I realised that I had gone astray in the chase for valuation. I had become an investor in my business trying to become a unicorn (even though that word did not exist then). I had thrown all caution out of the window. We had hired indiscriminately, and had lost control of the expenses. I chased a rainbow. I had forgotten my own lessons in building IndiaWorld a decade ago. The sermons I gave on profitability – well, I had started doing exactly the opposite.
Bhavana opened my eyes. And I learnt a lesson I have not forgotten to this day. The purpose of a business is to create value for its shareholders, employees and customers. And it cannot do so if it is not profitable. It is hard to do it with an insatiable appetite of funds with all kinds of bad habits creeping in.
As it turns out, that story did have a happy ending. In less than a year, we made the business profitable. And Netcore has never lost money after that in the past 12 years.
We have gone through multiple shocks over the years – and every one of them has made us stronger. We are what Nassim Taleb would call antifragile. And that is probably true of all proficorns. Each one has a story to tell. But the world is fascinated by the stories of funds raised by young startups, not the profitability of older companies.
It is not that the world does not need capital to fund companies. Some businesses do require capital to begin with. The problem is when raising capital becomes the primary business model rather than embarking on a path to creating a profitable and sustainable business. That’s the contrast I wish to draw. There is an alternate model to build a business, and it is in times of crises that the differences stand out.
For entrepreneurs, the choice is for them to make. For me, building a business that is antifragile, that has the innate financial heft and freedom to convert a crisis into an opportunity, and that can hire and grow is the right way to do business. The Proficorn Way is my choice. What’s yours?