My Proficorn Way (Part 79)

The Netcore Idea

Netcore had an unusual beginning. When I was running IndiaWorld, we had started offering Linux-based mail servers in 1998 for companies to do their internal mail. It was a small side business, useful because this way they could also reply to all the emails that came in from their newly launched websites. When I was trying to raise capital for IndiaWorld during that period, the Linux corporate mail business stuck out as a sore thumb. “So, you are running these global portals for Indians, and then you have a business that offers email for companies in India? Tell us the connection.” This is what I started hearing from potential investors. It put me on the defensive in the conversation. I decided to separate it out – after all, the real value lay in the portals. And thus Netcore as an independent entity was born.

Netcore has lived through many avatars. Had I stuck to the first idea of Linux mail servers, we would have long been dead! After an initial period of failed experiments, we finally hit upon the idea of SMS services for enterprises in India followed by email marketing – both around 2007-8. There was no deep thought or detailed business plan; it was more of figuring out problems we could solve for businesses based on what we knew. Email has been the one constant for Netcore throughout. It is our “hedgehog” attitude – the one thing we are passionate about, the one thing we are best at, and which is also our financial engine.

In 2014, we were worried about the future of email, and so decided to move up the marketing stack. From there was born our marketing automation suite. That has its own story. My colleague, Veer, heard the phrase “martech” in a customer call. He liked it, and we investigated further. As it turned out, there was a Martech conference happening in Boston in a few months. We both decided to attend. The conference opened our eyes to a new world – beyond SMS and email. We decided to make the bet on campaign automation.

As it turned out, email did not die but grew in strength. But with the automation platform, we also opened a new world for ourselves – assisting B2C enterprises with customer engagement and journey orchestration. And as it so often happens, one idea led to another and we expanded into personalisation and product experience via well-timed acquisitions.

There has not been one single driver for Netcore. Instead, it’s been a series of ideas. We never had a long-term business plan; our focus was more on survival and on year-on-year growth. Since we did not have any outside investors in Netcore, the pressure was more internal than external. We kept listening to customers and added features and product lines. It is only in recent years that we have been developing a longer-term roadmap.

In the fast-moving world of tech, new ideas are a must. Keeping abreast of the competition (small and big companies) has to complement one’s own worldview. A proficorn of today can become a has-been of tomorrow if one does not have products that fit the market needs. In a SaaS (software-as-a-service) world where everything is a click away, competition is global. In such a world, to survive and thrive is an extreme challenge. New ideas have to be as much at the heart of a proficorn as they are for a startup.

Thinks 58

An agenda for agricultural reforms: by Barun Mitra. “Indian agriculture has performed a miracle in the past 50 years, defying the dire prediction of many. Yet the plight of farmers have only worsened relative to other sectors of the economy. There is a general consensus on these two points, even at a time when opinions are quite polarised on the new farm laws. By focusing on the areas of agreement it might be possible to chart a path that need not be so divisive.”

A summary of facts about agriculture in India: by Gulzar

The Auto Industry Bets Its Future on Batteries: NYT. “Carmakers, government agencies and investors are pouring money into battery research in a global race to profit from emission-free electric cars.”

 

My Proficorn Way (Part 78)

The Niti Idea

My foray into the periphery of politics also began with a failure and an idea. I started Friends of BJP in January 2009 just before the general elections in April-May. In the aftermath of the election results when BJP touched a new low of 116 seats in the 543-member Lok Sabha, it was clear that we had made no difference. But out of these experiences came the desire to do something in the political space. Through various conversations and reflections came a wild idea – could the BJP win a majority in the 2014 Lok Sabha elections? It was the era of coalition governments – no single party had won a majority since 1984 when Rajiv Gandhi swept to power in a massive sympathy wave after the assassination of his mother, then Prime Minister Indira Gandhi.

I started with the thought that a single party in power would accomplish much more than a ragtag coalition. So, instead of thinking 180-200 seats, what would it take for a party (in this case, BJP) to win 272+ so it did not have to depend on other parties to govern? This single idea laid the foundation for my political venture – Niti Digital. In June 2011, I wrote a series on my blog at emergic.org outlining how it could be done. To the political players, what I was proposing seemed impossible – India was then the country of coalitions, an aggregation of state outcomes. I proposed a different approach – to make the next election a wave election where voters rose above caste, class and community to vote as one. A very different campaign would need to be run to make this happen.

It was then that I also decided that instead of me being a passive bystander, I would become an active participant. That led me to create Niti Digital in early 2012 – with Niti being an acronym for New Institutions to Transform India. I funded the venture myself. Niti grew to a staff of nearly one hundred at its peak. Niti’s mission was to help the BJP win a majority on its own in the 2014 elections. Success was binary – and we would know in May 2014. All activities in Niti were driven by a single question: in case we fail, would I regret making the attempt? So I moved ahead and created the four verticals in Niti – media, data, analytics and volunteering.

Niti was an entrepreneurial venture. It succeeded in its mission – not from a financial standpoint (there was none), but from the eventual outcome with BJP winning 282 seats on its own in the 2014 general elections. In a sense, it was also a proficorn – private, ‘profitable’ (in its eventual success), promoter-funded, and had an important impact in the national campaign.

The starting point was again a simple idea born out of an entrepreneur’s desire to not let the past dictate the future. I was an outsider in the political sphere, which worked to my advantage. I had no mental baggage about what was doable and what was not – I just applied my entrepreneurial mindset to solve a different problem with a big, bold idea.

Thinks 57

Privatisation: But from which PM Modi? by Debashis Basu. “Human memory is short. That alone can explain why many are deliriously happy with his latest slogans and ignore seven years of poor “doing business” climate, taxtortion, extortionate oil prices.”

Just berating babus is a waste of time: by Sunil Jain. “Bureaucrats may stymie what the ministers want, but the only way to fix that is to have sweeping reforms.”

Vaccinating India brilliantly: by Naushad Forbes. “For vaccination too, the approach must be decentralised, and not micro-managed. Having set the rules, the state must step out of the way, and let a thousand flowers bloom. Trust in institutions is critical. Trust hospitals, NGOs, industry, schools, colleges. Everybody has a role to play. Working together, we can run the world’s largest vaccination programme brilliantly. As with testing, no one else will be able to match us for cost or efficiency.”

My Proficorn Way (Part 77)

The Khoj-Khel-Bawarchi-Samachar Ideas

While the first idea is a good starting point, many times a second idea is needed to push the business forward. In early 1997, I too faced such a situation. I had lost IndiaWorld.com (the domain) and had restarted as IndiaWorld.co.in. Realising I needed a .com domain, I tried IndiaLine.com. Both were not working. Failure was staring at me. And all I could think of was: Not again. For five years after my return from the US, I had tried many ideas. None had succeeded. And now, I once again was on the brink. I needed something new.

Bhavana (my wife) and I were on our way back from Nakodaji to Jodhpur airport. Every year we would take a few days to visit temples in Rajasthan. Bhavana was also my partner in business. A CA by training, she had easily taken over content and operations, even as I tried to generate business from corporates for their websites. We were talking about how none of the names for the portal were working. And in a flash of insight, we hit upon the idea of using Indian names. We had been thinking of various vertical sites for search, cricket, food and news. The initial approach was to do them under IndiaWorld names – like Yahoo and other search engines were doing. But the IndiaWorld name itself was not working, we needed to think differently.

It was during that road journey that we came up with what became a collection of sites with Hindi names. Khoj, Khel, Bawarchi, Samachar, and many others. And did they work! Each became a brand by itself. Khoj became synonymous for India’s search engine, Khel was cricket, Bawarchi became popular for Indian recipes. And Samachar became the start page for millions of NRIs seeking Indian news. The simple idea of using Hindi names worked beyond our imagination. This was the idea that changed our fortunes and future.

As I look back, it was the adversity (not having the right domain) that created the opportunity (Hindi names as the domains). IndiaWorld was the idea that had gotten me going, but it was the quartet of Khoj-Khel-Bawarchi-Samachar that provided the booster shot. They became the brands that we became known by.

Ideas cannot stop. As an entrepreneur, one has to keep pushing. Sometimes, all it needs is one big idea – though one never knows when one is starting if it will really be big. (No entrepreneur starts off with a small idea.) At other times, it is a series of ideas which come together to create something big. Even now, as an entrepreneur, I always have a bunch of ideas floating in my head. They wrestle with each other and the best come through. Ideas have a life of their own; the entrepreneur is the instrument through which they see the light of day.

Thinks 56

The Joy of using a Notebook: by Harish Bhat. “Notebooks help you record your thoughts the very moment they occur to you, and you can then keep playing with them, refining them, as you go along…A notebook at your constant disposal encourages you to be creative.”

Create a Digital Commonplace Book: Advice in NYT. “Readers have collected their favorite literary lines for centuries. Now compiling a portable word scrapbook is easier than ever.”

Ben Thompson on memes: ” I was looking to the real world as a guide to understanding the Internet, when it was in fact inevitable that the Internet would, over time, come to impact the real world. Some of that impact will be fleeting, like many of the protests Tufekci documented; some will have short term effects, particularly in places, like Wall Street, that easily translate sentiment into prices. The biggest impact, at least for the next few years, will likely come from memes capturing existing infrastructure, like Trump did the Republican party, and Ocasio-Cortez, to a lesser extent, the Democratic party. The most intriguing people, though, both for the potential upside and the potential downside, are those that leverage memes to build something new.”

My Proficorn Way (Part 76)

The IndiaWorld Idea

Ideas are seeds that when planted and nurtured right give rise to entrepreneurial ventures which can become proficorns. So, how does one get the idea?

Ideas come from many sources. It could be while working and seeing problems that the current company (or any other) is not addressing. It can come from personal experience – a pain point that you experienced and which others could also be living through. It could be a copy of an idea that is working elsewhere – in another vertical or in another geography. It can originate in conversations with friends. It can come from extrapolating a trend and imagining a new future.

For me, the idea of IndiaWorld came from my own frustrations in the US in getting access to news about India. While studying at Columbia University, I would go to the library to read the newspapers and magazines from India – all of which arrived about two weeks late. Those experiences stayed with me. During 1994, when I realised that my imaging software business had failed, I had to start thinking about what to do next. It was then that stories about the Internet and its potential started appearing in international business magazines.

(An aside: my father subscribed to many publications. His belief was that one had to know the cutting edge ideas across fields. It is a lesson I have not forgotten to this date. I pay for various online publications – a simple belief is that a single idea from any of them is more than enough to pay for the cost of all of them many times over. Financial Times, Wall Street Journal,  New York Times, Washington Post – they have some of the best tech and business writings. I have even subscribed to many others. In the world of free and abundance, the paid curated sources of knowledge are what have value.)

The dots started connecting: the World Wide Web could bridge distances, Indians in the US could get news and information without delays, the Mosaic browser with the HTML protocol could make access to this information easy, and a web server would make publishing that information simple. All of these ideas came together to create what later became IndiaWorld. I still remember my first experience of using a service called Netcruiser to connect to the Web in September 1994 during a US visit and accessing sites with a click. The excitement and potential convinced me of its power and potential to forge an “electronic informational marketplace.”

In just about 6 months after that in March 1995, IndiaWorld was launched. It had taken about a year since the first idea to launch. IndiaWorld was the first portal globally with a focus on India. Our early mover advantage helped me live through various setbacks and emerge successful in the subsequent years.

An entrepreneur’s idea is deeply personal – it is not always easy to persuade others of the world that will come to be. It is a competition for the future. Of course, execution matters and so does luck. But the idea is what starts it all – the idea that sticks, refuses to go away, becomes better with each passing day and conversation. These are the ideas that lead to the inventions and innovations which make our world better – and at the heart of each idea is an entrepreneur.

Thinks 55

On Product-led Growth: “The difference between product-led companies compared with sales-led companies is that they use their product to do the heavy lifting. Instead of paying expensive salespeople to convince executives to sign large contracts, these companies impress the pants off the end user with a free version of the product. The end user then kicks off bottom-up growth by spreading the product within their organisation and creating an internal request for the paid version.”

Protest. Agitation. Movement — Various facets of dissent: As a protest captures popular imagination and becomes a topic of conversation in every home, Financial Express examines the various facets of dissent.

Atanu Dey: “Since India is a socialist country, government control of the economy is by intent and design. Being in government gives one immense discretionary powers — to grant or deny licenses, to block and prevent legitimate economic activity, to extract rents wherever possible. Therefore political power translates into economic power. This politicizes the economy, meaning economic policies are dictated by what is politically expedient or what is most financially rewarding to the policymaker. That leads to poor economic outcomes.Politicization of the economy then leads to the corruption and criminalization of politics because ultimately money determines who wins elections. The lesson here is that corruption is not just an unintended side effect but actually the designed objective of a command and control economy.”

 

My Proficorn Way (Part 75)

Product-Market Fit

The greatest challenge a startup faces is getting the first customers. Persuading people to part with money is a non-trivial exercise. It is an exchange – they will pay if they see value. For an entrepreneur, getting the “product-market fit” right is what will determine eventual success. While it is obvious that one must build what the market wants and will pay for (either with money or attention), not every product ‘fits’ what the market wants. Finding the early customers once the product is ready is what will prevent failure.

Here is what a16z (Andreessen Horowitz) has to say about product-market fit (quoting Andy Rachleff):

A value hypothesis is an attempt to articulate the key assumption that underlies why a customer is likely to use your product. Identifying a compelling value hypothesis is what I call finding product/market fit. A value hypothesis identifies the features you need to build, the audience that’s likely to care, and the business model required to entice a customer to buy your product. Companies often go through many iterations before they find product/market fit, if they ever do.

When a great team meets a lousy market, market wins. When a lousy team meets a great market, market wins. When a great team meets a great market, something special happens.

If you address a market that really wants your product — if the dogs are eating the dog food — then you can screw up almost everything in the company and you will succeed. Conversely, if you’re really good at execution but the dogs don’t want to eat the dog food, you have no chance of winning.

You often stumble into your product/market fit. Serendipity plays a role in finding product/market fit but the process to get to serendipity is incredibly consistent.

You can always feel when product/market fit isn’t happening. The customers aren’t quite getting value out of the product, word of mouth isn’t spreading, usage isn’t growing that fast, press reviews are kind of ‘blah’, the sales cycle takes too long, and lots of deals never close.

I have failed many times in my life – in every case, I created a product (that I thought was great) which the market did not want. We see this mismatch around us all the time. Ads or promotions can attract an initial audience first, but they will not return if the product does not match their needs. Getting the first customers and demonstrating product-market fit is what will push an entrepreneurial venture along. As Eric Ries puts it: “The term product/market fit describes ‘the moment when a startup finally finds a widespread set of customers that resonate with its product’.”

There is no magic formula for getting product-market fit right. Even the best can get it wrong. And that is why so few products (and ventures) succeed. But get it right – and the prize is big! This is the thrill and excitement in the entrepreneurial journey.

Thinks 54

Steven Johnson’s new project: “A century ago, at the end of the Great Influenza, global life expectancy was in the mid 30s. In the US, it was 47. In places like India, it was in the mid 20s, significantly lower than the average lifespan in most hunter-gatherer societies. Average lifespans were so low in part because childhood was shockingly dangerous. Roughly a third of all children died before reaching adulthood. Today, just a hundred years later, in the middle of a global pandemic, global life expectancy is in the 70s. Childhood mortality worldwide has been reduced by a factor of 10. The doubling of human life expectancy should be understood as the single most important development of our era.”

On APIs: “Going down the API-First Ecosystem Rabbit Hole with Shopify, Stripe, Twilio, and more.”

The Case for Semicolons: from NYT. “It’s a period on top of a comma, and it works like both a period and a comma. You can use it to separate two independent clauses — two sentences that work on their own — or to separate items in a series that would be particularly unwieldy with only commas, often because the items contain commas.”