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  • Entrepreneur’s Interview – BrizzTV

    Sachi: Good Evening Amar, thank you for accepting to come on to this interview.  
     
    Amar is the founder and CEO of Brizz TV. Brizz TV is an innovative platform that delivers internet content directly to the television using set top box technology.  
     
    Without further adieu I would like to ask Amar to briefly tell us about his background and then about the idea?  
     
    Amar:
    Thank you. My name is Amarendra Sahoo, I am a 2004 Computer Science Graduate from NITK Suratkal. After graduation from Suratkal in 2004 I worked across various companies like – Cisco, Juniper, and Lucent for about 5 year. Then I joined IIM Bangalore in 2009, and that is when I started the company – 2009 December.
    Clearing the CAT I would say was an accident, and I joined IIMB – also to fulfil the dream of my parents, wife etc – not many could get a selection to IIMB and not join it. In all this, I was still a “Techie” at heart. Neither the work as an IT professional nor the MBA knowledge was able to satisfy the void I felt. There was a period of self introspection and the meaning of the MBA and the work that would be of interest to me while at IIMB.
    I was also reading some very interesting technology and entrepreneurship blogs at the time, – the achievements of people seems to push me to believe I could do something too. I felt I had quite some time at my hand and I should consider starting off.
    I come from an embedded system, networks background and that probably fed me to believe I could do something more challenging than a e-commerce site. At the point I was thinking of all the idea I consciously stayed away from it even though ecommerce sites were getting a lot of funding.
    While all these questions were popping up at the back of my mind, one day while sitting in a case discussion on Reliance Big TV – as part of the Marketing Course; It struck me that I could be very interesting if we could show Wikipedia on the television without any complex internet stuff in it! A regular TV but with Internet content in it – That is how BrizzTV began.
    At BrizzTV, we show selected Internet content directly on your TV – Example, if we are pushing facebook on your TV you could watch it, unlike internet where you can pull the content. Just like you cannot watch a cricket match on ESPN unless it has been broadcasted, you wouldn’t be able to watch unless we broadcast it. So the data that we transmit will be available on the TV just like any normal channel.
    Our focus is to keep this medium affordable, accessible and easy to use. The problem that we are solving is pretty interesting – in a country with a large rural population, an investment into a PC wouldn’t be economical. Added to this would be the cost of internet. Internet is also not all pervasive, and also costly for a rural consumer.
    In addition to the cost of purchasing the PC, the other barrier for people to adopt to PCs is lies with the additional learning of the usage of the operating systems, brower etc that are  a sort of barrier for adoption.  Also the rural person could run his life without an internet connection!
    Given these thoughts, I wanted to give an affordable, accessible and simple solution – that would have to be the TV. There is not much complexity to using the TV too!
    Facebook which I used as an example earlier is just to make a mention – our focus is on providing quality content that would be mass consumed like; say Wikipedia, or Exam preparation etc. The facebook example was primarily to relate with the present generation J.
    Simply put, Brizz TV enables you put selected internet content on TV, available on a channel interface – say channel 931, 971 etc.
    Sachi: Could you tell us how you managed to put your first team together, and how you managed your finances?
    Amar:
    I never thought I was heading this company, and hence there was no thought of putting up the team as such. I discussed the idea with my friends, and whoever felt that the idea was good I believed we could form a team.
    The first friend I found this way was my batch mate from Surathkal – Jeetu. He was working with Cisco at that time. So we both came together to start this venture off. None of us were from the broadcast domain, and our limited understanding wouldn’t give us a real picture of the technical constraints we might face. We approached an expert – Krishnan who at that point was working at Philips and understood the set-top box pretty well. He encouraged us, and after some calculations and suggested this could be possible if a broadcaster like Airtel or Tata could agree. This was how we formed the first team.
    Coming to the point of Funding part – Both Jeetu and I were basically programmer, and hence we believed we didn’t need any funds to start off. We had a product bent of mind and hence finance was something that we didn’t bother much about. We began working on the product in December 2009 and by April 2010 we had built the prototype. We next had to move towards meeting a broadcaster.
    We approached NSRCEL with the thinking that they could help us connect with the broadcast companies. At NSRCEL we met Guhesh who thought the idea was cool enough to try – he had a friend at Airtel and we were able to get the traction. With this prototype demonstrated, Airtel was willing to work with us. Other things began to move ahead – we were funded by NSRCEL in December 2010. 6 months post the VC round of investment from NSRCEL, we got our next round of investment from Ojas.
    Sachi: Could you tell us how the discussion with Airtel happened, how was the experience? 
     
    Amar: 
    Airtel is a very partner friendly company, most of their activities are outsourced. They weren’t very aggressive in the negotiation too.
    I wasn’t looking for a negotiation too; I always thought that the product I was building had to see the light of the day. I approached it with an open mind.
    Airtel wanted the technology evaluation and proof of concept – all this happened extremely quickly. The approach seemed to be that we (Brizz TV) could do a lot of value add if the young team was taken care off. Airtel has been a fantastic organization to work with. Given their long term vision with Brizz TV, they offered what they generally offer to anyone else without much negotiation.
    There was some bit of luck and the remaining worked with the technical strength the team had.
    Sachi: You have been funded at a very early stage – it would be interesting to understand the experience? 
    Amar: We are a pre-revenue product company – any VC who would invest in us wouldn’t be looking at any revenue for at least one year. It was pretty interesting if we look back at the instance. None of the factors seemed to be favoring us – I was studying, and there were 2 other members in the team. The product was just taking shape, and the company we were working with – Airtel was thought to be as someone whom a start up should be scared off. The technology that we were building was however a very interesting one.
    We went about looking at many VCs in search of funding. The IIMB – NSRCEL connection helped us get a ear from the people we met. Though the technology was interesting, it want something that was tested – they weren’t sure about the monetization prospects of the company.
    I was again luck that I came across to the Ojas investments – Mr Rajest. He was also an NITK alumnus, which helped connect better with him. The team seemed to have struck chords as well. The perspective of looking at Airtel being interested in us also seems to have worked for us. And I think he was willing to take the bet on us.
    Though initially we went about just meeting folks, we began to feel the pinch towards May 2011. We required the money for supporting the operator lab that was crucial for the testing of the final product. Again I believe it was luck that pulled us through.
    Sachi: Out of curiosity, did Airtel help you? Did they co-develop the product or did you get an infrastructure support ?
    Amar: 
    Airtel provided free access to their labs, but given their schedules etc they couldn’t co-develop the product with us. We suggested that we would take care of the technology, and Airtel could help test the product in the lab.
    I should say they facilitated everything around technology development and that help  for us.
    Sachi: Most of your team is from NITK. What do you think excited people to work with you??
     Amar: At college we were always perceived as being friendly guys, we were not considered geeks. People knew us as these are cool chaps and straight from heart. They do things right and they don’t lie. When they say something they mean it. I think this reputation seems to have paid off. So our friends are always willing to work with us.
    The open approach we have followed has helped us all through.
    Sachi: How do you envision yourself in the next 4 or 5 years?
     
    Amar: I think I should be still be rocking. Doing something that excites me something in the tech space. Hopefully Brizz tv, will be a much bigger company – more than just in terms of revenue. We intend to create something meaningful out of India that world finds useful.
    Sachi: If I could mention, you represented India at the Intel UC Berkeley Challenge. Could you tell us how that experience was? How did it help? 
     
    Amar:
    The trip gave me a free trip to Berkeley – I saw a parking space “Reserved at all times for Nobel Laureates” – that excited me as I had never seen a Nobel laureate. I felt extremely excited about the concept.
    The competition was good too, we didn’t win the competition but the experience was pretty good. The exposure was pretty useful for us.
    Some of the competitors from China were doing a bio-oil business – this got me to think of the Indian context where we do 90% business and 10% technology. The kind of innovations from these countries seems to be more technology focused than us. It was a feeling like we could see the future being built here.
    Sachi: You are an MBA and an Entrepreneur – It is generally felt that this combination doesn’t work best. What do you have say about it?
    Amar: 
    It is like telling people who have pistol are dangerous because they can fire!!
    MBA to me is a tool; it is good to have that. It tells you something beyond technology that you could use – you could value add.
    To me personally I have seen If I am not having MBA, things would have been little slower.
    It gives you a market focus, structures your thought.
    If there is a question is “Does the MBA make a better entrepreneur?” I cannot answer that question. But I  am going to  say it  never going to be a harm  it only helps as long as you know how to use it like a tool and it works in  some person’s hand and does not work some else.
    Besides the large network that an MBA provides if you have graduated from a top institute, it gives you a different way of looking at things you know. I am personally excited of doing an MBA.
    It definitely adds value to my team, my company – but I am still a techie at heart. If you consider MBA to be a tool it would be a good perspective. – It never harms, it helps
    Sachi: What message would you like to send across to all the readers?
    Amar: Since I am a techie at heart, I would talk about technology. If you are a technology person, build your technology product first. Build it so well that world just cannot ignore it. People just cannot take their eyes off it.
    If you look at Indian web companies, there is lot of things as an engineer I never liked. The scope to improve is vast. You can make it 50% or 100% better than what it is today.
    Keep your eyes open. Don’t listen to the markets. The market’s foresight is pretty short – a quarter of a year.
    Do not believe when any one says you need leadership and all of that. All these are secondary. If you are good person given a chance, you can be a good leader.
    Build your character and just keep building a good product.
    Sachi:  Thank you Amar, taking your time to this interview. Thank you once again.

  • Cost Minimization and Organizational Innovation

    In the last blog we began understanding the relation between innovation and outsourcing. In this blog we move to discuss the first of the various factors that influence the outsourcing choice – Cost Minimization.
    Cost minimization is one of the most common motivations towards cost minimization. Cost minimization is derived from economies of scale which help spread the large fixed across a larger customer base. It works best when the market has a large number of buyers and seller – indicating that there is high competition in the market. The market therefore would have a large pool to choose from for the vendor who would give them the product at the least cost and therefore benefit from outsourcing.
    One would also need to think of a globalized context in the present context. The globalization in the present context enables the companies to source the product from a larger pool and also benefit from the lower cost of factors of production the not so developed locations of the world – This is how the IT Enabled services industry has developed. The large fixed cost that these companies incur is spread across the large number of clients that these companies serve.
    Let us take the example of Bharat Forge and understand this better – 
    Bharat forge is an Indian company focused on forging – it is the second largest in the world. It has made significant investments in fully automating the forging processes and has instituted an IT enabled knowledge management system to capture and leverage the intellectual capabilities of its engineers and brought about improvements in the forging process that enabled it produce superior products at competitive prices.
    The above example also indicates an additional advantage that a company that invests in cost minimization through specialization – by aggregating the demand of multiple customers – the company also begins to innovate. By doing a relatively narrow set of tasks, the company would be in a better position to figure out superior ways of performing the task and hence are able to innovate greater than a generalist organization. 

  • Innovation and Outsourcing

    In the last blog, we summarized the various classifications of theories that we had discussed over the last few weeks. In the current blog we begin looking at a very interesting study conducted by 2 Professors at IIMB on the concept of Outsourcing and the decision making process associated with it.
    Through the blogs on innovation, we haven’t explicitly mentioned the underlying common understanding – It is specialization that eventually enables innovation. The range of activities that an organization has to take is pretty broad and, this makes innovation a difficult task for organizations. But it is essential for the organizations to innovate constantly to stay ahead of competition. Given this need to innovate and the pre-requisite of innovation in organization the company would like to focus on a specific activity while procuring the remaining from the market. In other words – “Outsourcing”. It is important to understand that specialization and outsourcing are complementary business imperatives.
    The generally held opinion about outsourcing that companies generally outsource activities that are “non-core” while conduct the “core” functionalities of the company in house. The opinion should be reconsidered if we look at the choices that companies like “Nike”, “Dell” and even “Bharti Airtel” have done. While “Bharti” and “Nike” have decided to focus on “marketing” as a core area “Dell” has focused on “Supply Chain Management”. 
    In order to understand the manner in which the organizations can make a choice we would have to look at the decision made on the following:
    1. Cost Minimization 
    2. Resource Access
    3. Resource Leverage
    4. Risk Diversification

  • Summarizing our understanding of Organizational innovation

    In last blog we attempted an understanding of the strategic adaptation theory and its implications to organizational change. In this blog we would attempt to gain a summary of some of the discussions we have had on organization change and innovation. 
    A careful look at the kind of words we have used over the last few blogs would get you to realize that we have dabbled between organizational change and innovation at various points. This blog primarily looks at this question. 
    “Organizational innovation” as a term is pretty ambiguous. The meaning is pretty broad and means innovation or innovative behavior in organization or organizational adaptation of innovation. The relation between organization and innovation is complex, dynamic and multilevel so getting a precise definition is pretty difficult. The concept of organizational innovation is pretty loose and slippery too!
    In the discussion this far – we have looked at 3 interrelated approaches to understanding organizational innovation. 
    The first focused on understanding the effects of organizational structure on the organizations ability to learn, create knowledge and generate technological innovation. The approach however, doesn’t continue the aspects of internal organizational dynamics or environmental forces factored in. The second approach used the organizational learning and knowledge creation was an approach to understand the possibility of organizational innovation. And the third approach focused on the organization’s capacity for change and adaptation. 
    It would be good to note here that none of these approaches individually help understand the concept of organizational innovation completely. It is very important to have an overall perspective of these approaches and apply it when the situation requires it.

  • Strategic Adaptation and Continuous Change

    In the last blog we attempted to understand the punctuated equilibrium model and attempted to associate the organizational innovation component to it. In today’s blog we look at Strategic Adaptation and Continuous Change. 
    The theories of Strategic Organizational Adaptation and change emphasize on the role of managerial action. The strategic choices that managers make shape the organizational change. It is the choice of the actors that decide the outcome rather than passively accepting the environmental selection. Though we cannot claim that the organizational actors have a complete autonomy, the theory talks about a “bounded autonomy”. These organizational actors through their actions and “enactments” are capable of redefining and modifying structures that open up new possibilities for the future.
    Organizational change in this approach would be seen as a continuous process encompassing the paradoxical forces of continuity and change rather than an abrupt, discontinuous, episodic event described by the punctuated equilibrium model. The continuity maintains the sense of identity with the organizational learning, and factors in the political legitimacy and increase the acceptability of change among those who live with it.
    It has also been argued by the management theorists of this school that consistently successful organizations have used a combination of “induced” and “autonomous” processes in strategy to initiate an organizational renewal. The induced initiatives work on the tasks that have an internal scope while the autonomous focus on tasks that have an external scope. 

  • Entrepreneur’s Interview – OnUs Payments

    Sachi: Good evening everybody, today our guest for this entrepreneur’s interview is G.G. Shrinivas. G.G. Srinivas along with Hari have founder this startup called ‘Onus payment’. 
    Without further delay I would request G.G to give us brief background about himself, his co-founder and founding of the company.
    Shrinivas: Thank you. I am a 97 graduate of IIM Bangalore. Hari and I were colleagues in Standard Charted Bank – we were working in card sales at that point of time. We occasionally kept in touch with each other and saying some day we want to start off. Everything kind of fell in place thanks to the circumstances and the opportunity that was there at that time. Both of us were in Bombay fairly dissatisfied with what was going on – that is when we began working on taking this off the ground.
    So there was sense of comfort with each other because, we had worked as colleagues. We were just ordinary colleagues, there was bit of respect, but I wouldn’t call it as deep friendship. I can talk about respect for Hari, I think he is the one of the best sales man that I have ever seen in my Professional stint. He gets across to the table something very fundamental. So even if we are not friends at that point of that time, the fact that we respected each other, we said let’s try it out.
    We went about the classical way, I mean like you know, normally whatever anyone would do, when he starts a company. Get the idea it’s like one of our boss used to say take a deep drag of band substance or is their market at hand. So, we did a lot of validation in that point of time. We went to lot of seniors who were in this fields, I mean to a couple of heads of MNC Banks in India, A couple assets heads in India of MNC Banks. And said this is the opportunity at hand, are we dreaming this or is this opportunity that is there to be exploited. The unequivocal response that we had from everybody was, this makes a lot of sense provided you scale it up. This is going to be pretty big opportunity. I think to the extent that we spent little too much time on the validation, but we went about validating the complete idea. We went customers and we said if we give this product how much would pay? It was never about would you like this product – it was always about would you pay money for this product? We had gone to some of the high end schools in Bombay, which is where we were located at that point of the time and asked them about this.
    We had industry experts who said this possible. We had customers who said they are willing to pay. The funny thing was Hari being Hari, went out and actually closed to sales and came back and didn’t had product, money, technology nothing. I mean we had not even incorporated our company!
    The next phase of it was we had to go back to our families and say that this is what we starting. For first time entrepreneurs like us, it was very important to have a backing of the family. So we went up to senior people in Hari’s family and said, ‘this is what idea is’ should we be going ahead – one of  them actually ended up being on our advisory board. So, that’s the great thing for us. They actually liked the idea, after we had checked, cross-checked, verified and re-verified and we had wasted sixth month of time, is when we said OK fine now we have to form a company now. That’s when we started a company.
    Sachi: Could you explain what your company does so that the readers of the blog have an idea? 
    Shrinivas: Without going into great details about what the structure of payment industries is like in India; Think about any transaction less than 200 Rupees these are the transactions like buying coffee, buying an idly, buying a tea, buying a cholle buthur kind of thing and you are doing a lot of these transactions day in and day out. There are lot of transaction we do in less than 200 bracket – the only transaction tool that is available to us is cash. We can go by our personal experience or whatever we transact on a daily basis which is less than 200 Rs. Irrespective of which category of customer class it belong to the only transaction tool that is available to us is cash and cash is increasingly becoming difficult to use as a transaction tool because some of the changes we are seeing to. As you know, right in front of our eyes the 50 paisa is going out fashion. People neither give 50 paisa nor accept 50 paisa. As late as 2 year back some people were accepting it and without knowing it’s not getting accepted.
    So what happens is the bulk of the transaction that we are doing is less Rs. 200. And this transaction cannot be done on cash. So we looked at this and said – is there an opportunity for us to tap into these segments. These transactions come into the ‘C’ category of transaction – This is large volume low value.
    If we keep focus right and if we cherry pick within this transaction, this is substantial value of transaction that can be done on this. Provided you get across the right technology, keep your cost low everything else goes with to run a company. So if you keep everything else constant you should make money!
    Sachi: Both Hari and you are from the sales background of and to scale up the back end operations will be IT. We have seen that many firms begin with creating the software themselves. I understand that you have not taken that approach. How have you managed all that?
    Shrinivas: Hari and I are yes from sales background, Hari is one  of the superlative sales guy that I  have seen. There is fundamental understanding that when you are up to start up a company, to start off a new product, new concept it will take heck a lot of selling to push the product across. May be a little naively, but we believed that everything else can be made. Once customer exist and once he is willing to pay, the rest of the stuff can be put in place – as in raising the money to start the operations, getting the technology to run the operations, actually running the – operations everything can be put in place provided you have customer first. Obviously two of us are forced to think like this because we are not technology persons.
    I am a jack of all, whereas Hari is primarily into sales. The advantage this gives us is that when the operations are still not scaled up I am pretty much capable of handling operations, technology and marketing. Having said that jack of all trades never works out when things going to specialization. When the company is starting off somebody like me, would be able to handle, all the other things that Hari is not handling. There is an understanding between Hari and me what he is handling at this point of time is one of the important things of business. Getting to run a company is almost like pushing a vegan once it is running even I can go and give it a push, but when it is standing to make it move  is what is very difficult. Hari provides the traction I ensure that I take care of everything else. So, we don’t increase our cost base in the interim. Now once the whole thing starts of we need to obviously get in people who handle the technology, operation – at that point of time there would be fair bit of specialization.I think we are approaching that time because what we have done.
    Because of this approach, have we made mistakes? – Yes we have made mistakes. I mean there was a wrong choice of one of the product we had taken which kind of set us back by about four months. Would trained technology have helped? Obviously, I mean like you know Grade A technologist would have helped. Have we suffered from other fronts because of this? No, technology is one of the issues that we had. But it was not unmanageable. Thankfully it didn’t sink the company.
    We put the paying customer in front of us and align the rest of us behind the paying customer. With one and half year of this, I can say it works.
    Sachi: Putting the customer front and aligning all other things behind it definitely has some advantages, would you also highlight some of the challenges yuo faced in this approach and how you handled it? 
    Shrinivas: Between Hari and me we have 21 -22 years of payment card experience. Either in sales, marketing, operations, a little bit of service and collections. What you try to do is you end up a duplicating a whole bunch of things which are there on a payment card.
    The biggest example I can quote is – the credit card allows you to do paisa transactions. When you go and buy something in a super market you can buy for 1063.15. In real life I have not done a 0.15 transaction ever. Now over the last 15 odd months we have done over 17 lakh transactions. Within this transaction everyone of the paisa transaction that has come to us, is actually an error by the customer on the data entry front. What essentially has happened is something where I can go and probably pump my chest and say you do a one paisa transaction, is nothing but a boast .Which doesn’t hold any value for the customer because the customer is entering into round figure transaction of one rupee. And here I have build up a utility which can take paisa transaction. Now look at this and ask – why did this you stupid mistake happen? Don’t I go out and purchase? To put it simply, if I am drinking chai every day, and this were to be taken on a card how many times paid in a paisa. And answer is ‘NO’, so why did I put it on payment card? – Because I was aping credit card.
    So the experience that we have some time noose around your neck. That’s when we decided that will not invent feature that are nice on credit card, unless the customer comes and ask for a feature which we should have the ability to turn it around fast. We would not implement that idea because we burnt our fingers in couple of features which we put on the card which the customer never uses. They are nice to tell on the sales pitch but all most never the customer has a utility for that kind of transaction. Sometimes like the paisa example I gave you, they actually become a point of failure for payment solution.  We went by heuristic of saying if Hari and I want to X number of features on the card. Hari will divide feature at by half and I’ll divided the features at by another half. And whatever is the number of features are left is the features that we implement. Any feature that has to be implemented after that the customer has to ask for it. The design that will have it will take into account that the features may be added later but would not make feature unless customer ask for it. So what happens is we typically go to the customer and say this is the basic product this is what it is you tell us you will use this and if there something needs to be added we can turn it off fast that’s not a problem. Thankfully we have a very good technology partner. So what happens is we can implement those things very fast. We know that we are not wasting our money in terms of spending a feature. So it actually worked out for us very well.
    A wasted feature is wasted time and wasted money. We have couple of them I mean like we talk some experience on this.
    Sachi: You said, customer feedback on features is essential, did your dependence on this feedback hold you back?
    Shrinivas:Thanks for the confluence of a couple of technology issues of that we had,  for first seventy days of operation we visited the customers every single day and at 11.00 O’clock in the night. One of us would drive, 50Kmtrs, two ways and visit the customer at 11.00 PM including December 31st of 2010. If you visit a customer 70 days continuously doesn’t matter whether the customer is a dumb guy – he will start talking. Even if you are deaf you will start listening because there will be issues on the card which would start understanding pretty fast.
    In hindsight, that was the best thing would have happened to us. Rather than the pain of going there every day at 11.00 O’clock that was the one best thing happened to us because at the end of it we understood how the customer is using. Simple thing like a 21 years young girl telling a boy with her – telling him that I will pay by my card it is much cooler! It makes your day. Obviously I am not giving you the bad news.
    70 days of visiting the customer you pretty much get it. I would honest enough say that we say that this is the not part of the design, If anything else it would be part of the bug. But it helped us a lot.
    Something that we tried now consciously to do that even when we set up installation, however small the installation is we ensure that for a  25 days we will visit the customer every alternate day. To a point the customers starts asking why are you not handling over the solution to us. There are a the couple of features on the card which we do not hand over because you want the customers to realize, otherwise he will never gets into the operation. We continue to visit – Till he says why you are coming so often, it is at that point that we complete the installation and at that time we handover.
    It is at that point of time that you understand lot of things which are going over there. First and foremost you know we need to know what the points of expansion in the business are.  It is not to understand the customer business, but it is to understand where our future points of expansion are. It’s a small installation one is I can say god has given me small installation to this place. Other is to look at it and say where can I expand his business and in the process expand myself also. So, it helps us in the 25 days to understand where we can be, where the solution has to move, what are the kind of thing. So, we added a couple of solutions, which are totally not part of payment in this process when we understood from the customer, so it helps us there, for us it is a big thing, even it is painful we will have to visit the customer first 25 days at least every alternate day. Obviously it is a big installation we will have to park as on there of 4,5,6,7 hours a day. In the process we understand good amount of thing of the customer and that tells us what are the feature sets that we need to have? what is the pain points? what is the future expansion that can happen?. You pretty much bit understand the flow of transaction, whose blocking the process, whose helping the process, who are your early adopters. So there is lot of things that you understand at this point of time. That kind of helps us to define the features set.
    Sachi: Lot of aspiring entrepreneurs have questions on funding so – could you tell us how you organize your funding? 
    Shrinivas: As a background I think we lost about 5 and half months of time on funding. Before we had gone off this entire round, there were three things that we ensured.
    The first thing we said was at all points of time have sufficient capital to run the business one mistake should not turn the game. That helps because both of us are experience professionals to that extent we had sufficient of payments so that we could spend on the company.
    That the second what we did was we said that as founders may be will not pick up money from company as in charges but as founders we also will never cross a particular limit – that is we would not get into a situation of good money of the bad money. We drew a line of what you would invest. We had friends and family money always as a backup, there are commitment from friends and family due to us. Third we were in touch with some couple of angels who were really helpful in the whole process.
    Thanks to a confluence of things we wanted to pick up our first funding from NSRCEL, that got delayed extremely and the mistake that we made and this is the second big mistake that we made  one was obviously the whole process of super validation and seeking over the customers and customers starting of everything. This is the second mistake that we made was we didn’t know when to  say no to NSRCEL money and actually go to the angle who was pretty much saying come and take the money. Because he was happy with the traction and he didn’t wanted us to die for lack of money. I think we did a mistake there. Yeah, it didn’t kill us it hurt us but all that were same mistakes, something that will carry forward from this wrong.  One was the complete validation phase we kept on validating. Second one we were also turning all the stones to figure out where we can find funding. Because we knew that some time we would be going for big amount of funding. So one of the things that we did was we started looking out for money not   asking for money but looking out for money before there was a need. We are happy that point of time because crux comes to crux we can get about 10-12 months of money almost in weeks time into our bank account but do you want that No. No we don’t want that because – like ambulance coming to you early is good thing but actually calling it is early is not a good thing.
    Sachi: In the discussion you did mentioned about first mistake waiting for a customer. Could you just tell us bit about that?
    Shrinivas: We have three first customers all three of them like the product. All three of them are saying ya let’s do it. So, we are wearing the bride’s maid dress and marriage is not happening.
    Were we doing something wrong? Actually to say we are not doing anything wrong – we are good thing, we are adding value to the customers and customer are saying we are interested in you but guess what he is interested in his business I mean he is running his primary business. And there are days when I would to get frustrated and lets pick up the phone and like you know lets pursue and Hari would stop me , and there are days he would do that and I would stop him. We were like bride’s maid for for four and half months.
    Thats heck of lot of time, I mean like you know when you have product ready, everything is ready with you and you are dying to start of the race. And dam referee is not shooting the gun!.
    So you start wondering what’s happening. I don’t know unlike the funding part of which doesn’t mentioned is the second mistake which where we clear learning in terms of to do next time when we have a situation like this. Here I don’t know what to do? Thankfully, I have never been in the state again. Its learning but I don’t know I will apply it next time.
    Sachi: What is your message for other aspiring entrepreneurs?
     
    Shrinivas: I don’t know, whether we are to pass messages and give advice we need to have bank balance – Bank balance that has come from this operation.
    When you look back at whole journey right from the stage of  validating  the idea to this point of  time where we are saying hey we are doing X number of transactions that represent a valid like high number of  transactions per month kind of thing. The sheer number people would want to help you is phenomenal and to anybody who doesn’t start off and cannot understand what I am talking about – because number of people who are likely to laugh at you, and declare as you public hazard, trying to kill you by laughter for having propounded such a silly idea is so miniscule compared  to the number of guy who would actually go on a limb and help you with the things like where find a customer, where to find the technology help you on their area expertise, giving a general bit of advice, maintain your operations.
    It is phenomenal, for example I have friend of mine sitting in UAE and writing major amount of code for me for free. Why because somehow people will always help somebody who is taking a risk. It’s something that we always discount. It is when you start off that you realize – there are some really nice people who really love to help anybody who are taking risks.
    I call it good luck that will not be a part of business plan but ones you are start off their bound to be huge amount of good luck. There are I mean like there are lot of people who would like to help you. It is very heartening thing, it’s very non-monetary payoff for the whole thing, obviously in the start of thing talk about non-monetary pay off.
    Sachi: Thank you once again for being in this interview. Thank you.

  • Punctuate Equilibrium and organizational innovation

    In the last blog we talked about the evolutionary model of organization and the sort of innovation that would accompany it. In today’s blog we discuss how the organization’s model of growth when modeled around the punctuated equilibrium would handle innovation. 
    The punctuated equilibrium model proposes that organizations typically initiate a revolutionary structural change during periods of environmental turbulence. The general state of an organization would comprise of long periods of evolutionary change with certain short bursts of radical change. These short bursts of change could really transform the organizations strategy, structure, power distribution, control systems etc!
    One could call the relatively stable period of growth as – “evolutionary periods” while the short radical changing periods as those of “revolutionary periods”. 
    Empirically it has been found that the organizations that were able to transform themselves drastically were able to perform better than those that transformed incrementally. But this study wasn’t comprehensive enough to allow us to understand the reason of the failed transitions. The implication of the concept is that the competitive environment repeatedly changes over time and the successful organizations accordingly have to initiate periodic discontinuous or revolutionary change to adapt to the environmental changes.  
    The challenge here is that the organization would have to develop diverse competencies and capabilities to shape and deal with the technology cycle.
    While this model explains the patterns of organizational evolution and relationship with the change well, the model fails to address the crucial question of how organizations create manifest into new forms during the revolutionary phases. It also doesn’t address the long terms survival prospects of the organization!

  • Evolutionary view of organizational change and Innovation

    In the last blog we learnt about the classification of theories on organizational change. In today’s blog we attempt to understand the relation between evolutionary view of organizational change and the associated innovation. 
    When one thinks of organization’s established structures, procedures, norms etc, we realize that generally these would have developed as learning from organization’s response to the challenges it faced. Every time a new challenge is posed to the organization, these very systems that have been set up to handle some similar but past situations turn to be inertial force. Thus these organizations are slowed down in responding relatively to the threats and opportunities that the environment poses.
    When faced by environmental change, new entrants within the industry would potentially displace the established organizations that do not react quickly enough. It has also been observed that new entrant companies play a “competence-destroying” technological innovation, while the existing companies thrive at “competence-enhancing” technological change adaptation. It would be interesting to also relate these to the discussion we had on the J-Form and adhocracy models and the innovation. We leave that as a thought exercise for the readers here.

  • Class of Theories relating organizational change and innovation

    In the last blog, we looked at the affect of market economies on the organization’s structure and there by the innovation – knowledge sharing perspective. Over the last few blogs we have covered 2 dimension of the study of organizational innovation – its relation with organization structure and its relation with organization knowledge creation & learning. Starting from today, over the next few blogs we attempt to understand the relation between organizational change and the innovation there in.
    If one where to begin the journey of understanding the relation between the ways an organizational change we would first have to understand the process or perception of the way organizations change itself. It is pretty clear that organizational change happens in response to the environmental challenges or technology changes. Management theorists have classified the study of organizational adaptation and change into 3 categories
    1. Incremental / Evolutionary view of Organizational change – it focuses on the way environments select organizations and how this selection process creates change in the organization form. 
    2. Punctuated Equilibrium and Discontinuous Organization Transformation – treats organizational transformation as discontinuous event occurring over a short period of time
    3. Strategic adaptation and Continuous Change – stresses that managerial action and organizational learning and importance of continuous change. The organization is not a passive recipient but has the power to influence and shape it.
    We shall dwell into these individual streams over the next few blogs.

  • Organizational Innovation influenced by Societal Context

    In the last blog, we looked at a short case where a new concept – Spaghetti Organization was discussed. In today’s blog we look at the societal institutions influence the organization form and its innovative ability.
    We have discussed 2 forms of organization in pretty detail with respect to the organization’s innovative ability – The J Form and the Adhocracy. We also mentioned that organizations were said to be of J form given the structure followed in Japan. However we would require to broaden the horizon from Japan and ask if there is a larger social context that drives such organization structure. While understanding Adhocracy too we used the example of Silicon Valley to talk about labor market which is a component of society!
    Research has indicated that there is a relation between the type of “capitalism” and the innovation stype persued. If we could classify the capitalistic economies into 
    1. Coordinated Market Economies (CME) and
    2. Liberal Market Economies (LME)

    we begin seeing some patterns. CME and LME differ from one another in labor market organization, training systems, soceital norsm, values governing business and economic relationships.
    CME is followed in countries like Japan, Germany etc. These have deleveoped institution that encourage long-term employment and business relationships, facilitating the delevopment of distinctive organizational comepetencies conducince to continuous but incremental innovation. LMEs on the other hand, are follwed in contries like the US and the UK, where a certain type of adhocracy is followed to be able to rapidly and radically innovate. It is not just the labor markets that aid these types of organization structures – the financial markets, education systems etc too play a major role. 
    What one needs to remember is that the relation between instutions, organization and innovation are more complex than the simpified difference between the J-Form and Adhocracy. they are more dependent on the social context and the institutional framework that is developed. Infact the societal institutions play the dual role of creating constraints and also possibilities for the firm to evaluate the type of oganization they could evlove into