It was a strange gathering.
The date was February 23, 2013, and it was unusual because the people in the room had come together to discuss failures at a time when India’s fledging startup ecosystem had just about started experiencing a funding high.
India’s startup boom was getting considerable global attention, and a new breed of founders, who had quit their cushy jobs to start up, were busy preparing business plans, burning the midnight oil to build products.
I was on stage as part of a panel discussion inside a hall full of startup founders and investors that afternoon. The event was the Indian edition of FailCon, a Silicon Valley based platform founded by Cassandra Phillipps for celebrating failures. With me were Kumar Rangarajan of Little Eye Labs, Sumanth Raghavendra of Deck, and Manasij Ganguli of ThreadSol. Earlier in the day, Zipdial’s Valerie Wagoner had spoken at a session on failures too.
Here’s what happened in the following months: Kumar’s startup was acquired by Facebook in January of 2014 and Zipdial was scooped up by Twitter in January last year. Sumanth is today among the most admired voices in the ecosystem, questioning and offering blunt insights to founders looking to make sense of everything happening around them. And I have turned an entrepreneur too. It’s almost as if the platform for discussing failures indeed became “a stepping stone to success”, to use a cliche.
A few weeks later, I organised a closed room, private conversation on failures, which was attended by a bunch of founders including Flipkart’s Sachin Bansal. The atmosphere was high on energy, the sharing of failure lessons unprecedented and sense of camaraderie amazing. Looking back, and considering where the Indian startup ecosystem is today, such sessions are the need of the hour.
But my pick from the lot who shared the stage with me back in 2013 is Manasij Ganguli, who was on a painful, slow burn since 2013 to finally being counted among a handful of profitable enterprise software startups in India today. I call it a slow burn because it took nearly three years for the company to hit the million dollar revenue mark. Painful because it required living with consistent rejections from investors, customers and coping with a high mortality of ideas.
In a year when almost every investor, startup mentor and entrepreneur is talking about an impending bubble and bracing to cope with a funding winter, founders such as Ganguli stand out. His company ThreadSol today works with some of the biggest textile and apparel brands including Zara, Victoria’s Secret, and Madura Garments, helping them save costs across different stages of production using intelligent software.
“I don’t understand the idolism, mysticism and ‘Steve Jobs’ attributes that go with entrepreneurship — there’s nothing miraculous about entrepreneurship,” Ganguli told me in an interview on Thursday. “And there’s nothing glorious about failure: you fail every day.”
Ganguli, along with six of his engineers had been up all night after a server crash the day I met him. “The key is to have more successes on an average than the number of times you fail,” he told me.
Ganguli’s Intellocut made sales of nearly $2 million during the year ending March 2016, and clocked net profit of around $700,000. Not a startup unicorn by any measure, but if you look around at the latest tally of Indian startup unicorns, you wouldn’t mind missing out on the tag.
“Today, I get calls from the VCs who did not even meet me a few years ago: everyone is looking for some real bets now,” he said.
Here are five things I learnt from Ganguli:
- Be the custodian of the capital: No matter what, stay miserly and stay focused on keeping costs in control. Ganguli raised $200,000 in seed funding in December 2013, and used that to generate nearly $2 million in sales, and ensured he hit the profitability mark. “Your business should always outpace the cash burns.”
- Keep talking with the team all the time: As you grow from a dozen first employees to more, the startup cannot afford to be founder-led. The core team needs to imbibe the vision, own it and spread the mission. “You should ensure that everyone is able to speak their minds out without any fear.”
- Go beyond Bangalore for talent: India’s Silicon Valley is also becoming notorious for its talent pool, which is pricey, lacks loyalty and lives in “a fool’s paradise.” Ganguli shifted his software development base to Kolkata, a city which according to him offers great talent at a fraction of the cost. And the talent is far more loyal.
- Be careful in picking mentors, or don’t pick them at all: Here’s another blunt insight from him — you need mentoring if you are weak, and if you are weak, you cannot be an entrepreneur. “You do need qualified opinion, for instance in areas of finance and taxes, but that doesn’t mean you can call them mentors.”
- Angels (and demons): Pick your angels carefully, don’t fall for their larger-than-life profiles. One afternoon in August 2013, Ganguli was waiting for his turn to make a pitch to over a 100 angels in Mumbai. He says it was like a beauty pageant show. “I don’t get asked the right, important questions. Most of them wanted to know why there were no startups similar to ours in the US.” He eventually did meet someone who became a long time backer that day. But there was another high profile angel investor whose words still inspire Ganguli to stay on the course: “There was one person who, while getting into his BMW, waved at me and said, you will get tired, don’t do this.”