Book Review - Entrepreneur Journeys : Bootstrapping, weapon of Mass Reconstruction

Earlier on ThoughtsPrevail; we reviewed Sramana Mitra's book Entrepreneur Journeys-Volume I here & here, in this article we review her book Entrepreneur Journey's [BootStrapping : Weapon of Mass Reconstruction]

Like her previous book, Sramana follows the same format where she interviews successful entrepreneurs however this time around they are the ones who have successfully bootstrapped their business. The interviews provide vital answers as to whether a startup really needs VC funding or it can be entirely bootstrapped. It also gives some insights into why mentorship is so important for any startup.

Notably the book includes interviews of the so called sultans of blogosphere-Om Malik of GigaOm and Rafat Ali of paidContent [which was acquired by Guardian for $30M].

Though there are many inspiring interviews, the only downside of the book was that the focus was mainly on US based startups but this does not take away the core message delivered through the book i.e "How to bootstrap a business"

Some of the useful tips from the bootstrappers interviewed in the book are given below -

Greg Gianforte, RightNow

• Find an entrepreneurial mentor, and if you are going to bootstrap, find a mentor who has already bootstrapped a business
• Bootstrapping is a discovery process. Rather than building an ark, waiting for animals to come, and hoping the tide rises-you take an incremental approach and discover a legitimate, real world value proposition.

Cree Lawson, Travel Ad Network

• Nothing is more expensive for a business on a personal and financial level than client and customer churn.
• The right relationship with an experienced operator is more important than the valuation you can achieve in fund raising.

Beatrice Tarka, Mobissimo

• You can have the best technology and the best product on the market, but without good team chemistry your business will fail.

Om Malik, GigaOM

• I think that a lot of people do things for money, and it's the stupidest thing we can do for ourselves. Everybody thinks money is the answer, but it is not. What made me tick was writing; that's what I was born to do. How can you ignore your natural animal instinct ?
• A lot of people make the mistake that when they outsource, they outsource it all. The reality is you outsource the physical function of it, but not the mental piece.

Rafat Ali, paidContent

• The thing about email newsletters, which is still true today, is that you have a viral presence in somebody's inbox day in and day out.
• I learnt that when you start a company, you need to spend money on keeping the books in order.
  

J.R. Johnson, VirtualTourist

• We always knew that in the worst-case scenario, we could go into the cockroach mode and just hide out in the dark for a while and let the content grow.

Guillaume Cohen, Veodia

• One of the biggest experiences for me, as a first-time CEO, is bringing in smart people who are much better than I am in their fields, then staying out of their way.

Wayne Krause, Hydro Green Energy

• I remember seeing National Geographic drawing of a big ocean device to create energy, and I kept thinking that there had to be a way to make energy out of those waves. That's how it started.

Scott Wainner, SysOpt & ResellerRatings

• For me, being an entrepreneur is so much trial and error that I would rather make the mistakes in the lower dollar range than at the Super Bowl advertising level.

Ramu Yalamanchi, Hi5

• No matter how many businesses you start, it just takes one successful business to make up for all the other attempts.
• If you are going to build a service and it has a good chance of becoming very popular, make sure you address the scale needs up first.

Murli Thirumale, Ocarina

• Everybody who tried our product wanted it. All we had to do was get into the taste test.
• A lot of startups are based on hypothesis- they build something and start interacting with customers, but they never verify it. What they are doing is rationalizing the hypothesis rather than evaluating & verifying it.
  

Manoj Saxena, Webify

• If you raise a lot of money, you are leveraging the hell out of yourself. And you probably have a lot of people wanting to grab the steering wheel if things don't go right.
• A Lead User is typically a person who has such a strong need or pain that they go out and build something on their own to solve the pain.
  

Lars Dalgaard, SuccessFactors

• I didn't care about the title; I cared about the learning.

In few words, it is an interesting as well as inspiring read for Entrepreneurs who are bootstrapping or wannabe entrepreneurs thinking of bootstrapping.Let's wait to see what Sramana has to offer in her Volume-III !!!

Strategy Roundtable for Entrepreneurs

There is a webinar for Entrepreneurs organized by Sramana Mitra, Forbes columnist & author of Entrepreneur Journeys[review here & here] on the following dates:

March 11, 2009
March 25, 2009

Below is the recording of the webinar held on February 18,2009 [quite insightful, especially the discussion on Bay Area Digital] -

Book Review : Entrepreneur Journeys [Part-II]

In continuation to the review of Entrepreneur Journeys by Sramana Mitra, today we have look at the other Entrepreneurs featured in the book & some useful tips for the Entrepreneurial community.

Philippe Courtot,CEO Qualsys

• Too many people crack under stress. In venture, you must thrive on bad news. If you don’t thrive on bad news, move over, because every day represents something uncharted and new where you sort of sit down and say, “How do we deal with this?” And you make mistakes every single day too. As soon as you realize you made those mistakes you go back and you fix them.
• On "not" getting selected for a job in France : In France, we have psychological tests and when they turned you down, they did not tell you why.So when I wrote a letter to them, they wrote me back saying that their policy was not to tell why they had turned down people.But I insisted..insisted and finally they responded saying that my Psychological test showed me that I was far too much of an independent thinker.They were looking for people who were willing to be directed and they said that I would not be happy working with them.
• It is very important to see yourself, what you do and what you have with the eyes of the customer.
• American society was based on what you can do.So,it was than I realized that it would be best for me to come to US and work internationally.
• I went extreme skiing for 9 months.I have done that every time between jobs- take a sabbatical.It allows me to digest what I have learnt.To digest and forget, essentially and than I come back fresh and new.
• Lessons learnt from skiing : I learnt to push myself from a physical standpoint.The biggest thing I learnt to address was fear.In business it is the same.If you look at your competition, if you are afraid of your competition and you focus on that, and you don't look at where you should go, you get lost.The big trick in business is to transcend your fears and be aware of the obstacles, and then focus not on the problems but on the solutions.
• Difference between Asian and Western mentality is that Asian people look at life as a complete interaction, while the Western mentality is about the immediate success.
• A lot of VC(s) micromanage everything and they are on your back constantly, which doesn't work for me.
• The only piece of technology missing today is ubiquitous broadband wireless access.

Steve Singh,CEO Concur

• My professional background is very engineering oriented.I happened to have a passion for the business side as well, so I migrated in that direction.
• The ideation story is quite interesting.During my days of extensive travel[in my job at Contract Software], one of the things the CFO told me was I had a week to get my expense reports in [before the acquisition by Symantec] and if I didn't , I was going to loose out on my expenses.As expected I lost money, but this made me wonder that there was no easier way to do this and this is how the idea of Concur evolved.
• Our view is that you must confront the issues that exist in your business as soon as humanly possible and solve them.
• One of the great things about an on-demand business model is you can drive your cost structure down to the point that it is very compelling for companies of any size.
  

Edward Fields,Co-founder Hotchalk

• My parents were educators.I launched Hotchalk to actively involve myself in raising the quality of education worldwide.
• Through the experiences, I realized the tremendous potential of web-based educational technology resources.I was inspired by my own experience as a parent and the frustration that parent teacher conferences always seemed filled with surprises.Since I did not have any continuous visibility into the daily or weekly goings at the school, I discovered all sorts of things at these meetings.
• We[Hotchalk] know teachers intimately.We speak with them daily through surveys, feedback forms and phone dialogues.These open lines of communication with teachers enable us to offer resources on their sites known to provide value to educators.Schools cannot afford to waste funding on products that do not benefit their teachers, yet it happens all the time.
• When teachers work together with students and parents, academic achievement follows. We don’t try to work with school administrators. We work with the teachers, and they’re the most crucial element of the education value chain.
• It can take a long, long time to sell any new product to the schools, by going through the school administrators.
• We do not accept advertising from fast food companies or anything that is sexually abusive.Hotchalk only presents tasteful advertising to meet the needs of students in a positive way.
• Leaders work for their followers and it's the leader's job to make sure that the team has the tools, training and resources necessary to carry the day.
• 2.8 million teachers need to be recruited over the next eight years to meet education demands. These future teachers are students in universities who use Web 2.0 applications daily, so using a web-based application is second nature.Hotchalk's product is simple and easy to use, so even less technology-savvy teachers can get on board.
• It's time we remove politics from education and support teachers, making sure that they are given the best resources they need.
  

Harish Hande,Founder SELCO

• SELCO is my first job and hopefully it is my last.
• A lot of things get lost in translation.Between Orissa and Bangalore[since my mother is from Karnataka], we chose the latter.Another factor was the lack of money in my pocket, and I had relatives there who could subsidize my cost of living.
• The focus in the initial period was not looking at where money was, but rather looking at what the success level of the technology was and if people would accept it.When you have no money, you tend to become more innovative.
• In our company, we have to think of ways to help the poor, not sympathized with them.
• You can always create a product that matches poor people's needs,it does not matter how poor they are.World bank has always said that solar does not make sense for them because they were not poor, but here you can see if the need is matched, then it is a productive fit.
• The pressures I see today are when young people want to join the company, and their parents call up and ask how long we are going to be there.Convincing the families of my applicants is a difficult task.
• Message to Entrepreneurs : There is no short cut to creating good processes.A lot of people try to solve it quick, and that can't happen.Some people do it by numbers, I would never do that.Concentrate more on the processes and the numbers will come.

Book Review : Entrepreneur Journeys [Part-I]

With the new year starting off on a good note, I had the fortune to read Entrepreneur, Blogger & Forbes columnist Sramana Mitra's book Entrepreneur Journeys.Though, I am a voracious reader;this article would be the start of a new innings - my very first book review

Anyone who is interested in startups would definitely be a reader of her blog but after reading this book, I feel it is a great boon to the existing as well as aspiring Entrepreneurial community !!! The book touches the various aspects of startups namely Bootstrapping, Venture Funding, Business Models, Ups & Downs in the life of an Entrepreneur etc. using a simple medium of Q&A. She also focuses on how Internet has changed the entire game of Business & why Web 3.0 is the next big thing.

Though these simple words describe the simplicity & depth of the book, I would like to couple it with some of the notable excerpts:

Jerry Rawls, Co-founder - Finisar

• We did not have any outside investors, so it was clear that we did not have enough money to support both of us. So, I stayed at Raychem and Frank Levinson went off and got started. At the end of the year I left Raychem and joined him fulltime in Finisar.
• While we were doing product development we supported ourselves, probably for four years doing mostly consulting work.
• I heard a guy a few years ago give a talk and somehow in the talk, he threw a line "Culture eats strategy for breakfast" & I completely agree with that.
• We have a culture where we accept nothing, there are no sacred cows.We want to continually improve every part of our operation.We have a culture that says we are going to hire bright people who have good interpersonal skills and can really handle pressure & work well in small groups.
• Because it is a company policy that everybody travels Economy, I myself also travel economy.

Sridhar Vembu, Founder of Adventnet

• We at Adventnet hire young professionals whom others disregard.We don't look at colleges,degrees or grades.Not everyone in India comes from a socio-economic background to get the opportunity to go to a top engineering school, but many are really smart.We train them and in nine months, they produce results at the level of college grads.Their resumes are not marketable but these kids can code just as well as the rest, sometimes even better !!!
• We found we could reach customers directly.Today we have most of the new customers through the internet.It has become much easier to supply companies directly.The internet is allowing us to reach all these customers.
• I am not ashamed to compete on price, that is our main strategy.
• Keep the marketing costs low, that is our strategy.If we do the SalesForce economics, 75% of their revenue is spent on acquiring customers.There should be a better way of doing business than charging the customer for acquiring him.Why not give it away for free,if all the money will be spent on acquiring the money elsewhere.
• Most attrition happens from boredom related issues.We try to keep our team motivated and challenged with interesting work, and as a result, they don't leave.
  

Steve Hafner, Co-Founder - Kayak

• On working at Orbitz: I saw a company start from a few PowerPoint pages and grow to the point that when I left it was booking $4 billion a year in tickets and hotel rooms.
• Kayak helps users find deals from all of the other travel websites.We thought by doing a bit what Google does, which is build a very simple and sleek interface which goes out and searches on behalf of consumers & brings back the results in a comprehensive display, we would give consumers a choice of where to buy.
• In the first year or two of Kayak, we focussed on building a great product.We felt if we build a great product, consumers would stumble on it, like it and tell their friends.
• We are of the mentality that for every dollar which could be placed into marketing, we would rather place it into engineering and make the product better.We spend next to nothing on marketing.
• On the internet, there is always going to be a lot of competition because it is easy to build a website.The hard part is to make the website scale.
• There are three things you need to do to have a viable Vertical Ad network.You need to get a set of publishers, you need to get an audience and you need to match them with technology.
  

Gautam Godhwani, Co-Founder - SimplyHired

• What we saw in the employment space was an incredibly large market.There is a market of $100 billion market in US alone.At the same time,the market had services that we called pain killers versus vitamins.If you needed a job,you really needed a job.If you had to hire someone,you really needed to hire someone.
• From the beginning, I have believed the value of a vertical player, search engine or otherwise, is able to participate in a greater lifecycle of the user.
  

I hope you enjoyed reading the review cum insights of the book Entrepreneur Journeys.There are many more exciting lessons from the other Entrepreneurs featured in the book which would be unveiled in the Part-II of the review...till then, keep breathing the fresh air of Startups