When startups start outgrow loyal early employees

It must be a fairly common scenario – You have an idea, you are lean or you have raised a small amount. At this point, you hire from your network, getting on people who are loyal, people who you like working with, people who are a good culture fit
You are OK with hiring generalists. You have time to groom them. You hope they will work hard and take us to the next level.

And they do! Then, thanks to their work your startup takes shape. You raise more money. You appreciate their work and praise them for what you expect of them – hard work & dedication & loyalty.
What you value the most is that they think of your company as their company. There is a strong sense of belonging & loyalty. This loyalty is what you value the most

With more money comes more pressure.Grow faster, make a better product, beat competition. It is like you suddenly graduated to the big leagues. Warm up is over. Shit gets real. This is war. Things get more difficult.
Founders get pushed. They push everyone else
Expectations become unrealistic. You expect things to be perfect. You expect to be on top of SEM. You expect conversion to be best in industry. You expect the product to be great. What was exalted as hard work earlier is mediocre now.

Now, as a founder you are left with 2 options. Maintain the status quo and live with mediocre performance ( since they are generalists. They can only be good. They can’t be great ) Or you start pushing them. Tell them what they are doing is not good enough. You tell them they are not good enough yet. That they must get better

This is where the men get separated from the kids.
The men take reality on their chin. They realize that they must get better for the company to win. They realize that the only thing that matters is winning. And do win we must have the best man at each critical position. They embrace this reality, worked harder than ever and if needed, concede that position to someone better. They do their best to level up and embrace the change. They keep the organizations’ best interest at heart. If they feel they are the best guy for the job, they work harder than ever and prove it. If they feel there is someone who can do it better, they embrace that change

The kids take it personally. They believe that the new-found criticism, pressure and unrealistic demands are unfair. They start feeling betrayed. They feel that the company that they treated as their own is turning their backs on them. They feel that all the hard work they out in is not appreciated. That they have been used and discarded. Instead of hearing “We need to get better at this”  they hear ” You are not good enough anymore”. They take it personally. Some of them become emotional about it. They sulk. They look hurt

And that is when you know that the startup has truly outgrown them



Targets work for everybody / My biggest learning


targets work for all companies – big/ small/ startups/ before MVP / after scaleup

The right way to build a company is to have a target-driven approach
CEOs should know how to fashion a target based approach. Its elements are :

Know what is important for the company. Use this clarity to set the right targets
Set aggressive, but empathetic targets. Be gracefully aggressive
Motivate, empower and enable the team to achieve those targets

Set the right targets. Sit back and focus on your job.
Stop worrying about how targets are being achieved. Dont fuss over what is right, how it is supposed to be done or what who is doing wrong, Dont worry about people coming in late or early.  Just make people accountable for meeting their targets.

Nothing gets done without targets. Target setting & motivating the team to exceed expectations are the most important skillsets a CEO must have. irrespective of the size of company

Trust the team. Empower them, Let them work their way. TRust them> Stop nitpicking as long as targets are being met

Motivate, communicate, lead by example.

How to think of ideas/ How to build big companies

How to build big companies which are worth the pain

  • Find something you care for. Something that you really want to solve.
    A good benchmark is to ask -> If this is something I am doing for 10 years everyday, will I be happy? Would you be happy if you just grew 5% week-on-week for 10 years, without the kind of hockey stick growth one hopes for. If it is a no, don’t jump into it. Find something that is a yes.
    Or if you have a really cool, low involvement(completely online/ app) idea, build it, see the kind of traction it gets before leaving your job and plunging into it full timeeg: Do you want to solve the blue collar jobs problem – Yes
    Do you want to solve the middle school education problem – Yes
    Do you want to make top notch facilities available to middle class kids? – Yes
    Do you really want to help people buy & sell cars – Not really
    Jack MA- I want to bring Chinese companies online – BAM
  • Dream the future. How does the industry you want to impact change in 10 years
    What can be inproved? What new technology can change in this industry?
    Imaginthe future & build it. Don’t do anything incremental. Think disruptive. Think how can the industry / experience be improved significantly
  • Overlay a layer of pragmatism. Build an MVP of the future you have dreamt. Does it excite users? Does it excite you? Can you find a way to build towards the future you imagined, while making money / getting traction today? How will you keep urself + team motivated for 7 years?  You need to build something today that brings money  OR investors OR solid traction?
  • Companies are derivatives of something. Make sure the underlying is growing like crazy. Only then you can ride the wave
  • Find a way to build that future, That is what entrepreneurs have to do. Make a way to make the future happen eg: COD, returns, Practo, ola (activation 99 offer), Capitalfloat.  Find hooks that get early adopters. Find hooks that makes people try out the future. If you are excited about the future, find a way to pave your way to there. Push. Push. Make it happen. That is what you are supposed to do
  • Invest in marketing. Get to users as early as you. Validate your dream of the future. See if users buy in. Else find hooks to make the users give the future a try
  • Raise money

Alternative framework to evaluate companies :

1) Company is a derivative of an underlying. Underlying should grow very fast for the company to fly
2) Evaluate the company based on the next best alternative available for the TG. Is the TG unhappy with the issues of the current best alternative? Can the new company solve the problems voiced by the TG? It is a problem if the complaints of the TG are unrealistic/ can’t be solved?
tip: Ask the TG for potential solutions to the issues that they highlight. DO they have any ?
3) Generating trials should be easy- How easily/cheaply can you get the user to use your service
This is a function of current demand (#searches) & frequency (repeat) and familiarity (has he gone through the process earlier to appreciate a new solution?)
4) In India, unicorns are being built in fields where targeting tier2/3  towns & villages. Where geographical constraints are not an issue ( paytm, flipkart)

5) Anything that creates efficiency / improves resource utilization/ reduce idle time for businesses/ SMEs/ Workers becomes valuable

Gabrice Grinda’s framework:

What I learnt from fundraising

  • Never use a ppt. Mail the ppt early. The moment you open a ppt to present, you become a salesman. Also, people start looking at the ppt instead of looking at you. You are the alpha in the room. All eyes should be on you. Be the alpha. Be the presentation. Control the room
  • Sell yourself. Tell why you are a kickass founder, why you will win. Start with your story. WHo you are. Why are you special. Why do you want to do this insanely difficult thing. VCs want to back winners. Who will build a company against all odds. Sell yourself and your ability to build a big company
  • Then sell the vision. It is your job to sell the vision and your team’s ability to execute the vision. Be insanely passionate about your vision. Not everyone will back your vision. But you need just one backer 🙂
  • Team matters. Then the space. Then the execution(how have you done so far)
  • Money is a commodity in today’s market. Treat it like that. Raise money but remember that it is a commodity. If not one fund, someone else will give you that. You always have the upper hand. You are creating value. They have a commodity.
  • VCs chase deals they can’t get into. If you court them too much, they lose interest.

Be slightly aloof. Let them chase you. Keep them on the edge

  • Never NEVER  NEVER be defensive. Have a vision. Stick to that vision. If someone pushes you/ asks something that is not your favorite question / punches holes -> breathe, go to the Meta ? Macro (  let’s take a step back and ask what is the winning model )  And ask a question in retort (Why do you think we are doing this? We could do X or Y or Z. Why do you think we are doing this?
  • Control the discussion. Know what you want to talk about. Know your strengths. Always make a presentation with the flow you want to go with. The story and the sequence you want to take. Try to stick to that. Every time the discussion meanders, try getting it back to your original script. HAVE A SCRIPT. MAKE A small ppt with the SCRIPT. Stick to the SCRIPT.
    SCRIPTS will help you avoid being defensive
  • Use screensharing. Not ppts. Use screensharing + call. Helps you control the discussion and the flow. And you talk about what you want, in the sequence you want

  • Show growth. Go out to raise at a stage where you can show growth in some ( not all ) important numbers. VCs are hooked to growth. Just show growth. Growth is what sets their antennae buzzing.  Just focus on growth. Go to them when you have a nice growth graph ( unless you are raising to concept)
  • Avoid tele-calls/ skype. Insist on face to face. Helps you control the conversation. Helps you take cues when the other person is not following your line of thought.
  • Always make sure the other person gets your point. Don’t move on unless you are sure everyone in the room gets THE POINT. Else it will keep coming back and break your flow.
    If you are making a point, make sure everyone gets it. Else don’t move on. Stay. Repeat, give examples. Give data. Move on when everyone in the room understands what you are trying to say. They might agree or disagree. But they must know exactly what you are saying
  • Never go out to raise till your product & experience is perfect. Product & UX matters more today than revenue. UX is hygiene. Make sure your UX & product is amazing before you raise. Be completely confident in letting someone use & play with your product. Don’t raise till you are ready
  • Don’t mix numbers with Macro. First make sure everyone gets the macro. Make sure everyone is aligned awith the vision. Make sure there are no doubts there. Blow them away with your vision. Tell them why and how ill a big success be fashioned .Once that is clear, present what data you have ( preferably in the next meeting)
  • There is always a way to present yourself better. Think about it and be a better sales guy.
    You can always hsow how far you have come instead of obessing on numbers.( show a timeline view of what you have achieved in how little time)  Even if your mobile app / adoption is low, show that you have a mobile focus by showing how it reflects in your actions. Show that you know that mobile is key and are working towards it, even if you don’t have the download numbers yet
  • Have a vision. Think big. Don’t think incremental. Think of disruption. Think of domination. Think fo how new business models will turn the industry on its head

Tips on being a better CEO

This is relevant only to my firm (YTPL). I am writing this because sometimes, writing stuff down is the best way to crystallize and make actionable out of thoughts:

  • Read this often. Add to this when you can
  • Praise people you want to keep. Praise them often so that they start craving it from you. Don’t be a mean leader like you are. Stop belittling your team, even if it is jokingly. Praise them on what they did right. Flatter those who you want to keep happy. Give compliments everyday, to everyone.  Be like AG, but have more clarity on what we are have to do to get to the next level.
  • Hire an office boy for the small stuff. Don’t squeeze that 8-10K
  • Don’t sweat the small stuff. Don’t get distracted.  Keep a slot at the end of the day (say, post 8 ) to do the admin, paperwork and the small stuff.  Don’t let interruptions distract you from the real work. It will only frustrate you and make you a bad ‘doer’
    Keep a slot for the mundane office/ admin / paperwork. So that you can stay focused on the real deal for 11 hours
  • Organize your life. However much you think you can be flexible/ manage things, having a routine helps. Having a routine cuts down on the number of things demanding your attention. Have a routine. Stick to it if you want to be productive. Don’t be a wanderer. Settle down. Be organized to be productive
  • Fix a time for different meetings. All heads meetings. Tech. Ops. Product. Marketing
    Define what to be discussed in each meeting. Be organized around meetings.
    We are at a stage where we should know whet each deptt is supposed to do. Write these down. Define what they should track. Define open questions. Put a structure around meetings & decisions
  • Prepare for meetings. Perfect the art of asking the right questions. Meetings are useless when you can’t ask the right questions.  And you need people like AB and 3 more of them to get the answers. Grow 3 more like AB
  • Hire people who are different from the existing team members. Hire people with different strengths that the existing team
  • Plan ahead – Don’t be reactionary. Imagine where the business will be 3 months from now, what will be needed for that and start working on it today>
    Plan PR , Plan Marketing, Plan Hiring, Plan fundraising in advance
  • Be a better manager – Stay in control
    Your job is to ask the right questions – Ask the “What”  Let the rockstars figure out the “how” themselves
  • Be a better leader – Talk to people about issues you have with them. Don’t sulk. Don’t let things drift.  Motivate people better. MOTIVATE PEOPLE BETTER
  • Try out multiple things -> create the right setup, attitude and capabilities for the same
  • Make everyone independent. Give everyone someone to manage. Give them people under them to manage so that they can run experiments instead of doing the stuff themselves. Hire more executives. Run faster.
  • Lead by example -> reach before time, Leave the last. Stay focused. Keep working. Drown out distractions. Lead by example. No late nights, just really early mornings and early to office. Don’t relax, just get better


what every CEO/ PM must learn

  • Good PMs and managers in general must be able to break down the end goals into discrete tasks and assign the same to the right people in their team.
  • Good managers should be able to estimate(from experience& smarts) how much time will each individual task take and in which order should the tasks be assigned & completed.
  • Good managers know what can be parallelized and what should be the checkpoints in the process.
  • Good managers clearly establish at the begining, the exact output for each task and the project as a whole.

However, to put it in one sentence, good managers know how to break complex projects into meaningful, small tasks which add up to the whole.  even when one task is assigned to one resource, it is best to define sub-tasks for the day and schedule necessary checkpoints to gauge progress.
Not doing this step often leads to situations where resources(especially techies/ geeks) overdo things, keep experimenting and keep chasing perfection. This often leads to costly delays in the project at hand. Defining sub-tasks and checkpoints makes sure everyone is focused on the task as well as the deadlines (And it is not just you who keeps an eye on the project timeline)

Often, young managers don’t do the above because they don’t have the experience/ can’t imagine how the tech team(or any other team you are working with) is going to go about it . This is almost always a mistake. As a manager, it is your job to be in control of the project. The same is true for startup CEOs. Even if you don’t code, you must be involved and in control of defining tech projects, requirements, timelines & checkpoints for technical projects. How will you get there when you haven’t ever done it yourself? Well that is an art and one good managers/ CEOs should build comfort with. As Ben Horowitz says, good product managers define the ‘what’  and let their juniors figure out the ‘how’

A more important exemplification of the manager’s ability to break down a complex task into smaller parts is seen during a startup’s early days. A lot of times founders trick themselves into thinking of business models . A particularly dangerous trait is when founders figure out multiple possible business models and keep swinging between them as they go on learning more about the customer, problem and market. This often leads to business models being force-fitted and this is dangerous.
Good founders, like good managers can break the bigger project(finding a sustainable business model) into smaller tasks(Relevant & important questions about the problem, consumer & market). In the initial days, founders must focus on ASKING the right questions & DISCOVERING the right answer. The focus must be on market visits, field work, consumer interviews, user behavior and NOT business model. The answers to these questions will then qualify as ‘Validated Learning’, what Eric Ries calls ‘the currency of a startup’ in his famous book ‘Lean Startup’

This is helpful in 2 ways:

1) If you have the answers to the right questions, the business model selection becomes very easy. You can easily pick a business model which is in sync with the answers you arrived at

2)When you take the question-first approach, you can potentially imagine newer business models more suited to your consumers and market. This is always a better model than just fitting an existing business model. Plus, you can always keep the existing business models for reference anyway

So focus on asking the right questions, get close to the user & market to unearth the answers. The rest will take care of itself.




A note about hiring tech cofounders and early tech employees

Ben Horowitz talks about the difference between a peace time ‘head of sales’ vs a war time ‘head of sales’. How these two need to be different people and that just any great ‘Sales’ guy does not fit into both these roles, since the needs of these 2 different roles re vastly different.

I completely buy his point given my experience with techies- the good, the bad and the ones who made a turn for the better. Since tech talent is so rare (And frankly overhyped for early stage startups ) a lot of non-tech founders end up hiring friends or anyone who is good at tech and willing to join them. This, potentially, is a huge mistake.

Good engineers are not good tech founders. A less experienced tech founder but one who really wants to make a business is a much better fit than someone who knows a lot of tech but is hung up on his awesomeness/ wants to build a great tech product on day1/ thinks he is god’s gift to the world. Some ways to spot the difference between the two kinds of techies (A & B)

  • A thinks about what the user will see (eg: front end & how to get the message across- (test user reaction, get MVP out and validate)) B worries about the future and scalability and back end issues. Taking a back-end first & back-end heavy approach points to B(unless it is by design an enterprise product/ SaaS where robust tech and back-end and 100% uptime are your priorities)
  • A worries about building business. B worries about building products
  • A is a team player. B is throwing his weight around
  • A wants to be a team man B is obsessed with himself and wants to fly solo
  • A appreciates what others are doing B thinks he is god’s gift to the world
  • A wants to hack B wants a nobel prize for his code
  • A great startup tech founder is very different from a great tech lead/ engineer
  • When you are recruiting a tech founder, make sure you keep this in mind

Some problems might just be best suited for brute force


App discovery is a huge problem. The app landscape is a wasteland with only a fraction ever getting to meaningful traction (forget revenues) Everyone is writing code, building a website and making apps. People are solving, coming up with solutions to everything. But how will these get discovered?

And there are people who break their heads over how to solve problems. mobile payments  cab hailing  doctor on call, language translation, IVRS navigation


What if there was a justdial style number ? You just put your query / problem and we will send a application to your number. This application will be best suited to help you solve the problem.

Or get a life coach. let him help make your life more organised using the best of digital tools 

Or will all this always be D-I-Y?

A list of startup lessons – 2

This post is more relevant for founders who double up as CEOs. It will usually be the founder who sets the vision/ sells the vision. This post is largely based on my 10 months’ experience in a startup with 2 other co-founders. We have pivoted often, once after building the product and often after dissecting promising ideas after weeks of research.  Without further ado!

  1. All startups need leaders. Down with democracy
    When everyone has an equal say, things move slow. add the fact that the group has smart, opinionated people and you will never build true consensus. Successful founding teams have one person who has the final call. The rest go along. Earn that trust & respect, LEAD, take the tough decisions yourself and get others to run with the decision
  2. Confidence is everything. yes, ALWAYS! 
    Have a vision. behave as if you know. Assume that you might not, so do experiments and get data. Validate. If you are not sure, if you don’t know, go with what you think is best. It might be wrong, but it is your bloody JOB to have a vision and take everyone along. You might be wrong but if you don’t have a vision, you will move too slow, get frustrated, the team will lose motivations, you will second-guess and you will die soon. And you will never know if your vision was right. Have a vision. Be confident. Move fast. Validate it. Change if need be.
  3. Ideas before friends
    Good ideas, when executed well, make money. Friends don’t
    We are a group of people who want to do a startup together and are looking for an idea – e.p.i.c. FAIL!  Find ideas independently, look for co-founders for executing it. It is your job to find an idea. Find an opportunity – Then ask your friends to come along for the ride. But pick out the destination yourself
  4. Take lonely decisions 
    Just because it is a startup doesn’t mean you have to discuss and debate everything among co-founders. Don’t expect anyone else to take decisions for you. There is no magic wand. Mr. CEO, man up & decide. take inputs but decide on your own. Take the blame for wrong decisions. Try to be correct as often as you can. Keep the decision making swift.
  5. Assign and take individual ownership. no group projects.
    Make independent projects, let people come up with their own solutions, stop debating, stop analyzing, stop trying to be perfect. Let people make mistakes.
    Let people come up with their own solutions. Interfere only when something is going wrong for long enough / something is clearly stupid/ someone asks for help.
    Do meetings, decide on next projects/ experiments, set deadlines & deliverables, follow up. discuss. Be an enabler, stop being a roadblock by questioning / debating/ second-guessing / looking for the perfect solution
  6. No group ideation to find ideas.
    This even sounds ugly, incestuous. It is a bad idea to find ideas together. get away, build conviction, inspire others, take the leap, fail fast, fail often. This is a special case of the point made above
  7. Figure a need/ gap/ business model
    Building teams is easy once you get there. Don’t get stuck on the best team. Get stuck on the business model/ need
    You can always build teams once you have a proven business model. Get to that point first
  8. Make things happen
    This is a f****** startup. nothing happens on its own. no emails and phone calls will magically find your inboxes. Everything that happens, happens because you make it happen. Do your job, make it happen
  9. Make peace with the sub-optimal
    Find the next milestone for the business (funding/ revenue/ more funding/ hiring/ growth/ profitability) and focus your energy on that. It is ok to grow like crazy while having sub-optimal decisions. Be ok with the sub-optimal as long as you are on track for what matters most.
  10. Get married to your co-founders, but don’t sleep together
    people. product .personality  in that order
    Prioritise your co-founders’ happiness.  Next comes the startup itself. Make your quirks, passions, opinion, ego and interest a distant third. Marry your co-founder and treat him as your wife.(irritates you, is difficult but you still give in happily to her)
    Avoid staying together though, too much face-time builds stress. Living together never lets you get out of office completely. Builds stress, hampers cooling-off.  Abstinence,  please !
  11. Be happy
    Never a beautiful creation did an unhappy man make. Find out what keeps you happy, go after it. Unhappy founders don’t stand a chance.