), Private or Public Limited Company.

Step-By-Step Process

I. File INC Form 32

INC 32 is the eform used in electronic filing of the Memorandum of Association (MOA) and the Articles of Association (AOA). The Standard format to be followed is Form INC 33 (for MOA) and INC 34 (for AOA). Previously, a company applying for incorporation would use their own format and sent to the Registrar of Companies individually, but since the introduction of SPICe Form, one needs to apply for AOA and MOA with the standard format prescribed. This creates less confusion and a narrow scope for making errors.

Based on the type of company, the following standard templates are used:

Sr.No Type Of Company AOA MOA
1 Company Limited by Shares Table A Table F
2 Company Limited By Guarantee (not having share capital) Table B Table H
3 Company Limited By Guarantee (having share capital) Table C Table G
4 Unlimited Company (not having share capital) Table D Table J
5 Unlimited Company (having share capital) Table E Table I

II. INC 1 or Name Change
Only a single name for the company can be proposed in a form.

III. File DIN
DIN is automatically allocated to directors that do not have a DIN.

IV. Digital Signature Certificate (DSC) is an essential step in this process. Without a DSC, a company cannot file for incorporation through SPICe Form. The Directors, witness/es and a professional will be required to use their DSC on the SPICe Form. The limit is 7 subscribers and 1 witness per incorporation, though accommodation for certain cases that require more than 7 subscribers has been undertaken.

V. Permanent Account Number (PAN), Tax Deduction and Collection Account Number (TAN) and Employee State Insurance Corporation (ESIC) registration can be done in a single step.

VI. Documents Required

  • Memorandum Of Association
  • Articles Of Association
  • A declaration and affidavit must be filed by the first subscriber/s and director/s.
  • Proof of Office Agreement – Rental Agreement, conveyance, lease deed and rent receipts.
  • A copy of Utility bills lesser than 2 months – phone bill, electricity bill, etc.
  • NOC from the sole proprietor, partners, other associates, etc.
  • Proof of identity and residential address of the subscribers and directors.

VII. Share Capital
The minimum share capital (authorized and subscribed) for a One Person company (OPC) is INR 1, for a Private company INR 2 and for a Public Limited Company is INR 7.

VIII. Declaration by a Professional
The DSC of a professional (Company Secretary, Chartered Accountant, advocate, Cost Accountant) along with the professional’s membership and certificate number is required to file SPICe Form (a declaration that all information provided is accurate and true).

IX. The Form is then processed at the Registrar’s office.

Conclusion

SPICe Form was introduced to replace eForm 29. While drafting the SPICe form, accommodation was made to changes that benefited the stakeholders by reducing timelines and multiplicity of several forms in the process of Incorporation. SPICe will become the standard form and format for all incorporation related purposes.

How To File Patents In India?

A patent is a form of intellectual property defined as “a government authority or licence conferring a right or title for a set period, especially the sole right to exclude others from making, using, or selling an invention.” The purpose of a patent is to protect the intellectual property created by an inventor for a period of time so that the inventor has first rights over how he wishes to use his patent. A patent can be sold, leased, be used in exchange for royalties, equity, etc. A patent holder however, does not become the holder of the invention unless he has invented it first.

The then British Government of India, during the year 1856, tried to encourage and propagate new inventions termed as ‘exclusive privileges’ in the manufacturing sector. The first invention to be granted Intellectual Property Protection in India was by the Government of India under the petition special privileges to George Alfred DePenning for inventing the ‘Efficient Punkah (fan) Pulling Machine.’

The Indian Patents Act, 1970

Patentable Inventions

The list of inventions patentable are:

  • Process, manner, or method of manufacture or Art
  • Machine, apparatus or other articles
  • Product patent for medicines, food, drugs and chemicals
  • A substance should be produced by manufacturing
  • Computer software  used with hardware or with technical application to industry

Inventions Not Patentable (Sec 3)

The following is a list of inventions that cannot be patented:

  • Any invention obviously contradictory to established laws or that is superficial.
  • Any invention that could be used to exploit the population, contrary to morality, public order, or causes prejudice to life or health (of animals, plants, natural resources, humans,etc).
  • The discovery of a scientific principle, any substance occurring naturally (living or nonliving) or any abstract theory.
  • If no new product is formed nor a new reactant is formed using machines or apparatus. The discovery of a new property or new form of a substance.
  • Mere mixture of chemicals.
  • The duplication, rearrangement or arrangement of known devices.
  • A method of horticulture or agriculture.
  • Any surgical, medical, diagnostic, therapeutic, etc. process for the treatment of humans or animals (to render them free from disease).
  • Animals and plants in part or whole (other than microorganisms).
  • Algorithms, computer programmes, business or mathematical methods.
  • Musical, literary, artistic, dramatic, cinematographic (aesthetic productions or works), or television productions.
  • The mental strategy in playing a game, a mental act, rule, method or scheme.
  • Topography of integrated circuits
  • An invention that is traditional knowledge or which is a duplication or aggregate of known components properties.
  • Inventions related to atomic energy cannot be patentable under Sec 20 (1) of the Atomic Energy Act, 1962.

Application For Patents

The person applying for a patent should apply jointly with another person or alone and can be:

  • The first and true inventor of an invention.
  • An assignee can make an application on behalf of the first and true inventor of the invention.
  • The legal representative of a deceased applicant provided that before death, the applicant was entitled to make such an application.

Form Of Application

  • Every application made shall be for one patent only at the patent office in the prescribed form.
  • An international applicant applying for a patent in India under the Patent Cooperation Treaty must file a corresponding application before the Controller in India. No patent is valid for the entire world because patent law is territorial in nature. Filing an application in India enables a person to file for application at convention member countries which makes the application process easier when applying to multiple countries.

Amendments To The Patents Act And Rules

The Indian Patent Act was amended in 1999, 2002 and 2005. The need for patenting marks of patent agent examination, and chemicals and drugs under Trade Related Intellectual Property Rights (TRIPS) brought about the need for an amendment to the Patent Act.

The Indian Patent Rules were amended in 2003, 2005, 2006, 2012, 2013, 2014 and 2016. The rules were amended to include a fixed fee structure, patent agent exam qualification, appointment of the patent office as searching and examining authority, third category for applicants that are small entities.

The Indian Patents Office

The Office of the Controller General of Patents, Design and Trademarks (CGPDTM) administers the Indian Patent Office, which is an Office of the Government of India that is entitled with administering the laws of patents, trademarks and designs. It is important to note the distinction between patents, designs and trademarks.

Patent Duration

The duration of any patent filed in India is valid for a period of 20 years (irrespective of filing with complete or provisional specification) from the date of filing the application. If an applicant wishes to file an application under PCT, then the term of 20 years begins from the date of international patent filing. If an applicant wishes to file a patent in another country, then he must file the patent with the Patent Office of that respective country (through the conventional filing of an application or through the PCT route) since patents granted in India are valid only throughout the territory of India.

How To Get A Patent?

Get an Idea for a Patent

First get an idea of what has to be patented, and the same has to be presented on paper with a description, drawings and sketches (if necessary) explaining the work of the invention.

Patentability Search

Next, an individual must check the list of patentable inventions. The Patent Act (as mentioned above) entails what constitutes a patentable invention and what doesn’t. Only if an idea is patentable can an individual move forward to the next step. It also enables an individual to search for existing patents in case the idea or patent already exists.

Patent Application

If a patent is at the early stages of its development, then an inventor can file a provisional patent. This enables an inventor to secure a filing date (12 months of time to file complete specification) and it is also lower in cost to file a provisional patent as compared to the cost of filing a complete patent. If an inventor has complete specifications about the invention, then the individual can file for complete specification.

Publication of the Application

After an inventor has filed for complete specification, the application is published 18 months post first filing. If an inventor feels that they cannot wait for the period of 18 months from the date of filing the application, then s(he) can file for an early publication request along with the prescribed fees and the patent would take about a month to be published under an early publication request.

Request for Examination

The controller, upon receiving an RFE request from the applicant, hands over the patent to the patent examiner for examining criteria such as novelty, enabling, inventive step, patentable subject-matter and industrial application. All steps covered till now (from patent application till grant) is termed as patent prosecution. The patent examiner then submits a first examination report to the controller and the applicant which consists of documents of the claimed invention.

Response and Clearing of Objections

Based on the examination report, most patent applicants would receive objections. A patent agent can help create a response to the objections raised in the application. An inventor can communicate to the controller as to why his invention is patentable.

Grant of Patent

After all objects raised in the report are resolved and the patent is deemed to be in order of grant after meeting all criteria requirements, the patent is granted to the applicant as early as possible. The grant of a patent is published in the patent journal.

As we move towards becoming a Product Nation, it is important that companies and individuals own their IP. A Patent can become a competitive advantage in itself and is to be ignored at your own peril!

InnoFest 2016 – Innovation celebrated in Bangalore, and how…

Robots, Drones, Electric Bikes, 3D printers, Modular Homes – It’s all Happening in India – #IndiaInnovates

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The Indian Software Product Industry Roundtable (iSPIRT), a think tank dedicated to the cause of the Indian Product Industry, held its flagship event InnoFest 2016 in Bengaluru. This unique event was inaugurated by Mr. Mohandas Pai, Chairman of the Board, Manipal Global Education. The one day long festival focused on hardware innovation encompassed inspirational talks by industry leaders, sessions by key innovators, a panel discussion, a product showcase, workshops, a DIY pavilion and makerspaces. Mr. Mohandas Pai and Vijay Shekhar Sharma, Co Founder Paytm, delivered the  opening address.

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InnoFest 2016 had over 1200 registered participants and showcased 150 products and innovations. The event featured 10 Workshops, 12 DIY Pavilion participants and 2 Community projects, wherein the audience could actively participate. Over 35 Speakers addressed the huge gathering of budding innovators, manufacturers, techies, entrepreneurs, students, professors, researchers and representatives from the financial sector. A significant number of participants were women entrepreneurs and innovators.

In his keynote and inaugural address Mr. Mohandas Pai, said, “More often than you think, innovations are stemmed from an idea that provides a solution to recurring and nagging problems that you may face personally. To translate that idea into a product and a business, requires an eco-system to support it and reach-out to the markets. InnoFest provides that platform and unlocks a plethora of opportunities. It is imperative that successful innovators need to foster other innovators and harvest benefits collectively. I’m elated to say that InnoFest is turning out to be a hub for innovation led entrepreneurs.”

InnoFest 2016 showcased exciting innovations such as a Sumo wrestling Robot, electric bikes, modular portable micro housing units, a 3D selfie maker, digital microscopy, 3D printers, pop up makerspace, farming tools, healthcare devices, education products, green energy equipment, environment related products were just the tip of the iceberg.

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InnoFest also had a host of mentors who were available throughout the day to have a one-on-one discussion with participants. A workshop focused on providing a clear understanding of Entrepreneurship for early entrepreneurs and novice entrepreneurs was a runaway hit.

A key element that innovators grapple with is Funding, InnoFest featured a session on funding resources for early stage Hardware Entrepreneurs, Crowd Funding, Challenges in obtaining Grants and Equity Funding.

With the Make in India movement gaining momentum a session on Building Hardware Businesses in India/from India, enlighten the participants.

Mr. Sharad Sharma, Co-Founder of iSPIRT and Convenor of InnoFest, said, “India is on the cusp of a business revolution. We are going to see a spurt in the manufacturing sector addressing basic human needs air, water and food. Today’s innovators are going to be the leaders tomorrow. Events such as InnoFest will be pivotal in providing a jump-start to budding entrepreneurs.”

The Patrons of this event were Mr. Amitabh Kant CEO, NITI Aayog; Mr. Jayant Sinha, Minister of State for Civil Aviation, Government of India; Mr. Nandan Nilekani, Former Chairman of Infosys and Former Chairman of UIDAI; Mrs. Kiran Mazumdar Shaw, Chairman and Managing Director of Biocon and Mr. Mohandas Pai, Chairman of the Board, Manipal Global Education.

InnoFest was concieved as a day-long festival of ideas and inspiration that will exponentially multiply innovation across the country and make India into a Product Nation. Our research shows that there is a need for a strong support ecosystem for hardware innovators similar to that available to software innovators. InnoFest seeks to bring together the multitude of partners needed to build such platform that encourages and supports grassroots innovators from ideation to realization to growth. iSPIRT strongly believes that a robust product ecosystem is the key to rapid growth across the country.

 

#IndiaInnovates

Why Did 33% of Prospects Reply to This Cold Email?

Cold emails have earned a bad reputation. Prospects see them as a nuisance, and most just hit delete without even a casual read. Even when the message is highly targeted, the open rate ends up being less than 10% on average. I call it the “Rhino effect”. Most of us have developed a thick skin over the years as a result of the constant barrage of irrelevant email.

Not willing to settle for “status quo”, we worked hard to crack the code of email copy that would put a smile on our prospect’s face. Our formula was not necessarily new or unique – arouse curiosity in the subject and follow it up with a crisp and engaging body. But we pushed ourselves really hard to execute this formula to perfection.

The results of this effort were very encouraging. More than a third of the recipients of these emails choose to reply to our cold emails, and close to 10% of those have converted into solid opportunities.

Here is one of those highly personalized emails:

 

So, what exactly did we do?

1. Searched and Researched

The objective of our research was not just to find out about their business, but to also understand what interests the individual both professionally and personally. In this instance, we reviewed Jack’s Twitter account and learned that he was a keen Manchester United fan. We also found out from LinkedIn that he had recently been appointed as Sales Enablement Manager at a high-growth startup which had recently raised a large round of funding.

2. Mapped Individual KPIs With Their Business’ Objectives

Once we had learned about the business and the individual, we made logical assumptions and weaved them into our message. For example, as Jack’s startup had recently raised big funding, it was safe to assume that the company was experiencing very strong sales growth. As a Sales Enablement Leader, we knew that scalable expansion and shortening ramp-up time for new hires would probably be a key KPI for him.

“At MindTickle I have seen many sales enablement leaders adopt such an approach to improve the sales process and develop new hire training.”

3. Learned About The Person Not The Persona

Most people include personal information on their social media profiles. This gives us an idea of what their interests are so that we can connect with them on a personal level. In this example, we knew from Twitter that Jack liked to ‘coach’ the team by live-tweeting during matches. We leveraged this information to relate his personal interests to his professional objectives:

Manchester United and sales enablement both create champions out of regular players. Each goal, each strike, each pitch, each value prop, has to be carefully honed and drilled in…

PS: I am also looking forward to the Derby match with Liverpool this weekend :-)”

4. Connected with a Hook That Brings A Smile To Their Face 🙂

None of this research and copy would matter if Jack didn’t even open our email. To get his attention, we crafted a hook that would make him curious, just like we would at a networking event. In this example for instance, we connected his new role with his love of football:

Why a Man Utd fan is the best fit for sales enablement”

As a result Jack not only opened the email, but he also gave us an opening in his calendar.

5. Empathized

Rather than jumping into a left-brain pitch of why our product is superior, we chose to paint a picture of what we can help him accomplish. We sprinkled credibility on top by calling out recognizable names of companies that had investors or locations in common with Jack’s company. Everyone needs a little reassurance even from someone they don’t know….yet.

“The right technology partner can amplify your training efforts and increase the engagement of your sales reps, while simultaneously reducing their ramp-up time.

Several fast growing tech companies  (Couchbase, Rocket Fuel, AppDynamics, Cloudera and Avalara to name a few) use MindTickle’s sales readiness software to train, coach and keep their sales team updated.”

We’ve been refining these practices over the past year and our response rates have consistently improved. Even when the timing has not been right, the friendly responses to our cold emails have been heartwarming. But don’t just take my word for it, try it for yourself and watch your open and conversion rates improve out of sight too.

Guest Post by Mohit Garg, co-founder and chief customer officer of MindTickle

Implications of GST Bill on Startups

The much-hyped Goods and Services Tax (GST), after years of stagnation and lack of political consensus, was finally passed in the upper house of the Parliament, the Rajya Sabha, on 4th August this year, almost a decade after it was first introduced in the Lok Sabha in the year 2006-07. It is the biggest indirect tax reform post economic liberalization of 1991.

implications-of-gst-bill-on-startups

The economists say, a double-digit growth in GDP, which seemed too surreal, will now be a reality. This law aims to give a boost to the new age start-ups and make India a conducive place to conduct business. Currently, India is home to around 4,200 startups growing at an exponential rate of 40% yearly. It is predicted that, with further relaxation of rules, India will be home to around 11,000 startups by 2020. This can be corroborated by the fact that India was ranked poorly at 142nd in the ‘Ease of Doing Business’ survey conducted by the World Bank in 2015. With relaxation in the rules and regulations of setting up a business and lucrative schemes like ‘Start-up India, Stand up India’, India went twelve places up and ranked at 130 in 2016.

Before getting into the nitty-gritty of how beneficial will the new law be for startups, it is important that the basics of this law are first looked into. GST, as mentioned above, is an indirect tax reform also known by the moniker – ‘One India, One Tax’. Different states have different tax structures which make the taxation structure very cumbersome and complex. This is a major reason why many start-ups are hesitant to expand their businesses to different states leaving the state concerned with little industrialization and low creation of jobs. GST aims to bridge the gap by integrating all taxes, making only one tax to be paid by everyone. As a result, the tax calculations will be simpler, saving time and energy for entrepreneurs and start-ups to focus on their respective businesses instead of investing time and energy on compliance and paperwork. However, just passing the bill is not the end of the story – there are rules to be framed, tax rates to be fixed, the central and state governments must reach a consensus, and proper infrastructure needs to be put in place. Hence, the implementation of GST still has a long way to go and is likely to happen in mid-2017.
Implications Of GST Bill On Startups

How Does the GST Help?

The Act is deemed to benefit all types of businesses but start-ups and SMEs are to benefit the most. It has been structured in a way keeping in mind the concerns of the small businesses. This is elaborately explained in points mentioned below –

Simple Taxation – Instead of adhering to different tax regulations in different states, GST simplifies the process by making it simpler and clear by integrating all taxes into one so that not only money on taxes are saved but time on compliances are saved too.

Ease of Conducting Business – Registration of VAT from the sales tax department of the state concerned is an imperative to start a new business. A business intending to establish in different states has to apply for VAT registration separately. Not only this, the VAT fees in different states is not uniform, making this one among the many other issues regarding the problems faced by startups and existing businesses in India. To fix this anomaly, the GST Act has provisions which will make VAT registration centralized, uniform and simple for companies. The concerned company/business would just need to get a single license valid pan India and pay taxes regularly. This will further help startups to establish, expand their business hassle-free.

Integration of Multiple Taxes – In addition to the VAT and service tax, there are other tax regulations that must be complied by the businesses like Central Sales Tax, Luxury Tax, Purchase Tax, Additional Customs Duty etc. Upon the implementation of the GST, all such taxes will be combined into one.

Lower Tax Rates for Small Businesses – At present, VAT is applied to businesses having an annual turnover of INR 5 lacs and above. GST aims to cap this limit to INR 10 lacs only and businesses with turnover between INR 10-50 lacs will be taxed at low rates. This move will not only bring respite to the start-ups but also help them invest the money saved on taxes back in their business.

Improvement in Logistics efficiency – Seamless movement of goods is currently a problem with border taxes and checks at state borders which delay the movement of goods which, in turn, results in delayed deliveries and enhances the product cost. GST aims to eliminate such inefficiencies making the inter-state trade less time consuming. With an uninterrupted movement of goods across the border, the costs associated with maintaining the goods will significantly reduce. According to a CRISIL analysis, the logistics cost of non-bulk goods can go down by as much as 20% once GST is implemented.

Other Side of GST: The Cons

While there are other advantages for the start-ups as well other than the ones mentioned above, the new Act also comes with implications, not necessarily for the start-ups. Start-ups in the manufacturing sector with lesser turnovers might have to bear the brunt of paying duty. As per the existing excise laws, any manufacturing business with an annual turnover of less than INR 1.5 crores is exempted from paying duties. But when the GST comes into force, the chances are, this limit could be reduced by six times to INR 25 lacs. This can have a detrimental effect on the growth of start-ups.

There are high chances that the inflation might rise after GST implementation. Also, whether ‘mandi tax’ would be included or not in the GST is ambiguous. Such causes can adversely affect the food startups.

Critics also say, the implementation of GST would also affect the real estate business and add up to 8% of the cost in new homes and as a ramification thereof, reduce the demand by 12%.

Despite its implications, GST is the most important and business friendly tax reform in India which will lead to a double-digit growth. It seeks to unify, integrate different tax structures so that there will be transparency and efficiency in the way businesses operate and the government levies taxes. This won’t just reduce the cost of the products but also create employment opportunities as more startups rise and India becomes the startup capital of the world!

Guest post by LegalDesk.com, a Do-It-Yourself legal platform for making legal documents online. LegalDesk helps startups with incorporation and legal documentation services. It also provides Aadhaar-based eSign service to businesses.

Naming companies and products (part 1)

Recently, a high potential team of founders invited me to be their advisor on marketing strategy. Their product is a employee transport management system based on mobile App and SaaS backend, targeted at large organizations.

naming-companies-and-products-p1

I knew finding a great name was a daunting exercise. All the “real” names in English dictionary have already been trademarked. The names from animal kingdom, astronomy, astrological signs, mythical characters, all are gone. All names suggestive of product attributes and company heritage are already taken. Globally, over a hindered thousand new names are trademarked annually. That makes it hard to find a meaningful and memorable name today.

I did couple of brainstorming sessions and took a few rides together with the founders in buses and cars at peak times hoping to catch our emotions and thoughts during the commute and a Segway to an exciting name. We asked our family and friends and their friends hoping to catch a ray of hope. We also dipped into the customer research founders had done, to find words that described customer asks and aspirations. I also swam through the Greek and Sanskrit dictionaries and literature hoping to discover some esoteric word representing ancient god, speed, motion or a fun activity. Ultimately what helped was a name generator program that could generate 200-billion+ combination of eight lettered words of which it claimed 10 billion could be pronounced in English. So if you are looking for a great name for your new business, good luck to you. Sincerely. J

It is a question every entrepreneur must answer – how do you come up with a name that clicks? The first step is to know what a good name looks like.

Is the name really very important

What’s in a name? That which we call a rose by any other name would smell as sweet.  You guessed it right – this is a quote from Shakespeare. Shakespeare has been proven wrong many times over since then. For instance, ask beer and perfume makers. A name has plenty significance in the world of high tech products too. After all Facebook paid $8.5M to American Farm Bureau Federation in 2010 to acquire fb.com that was the sellers primary domain. Apple is rumored to have paid $1 million or thereabouts for iPhone.com in 2007. It is surprising Apple paid nothing for apple.com when it was registered on February 19, 1987. Well people hadn’t yet latched on to the idea of domain registration as a commercial product!

The point is not that a name has any disproportionate share in a business’s success. The number one software company of all times got a very average name in 1976 when Bill Gates chose it for his business. It was derived from MICROprocessor on which their SOFTware would run. There were a million “Micro somethings” around at that time, so this was a very poor and restrictive choice. But it did not stop the business from being a spectacular success.

The point is not that you can’t be successful with a bad name, but rather that a bad name can hurt you, and that there’s no reason to inflict this damage upon yourself when you can avoid it with only a few days’ worth of work.

After all, product or company naming is the first public act of branding. A product name contains important marketing communication components – corporate strategy, product concept and positioning. It communicates to the world outside as well as employees – “who you want to be”. So please pay some serious attention to the naming your product or company.

What makes a good name

A lot goes into making a name good.

For starters, a good name is easy to remember. That means the name is short, simple, easy to pronounce with no more than 2 to 3 syllables. Try remembering acetylsalicylic acid versus Bufferin. Names must also be pleasing to the ear. Even when reading, the mind translates the words into sounds. A name like Caress is as silky soft as the bath soap it represents. Imagine if eBay was named AuctionWeb or Google retained the original name  for its search engine – BackRub! What images does Pharmeazy create? Did I hear sleazy? And how about messy is Strmesy?

Two, a good name draws attention and arouses interest.  Being provocative is one way of getting attention, for example, Victoria’s Secret. Think of  a website named – Thankbunny.com – who is thanking whom? Will I meet Playboy bunny in there? Its is provocative and arouses interest. Similarly, names like Simtre, Vaave, Ecareibe, QUSTN draw attention, arouse interest but are either difficult to understand or have a very difficult spelling to remember.

Three, a good name distinguishes your product from the competitors’. Do not use a name if it can be confused with another of your products or a competitor’s product? Consider the following three products: Media Extender, Media Connect and Windows Connect Now. While the names are strikingly similar, the products are completely different, and are, respectively: a device to make Xbox function as a media center; a device to deliver PC-stored content to your stereo or TV and an architecture to simplify wireless home networking. “This is a recipe for confusion.”

Four, it should convey something real about the company or the product and support the product’s positioning. Wharton professor Karl T. Ulrich terms this quality as – name should be evocative of the things it names. It should generate strong images, memories, or feelings in the mind about the product. You could express what the company does or what the key product benefits are in the name. For example, “ERPNext” clearly conveys it’s a ERP product and the “Next” signifies innovation, future and so on. On the contrary, it is clearly a bad idea to name your product Tiny ERP; no one expects that planning their business’s entire operations is a task that can be handled by a “tiny” anything.  Finally, a name like “Planetsuperheroes” passes most of three tests so far except that it is perhaps a tad too long.

Five, can the name be trademarked? And even if it is, is the trademark defensible if challenged? If a word is already in use as a generic term, no amount of money spent takes it out of the generic category. Also, will the name infringe on a protected trademark? And even if you don’t think it does, are you ready to go to court and spend lots of money to prove it? The courts are tough on copycats. When Parfums International, a unit of Unilever Group, introduced Elizabeth Taylor’s Passion perfume in 1987, it was sued by Annick Goutal Inc., which made its own Passion fragrance. A New York judge ruled that Ms. Taylor’s product couldn’t be sold in 55 “first-tier” stores! In 2015, it was thought that Google infringed on BMW trademark rights by calling its new holding company Alphabet, the same name as a BMW subsidiary. Apparently they hadn’t as BMW has not filed a suit more than a year on. Closer home, Tata (Indigo car) has issued notice to Indigo airlines for name infringement. Often the trademark owner only starts making noise when the infringer has grown big and rich.

Six, if you have any plans of going global, you must check if the name translate into an inappropriate or obscene, repulsive or in anyway negative term in a foreign language? Couple of classic examples comes to mind – the Mercedes Benz China entry with a brand name Bensi that meant “rush to die.” Coors beer slogan “Turn It Loose,” when translated meant, “having diarrhea” in colloquial Spanish.

Reebok that picks up over 1000 new names every year for its products went horribly wrong in 1996 with a product name. Reebok named a $58 women’s running shoe “Incubus” after legal research found the name was not a registered trademark at the time. Unfortunately Reebok forgot to look up the dictionary. After shipping 53,000 pairs, Reebok learned from media that Incubus, according to medieval legend meant – a demon that has sex with sleeping women. The company issued apology but had to withdraw the product soon. To avoid such costly mistakes in future, Reebok hired a name consultant.

Seven, can the name be shrunk down to an inappropriate acronym? Does it lend itself to an undesirable pun? Merrill R. Chapman in his book “In Search of Stupidity” narrates an interesting incidence of a company selling accounting software. This company once introduced a reseller program whose name shrank to “CPR,” a most unfortunate name when selling to a market consisting of middle-aged sedentary males who are wondering if a major chestburster is in their future.

Eight, names should ideally be timeless  – be able to survive the life of a product or a company. You must decide how long term are you thinking. For example 20th Century Fox is kind of a misnomer in the 21st Century. Kentucky Fried Chicken had to rename to KFC when going global. But Yahoo!, Google, Oracle or ERPNext are timeless names.  So many companies had to make a costly change of their names after they became big or decided to go global.

Nine, a lesser consideration for the name should be how it would work on T-shirts, coffee mugs, bumper sticker and other marketing collateral.

Last but not the least, the name should be available as a domain for your website. You must own the domain name associated with your product, brand, or company name. This means that if your name is JohnDoe, you must own johndoe.com.

Not johndoe.net, not myjohndoe.com, not johndoe-xxx.xxx and  not johndoe.in. Being in India, you must grab .in name but always try to reserve .com domain. In some cases you can acquire a domain name that has been registered by someone else. But, honestly, this is rare for smaller companies. Maybe Apple can acquire iPhone.com for a million dollars. But, in most cases, you can’t do that. As a result, you are probably going to have to create a name that is fully available. In plain terms, you should only consider names that are either available for registration or that you are confident you can acquire for a reasonable price.

Rarely will a name do all these things equally well. For example, Amazon is a great name and does almost all these things, but does it generate strong images of online retail – hell, No. Similarly the word Starbucks by itself does not mean coffee. Should Jeff Bezos have called his company booksonline.com? No. Bezos had big ambitions for Internet retailing and it was right for him to pick a more general name with interesting and positive associations than to perfectly align his company name with his initial product strategy. The name Amazon has even allowed the company to extend its service offerings to information technology infrastructure.

With time and investment of marketing resources, a name can acquire meaning and associations, and usually grows in attractiveness. After all Starbucks did not mean coffee or generated any image of coffee but over the years it has become synonymous with coffee.

So much for now. If I happen to see some posts below I would publish part 2 that will cover naming process and some specific guidelines for naming in tech industry. I have taken liberty to comment on some of the existing product or company names. Those views are entirely mine.

Altizon – Impact of Effectuation

Effectuation (effectuation.org) is a decision-making framework used by expert entrepreneurs. The early morning workshop of PN Camp Introduces this concept and help participants arrive at stakeholder commitments for their product market fit.

vinay_nathanVinay Nathan of Altizon talks about application of effectuation in his company and how it made him do more with less.  Altizon is a Pune based Industrial IoT company. Altizon was founded in April 2013 by Vinay Nathan, Yogesh Kulkarni and Ranjit Nair and is a venture-backed startup. They recently launched state of the art Industry experience center for their product

What was the change in your head with effectual Stakeholder Dev?

Put in a lot more structure and rigor and discipline to something we should have been doing anyway. After 2-3 yrs of doing this startup we got insular. This workshop made us go out and resume our conversations with stakeholders. Really made us think about their affordable loss, make our asks into Affordable Asks for them. We were surprised by how much we got.

We’re an Industrial IoT company, and IoT is ecosystem play, so it was a snap-fit for us. We have to go to SI, App devs, chip guys, OS guys, manufacturers, etc.

What stakeholder development did was when we went across stakeholders with an ask here, and an ask there, and you get surprised by what happens. We did many mini pivots based on our asks and what we got from our stakeholders.

Mainly, while this was something at the back of our mind, we weren’t doing it in a structured way before, and we hadn’t heard about effectuation before. It put in a framework to what we were doing before in a patchy way.

How was affordable loss useful as a concept to you?

We now ask every SI to build a demoware component on our platform, this is affordable loss for them, and an affordable ask we make. Once we found out the affordable loss of our partners, we were able to put together an entire Industry 4.0 experience center with loaned equipment and demoware. So from manufacturers we asked for demo equipment, from Sis we asked for demo software that integrates, and works on our platform. This was nowhere in the picture without asking bunch of affordable things from our already existing stakeholders. In fact the Centre now acts as an interop lab for our SI partners to test their solutions.

For example, we have the entire integration equipment and a mini assembly line for smart manufacturing in our lab that Wipro or Microsoft doesn’t have in their center of excellence. We have the only center where an Industry 4.0 lab things actually has live hardware, integration across these equipment, demos from multiple SIs, and our platform in the background. To get this lab In place we would have had to spend $75k at least, instead we got it all with Affordable Asks for on engineering effort and loaned equipment. The use cases knowhow would not be available even on hire. We have now begun investing in this infrastructure to further enhance it.

Another example, we realized for scale, if we go down the solution route, we will use 50% of our dev bandwidth for that but won’t be setting up for scale. For us scale comes if Sis take our platform and sell/implement on it. So even if it’s more painful invest in the ecosystem, as much as we do ourselves. Category leadership meant we need to grow faster, so made building the SI ecosystem critical. The Affordable Ask/Effectuation framework helped us reach out to Sis and get demoware in return. This was not our approach before Stakeholder Development.

What were 2-3 things that you got?

We weren’t reaching out to competitors. Stakeholder development was breaking barriers of who to reach out to. Logical ones anyway you will meet anyway. But stakeholder development made us go all out to meet competitors. This was a huge mind set shift.

Industry 4.0 experience center was not even a dream before this

While getting customers to our experience center, we became aware of another group in the company, got them as customers

When you go with Asks, you might get new Means, but you also get New Goals. How do you take on ‘new goals’ without getting side-tracked?

We started working with an industry major on courseware for Industrial IoT. We were investing in the courseware since it was a marketing effort for us, and affordable loss for us. While we did that, we got to learn about a parallel product group sitting in Germany, who were looking for a platform/OEM play. We took this opportunity and are now in a sales discussion with them, where they will OEM our product.  We then got in touch with their consulting arm, and they wanted to know how to use us in their consulting practice, and we’re working with them on this. This happened in 8-10 weeks after we learnt about effectuation.

Right now, even more than the leadership, the entire team kind of works on this, and keeps doing it.

How much would it have cost to setup the experience center you vis-à-vis doing the Affordable Asks? Equipment cost, plus demoware cost (in time/money)

Easily we have availed of engineering efforts worth $75k in the first version of the center. Now this is ongoing activity and we will continue to benefit from the partner driven approach to building the center.

How are the Sis working with you in this model? Is it different from how you’ve worked with Sis in the past?

We would sell evaluation kits and hope they built good demos. We would rarely have access to what they built. Now by utilizing our own demo center they are keen to have it running in our center.

The other option we did with some partners was a joint webinar. But the number of stakeholders were too many and it was time consuming. Now we have more of a hackathon approach.

Can you give us some more examples of where you accepted different goals from stakeholders, in exchange for new means you got?

By interacting with our stakeholders across SI and equipment players we believe there is a space to create a Consortium focused on Industrial IOT for India. We now plan to play a leadership role in creating  it.

What were some surprises along the way that made you do mini-pivots? Did you get any Lemons that you made Lemonade from? ☺

We discovered while talking to the SI that there many application ISVs that have built assets on older Historian product lines that would love to move to an IOT stack. This acted as a spur for us to do campaign in that sector. We landed one applications ISV partner through this campaign who is now building an app for the Power sector using our platform. Now this is a customer segment we are actively targeting as it aligns very well with our marketplace model.

5 email marketing myths you shouldn’t believe…

email-marketing-myths-you-shouldnt-believe

Well, just as any other marketing strategy and methodology is important and it works, the concept of email marketing is equally important. Email marketing is sending emails to a group of subscribers promoting your product or services.

In fact, most marketers don’t realize that email marketing is one of the major components of marketing.

But just as everybody has myths about web marketing, there are a number of myths in email marketing too. If you want to make this strategy flawless, you can consider 5 email marketing myths you shouldn’t believe.

  • If you think unsubscribing is bad for your business, then it is time you think again

Yes, that’s correct. Unsubscribing has a far wider concept than you think. The audience who subscribes aren’t necessarily focused on knowing about your product or services. They may have done it in the spur of the moment or to get the information about your product for their own use.

That does not mean they are going to buy it from you. And unsubscribing speaks volumes. First, not interested and the inactivity of the user are about not being very much indulged in reading what you present them in your emails. And then unsubscribing saves you from the trouble of including them in the list of recipients who never respond or express interest.

  • Email is dead

If you think that emailing has lost its charm, then you are absolutely wrong. There are hundreds and thousands and millions of organizations that are making huge sums of money with email marketing.

In fact, email marketing is a major component of traffic for most websites.

  • The length of the subject should be less than 55 characters

If you think you can make a better and the intriguing subject line that exceeds 55 characters, and then feel free to do so, because content is the KING.

It is true that if you make subjects that are shorter, it will of course result in higher rates of opening, but it is never said that it will also result in higher clicks or higher conversions.

  • The best time for sending emails to subscribers is either the Monday or the Tuesday

Yes, it is true that everybody gets back to work on these days. But that is not necessarily true that the subscribers are more open to reading emails on these days only. There are millions of people who read their mails on everyday basis, no matter if it is a weekday or if it is a weekend. So you make sure that you send them emails on everyday basis. Weekends are the two days where the people get enough time to take a detailed look to their emails.

  • If that you send with a trusted automated responder, there is no reason to worry

Organizations like Aweber, Infusionsoft etc. changed the meaning of how marketing is done. There was a while where you must be uncertain about giving your email address online because you could open the ways to interminable spam. Then, some big email marketing names ventured up and led the pack so you would know whether you hit “Unsubscribe,” you would be allowed to sit unbothered.

These myths are the perfect signs that email marketing isn’t bad and can result in the increase of sales and business in ways you wouldn’t think of.

There are companies all over the world that are experiencing the rise in business with the help of email marketing only. They are consistent in sending emails to their subscribers, draw their attention and ensure that on receiving the subscriber responses will take care of their queries and answering their concerns.

So do not take these myths into account and make your email marketing more effective.

Author – Charlie Robinson

(He is a marketer and interim VP of Marketing of multiple tech companies. He is currently heading marketing at Adling, a digital agency in Cupertino).

 

Ease of Doing Business – Is India Game?

Conducting business in one’s own country is never easy, let alone conducting business overseas, where rules, regulations and business environments differ. ‘Ease of doing business’ is also an Index created by the World Bank. It ranks economies from high to low, with the former indicating easier, simpler and better conditions for business as compared to the latter, indicating difficulty in conducting business. This article aims at giving you a glimpse into the world of investing in and conducting a business in India.

Economies are ranked based on parameters such as starting a business, dealing with construction permits, availability of electricity, registering property, availing credit, protection of minority investors, paying taxes, international trading, distance to frontier, entrepreneurship, good practices, transparency in business regulation, resolving insolvency and enforcing contracts. For any business, it is important to acknowledge these factors, or at least those that apply, as they decide how easy or difficult it is to conduct or start the business in a country.

For the year 2016 by World Bank’s records- India moved up from 134th to 130th rank in the Ease of doing business Index. Among the parameters mentioned earlier, India has best ranked in the protection of minority shareholders. It has also bettered its rank in the availability of electricity, getting construction permits and starting a business. On the downside, paying taxes and accessing credit have been the most difficult for business. Additionally, two key parameters that India needs to work on are enforcing contracts and resolving insolvency, that have both been a hindrance in conducting business.

To give you an idea of how few other countries fare in the rankings; Singapore, New Zealand and Denmark occupy the first three spots in the world, whereas Eritrea, Central African Republic and Libya occupy the last three spots.

The Indian Government has taken several initiatives towards increasing the ease of doing business, here are some that deserve a mention:

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Registration

  • The availability of www.ebiz.gov.in, a Government portal where services are provided such as employee registration, name availability, Director Identification Number, PAN, Certificate of Incorporation, TAN, RBI (Foreign Remittances), EPF, Importer-exporter code, Foreign currency – transfer of shares, etc. Making registering and running a business much easier than before.

  • Now Aadhaar eKYC and eSign are being used to grant Digital Certificates to directors (DSC) of the company. This process is now made paperless and takes only a few minutes.

  • The requirements for minimum paid-up capital and common seal for companies has been removed as per the Companies (Amendment) Act, 2015 and the process for starting a business is now streamlined.

  • The Indian Prime Minister has shown particular interest in building a positive entrepreneurial spirit. He launched MakeInIndia, a website helping young entrepreneurs set up, access information, and build a business of their own.

  • Employee Provident Fund Organisation (EPFO) and Employee State Insurance Corporation have online portals so that businesses have real-time registration, online application for clearances and payments be made through 56 partner banks.

  • An Investor Facilitation Cell has been introduced as a first in order to help investors and guide them through the course of their business.

Taxation

  • GST (Goods and Service Tax) will replace indirect-tax, to be implemented by 2017. That is the removal of several layers of multi-layered taxes and multiple tax rates into one uniform Goods and Service Tax. This will make India attractive to foreign Investors as well as boost India’s exports because of less regulatory and bureaucratic tangles.

Infrastructure

  • In cities like Delhi and Mumbai, online construction permits such as DPMS (Development Permissions Management Systems) are in the process of being launched. Since the permits are completely digitized, the biggest impact this will have is speeding up the process of getting a permit by 5-8 months. It will save one the trouble of meeting someone in person, which has a direct positive impact on reducing corruption, delayed work and human error to a large extent.

  • A business being affected by a cyber crime is every founder and investors’ nightmare. Training programmes for officers in the sensitization towards cyber crimes and related infringements is also a significant initiative taken by the Indian Government.

  • Special management teams have been set up to fast track and facilitate investments made to India from South Korea or Japan. The plans are coined ‘Japan Plus’ and ‘Korea Plus’.

Compliance

  • If your business deals with cross-border trading, you’re in luck. The Government has made the process highly efficient by reducing the time utilised at ports and airports. Necessary clearances for exporters and importers has also been prioritized. As a result of the improvements made, export and import clearance that once used to take nearly 5 and 11 days has reduced by more than half the time.

  • Minority shareholder’s Interests are well protected in India. Apart from ranking high on the ‘ease of doing business Index’, a greater disclosure is now required of the board members on matters of ‘conflict of interest’.

Legislations

  • A National Company Law tribunal and an appellate tribunal was set up to replace the existing Board for Industrial and Financial Reconstruction (BIFR) and Company Law Board (CLB). The National Company Law Tribunal was set up to resolve corporate disputes faster and efficiently, to examine existing laws that relate to winding up procedures and to suggest reforms regarding winding up and insolvency in an effort to match up to international standards and practice in this field.

  • The ease of doing Business in India is also about exiting a business efficiently as much as it is about starting and running one. Thankfully, the Government is soon to enact the ‘Bankruptcy Code’, which will make it easier for investors to exit a business in case of Insolvency.  At present, it takes 4 years to resolve an issue related to insolvency. With the new code, time taken to exit from a business will be reduced to a period of under a year.

Foreign companies that invest in Indian businesses have contributed heavily to India’s economic growth over the past years. The Government has set up FDI and FEMA measures to increase economic activity, set regulations and caps on sectors and generate employment opportunities.

Foreign Direct Investment (FDI)

Money that India receives from investors abroad is FDI. Foreign companies that invest in Indian businesses gain a monetary advantage in terms of labour wages and benefit from the high economic growth rate prevailing in India.

The Foreign Direct Investment allowed for an entity based in another country is:

Sector FDI Allowed
Direct route Indirect route
Insurance and Pension 49%
Defence 49% above 49%
DTH, Cable, sky broadcasting 100%
Brownfield Airport Projects 100%
Scheduled Air Transport Services 49% 49%-100%
Foreign Airline Companies 49% of paid up capital Upto 49%
Marketplace Model of e-commerce 100%
Food products manufactured/produced in India 100%
Asset Reconstruction Companies 100%
Brownfield Pharmaceuticals 74% above 74%
Private Security Agencies 74%
Non ‘News and Current Affairs’ linking channel 100%
Mining and Mineral separation of Titanium Upto 100%
Publishing/Periodicals/Journals Upto 100%
Publication of foreign newspapers Upto 100%
Publication of Indian versions of foreign magazines Upto 26%
Satellites Upto 100%
Telecom 49% 49%-100%
Banking Private Sector 50%-Upto 74%
Banking Public Sector Upto 20%
FM Radio Upto 49%
NBFC 100%
Commodity Exchange 49%

(Figures as of August 2016)
Source: http://www.makeinindia.com/eodb

The Foreign Exchange Management Act, 1999 (FEMA)

The Foreign Exchange Management Act, 1999, was set up with the aim of Increasing foreign exchange through increasing external trade and promoting foreign exchange markets in India. All Offences relating to Foreign exchange are considered Civil offences.

Some of the revisions in regulations of FEMA to promote the ease of doing business are:

  • Acquisition and transfer of fixed/immovable property – several conditions for which RBI approval is no longer required to buy immovable property outside India by a company registered in India.
  • Possession and Retention of Foreign currency – an individual can have up to a maximum of USD 2000 in foreign currency at any time. This applies in all cases other than if the individual is not  a permanent resident of India, he obtained the foreign currency while being resident outside India or if such currency was brought in compliance with the laws applicable.
  • Export and Import of Foreign Currency – the upper limit of notes an individual can take outside the country or bring into India is INR 25000 (currency notes or RBI notes).
  • Import of Foreign Exchange – foreign exchange sent to India has no upper limit except in the case of currency notes, traveler’s cheques and bank notes. The upper limit on these types is USD 10000.
  • Postal Order/Money Order – any person can buy foreign exchange from any Indian Post Office in the form of money order or postal order.
  • Declaration of exports – for businesses that are either engaged in exports or those that are set up in Special Economic Zones or Special Technological Parks need to declare their exports backed up with evidence.
  • Insurance – regulations that are stated for an individual resident in India that avails a general or a life insurance policy issued by an insurer outside India and vice-versa.

Routes to Invest in India

Automatic/ Direct Route – No permission from the Central Government required under this route.

Government Route – Applications that are considered by the Foreign Investment Promotion Board (FIPB) come under this route.

Who can Invest in India?

  1. An Individual – FCVI, Pension/PF, Financial Institutions

  2. A Company – Non-Resident Indians, Foreign Trusts, Wealth Fund

  3. Foreign Institutional Investors – Private Equity Funds, Partnership Firm, Proprietorship Firm

Note: Investors from Pakistan and Bangladesh can Invest only through the Government of India. Residents from Pakistan cannot invest in Defence, Atomic, Space and other select sectors of the economy.

How to Invest?

Foreign Investors can invest in India in the following ways:

  • Incorporating a company – Either a ‘Private limited’ or a ‘Public Limited’ Company.
  • Sole Proprietorship/Partnership – Under RBI approval.
  • Limited Liability Partnerships – Allowed under Government Route in sectors that have 100% FDI.
  • Other Structures – Not for Profit entities, etc. are subject to FCRA regulations.

The steps an Investor should follow before investing are:

  1. Identify Sector
  2. Obtain Central Government approval if required for that sector
  3. Transfer Funds through eligible financial instruments
  4. Meet the stipulated requirements of the RBI Act
  5. Registration and Document Filing (PAN, TIN)
  6. Find Ideal Space and obtain clearances, if any
  7. Obtain Licence(s) if required
  8. Finding staff, paying taxes, etc

Taxation

An individual – Is taxed on the net income earned based on the tax bracket

A company – 30% tax + surcharge + education cess. Profits withdrawn are Taxed

Branch Office or Permanent Establishment – 40% + surcharge + cess

Incentives provided by the Government

  • Special Economic Zones (SEZ), Export Oriented Units (EOU) and National Investment and Manufacturing Zones (NIMZ) offer incentives such as tax reduction and tax holidays for businesses set up in such zones. Manyata Tech Park and Eco-Space are examples of SEZ’s.
  • Incentives on exports such as duty remission/exemption scheme, market schemes, focus products, duty drawback, etc.  to increase exports.
  • Area based Incentives for operating in particular areas of India such as Uttarakhand, Assam, Jammu and Kashmir, etc.
  • Apart from these Incentives, each State Government has its own incentive policy.

It is safe to say that with the Governments several acts and initiatives to stimulate increased investment and growth, India has truly built favourable all-round business conditions. India emerged as the top destination for foreign direct investment (FDI) by capital investment in 2015, attracting $65 billion worth of investments, overtaking China and USA. Business in India? Absolutely.

Guest post by LegalDesk.com, a Do-It-Yourself legal platform for making legal documents online. LegalDesk.com helps startups with incorporation and legal documentation services. It also provides Aadhaar-based eSign service to businesses.

Founders: you are not doing it right

I see a lot of founders requesting 15min time from me for quick advice. They are clear that it is not a funding pitch, but, more to get my opinion on some of their questions – is this a right market, whether idea has legs, customer size, product feedback, etc. Based on who is requesting, I tend to allocate time for few and discuss, which usually goes for 30min+. I know that 30min is not sufficient to give deep/quality actionable items, other than some calculated guesses based on what I would have heard. My worry with such meetings is that I am guessing and my comments may not be based on a lot of input data/context and may not be right for the startup. So, I usually put caveat to founders to validate and test before taking my ideas as it is. I also know that most of the founders ignore all the comments that were contracting to their current thoughts and move on to the next mentor.

I say the whole mentoring, where, mentors are spending less than few hours with founders is completely bogus. I am being on the board of many young startups, it takes lots of meetings to understand the contours of the idea, market, team, capability, and strategy. At most one can help is bit tactical, but, doesn’t change the outcome for the startup. If it is the case what should founders do?

Founders have two important things to do before they get into startup-mode: a) Deep understanding and building their point of view of the startup-model and b) Executing the startup with their understanding of the model.

I see that most of the founders don’t do (a) at all. They want to take as many shortcuts as possible by talking to other friends, founders, and not spend time required to dig deep and build their opinion and model of “what it takes to build a world-class startup/company”.

Knowing what I know, I would ignore every mentor, event, startup pitch session, hackathons. Instead, I will get an internet connection, a decent laptop, personal notebook and sit at a quiet coffee shop. Start researching on web on all the topics that matter. I would first figure out the most insightful writers of the topics that one has to research and read. The goal is to build a Point of View about your product/market/idea/hiring/pitching/scaling etc. that you are an expert and you are better than any average mentor.

Once the rules of the game/knowledge is gained, you would have built a framework of thinking about your startup. Then, get into execution mode. During this phase, you try to interact with mentors, pitch sessions, hackathons, and investors so that these interactions are meaningful and actionable.

How To Choose The Name For Your Startup?

A Company name is the identity of a company and what people use to refer to it. Picking a company name at times can be harder than finding a business opportunity, and on several occasions, people have gone ahead and started their company without an apt name. This can damage the value of the company or the business itself because you are losing customers who don’t understand what your company does, too many similar companies or it’s just difficult for them to find you because of the company name.choose a name for company
The different company types are (based on name):
Private Limited – include the words ‘Private Limited’ or ‘Pvt Ltd.’ following the name of the company.
Public Limited – include the words ‘Public Limited’ or just ‘Ltd.’ following the name of the company.

Here are few things you can do to help choose the right name for your company:

Identify what your business does and which industry it belongs to

Once you have an understanding of what your company does and whom it is trying to serve, it will give you a platform for names to choose or a starting point. Remember your target audience should be able to associate with the name. Did you know Lumia didn’t sell well in Spanish countries? This is because Lumia means …..well…..err……umm prostitute in Spanish. Go figure, Nokia.

Chubbybrain is a company that funds other companies, but because of its name, ‘Chubbybrain’, no one knew what they did as they couldn’t relate the name to fundraising. ‘Xobni’ is another such example. Xobni sold email-related products until the company shut down. Xobni is literally inbox spelt backwards. Again, the market didn’t get it and that’s why no one now uses Xobni.

Now it’s time to brainstorm

Come up with a list of apt names that the company could use and check for its availability online. If another company has the same name, then you can’t use it. If the name is similar, then people will get confused again. If you come up with a name that will be difficult in communicating what the company does, then you will have to spend on marketing to help your audience identify your name with what you do. Accenture and Verizon spent millions on marketing after they had changed their Company names in an effort to rebrand themselves.

Think big, don’t get tied down

Your company has the potential to become international and cater to several markets in different economies. If you name your company after something local, it will be difficult to market it internationally. For example, if you choose a company name in a regional language or name the company after a particular region, it will be difficult to market outside those regions. One exception could be Cisco, named after San Francisco, that operates globally.

Your company name builds goodwill in time

The name has to be memorable, creative and distinctive from the rest. Apart from goodwill, it has the possibility of attracting customers, clients and several other business opportunities. Kingfisher has been declared bankrupt and some of their listed assets for sale was the company name and logo for around 330 crores. Goodwill increases the value of your company.

Sample study. Don’t be overconfident, test it out

Once you have a list of desired names, do a sample study with your friends, relatives and colleagues. Find out what they associate the name with when they first hear it. If they can zero in on what you are trying to convey, then you are pretty close to finding your company name. Don’t just go around asking people “Is this name alright for my company”?

Trademarks

A trademark is a visual symbol of the company which could be a combination of words, signature, colour, image, logo, brand name, tagline, etc. Any individual or company can apply for a ™ registration which would take 6-24 months along with a validity of 10 years, upon expiry, can be extended. A business can protect itself with the use of trademarks on its products the way Apple or Nike does.

  • Trademark Search: both online and offline have to be done. It can be done through a trademark agent or by checking the trademark office (INR 0-500).
  • Create Application: If your business or logo is unique, the trademark attorney will draft the trademark application, as long as there are no infringements with someone else possessing or using the same trademark.
  • Trademark Registration: The office will check if any objections arise from the application. If not, then it will be published in Trade-marks Journal. The approximate government fee is INR 4,000 and Attorney fee INR 3,000.

Check Domain Availability. In this age, you NEED a Domain

Your domain name is your IP address online so people can search for you and find you on the internet. You cannot use a name that someone else is already using. Leandomainsearch and bust name are just a couple of sites that can help you look for your domain name. Once you enter the names you want, it will give you what all options or combination of options that are available from which you can choose to name your domain name/company name.

Registering the Domain

One of the most common and marketed sites is GoDaddy, that offers domain names at reasonable prices. Another one is BigRock. You enter the names you want and it will give you the availability of those names which you can purchase for 1-10 years. Once the term is over, you can repurchase it, or if you choose not to, someone else can.

You will be given the option to buy .net, .web, .org. Or all three in a bundle, apart from which are info, .asia, .in, etc which can be bought separately or in a bundle.

Should you change your company’s name? Don’t be shy to fix a bad name choice

If you have chosen a company name and people still find it hard to identify you, then you should probably change the name. Rebranding your company name will also help build a good image. In the case of Anderson Accounting, the company was guilty of fraud and manipulating their books of accounts. Anderson Accounting then changed their company name to Accenture, in order to rebrand themselves and have been doing good ever since. Another example, Cadabra was the original name of Amazon. People couldn’t spell it nor did they identify with the name which was abracadabra, shortened. And the name was changed to Amazon, what we all know it by today.

Guidelines for naming a Company

Companies Act, 2013 and Company Incorporation Rules, 2014 stipulates the guidelines for naming companies. Some of these guidelines are:

  • The name should be in resonance with the company’s principal object.
  • Companies engaged in financial activities must have a name indicative of such financial activity being carried out, included in the company name.
  • Names that include the words ‘Bank’, ‘Insurance’, ‘Mutual Fund’, ‘Venture Capital’, etc., should get regulatory compliance from the respected regulatory body (RBI, SEBI, IRDA, etc).
  • Certain names require the Central Government’s approval if the company’s name includes ‘National’, ‘Union’, ‘Small-scale’, ‘Prime Minister’, ‘Federal’, ‘Statutory’, ‘Judiciary’, ‘Scheme/s’, (that may resemble ones offered by the central or state government) ‘Governor’, etc.
  • In order to name the company after the promoter or the promoter’s relatives, a non-objection form is required to be signed by the person who will share the company’s name.
  • The company needs to declare whether they have been using the name in the past 5 years in other forms of business such as sole proprietorship.
  • Every company incorporated as a Nidhi, shall have the words ‘Nidhi Limited’, towards the end of the name.
  • Once a name change has been made, only after three years can anyone avail that name.

Some of the limitations on naming your company are:

  • The name shall not be identical to the name of an existing company, nor a plural of an existing name, nor translation of an existing name in another language.
  • Generic names that have the names of places, or really general names are not allowed. For example, names like ‘Corporate Technology’, ‘Karnataka Business’ or ‘Solar Power’ will not be allowed.
  • An abbreviated name of the founders is not allowed in India. For example, ‘KPMG’ is named after all their founders. This would not be allowed as per the Companies Act, 2013.
  • A proposed name should not violate trademarks, or the Emblems and Name Act, nor include offensive words.
  • Names of patriots or people still in office or government cannot be used in a company’s name.
  • A name cannot imply any association with a foreign government or foreign embassy.
  • The term ‘State’, can only be used by a Government Company in its name. Examples are ‘Karnataka State Construction Corporation Limited’ and ‘Karnataka State Tourism Development Limited’.
  • The proposed name is identical to the name of a company dissolved as a result of the liquidation. Post 2 years, a company can then apply for the name of the dissolved company.
  • The name cannot be used if it is too similar to the name of a limited liability partnership
  • Using different spellings, spelling variations or phonetic spellings does not differentiate a company’s name from an existing name.

Don’t rush it. To some, it might be the easiest thing in the world. A random word simply popping into your head, sounding just right at just the right time. To others, the process may end up being rather gruesome. The result is all the same, though, you’ve got a match. A company name that will be just as important to you as it may be to the world.

Guest post by Krupesh Bhat, LegalDesk.com, a Do-It-Yourself legal platform for making legal documents online. LegalDesk.com helps startups with incorporation and legal documentation services. It also provides Aadhaar-based eSign service to businesses.

5 ways to increase your CTR on blog posts

For those who don’t know what CTR or Click-Through Rate is, it is the number of times visitors click on the ad placed on your blog divided by the number of views your blog gets. The business rules are simple. You get paid per click that is made on an ad placed in the blog. But, there are certain factors that control the way users click on such ads. The prime reason for placing such ads is to bring the reader close to a purchase decision.

Listed below are 5 ways to increase your CTR on blog posts.

  1. Catchy headline or message

The headline of the ad is like the elevator sales pitch. Learning the art of how to create a blog is not everything. One chance and it’s either a click or ignored. So a catchy meta title and meta description does more than half the work for you. They improve the user engagement by around 500% so the blog post shares a greater chance of CTR. A catchy title is necessary as most of the people on the internet is speed readers who have less time to focus on such ads.

  1. Presentation matters

A well-presented and maintained page is more likely to make the reader feel good than a messy page with ads placed all over. So the layout design of the page, the font size and style along with the quality of images matters. This creates an ambience for the ad as the placement and click on an ad depends on it. A good looking page containing an ad is more likely to get a click, so make sure your blog post looks neat when opened. This is one way in which CTR can be improved.

  1. Dodge ad blocks

A big hurdle your CTR and in turn, ads may face is the ad blocks that are on the host computer or mobile. To get through them, you need to test your ads before by applying it by yourself and check if it is good enough to dodge it. One advice is to use three ad blocks and three links for each page of the site. Do not try to blend your ads in the content or play with the colors or fonts. If people can read the headline and if they feel interested, they will click on it. It’s that simple.

  1. Two in between content

 

It is seen that although it is discouraged to place ads between your content, but the metrics show that those that are placed in between content in a proper manner get the most clicks. Additionally, color influences, but in the right amount. Use maroon red rather than blue to catch attention. The click on ads after the content gets lesser views, so there are more chances for a click on the ad before the content ends, thereby improving your CTR.

  1. Text and image based ad works

Adsense lets you choose between a text-based and an image-based ad. Both yield different results. But text combined with image allows advertisers to bid on it and this increases your overall cost per click thereby improving your CTR. Never expect an exponential increase, but over time, it gives better results than a solely text or an image based ad.

Decoding how to increase CTR doesn’t really have to be difficult, all you have to do is just implement the above mentioned ways in your blog and see the magic!
 

Author – Charlie Robinson

(He is a marketer and interim VP of Marketing of multiple tech companies. He is currently heading marketing at Adling a digital agency in Cupertino).

 

8 Personal Finance tips for Bootstrapping Entrepreneurs

Starting up is hard, make no mistake about it, while media romanticizes startups and mostly talks about the glorious success stories, what goes behind is months and years of toil, frustration, fighting all kinds of odds. Cliched as it might sound but overnight success is the culmination of years of hard work.

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Bootstrapping a startup is even tougher, apart from challenges of building right product, right team, right marketing plans and dealing with daily operational chaos, you additionally need to worry about money and  cash flows and hence constantly innovate to compete, there are no easy paths, what you need is undivided focus and continued perseverance.

Now with all these challenges last thing a bootstrapping entrepreneur needs are fresh challenges on personal finance front. It can be distracting to least and can even have a debilitating impact on your business, when all your energy and time should be focused on getting your business to move to the next orbit, unforeseen issues on personal finance side can sap your precious energy.

While we cannot mitigate all risks in business, but with a better financial planner you can reduce distractions and also some legitimate business risks, here are few tips that can help you manage your personal finances better.

1. Keep your personal fixed expenses low

As you bootstrap, start with a review of your personal expenses see if you can lower your expenses especially the fixed ones, there are always expenses which can be cut, like a costly dish TV subscription with all the channels you never watch or suboptimal phone bill plans when you can get a better offer or the weekly outings where you splurge or non-healthy junk food, or the gym membership where you never go, maybe a jog in nearby park can be better. Cut expenses wherever you can and migrate to a leaner personal expense structure.

2. Track your expenses and do active budgeting

Last thing you want when you are running a startup is surprises every month on your expenses which can be due to faulty planning. Plan your expenses to the last tee, do active budgeting. If required, use budgeting software. If not, pick up a simple excel sheet. There are a lot of pre-formatted excel workbooks available which can help you plan your budget.

You can use the following sheet for expense planning.

Screen Shot 2016-09-05 at 2.37.32 pm

3. Before you bootstrap plan for the worst

Create multiple cash flow scenarios. A lot of assumptions go bad when you are starting up as there are too many unknowns in a startup environment. Slipping product timelines, fundraising plans going awry, growth not taking off as you expected there are simply too many moving parts. So for any plan you create do a thorough analysis. Hope for the best but always have a plan ready for the worst.

4. Get a good health Insurance for you and your family

One of the major unplanned expense that can hit you is unforeseen health. Cost of health in general has skyrocketed in India. So before you bootstrap, ensure that you have a good health insurance cover for you and your family, the cover should be adequate and should reflect your lifestyle.

5. Do not park money in savings account, Invest in liquid funds

Your day to day money requirements should be parked in instruments which give higher returns. Every additional rupee matters. Therefore, do not keep your money in savings account but invest in short-term liquid funds. They provide 2-3 % higher returns than saving accounts and are almost as liquid as savings account, so you can use your money anytime and also earn higher from your savings.

Let’s say you maintain 5 lakhs rupees balance in your liquid account, this is an account for your emergency funds. Below chart explains what will be your account balance at the end of 3 years, if you see liquid funds will give you 4.3 % and 8.3 % higher return vis-à-vis Fixed deposits and savings accounts respectively.

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6. Avoid speculative investments like daily stock trading

As an entrepreneur, you are already grappling with ambiguities and surprises. The last thing you would want is surprises on your personal finance front. So start avoiding any risky investment you are making and stay away from stuff like daily stock trading or other speculative investments in the stock market or otherwise.

The below infographic explains why day trading is not a good idea 🙂

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(Source: Zerohedge)

7. Create a personal financial plan

You must have created a proper business plan for your startup but what is also equally important is that you create a financial plan for yourself. Look at how your cash flows are going to be like what are your projected expense, both recurring and non-recurring, sources of income, how much savings you have, short term and long term liabilities. Finance planning helps you create a detailed view of what to expect on money front in next few years, here is a simple step by step guide to create a financial plan

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8. Ensure your loan liabilities are taken care off.

Having large loan (personal or home loan ) commitments is not a good idea if you are planning to bootstrap. If you have such commitments relook at them and figure out a way to manage risks arising out of these liabilities. Set up a viable payment plan for all of these liabilities.

Article Credit : Sarabdeep Singh, co-founder of Bodhik.