How culture is the fevicol of a startup

I recently attended a Playbook Roundtable organised by iSPIRT on “Culture Design” discussing how to preserve culture of a company that it started with? Reading so much strife because of culture conflict globally or in India or how MNCs should imbibe the “Transparency Culture” & “Accountability Culture” has made me wonder Isn’t “Culture” a confusing word?

Each time we use the word culture we incline toward one or another of its aspects: toward the “culture” that’s imbibed through osmosis or the “culture” that’s learned at museums, toward the “culture” that makes you a better a person or the “culture” that just inducts you into a group.

As per Wikipedia, Culture is, in the words of E.B. Tylor, “that complex whole which includes knowledge, belief, art, morals, law, custom and any other capabilities and habits acquired by man as a member of society.”

Tirthankar Dash articulated culture that can be depicted in a pyramid. At the base is the Philosophy – what are the belief systems underlying the culture.

On that base is built the Mythology or folklore. This would mean Stories – what are the stories that make your philosophy real and personal. And at the top would be Rituals – what can you do that will bring it all alive.

One truth we have seen over the centuries – whether it’s a team of 3 or a country or a civilization, culture exists in every community. So the choice is between letting an unconscious culture crop up like weeds or consciously creating a culture we truly love.

A lot has been said about “Corporate Culture” of late especially about “Startup Culture”. One can have big vision and goals, smart people, super pay, great products and more, but the undercurrents of culture many a times determine whether the company crosses the chasm from good to great.

So, the key question is what kind of culture we want to propagate, as a company, community and the country? How do we provide an environment where one can respond (said and unsaid) to people and situations to bring out the best in each of us?

How does one ensure that we preserve and pass the culture of company from the 10th employee to the 100th to the 1000th?

While each startup or a big company should identify its own values, rituals, celebration and mythologies, there are three critical aspects that each culture should have for it to sustain, have its employees be “in the zone”, an experience when your concentration and focus peak and you are able to scale uncharted territory.

Trust: Every culture should command and demand trust among its community. If there is trust deficit, it leads to fear which creates processes and policies. Leaders of many organizations are afraid of the 2 per cent employees who may break their trust. The reality is, whether you create restrictive processes or not only 2 per cent of the people break your trust.

You end up penalizing the 98 per cent of the employees with restrictive policies (attendance tracking, detailed travel policies, time-tracking etc.) Any driven employee cannot ever be in the zone if they feel restricted, monitored and trapped.

Progress: Growth, movement , opportunities whatever you call it progress is like oxygen for any company or culture. Driven people constantly look for avenues where they can satiate their hunger for learning. Hence the culture should foster open communication and collaboration coupled with professional & personal growth.

The Indian culture, often labelled as an amalgamation of several sub-cultures is a prime example of this progress over several millennia.

Purpose: As a leader, if you had to choose to do only one thing to get your team to be in the zone, it should be to continuously, shamelessly and loudly remind them of the larger purpose of the team and the organisation they are a part of.

Remember, there are a bunch of operational tasks and distractions vying for your team’s time and attention. It is your job to take out time and remind them of the larger purpose of the organisation. It is your job to get them back on track when they are distracted and to give them the feedback and support they require.

At InMobi we believe in nurturing a culture that enables people to become more of who they truly are. YaWiO which is the foundation of our culture is like the wind – it’s the presence that can’t be directly seen, but it can be felt very strongly. It is our glue that holds the organization together and can guide how to behave & act!

Guest Post by Ankit Rawal, Proud Veteran InMobian

16/09/201516/09/2015

InMobi’s Miip May Be More Important to India than Pichai

The emergence of an IP and technology-based leader from India will have a bigger long-term impact than a few Indians heading major global corporations

Isn’t it strange that we were obsessed with happenings at Google while the really momentous news of the coming of age of a serious desi challenger got lost in the noise?

Sundar Pichai and Google

News of Sundar Pichai’s ascension to the Google throne hogged media headlines for almost a week.

While I could understand the excitement instigated by the front page of Dainik Bhaskar in a young tier-2 and tier-3 city audience for whom a compensation of Rs 300+ crore would seem out of this world (however misleading that figure is since Pichai’s actual compensation in his new role is not known, and conversion from dollars to rupees doesn’t make sense anyway), the hoopla in the metro-based English language press was surely misplaced.

After all, what’s surprising? Indians including Ajay Banga (MasterCard), Victor Menezes (Citibank), Indra Nooyi (PepsiCo) and Anshu Jain (Deutsche Bank) have been CEOs of global corporations. And it’s now more than 20 years since Rajat Gupta became the CEO of the world’s bluest blue management consulting firm—McKinsey!

Indians are smart, ambitious and can communicate well. Once they have studied at a top US university and worked there for a while, they fit well into American corporate life, capable of discussing football and technology, and being politically correct. Most importantly, they can be quite conformist and refrain from rocking the boat. Clearly a good choice if you are a culturally diverse company like Google.

And, mind you, this may not really be the throne anyway as Larry Page and Sergey Brin are just one degree of separation away.

I have nothing against Pichai who appears to be a perfectly competent technical manager with the right credentials. But for me there were more interesting and promising events happening recently that didn’t get the attention they deserve.

What We Should Have Focused On…

For years now, we have bemoaned the absence of a Google-like company from India. Yes, we have had successful tech enterprises from India but these have been in the difficult-to-relate-to business-to-business (B2B) IT services space. The real big news of the last few weeks is that we now see some green shoots pointing to the emergence of an IP and technology-based leader from India.

On August 5, in a virtuoso performance that had a clear Steve Jobs touch to it, the CEO of InMobi, Naveen Tewari, introduced his company’s new advertising platform, Miip, to a gathering of who’s who in the technology world at Bangalore.

For the technological cognoscenti, InMobi is not a new company. It calls itself the “world’s largest independent mobile advertising platform”. Funded by Softbank, Kleiner Perkins Caufield and Byers and Sherpalo to the tune of $220 million, InMobi reportedly served 2.2 trillion advertisement requests in 2014. Its revenues are not in the public domain though some reports suggest that they could be as high as $500 million.

So, What Is Miip and Why Is It Significant?

Firstly, mobile advertising is huge and growing rapidly. With the shift of the internet to the mobile, most dramatically underlined by some Indian e-commerce giants’ decision to be “mobile-only”, the clear trend is for advertising on mobile.

Secondly, the whole promise of internet-based advertising (and now mobile-based advertising) is better targeting and customization. But this promise has to a large extent been belied. I am repeatedly amused by the fact that after I have purchased a ticket from, say, Indore to Delhi, I see online advertisements offering me low-priced Indore-Delhi tickets. These are completely wasted on me.

And, as InMobi keeps reminding us, many users see advertising as a distraction and an intrusion rather than something they find useful or enjoy.

Most extant internet or mobile-based advertising is intent-driven. You search for something you want to buy by entering it in a dialog box, and the search engine helps you by displaying related advertisements in addition to the search results. Once you have done such a search, related advertisements keep popping up even though the purchase may have been completed or you no longer have the requirement.

Such advertising makes limited use of analytics and doesn’t prompt you to check on other things you may be interested in. The range of products or services offered is also very narrow even though we know that there are hundreds if not thousands of companies that may be offering other products or services that may be of interest.

InMobi’s Miip is a mobile-based discovery platform that not only uses advanced analytics to overcome this problem, but also features a cute mascot that enters into a dialogue with the user to make suggestions and elicit user feedback. Along the way, the user can consult her friends before making a purchase choice using social media. All of this is done with high-quality visual content that exploits the superior graphics of today’s smartphone screens. Together, these enable an enjoyable and comprehensive shopping experience.

What’s significant in this case is that the company is already a strong player in the mobile advertising space, having entered at the right time about seven years ago. This gives it the muscle and the connections to capitalize on a big bet like Miip .

I particularly liked the launch of Miip in San Francisco, Bangalore and Beijing in quick succession, as these could very well represent loci of technological advancement and economic growth for the next decade. Unlike the earlier generation of Indian companies that shunned collaboration, it was good to see InMobi sharing space with important partners like Paytm and Walmart at the launch event itself.

I have only one regret about InMobi: I wish it wasn’t into push-based advertising that will promote even more consumerism.

India as a Product Nation

India’s success in services came from our ability to write high-quality software at low cost, without the need to make large irreversible upfront investments in technology or products. Companies like InMobi represent a new frontier where we are taking large bets and investing in platforms and new technologies.

This article is not only about InMobi, but about this new generation of companies that’s changing the way we do business. If sustained, this trend could help India become a Product Nation. In the long run, that would have much more impact than a few Indians heading major global corporations.

Reblogged from FoundingFuel

03/09/201515/03/2017

India B2B Software Products Industry Clocks Solid Growth from 2014 to 2015

India’s B2B software product industry has grown nicely since we published the first edition of this index in November 2014 – the top 30 companies are valued at $10.25 billion (₹65,500 crores) and employ over 21,000 people. The index has grown 20% in USD terms and 28% in INR terms from October 30, 2014 to June 30, 2015.

There has been an acceleration since 2010 in the pace of creation of B2B companies. Vertically-focused offerings in retail, travel, financial services, media have reached scale and we are likely to see some larger exits in terms of IPOs or M&A over the next couple of years. In parallel, we are seeing horizontal offerings targeting global markets emerge and start to breakout of India into the US and other global markets – we are starting to see not only India-based venture funds backing these companies but also Silicon Valley funds coming in once there is initial customer adoption in the US.

A new set of founders are coming into the B2B software products ecosystem. These include an increasing proportion who have worked at consumer and B2B startups that have scaled in India and who have identified problems that they can solve with software automation. We are also seeing continued venture creation from founding teams that have backgrounds from established enterprise software companies and some from IT services companies.

In terms of target markets, fast-growth Indian companies (in sectors such as organized retail, organized healthcare services and technology startups in product commerce and services commerce i.e. online-to-offline) are starting to purchase software from Indian B2B software product startups and have globally-aligned requirements, helping these startups get closer to product-market fit before or in parallel to starting to sell globally. We are also seeing many startups go global from day-one through a desk-selling model, as evidenced by many of the companies in the index. And finally, several startups have moved founders to the US and are succeeding in direct selling models there.

Some of the numbers: 80% of companies have global customer bases, while the rest are India-focused. 67% of companies are domiciled in India, with the rest principally in Singapore and the US. Bangalore and NCR account for half the companies’ principal city of operations with Chennai and Pune as key secondary hubs – there is a trend to newer companies starting up in Bangalore, Chennai and Pune and away from NCR. Average enterprise value per employee is climbing toward Silicon Valley levels – the index currently nets out to $480k per employee.

The top 30 companies in alphabetical order are:

Infographic for India B2B Software Products Industry Clocks Solid Growth from 2014 to 2015 from ProductNation.in

Here’s the report in its entirety:

India B2B Software Products Industry Clocks Solid Growth from 2014 to 2015 from ProductNation.in

Thanks to all the volunteers at iSPIRT who worked on this project as well as Professor Sharique Hasan of Stanford Graduate School of Business, Stanford University; Professor Rishi Krishnan of IIM-Indore; as well as Signal Hill for providing public market valuation comparables and Rakesh Mondal for designing the document..

We will publish an updated iSPIxB2B index every year starting with the next one in June 2016 – please do click here to submit names of companies you think should make this list.

18/05/201514/01/2016

Finance Secretary – interacts with Product Industry in Bangalore.

Mr. Rajiv Mehrishi promises deeper Institutional Reforms

Mr. Rajiv Mehrishi, Finance Secretary, Ministry of Finance for Government of INDIA, is a pro-reforms, vocal advocate of institutional transformation of the Financial System in INDIA. Additionally, he is also the Secretary, Department of Economic affairs. Mr. Mehrishi and his team – Mr. Manoj Joshi (Jt. Secretary), Mr. Ajay Shah (Head, Macro/Finance Group, NIPFP), Ms. Ila Patnaik (Principal Economic Advisor) and Mr. CKG Nair (Advisor, Capital Markets) – specially traveled to Bangalore to understand the software product industry landscape and discuss ways to make India go cashless.

The 4 hour interaction was at ITC Windsor Manor. It was chaired by iSPIRT Mentor Mohandas Pai. iSPIRT Governing Council members Bharat Goenka (Tally), Vishnu Dusad (Nucleus) and Sharad Sharma (BrandSigma) were also there along with Fellows Avinash Raghava, Nakul Saxena and Sudhir Singh. Shekhar Kirani who had planned the industry landscape showcase had to skip the meeting to be at his daughter’s music recital.

Showcasing behind the scenes transformation of India

The first session focused on bringing the software product industry landscape to life through a carefully curated showcase of 10 product startups. Each startup is a story of dreaming big about transforming India and the world. The goal of this session was to showcase India’s under appreciated prowess to shape industries and tackle deep rooted problems through its tech startups. The companies that participated in this carefully curated showcase were Ezetap, Instamojo, Capillary, PeelWorks, InMobi, Foradian, Team Indus, Forus Health, OlaCabs and Practo. The session went well and was an eye-opener to the policy makers. It helped them understand the breadth and depth of the emerging software product industry in India. One of them remarked that this was “one of the most awesome afternoons of his life”. They found the session to be “revealing and energizing”. Everybody felt more optimistic about India’s future after this session.

Making India go Cashless

The next session was a thoughtful discussion on how to make India go cashless in 4 years. It was led by Bharat Goenka and Sanjay Jain (iSPIRT Open API Expert Team member, former Chief Product Officer of Aadhaar). They presented a comprehensive approach and suggested a new Program, Jan Samridhi, for the Government. This builds on the Open API work that iSPIRT has already done (in eSign, UPI and GTSN) and proposes specific and inter-related policy and regulatory changes. This benefits of going cashless are many. It’ll curb black money but will also expands micro-credit to small businesses in a big way.

Tax Friction for Product Startups

The final session was about tax friction for software product companies. Most of these are arise from poor definition of software products within the Finance Ministry. Mr. Mehrishi promised a quick resolution of these issues.

Conclusion

It was a very collaborative and interactive session. It showcased how India has emerged as the 2nd largest software product startup ecosystem in the world. It also brought attention to this new paradigm of creating Public Goods with a Social Commons model (open source model) and how this approach would be instrumental in India going cashless in a short period of time. Mr. Mehrishi and team suggested that deeper institutional mechanisms are required to bridge the intellectual distance between Delhi and Bangalore.

These powerful dialogs that iSPIRT is fostering with key policy makers (e.g. SEBI’s UK Sinha, RBIs Raghuram Rajan) are making a difference. They are helping us rewrite the script of the nation. And they are taking us closer to making India a Product Nation! So go ahead, spread the word.

28/02/201514/01/2016

RBI Governor Dr. Raghuram Rajan meets Product Startups.

He is a maverick, a reformer, a decision maker and above all the Governor of Reserve Bank of India. The country’s foremost authority in Economics met with Product startups in Bangalore to understand their challenges and also provide useful advise by participating in interactive sessions for close to 3 hours.

Yesterday, at ITC Windsor Manor, Dr Raghuram Rajan, honorable governor of RBI, along with Industry stalwarts Mohan Das Pai, Sudhir Sethi, MD of IDG Ventures, Shekar Kirani, Accel Partners, Sharad Sharma (iSPIRT), Bharat Goenka (Tally) and many other industry leaders heard the stories of about 10 Indian startups. The idea was to understand the following challenges of the startup Ecosystem

Startups from India Competing with Global Giants with Capital Markets Challenges (like raising capital from Domestic FIIs, listing for IPOs, and other book building challenges)
Startups from India building Software and Technology Products and solving local and domestic problems with the new & developing landscape of Consumer Market Challenges (like changing landscape of payments, pre-payments, recurring payments, etc)
Product Companies like Tally and others from India, empowering small and medium businesses in INDIA to become Digital SMEs for leap-frogging the Indian Economy.

Dr. Rajan, was very forthcoming with his following admissions and suggestions.

Some of some of the difficulties in moving money in and Out of the Country (FEMA regulations for example), requires a more coherent set of rules, regulations and systems.
He also suggested that all Institutions, need to keep pace with the technological advances, and the need was really to have an Inclusive approach to carry everyone forward.
He assured full commitment to the Payments Systems Revolution, highlighting that
- Payment Banks and Small Banks will be in full steam in about 12-18 months
- Innovative ideas of White-labeling of BCs (Business Correspondents) via Individuals, Corporations or Registered Companies was actively being discussed.
His willingness to open up a dialog with Innovative Companies, where Banks are a purchaser of Technology was also evident in his offer to have more follow-on meeting.

Close to 180 minutes of conversation and showcasing of New Product Startups and Business Houses like Tally from Bangalore. Around 8 companies got the opportunity to showcase and highlight their challenges and directly interface with the Dr Rajan himself. Not all elements of the session can be reproduced here, but below are some of the key highlights and learnings.

Home grown Startups share their Stories with RBI

About 10 Indian Startups which started in INDIA, and which have global operations today, presented their stories not just from a valuation and growth standpoint, but from an emotional and proud-to-be an Indian startup viewpoint. To sum it up, almost every story was about Entrepreneur’s who dared to dream something not only for them, but for INDIA, and today want the Indian Systems (Regulators, Government and Institutions) to reciprocate to their needs. They highlighted their list of issues, the below checklist includes, but is not limited, to the following.

InMobi’s Naveen Tiwari, believed that INDIA can be the HUB for solving Global problems and with 39 other startups which have spun-off from INMOBI, it was clear that there is a 10x growth that is possible in the Indian startup eco-system.
Uniken a Security startup company with solutions for the Hyper-connected world, spoke about how their solutions have been deployed by Global and Indian Banks, including Bynet Communications. They stressed the need for all Indian Banks to adopt the latest solutions from India Solution Providers themselves which are on par or better than many cutting-edge solutions from outside of INDIA.
Fintellix highlighted their Software for GRC Intelligence (Governance, Regulation and Compliance), which are today used by both Indian and Global Private Banks, but they cannot get through even the RFP process of many Public Sector Banks, due to archiac processes.
Freshdesk presented a crowd sourced Customer Support Platform for Businesses, Tally Spoke about large scale adoption of their Accounting Software by SMEs (in millions), FORUS presented their home-grown medical devices (3nethra) which could be adopted by Indian Hospitals for 1/3 the cost, and how 80% of issues leading to Blindness can be prevented, while SnapBizz showed how even Kirana Store business owners today could gain improved visibility using the SnapBizz cloud platform.
Team INDUS and Deck.in showed, how Indian startups are turning world-beaters with their big ambitions in Aerospace and Enterpsie Software solutions.
Bharat Goenka and Pramod highlighted the need for Separation of Concerns between Transaction Enablers (Banks) and Technology Providers. Goenka stressed that Velocity of Growth, is dependent directly on the velocity of transactions.

Insights and Learnings from RBI and Dr. Rajan.

There were many learnings for all participating Startup & Business Entrepreneurs. Some of the key ones are

Dr. Rajan believes that for Capital availability & Funding Process for Innovators there needs to be a different RISK Framework that needs to adopted. The existing RISK framework was meant to keep the bad-elements away from the System. The new RISK framework should look at being a support system for Good Innovators.
Dr. Rajan also was open to look at enabling PUT-OPTIONs which will provide down-side risk protection for atleast the Investment-value like in WESTERN Contracts.
Dr. Rajan however, said we must all be cautious of Back-door debt masquerading as Equity and causing Systemic Harm.
Dr Rajan, participated enthusiastically on the following topics
- Payment Banks / Small Banks and their utility for the Indian Business growth
- NPCI framework and Payment Systems Revolution
- Working with FEMA (Mr. Padmanabhan) to resolve difficulties in Money Movements.
Other most important advise for Startups were also discussed. To note a few,
- RBI Governor said India has a decent Capital Chest which provides some Immunity to the Global shocks, however we cannot act in Haste.
- Today, the need for Inclusive growth were the Unsophisticated Audience can also be carried forward, should be an objective for all innovative solutions.
- Indian Public Sector institutions should welcome tech-savvy and young entrepreneurs as part of some of their committees.
- Most importantly RBI can play a convening role for adoption of Innovative Products by Indian Banks.

Conclusion

Overall it is apparent that the INDIAN technology/internet product markets, are in a Golden Moment where Aspirational issues are leading to better RISK appetite among INDIAN Entrepreneurs. It is a new Paradigm where not just startups, but all Institutionals bodies with-in INDIA, need to now collaborate and commit, for supporting each other’s RISKs and Needs. RBI on its part has definitely shown keen interest, and to quote from a fine statement made by Girish, Dr. Rajan, believes that RBI interventions may arrive late, but they will definitely be latest. The Entrepreneur hence must be patient and not act in HASTE.

02/01/201514/01/2016

Indian Regulator SEBI meets Software Product Startups.

How often has this happened? An entire team from Securities and Exchange Board of India (SEBI) with its Chairman Mr. U.K. Sinha meeting with Software Product startups in Bangalore to understand their challenges and also provide useful advice by participating in interactive sessions for more than 5 hours.

On 19th December, Mr. U.K. Sinha, Chairman of SEBI and his management team, heard the stories of 8 Indian software product startups. The idea was to understand both the Capital Markets Challenges (like raising capital from FIIs, listing for IPOs, and other book building challenges) as well new developing landscape of Consumer Market Challenges (like changing landscape of payments, pre-payments, recurring payments, etc.)

Mr. U.K. Sinha, was very forthcoming with his admission that new age companies require a completely new paradigm of evaluation and approvals. The new paradigm is needed not just for listing purposes, but also for market regulation and growth purposes. He assured full commitment from SEBI’s end to the budding entrepreneurs that SEBI is very keen, and will do everything within its capacity to help develop the markets keeping in mind INDIA’s growth needs.

More than 90 minutes of conversation and showcasing of New Software Product Startups from Bangalore took place. Mohandas Pai chaired the sessions on iSPIRT’s side. Not all elements of the sessions can be reproduced here; below are some of the key highlights.

Home grown Startups share their Stories with SEBI

About 8 Indian Startups which started in INDIA, and which have global operations today, presented their stories not just from a valuation and growth standpoint, but from an emotional and proud-to-be an Indian startup viewpoint. To sum it up, almost every story was about Entrepreneurs who dared to dream something not only for them, but for INDIA, and today want the Indian System (Regulators, Government and Institutions) to reciprocate to their needs. They highlighted their list of issues which include the following:

8 companies from various sectors (InMobi’s Manish Dugar, Ezetap’s Byas, Exotel’s Shiv Ku, HotelLogix’s Aditya, iViz’s Bikash, Paytm’s Pratyush, QuickHeal’s Rajesh and Deck.in‘s Sumanth) all presenting the journey of their startups.
A common hardship that resonated from most of them, was the unwarranted need of setting up subsidiaries or parent companies abroad, just to attract the right Investors and raise capital for growth.
Exemplary companies like InMobi, which raised initial money from Angel Investors today has a reach of about 1 billion people. Ezetap which raised initial money from AngelPrime, today has global operations, however it has its manufacturing, done entirely from Electronic city in Bangalore. Both urged that it should be made easy for Indian companies to raise money from Global Investors.
The existing regulations and guidelines make it very difficult for companies to get the right people (investors and advisors) on their Board.
Exotel, Hotelogix, Paytm and iViz, all stressed the need for modifying the SEBI/RBI guidelines on ESCROW, where Indian shareholders should have similar opportunities like Global Investors.
QuickHeal’s Rajesh highlighted how Kailash Katkar, a college drop-out had built one the most successful product companies out of INDIA over the past 25 years. Today QuickHeal is thinking of its IPO and needs to decide where to list.
Requirement for the Regulator to understand all stake-holders and their motivations, and provide for fast and timely intervention for Exits (IPO listings, etc.).
Need for new models to evaluate the new paradigm of Tech/Internet Product startups in INDIA.

At the end of this open session, Shekhar Kirani (iSPIRT Fellow; Accel) highlighted the fact that the Indian software product markets were entering an era of hyper growth. It is a new paradigm where not just startups, but all Institutional bodies within India, need to now collaborate and commit, for supporting each other’s need. In this context, he appreciated the interest shown by SEBI.

Policy Expert Team Interacts with SEBI

Following this open session, the visiting SEBI team met with iSPIRT’s “List in India” Policy Expert Team for an intense three hour closed door conversation about specific issues and their resolution. This iSPIRT Policy Expert Team is led by Sudhir Sethi of IDG and has Rajiv Khaitan (Khaitan & Co.), Sanjay Khan (Khaitan & Co.), R Natarajan (Helion), Rajesh Ghonasgi (Quick Heal CFO), Manish Dugar (InMobi CFO) and Harish HV (Grant Thornton) as its members. While specific details of this meeting are not available, Mohandas Pai told me that the session had been very productive.

Insights from SEBI

Mr. U.K Sinha, Chairman of SEBI, has an unbeatable track-record. In his past life, he was the chairman of UTI, and was instrumental in transforming UTI from a 1.2k crore institution to 12k crore institution. Many insights were shared by Mr. Sinha with all the participating Startup Entrepreneurs. Some of the key ones are:

Mr. Sinha and his team gracefully acknowledged that they were not just a Controller or Monitor of Capital issues, but they were equally keen to Develop Markets for businesses to thrive.

Further, Mr. Sinha highlighted the introduction of SME-ITP platform to facilitate capital raising by SMEs including start-ups which are in their early stages of growth and to provide for easier exit options for informed investors like angel investors, VCFs and PEs etc.

He also indicated that SEBI is exploring putting in place a framework for crowd-funding which will provide a much needed new mode of financing for start-ups and SME sector and increase flow of credit to SMEs and other users in the real economy. In this mode, SMEs and start-ups will be able to raise funds at a lower cost of capital without going through rigorous procedures.

It was indicated that SEBI is keen to facilitate capital raising by such companies to help them achieve their full potential.

New Wind is Blowing

I saw a collaborative approach to problem solving that I haven’t seen before. iSPIRT’s policy approach is refreshing different from the traditional lobbying mindset that one sees in trade bodies. And SEBI is clearly open to listening and learning. It was amazing to see how SEBI as a regulator and iSPIRT as a think tank were both focused on the same national goal. I came away from the meeting with optimism and a spring in my step.

09/12/201409/12/2014

Over seven seas: Why Indian companies are increasingly going global

NEW PRODUCT-3 While there are no numbers or research on how many Indian startups have global operations, I suspect it will be a sizeable number – a number that is growing every month and every year. No longer are Indian startups content in serving merely the domestic market, this new breed of startups and entrepreneurs consider the world as their market.

This, however, is not something that has happened overnight. We see a considerable number of Indian companies like Zoho, InMobi, Zomato going global and one consistent theme is that the entrepreneurs have some sort of a global stint. A recent report said that in China, 5 out of 10 billionaires are Internet billionaires and the common thread is that they have all studied or had stints in the US.

I feel a lot of us in India have the global context, having studied or worked or having both those experiences. Global context enables us to understand what market opportunities exist and the emerging trends throughout the world. To build a global company you need to have a global perspective and you need people at the top who think that way.

The second big pointer is the evolution of the Indian IT industry. When we started the revolution of IT services in 1990s with companies like HCL, Wipro and Infosys, it was all about labour arbitrage and how to get things done in a cheaper, better and more efficient way in India. Now that story has been beaten to death and people are more aware of what services companies are doing in the context of the opportunities that exist globally. Hence, instead of being a mere back end provider, people want to move up the value chain. People understand the opportunities and are now questioning why they can’t go out and address it.

Business today is borderless and in a global economy, boundaries have blurred and opportunities can be tapped across the globe. The intermingling of cultures and people on a very large scale has meant that whenever anyone thinks of any opportunity it is very easy to think about it as a global opportunity. Previously the thought process was limited to the market size of the domestic market.

For example, when we talk about selling to the travel and hospitality industry, we think about how many hotels exist globally and how many airlines operate across the world. The globalized nature of what we do today makes it much easier to implement ideas. There may still be some friction in the system, but today it is relatively easy to have the world as your playground.

It is also the question of market size. Although the 1.2 billion dollar home market may be a very big market, operating globally gives you a much bigger market size. Take for example the fact that 300 million tourist travel domestically, but the travel and hospitality market in India is fragmented. As a result the organized hospitality industry has about 120,000 rooms. New York alone has 120,000 rooms.

For us as a B2B player, we have to go where the marketplace is more mature. India today is as small as New York for us. Globally, we have 500,000 hotels and 500 airlines cater to. Even product companies that started with a notion of serving the domestic market have now gone global. It is also the case that if you are successful overseas, the domestic market tends to you accept you faster. Druva, Zoho are very good examples of that.

The ticket size for everything is much more globally. If a company sells something for a minimum ticket size of 10,000 dollars globally in India one has to sell it for 5000 $. The cost of operation for most of these companies, whether they sell domestically or globally, remains the same and any marginal increase is the cost of sale. Just by selling overseas, even for a small incremental change in cost, the company enjoys a much larger margin. It makes much more economic sense to go overseas, which means the opportunity size is much larger.

By going global Indian companies are writing a new chapter in how the world perceives us. Many of them are the future billion dollar companies and will serve to be great ambassadors of the are “Made in India” campaign that our Prime Minister has embraced.. With every globally successful company, India is creating role models for others to emulate.

08/08/201408/08/2014

Building Billion dollar product companies from India

“Flipkart raises fresh round of $1b”, “Wipro sets up $100m VC fund to invest in start-ups”, “Ratan Tata considering a personal investment in Snapdeal”, “Druva raises $25 million in a fresh round of funding” Entrepreneurship ecosystem in India currently seems to be buzzing with multiple investment rounds, acquisitions and launch of new funds. A big driver of this activity is the eCommerce boom that India is seeing currently with Flipkart.com and Snapdeal.com leading the race. Though the increased activity is going to benefit the ecosystem as a whole, the service sector seems to be getting more attention.

This brings us back to the question that we have been asking many times – “Why India does not have many billion dollar technology product companies?” There have been multiple debates and discussions around this topic for years. So I set out to do an in depth research using primary and secondary sources to find out what people say and how much of that is validated. Over two months, I spoke with multiple founders and players in the Indian start-up ecosystem and also read through many articles, discussion forums and interviews to find out what issues product companies face in India.

As per the research findings, following key issues emerged:

Difficult to penetrate Indian market especially the enterprise and government sectors.
Small early adopter market in India.
VC and angel investments are not directed to product companies due to reasons including risk averse investors, lack of fundable companies that can show traction immediately and no good way to discover good product companies.
Difficulty attracting and retaining talent.

But how do we resolve these issues? What have some of the successful companies such as InMobi, Druva and FusionCharts done to circumvent some of the above problems? What can we learn from other start-up ecosystems around the world?

Research indicated that the above issues cannot be fixed by one entity. Instead the entrepreneurship ecosystem as a whole needs to take multiple steps to address the specific problems. Some of the recommendations to address the above issues and move towards building billion dollar product companies from India have been discussed below.

Difficult to penetrate Indian market

Ecosystem players can play a huge role by bridging the gap between product start-ups and enterprise and consumer buyers. One way to do that is by bringing Enterprises & start-ups closer. Many of the B2B product start-ups interviewed for the research mentioned difficultly in penetrating the enterprise market as one of their biggest pain points. iSPIRT has taken the lead here and had recently organized a meet-up – InTech50 of product startups with Chief Information Officers ( CIOs) of global companies such as Citigroup, Procter and Gamble Co. etc. These meet-ups called “Swayamvars” are curated events where a large company can meet 5-15 startups it can potentially partner with. We need more such initiatives to bridge the gap.

We also need to increase the trust between start-ups and enterprise customers. Enterprise buyers often are reluctant in trying products from start-ups as they have had few bad experiences in the past. To solve this issue, start-ups should be educated on how to approach enterprise customers, how to draw contracts and what level of service to offer. On the other hand Enterprise companies need to be educated on the pros & cons of buying from start-ups to set the expectations right. They also need to be trained on how to evaluate a start-up vendor.

It is also essential to open the doors to start-up firms to apply for government contracts. Start-ups are often left out of the government contracts due to bidding criteria that favor large firms. Government should work towards either relaxing the requirements for bidding for government contracts or initiate a separate program to award contracts to start-up firms. Another way to resolve this issue would be to allow companies to compete for contracts based on their innovation and not be stifled by impossible high qualifying hurdles.

Small early adopter market in India

India currently has an urban population of 27.8% with an internet penetration that stands at 20%. The country is still evolving especially from technology perspective. Increase in early adopter market would take its natural course of time as more people start adopting technology in their daily lives and are open to try new products as seen in US and other markets. Though the issue of small early adopter market cannot be solved directly, in the meantime, more opportunities can be created for Indian product companies to sell to the global world. If we look at Israel startup ecosystem which has a small local market, we notice that they focus on US markets solely. India also can gain advantage of the large markets in US & Europe by creating avenues for start-ups to sell to global markets. These avenues could be either in the form of international treks taking selected Indian companies to US & Europe to meet potential buyers or bringing international companies to India and showcasing India product companies. In May 2014, Ravi Gururaj, Chairman of NASSCOM Product Council led NASSCOM InnoTrek 2014, a first of its kind event that took a delegation of India’s top product and entrepreneurial founders/CEOs to Silicon Valley. This is great initiative and first step towards putting Indian product companies on the global map. More such opportunities would open the international markets for Indian product companies.

Not every start-up can afford to make international visits or have international sales offices. To resolve this issue, a common international sales and marketing body should be established in locations such as US and UK. This common sales office could help all India based product companies to reach out to International customers by acting as their own sales and marketing office.

As per iSPIRT’s estimation, at least five Indian product companies have crossed or are on track for a $1 billion valuation. Among those are InMobi, Zoho, QuickHeal and Pubmatic. Each of these companies has grown targeting international markets and they are now rapidly expanding their global footprint.

VC and angel investments are not directed to product companies

Before we get to the recommendations, it is important to understand why Indian investors are risk averse especially when evaluating product companies. A deeper analysis reveals multiple issues – Limited growth opportunities for product companies due to market issues addressed in previous section and lack of enough M&A exits. We already addressed the market challenges above. To solve the issue with M&A exits, investors should focus more on smaller sub $40m exits. As Sharad Sharma described it, for every Billion dollar startup (e.g InMobi) there should be 10-12 $100m startups (which is the case right now). For every $100m startup there should be 10-12 $50m startups; and for every $50m startup there should be 10-12 $10m startups. A healthy power law distribution is a sign of a healthy ecosystem. In India, many believe that this power law distribution is broken. Looking deeper one can see that it is not broken at the top as we can see many $100m companies rising up slowly. It is broken at the bottom! There are too few small-value (sub $40m) exits. Fixing this situation by catalyzing more small value exits will improve the entire distribution.

One way to resolve this issue is by enabling more M&A opportunities for startups. iSPIRT has taken up this cause and had drafted an elaborate M&A connect action plan in 2013. As part of iSPIRT’s M&A Connect Programme, they have been organizing multiple roundtables to showcase Indian product companies to potential acquirers in Silicon Valley. This is a step in the right direction and we need more such initiatives to increase the volume of M&A in the Indian start-up ecosystem.

There is also a need to increase seed stage money through government innovation funding programs. Government currently provides funds through bodies such as Department of Science and Technology (DST) to fund technology research. Karnataka government recently announced that it is drafting a new “Startup Act” to boost the state’s entrepreneurial activity. Budget 2014 announced Rs 10,000 crore fund of funds for startups. Issue is not availability of funds but dispersion of funds through transparent processes and having single window clearances. Many of these schemes are not marketed enough and often the process to acquire these funds is extremely complex and outweighs the benefits. Israel’s technological incubator program which was started by the government in 1991, provides funding and know-how to people to become successful entrepreneurs. Since the first companies emerged from the incubator program in 1993, 61% have secured follow-on funding and 40% are active to this day. These are some great examples to follow to lay out a better process to access government funds. Some of the ways include building and funding incubators, and closer collaboration with academia through research programmes as in the US.

Government intervention is also required in resolving taxation issues by providing tax holidays to startups and removing the start-up tax. A great suggestion given by YourStory was to give startups in India tax exemptions on the line of Singapore tax exemption scheme for new startup companies. As per this scheme, a newly incorporated company that meets certain qualifying conditions can claim for full tax exemption on the first $100,000 of the normal chargeable income for each of its first 3 consecutive assessment years. A further 50% exemption is given on the next $200,000 of the normal chargeable income for each of the first three consecutive assessment years. Schemes like these would indirectly address the issue of lack of funding by allowing the start-ups to reinvest more of their earnings.

The Finance Act 2012 of India brought in an amendment to tax the share premium which is above the fair value of investment by the resident angel investors and not proven satisfactorily to the tax assessing officer. This “Start-up tax” law makes it much more difficult to raise early stage funding for start-ups. Instead the new Indian government should follow the Israel model and introduce “Angel’s law” under which a substantial tax benefit is given to individuals who invest in qualified Israeli R&D companies. Under that law the investors can deduct their investment from any other income source such as salary, capital gains etc. In 2009, the Israeli government also removed the capital gain tax for foreign investors.

Though many of the above suggestions apply to all kind of start-ups and not specifically product startups, but product startups have a longer gestation period before they can start generating revenue and therefore have higher funding needs.

Difficulty attracting and retaining talent

India is a risk averse country and people always look for stability and security when looking for employment opportunities. Finding a good employment is not just a concern of the individual but of his whole family. If a person opts to join a no-name brand start-up, he has to handle the questions, concerns and taunting of the whole family. Hopefully all this is changing slowly with the current increased activity and main stream coverage of start-up successes. But still attracting and retaining talent stays as one of the big concerns of start-ups.

In my discussions with different founders, various suggestions were made. “Start-up” hiring events are a great way to enable start-ups and potential employees to get to know each other. Recently held “Headstart Higher”, a start-up hiring program run by Headstart Network Foundation was a huge success and led to many employment offers being made. Apart from enabling recruitment, these events should also be a medium to educate both fresh graduates and experienced professionals on topics such as “benefits of working with start-ups”, “How to evaluate a start-up for employment”, “Value of stock options” etc.

It is also important to effectively sell the value proposition of working with start-ups. Many of the entrepreneurs interviewed indicated that the only way they have been able to acquire talent is by matching the salaries of larger tech firms. While it is good that they are addressing the salary concern but this is not solving the underlying issue as every potential hire would expect to get that much salary and not all start-ups can afford to pay that much. Instead entrepreneurs need to do a much better job of communicating the value proposition of working in a start-up (faster career growth, technical leadership and growth, quality of work, long-term pay-offs, flexibility of timings etc) rather than trying to compete with big companies on the strengths of big companies (salary, facilities, etc.).

Government should also work in skill development making young population employable. Close to 1.5million people graduate with an engineering degree every year in India but only 3 out of 10 are actually employable based on the skill sets. There are more than 5000 Industrial Training Institutes (ITI) in India. However, the quality of training is not up to the mark. They have poor infrastructure, outdated curriculum, less qualified instructors and limited interaction with the industry. The entrepreneurs who hire them spend considerable amount of time to first train them and then use them. YourStory.com suggests a creative idea – businesses and Government can work together on this, wherein businesses can train young force on the job and government can motivate businesses by providing wage subsidy for a defined period.

Indian start-ups are slowly getting noticed by the global world. Start-ups like Fusion Charts and the more recent acquisition of Little Eye Labs by Facebook are giving a new wave of hope and inspiration to the younger lot of product start-ups. SaaS companies such as iCreate, Manthan, Druva and Eka have potential market sizes of thousands of clients. As per iSPIRT, close to 26 product companies have the potential for a $100 million valuation this financial year. All these signs indicate that India is moving in the right direction. However to ensure we see more and more product companies hitting the billion dollar mark, we need to resolve the core issues such as difficult to penetrate local market, slow adoption of new technology, lack of risk capital and difficulty attracting and retaining talent. Resolving these issues require equal effort from government, ecosystem players, investors and entrepreneurs themselves and could take easily 6-8 years.

What are some of your recommendations to create billion dollar product companies from India?

The detailed research paper can be accessed here:

Building Billion Dollar Product Companies from India – Management report by Jyotiramnath from ProductNation.in

22/07/201422/07/2014

Naveen Tewari talks about “How InMobi is Disrupting in the Mobile space” #iSPIRT Event – Conclave for India as ProductNation

We recently had 11 disruptive startups that made a presentation to the Hon. IT Minister, Ravi Shankar Prasad. The first presentation was made by Naveen Tewari of InMobi. You can access the presentation made by Naveen here.

03/07/201414/01/2016

How We Got The IT Minister Excited About Indian Product Startups & Made Him Our Spokesperson #UnleashTheEnergy

A behind the scenes account of how a showcase of 11 disruptive startups was put together in just 100 hours!

If you’re reading this, I’m sure you are a part of the Indian product startup community in one way or the other. And unless you were living under a rock (which is fine, if you were busy hacking away or traveling to sell your product), you wouldn’t have missed that our Hon. IT Minister, Ravi Shankar Prasad was in Bangalore on Tuesday meeting with the product startup community. iSPIRT hosted the “Conclave for India as Product Nation #1″, an open dialogue between the Product industry and the IT Minister.

What made it all the more special was that the he was the first IT Minister to meet with startups and also that he first met with the startups first before meeting officials from his ministry! The Minister met with the industry leaders, gave a patient hearing to the needs of the product startups and also saw presentations from 11 disruptive startups.

And here’s what the minister had to say after meeting with the startups!

Feeling proud of India’s #ITProduct entrepreneurs.I shall be your spokesperson and ambassador.Lets make the India into a #ITProduct nation

— Ravi Shankar Prasad (@rsprasad_bjp) July 1, 2014

So how did we pull this off? And what if I told you that it was all put together in 100 hours. We ourselves cannot quite understand how everything fell into place! But as Sharad often says, when a bunch of passionate volunteers come together towards a common cause, magic just happens. At iSPIRT, we take our volunteering quite seriously. No wonder then, that we actually have open sourced our volunteer model through a whitepaper to help other communities benefit from it!

MoCIT Shri @rsprasad_bjp listening very patiently to Innovators for “India as a Product Nation” #UnleashTheEnergy pic.twitter.com/AQEKLHdSUJ

— Arvind Gupta (@buzzindelhi) July 1, 2014

A text message from Rajan on Saturday morning got me involved. Could we get on a call, he asked. There’s an iSPIRT event scheduled on Tuesday and some help was needed. We spoke and I got to know that there’s an interaction with the IT Minister scheduled on the coming Tuesday. As part of the interaction, we needed to put together a showcase of disruptive product startups to help the Minister get a sense of the kind of impactful work being done and the opportunities ahead. There was list of companies drawn from across various segments and stages, with whom we’d need to connect and get their availability for the event on Tuesday. Tapping into our network of volunteers (many of whom are themselves startup founders and industry leaders), we gathered the contact details of these companies and started reaching out to the companies. These were companies spread across the country and we checked with their founders if they’d be available to present. Based on the availability of teams and the some intense discussion and debate among the Program Managers for the showcase, a short list of the companies presenting on stage was drawn up. The thought process behind the selection of companies was to give the Minister a good view of the breadth (sectors where product startups are making an impact), the depth (companies that have achieved global market/tech leadership) and how far they can grow with sound support from the ecosystem, which includes the government as well. We were immensely privileged to have Mr. Mohandas Pai spare his valuable time for multiple meetings through the whole process and share his inputs on what kind of stories would make the maximum impact.

Arriving at the shortlist was surely a good beginning. They say well begun is half done. But the tougher half lay ahead! We were already at Monday morning, and within the next 24 hours we had prep up the presenters. Each of the companies were to have a short, crisp presentation with the key points to be covered in under 4 minutes! Shekhar went about this with the precision of a toolmaker, thoroughness of a scientist and the strictness of a school teacher! From putting together notes on what points to cover, iterating multiple times with the presenting companies on their presentations over a sleepless night, to conducting the actual showcase in front of the minister, Shekhar was always on.

@skirani hosting the product presentations to the IT minister @Product_Nation #ispirt pic.twitter.com/CmpKpyAXmM

— Sanat Rao (@sanatrao) July 1, 2014

(That’s me on the left trying to get the slides up!)

The event received some very good coverage in the media. Below are some links:

Here’s hoping that achchhe din are indeed ahead for the Indian software product industry!

InMobi Presentation for IT Minister @iSPIRT Event – Conclave for India as Product Nation #1 from ProductNation.in

Rolocule – Presentation for IT Minister @iSPIRT Event – Conclave for India as Product Nation #1 from ProductNation.in

FusionCharts Presentation for IT Minister @iSPIRT Event – Conclave for India as Product Nation #1 from ProductNation.in

SignEasy Presentation for IT Minister @iSPIRT Event – Conclave for India as Product Nation #1 from ProductNation.in

Uniken Presentation for IT Minister @iSPIRT Event – Conclave for India as Product Nation #1 from ProductNation.in

FrontalRain Presentation for IT Minister @iSPIRT Event – Conclave for India as Product Nation #1 from ProductNation.in

NovoPay Presentation for IT Minister @iSPIRT Event – Conclave for India as Product Nation #1 from ProductNation.in

Forus Presentation for IT Minister @iSPIRT Event – Conclave for India as Product Nation #1 from ProductNation.in

NowFloats Presentation for IT Minister @iSPIRT Event – Conclave for India as Product Nation #1 from ProductNation.in

NewsHunt Presentation for IT Minister @iSPIRT Event – Conclave for India as Product Nation #1 from ProductNation.in

Team Indus Presentation for IT Minister @iSPIRT Event – Conclave for India as Product Nation #1 from ProductNation.in

31/12/201330/12/2013

The Ad Business

Saikrishna Chavali posted the following question on my blog post about Data & UX being two ends of the product spectrum:

I’ve got a question: how did you understand the user when you were in the ad business? Did you ever meet real users? In PM theory, one is instructed to empathise with the user by actually “getting out of the office”.

Since it’s quite an important question, I thought I will take a shot at giving it a detailed point of view, and provoke some conversation.

While building the Ad Network at InMobi, we had 3 key stakeholders to take care of and deliver value to:

Advertisers & Agencies – who had ad budgets, setup and ran the campaigns, and looked at reports & analytics to measure ROI of their ad spend
Publishers & Developers – who had lots of traffic from mobile phones – mobile web, apps etc, and wanted to generate revenue by advertising
Users – who were primarily using these mobile web sites and apps to get their work done, or for entertainment.

When Publishers or Developers say

I want to monetize traffic

they’re basically saying

I have users who use my sites and apps, and I want to make money from them, so that I can sustain my business, and grow it

As an ad network, you have business relationships with Advertisers, Agencies, Publishers & Developers. And as product offering, you build user interfaces and APIs for these people to use. So, by definition, you have to have ongoing dialogue with users from these customer segments. I believe products are for users, and have blogged earlier about it.

At the same time, an ad network makes money when the users (consumers) engage with the ads in some applicable manner – Viewing, Clicking, Playing etc. The effectiveness of the network is increased if we can understand the consumers well enough that we deliver the right kind of ad experiences to them in every context. That bodes the question

How do we understand the consumers effectively?

For a large part, we understand consumers from the data generated by them in our system. Ad businesses typically talk of metrics such as requests, impressions, clicks etc. If these metrics represent a user’s intent in some form, here is how they would play out.

Ad Requests – “There’s some space in the screen, can you show me an ad that I might like and click on?”
Clicks – “This ad seems really cool and helpful for me. I want to see what the product/service it is showing.”
Play (a video) – “I am curious about what this video is, and hence going to watch it.”
App Download – “I want this app.”

Remember, for every advertiser that wants to run a campaign on your network, the campaign will certainly reach a bunch of publishers (say 50 or thereabouts) who each have access to a few million users (say 1 million each). Assuming there’s a user overlap of about 50% (multiple publishers’ sites or apps being seen by a user), that’s an overall reach of 25Million users (50 x 1M x 50%).

Now, how many days or surveys or phone calls or chats will it take for you as the product manager, to be able to talk to 1% of this target user base?

Come to think of it, the Ad is really the “product” of the “Advertiser” that’s targeted at a “User”. On the other hand, the Advertising System / Interface is the product of the Ad Network for the Advertiser. So, in the strictest sense our loyalties should lie and stop with our customers (Advertisers, Publishers etc).

Clearly that’s not good enough, because the effectiveness of any advertising business is based on the consumers engaging with ads being shown by the advertising system. So, we have a clear objective to improve ad effectiveness with the consumers. Here’s how that gets done.

Let’s say there’s a campaign with 1 ad in it. When these campaigns get setup, and the ad starts getting served, pretty soon, the ad servers start computing answers for questions like

1. How many times did this user click an ad that was shown a few times

2. How many times did this ad get clicked when it was shown a few times, across many users

The first question gives you an indication of whether a particular user liked this ad or not.

The second question gives you an indication of the percentage of people that liked this ad, from the overall population of people who saw this ad – CTR for the ad.

With these two metrics you’re able start understanding if specific ads work for specific users or not. You then architect and instrument your systems to iterate on what ads to show a given user, based on the expected effectiveness of the ad for the given user. So, while on one hand you can design your systems for your customers, based on meaningful real world interactions with them, on the other hand you end up being highly data-driven and experiment-driven to design serving systems that deliver some kind of content to millions of users. No wonder folks with data+tech chops are in high demand among tech companies.

What do you think? What other experiences have you had?

21/12/201321/12/2013

The evolving roles in product ecosystem

I was catching up with Avinash (@avinashraghava) earlier today and we were chatting about product startups in the country. If you’ve been in this ecosystem, and seen the evolution of product companies, some interesting changes happened over the past few years.

Back in 2001, at AdventNet, the Product Manager role was created, and so was the Usability Engineer role (which were primarily UX Designers). There used to be debates about project managers and product managers and I’ve had a chance to see these debates well into 2007-08.

While interviewing with Yahoo in 2004, the recruiter was not quite sure of what they wanted me to highlight (since i didn’t come from a software programming background) and asked “have you taken any short courses on programming languages, that you can highlight in your resume?”. I had to politely decline modifying the resume – it would’ve also meant not highlighting the UX-related work I’d done while at AdventNet. Guess that was a time when the tech world was still coming to grips with the need for Product Managers in product companies.

Those days, Yahoo had a good bunch of UX Designers, and not enough companies felt the need to have good UX Designers. I was lucky and fortunate to work with some very smart designers while building products such as Yahoo! Maps, Yahoo! Local etc. Those days, there were conversations about 2-pizza teams (at amazon), 3-people teams (PM-UX-Dev at google) and emerging agile teams.

By 2006-07, the ecosystem had recognized they needed product managers and many product companies started looking for pm talent. And they were getting started on hiring User Experience Designers.

When I moved to InMobi in 2008, we built the PM team, the UX team and also realized that the way to build great products was by leveraging the data we had, to generate analytics and insights. Helping the user with understanding of what’s happening in the system with respect to their work/needs was a great way to get the user engaged with the system. This starts initially (at low data scale) with basic reporting tools – tables, charts etc. As the data grows (and boy, does it grow fast!), these tools have to evolve into more sophisticated ones. The decision systems also crunch lots more data to generate their outputs. And who better to help with those than data scientists.

By this time, most companies and the recruiting world were familiar with and looking to hire UX designers.

Getting a lead on understanding data and building newer insights helps Product Managers think about smarter ways to solve user and business problems. It also helps UX Designers to visualize newer ways to portray information as well as overall experience. It’s no surprise that companies are now looking to hire Data Scientists quite early in the game, especially the ones that want to build world class products. The VCs are also paving the way with roles like Data Scientist in Residence.

I did a small experiment last year, looking through the websites of various companies in the data services spectrum (data warehousing / analytics / data consulting etc). I went through their archived websites of 2008-09 and saw that terminology such as “data warehousing”, “data analytics” etc had given way to “Big Data” starting 2010. I think this is an important trend to understand – tech businesses are prolific at creating data. To leverage that, they need a pretty significant set of people who can understand and make sense out of it.

Now that the world’s all mobile + tablet, the new challenge is “user acquisition”. Growth hacking anyone?

12/06/201312/06/2013

Fifth iSPIRT Playbook Roundtable: Product Manager, the Skill in Demand

It is a cliché to say product management is both art and science. The product manager’s function encompasses a range of tasks, only limited by the company’s vision. Deep Nishar, Senior VP, Products and User Experience, at LinkedIn, told the audience at Nasscom Product Conclave 2012 that, “product managers should have brain of an engineer, heart of a designer and speech of a diplomat.” The product manager with such an expanse of skill set is hard to find in India. With the intention of bringing experiential learning and to ignite conversations among product entrepreneurs so that they learn from each other, iSPIRT, the think-tank for startups, is organizing Playbook Roundtables that facilitate transferring of key knowledge through an open discussion. In the fifth Playbook Roundtable organized at Chennai by iSPIRT, Sridhar Ranganathan, who has rich experience as a product manager, shared anecdotes quoting from positions he held at Zoho, Yahoo, and InMobi to define who a product manager is.

Sridhar’s naval architecture career did not last long. A chance meeting with Sekar Vembu, founder of Vembu Technologies, landed him a job at AdventNet (all three Vembu brothers, Sridhar, Sekar, and Kumar were part of AdventNet then). He was placed to manage a team that was working on a product. Not a geek, he took three months to understand Java Script. A management shake-up at AdventNet properly designated him as product manager. Then began his tryst with product management. At Zoho, the discipline of product conception, execution, and delivery was practiced with a high level of checks and balances. With a small team and margin for error almost non-existent, Sridhar learned to work with constraints to deliver software products. Moving on, he headed the team working on Maps at Yahoo. This proved to be challenging as managerial oversight was nonexistent but any senior level meetings thrashed any feeling of achievement. Sridhar by now had crafted the art of product management and he had an excellent team to work with. Then at InMobi, his challenge was scale. He was able to successfully navigate through the phase where InMobi’s ad impressions went up from 50 million per month to 2 billion per month.

The product culture

There were 15 participants from OrangeScape (Suresh Sambandam and team), Fresh Desk (Smrithi, product manager), Kallos (George Vettah), LPCube (Lakshman Pillai), Array Shield (Vasanthan Kumar), ContractIQ (Ashwin), Twenty19.com (Karthikeyan Vijayakumar), RailsFactory (Mahendran), Fix Nix (Shanmugavel and team), Social Beat (Suneil Chawla), and Humble Paper (Vivek Durai), represented by its mostly founders. Suresh was keen to know how with a small product team (Zoho instituted a culture of a seven-member team to work on a product), Zoho was able to recruit college drop-outs and train them to work on products. Sridhar said if the company is big enough and has a strong culture (such as escalation of wrong codes, build times, and customer complaints to the highest level if not done within a set time frame), such experiments are possible. In Google, you know the person who is going to work because of the recruitment process but at Zoho, you have to groom the person.

Sridhar strongly emphasized that data plays a big role in product management and went on to say that “if you build technology products, your core data model and technology stack determines your business model.” He listed various challenges faced by organizations such as SalesForce to remove duplication of data. For example, to change a primary key, Zoho needed 14 months. George Vettah added that Ramco had to reengineer its offering after SAP effectively took away its market share. Sridhar gave away one more of his product philosophies: “If there is a constraint in the product, and if you have the market, you could only pray that the market does not go away till you reengineer the product.”

Education to Product: the product continuum

Through a graph, he illustrated the various stages of the product continuum: Taking problem complexity on one axis and scale or impact on the other, he said, for low problem complexity and low scale, education (of the customer to tell them why your product) is needed. At the next level, process needs to be defined (to quote an example, the process of how to apply for a passport online), Still further, at the higher complexity and more users, you need to define the procedure (how to fill in the form of the passport application), and still at a higher level, you need to provide a solution to the problem. But for a very complex problem with the highest impact (nonlinear), you need a product. So by understanding the need and the impact, you can execute your product strategy.

The product manager

He said that the fundamental role of the product manager is to identify the product that has the maximum probability of success. “The success metrics of a product determines the product manager’s action,” he added. This was followed by an interesting discussion on how the founder passes the baton to the next product manager as the company scales up. Kaushik from OrangeScape provided a fine example. The product manager has to work on three aspects: hygiene, spoiler, differentiator. A hygiene part of the product is not impactful but without it the product wouldn’t work. The spoiler is beating the features of the competition, and differentiator is the difference that your product makes. Further, at the first level, the product manager has to find users for the product, at the next the user level should be scaled, say from 2000 users to a million users, and further at the next level, if there is a drop in user level due to competition, the project manger has to devise ways to retain the user level. These three different stages require product mangers of different skill sets.

Finding the right product manager

Finding the right product manager is a challenge. Sridhar said the right product manager is identified by his ability to align with the vision of your organization and should have the potential to grow with the organization. For him, the hiring decisions are not done in a day. Sometimes it stretches to two months as he engages in long conversations with the potential candidate. Then an interesting discussion on organization structure where most of the times the product manger is asked to “influence without authority” was discussed. “The product manager has to be temperamentally strong,” stressed Sridhar. In many organizations, the developers and engineers are not direct reports of the product manager. Engineering team is headed by a senior engineering head. But your input on the engineer decides his grading. So at most positions, product managers have to work with teams that don’t directly report to them. By telling the team the importance of the product and by selling the vision (by exercising influence without authority), you need to get the work done. Smrithi, from FreshDesk, said influence without authority was one of the attributes looked for in a product manager in her earlier employment. George Vettah added that research has shown that for product managers did not possess strong right brain thinking (creative) or left brain thinking (analytical), but somewhere that balanced both.

Building the product, managing the team

The ideal way to enforce build discipline is to have a release ready after every build. This is practically impossible but if achieved, gives the product management team an edge on product release. This also makes sure that the product isn’t broken. Several R&D prototyping needs to be done before the product is handed over for completion to the engineering team. Once the product is fixed and passed to engineering team, it’s difficult to tweak again. So spend as much time in R&D rather than “release early, release often.” Sridhar said managing multiple products only requires you to have user interface and data operability aligned.

The product manager has to find the right time to pivot. Sridhar asked the participants to read Lean Startups by Eric Ries. The author has dwelt at length on pivoting. Failures are part of product management but how the product manager negotiates such down moments counts. The product manager has to be mentally strong. For any of the product manager initiatives, winning the trust of the stakeholders is key, stressed Sridhar. He added that the satisfaction of seeing the product completed after your visual thinking on it is immense. He said that the product manager’s role is cerebral as it involves a lot of thinking.

There were intense discussions when each of the issues was discussed among the participants. Vivek Durai, who is now solely developing a product, said his priority listing has changed and his to-do list has a lot of elements to add up to. Kaushik said his respect for his previous product managers had risen after this discussion. Suresh felt some more improvements can be made to the discussion format. Suneil felt that the discussions were insightful and opened his world to product management. Karthikeyan Vijayakumar said he would implement a lot of stuff from the discussions.

08/05/201313/06/2013

Don’t Build Something Unless Someone Is Willing To Pay For It & Asks For It Twice!

Notes from the Product Management Roundtable In Bangalore. Having attended the first ever iSPIRT Roundtable on Product Positioning in Bangalore and closely followed the second one held in Delhi, I was eagerly looking forward to the Round table in Bangalore on Product Management by Sridhar Ranganathan. Sridhar is a senior Product Management professional having spent considerable time in product management roles in companies like Zoho, Yahoo! and InMobi.

The 12 startups that participated in the round table consisted of a healthy mix of companies across various stages wrt their Product organization – some already had a PM function set up, some were scaling fast and were looking for ways to make their first PM hire and some where the CEOs or the founders were themselves donning the hat of a Product Manager.

The session started with a round of introductions and an open discussion around various aspects of Product Management – need for Product Management, hiring of Product Managers and setting up the team, prioritization, building an MVP etc. which set the right tone for the rest of Roundtable.

Sridhar shared his experiences of being a Product Manager and a Product Management leader in his previous roles. His experiences at Zoho were particularly of a lot of interest to the participants, as Sridhar was at Zoho during the period it transitioned from a company making Network Management Systems to the Saas giant it is today. He mentioned how the founders had a strong faith in setting up a Product Management function and empowering the Product Managers to lead the product efforts. He said it was like changing gears from moving in 4 big ships to 11 speedboats – with a Product Manager navigating each speedboat (a product). One insight Sridhar shared stood out, that the founding team needs to strongly believe that there’s a need for Product Manager(s) in the company and remain fully invested in the idea. Otherwise, there are very few chances of a Product Manager making a meaningful contribution and succeeding in their role.

Here are some key insights from the discussions at the Round Table:

Product Management is a highly cerebral activity

The importance of setting a conducive environment for the Product Management setup was stressed upon heavily by Sridhar. It is imperative that between the Product Manager and the immediate Product team (engineers, designers, QA), there be a very high amount of trust. The decisions of the Product Manager will directly impact the work, and subsequently the performance of the engineering team. Similarly, the Product Managers needs to believe that his engineers are capable and are able to solve the challenges he poses to them. Laying the right foundation and building trust among the team is absolutely essential for the Product Management team to contribute significantly towards the company’s goals.

Framework to Solve Customers’ Pain Points

The discussion then moved towards prioritization of tasks, catering to customer requests for feature additions and customizations. Sridhar presented a very interesting framework which is quite handy to place customers’ pain points in the right context and solve them appropriately.

Depending on the target group size is and the complexity of the pain point, one can address the pain points in different ways

Education: Can you provide simple walkthroughs of the product through screencasts or tooltips, put down a set of FAQs that customers can refer to and get the help they’re looking for?
Process: Can you tell customers on how to do something? As an example, creating a 1-page document on how to apply for a passport and redirecting customers to that section would be a way of setting up the process.
Procedure: Taking the above example itself, if you actually build a feature to help customers apply for a passport, it would be creating a procedure to solve a pain point.
Solution: Any customizations/hacks over an existing feature/flow would fall under this.
Product: Enabling the customers to do something completely through the product itself. E.g. Employee payroll processing.

Building an MVP

How much time should one spend in building the MVP? One of the keenly debated questions was on the amount of time to spend to build an MVP. While there were multiple inputs based on the nature of the product and the market each of the companies was targeting. However, Sridhar mentioned that one should invest enough time so as to avoid having to pivot at a later stage.

Is your product a ‘painkiller’ or a ‘vitamin’? It is important to understand this very well beforehand and pitch the product in the right manner to your first set of customers. You may be overselling if you’re trying to pitch a vitamin disguised as a painkiller and grossly underselling if it is the other way round!

What features get built into the MVP? Don’t build the product or a feature just because someone says it’s a good idea or if your prototypes ‘look good’. You need to validate that the customer is indeed willing to pay for the product. It’s even better if they ask for something repeatedly, which indicates that they have a pain point and they are willing to use the product/feature.

Taking the MVP to the market. Choose customers who can challenge you and make you think harder. The first 5% of the customers give 85% of the important feedback and the interest tapers off as you get the next set of customers. It is important to keep validating your view of the market and be ahead of the curve. You may have built something that was relevant at a previous time or maybe talking to a customer set that’s no longer representative of the larger market out there.

When to get a PM and what should the PM spend time one?

Sridhar suggested that whether or not there’s a formal designation assigned, there should be a Product Owner from Day 1, which is invariably one of the founders. Over time, it will be good if one can identify a good Product person from among the early engineers and have a Product person for a group of 7-8 engineers. The Product Manager should ideally be able to do 70% of everything! For the effective use of a Product Manager’s time, a helpful rule of thumb is that he spends 50% of his time planning for the future, 30% of the time on current initiatives and 20% of the time on firefighting.

Data, Intuition & Processes

How much does one trust data and how much does one rely on intuition to make decisions?

One of the participants remarked – “If you torture data long enough, you’ll get what you want”. It was general view shared among the participants and endorsed by Sridhar that data is good for discussions and not decisions. There’s a strong element of intuition and market understanding that go into making decisions and there should be ample scope for that. Finally, it’s the Product Manager’s call on the direction of the product and he needs to be able to take views from multiple perspectives. Data alone being the decision criterion may not be the best way to go about it.

What about processes? Do they kill creativity or actually help in better productivity and accountability?

A quick poll on what the participants thought about process threw up some interesting responses. The hardcore engineers found process to be a bit of hindrance. However when they put on the founder/senior management hat, they found that there needs to be some way to maintain accountability and provide better visibility to a larger group as a company grows. As one of the participants rightly said, process is ‘doing what you say and saying what you do’.

Sridhar cautioned against having too many processes (don’t put policeman unless there’s a lot of traffic) ot of traffic), he also shared some interesting ways of bringing in process. Rather than enforcing process, can the employees themselves be stakeholders in implementing process and are ihe also shared some interesting ways of bringing in process. Rather than enforcing process, can the employees themselves be stakeholders in implementing process and are incentivized for taking an active part in the process and evangelizing it?

Each of the participants took away some key actionables which they’d go back and try out at their respective companies. They’d also stay in touch to share their learnings and experiences to help one another build a strong product management function. After all, we’re working towards transforming a nation with products!

14/01/201314/01/2013

How to get to 1000 startups in India ever year

I will be on a panel with several others at the IAMAI conference next week for the India Digital Summit and the discussion is about how to make 1000 digital startups happen annually in India.

I thought I’d put some thoughts together and get some opinions before I present at the panel.

Currently there are less than half that number of product companies being started each year.

There are various issues across the funnel, but I’ll focus on the #1 issue, which I believe is at the top of the funnel.

Great product entrepreneurs starting great companies.

I wanted to pick a specific example from our accelerator: two of the most amazing hackers and geeks I have worked with – Melchi and Aditya co-founded Cloud Infra after 6 years at Google here in India, building high quality products.

I would fund them just given their background and the quality of hackers they are. Regardless of what they are developing.

Anyplace else (Valley) they would have been funded first and then they would have been asked questions. I worked with them for 4 months.They are amazing.

India needs more of them to increase the number of startups from 500 to 1000.

Unfortunately that’s not happening and is not going to happen.

I may get a lot of brickbats for this statement, but:

I believe the best product entrepreneurs should have built & shipped a world-class product before they start a company.

If you have worked in a services company it does not count. Period.

There are very few software product companies in India – in fact fewer than 20 are really good. Of those 20, many, including Google, are cutting back on hiring and investing in India.

That’s just awful.

Yahoo, Zoho & InMobi in particular have contributed a LOT to the product startup ecosystem in India, given how many good developers they have helped groom.

If you worked at any of these product software companies a few years ago, then you are a candidate for a high quality product startup in India.

Granted, a small number of these folks are actually starting companies, but that can be fixed.

The trouble is there are not too many of them in the first place.

And the bigger issue is that the Google’s and Facebook’s of the world are preferring to hire more folks in the valley.

In fact many of the top IIT graduates who get jobs at Google and Facebook are moving to the valley. 2 years ago they’d be working here in India.

To get 1000+ digital startups each year in India, we have to work on making sure world-class digital software companies hire more of our top people here in India.

I dont think tax breaks will provide them any more incentive to hire here.

I also believe there are enough quality folks here in India they can hire.

I’d love some ideas on what will make them hire more people of high caliber in India and keep them here. I’d love to see them not cut back on hiring in India.

What are your ideas on how we can get these companies to hire great engineering talent in India?