Disclaimer : The following blog post represents my personal point of view. As an aspiring entrepreneur, I have been to various entrepreneurship events, yet my acquaintance with the startup world is limited. I am still exploring and learning.
This is just for general introduction to some startup jargon you hear these days and what they actually are. If at any point, the information seems to be vague, do point it out in the comments and definitely search about them for clarifications.
There couldn’t have been a better time to do startups than today!
This might be the most commonly heard opening line in any entrepreneurship events these days. For the innovators bitten by entrepreneurial bug, its not unusual to think constantly about their journey ahead. You’ve an idea and you know how to technically approach towards a Minimum Viable Product (MVP) – good! Then read on.
General execution, marketing, reaching out to the target audience, scaling the potential business, team members (who would be as excited as you), angel funding, venture capital – these things would bug you more often than not. (unless you’re a serial entrepreneur with many successful companies on your portfolio!)
On 3rd March (Thursday), we had an event here in college organized by E-Cell. Having a general lecture given by senior students is not a new thing. But this lecture cum workshop was held in association with Commence Mint – a budding startup school based in Bangalore.
An Incubator – yes, that’s how they identify themselves. It’s basically a Venture Capital (VC) firm driven by general philosophy that even if the startup gets big, majority of its share should remain with its founders instead of the investors.
According to them, it is generally the other way round these days. Their current model seems to be more promising for both the parties, in terms of return. They had a really nice presentation – not much text & lots of info-graphics. I think its better for the interest of general audience when they’re not sure about the contents.
The mentors who came for the talk were middle-aged experience fellows. They already had worked in startups and have ventures of their own. I got to know some significant things about venture capitalist for that matter. I would write them in points for the readers to have an general idea –
- A VC is a corporation or an individual who invest in startups at their early age. They are like Private Equity (PE) firms providing office space, taking care of general stuffs like food, personal mentoring as well. Though most of these describes more of an incubator.
- One invests in founders not idea. Yeah, that’s goes against the general notion but it’s true. Ideas keep changing but people don’t. And its much harder to recover in case of loss on the later part.
- A disruptive model with global potential is what lures them. They expect not 10 or 100 but atleast 1000% return on their investment. This might not be the case always but just think, even if one startup makes it big out of 10 startups in their portfolio, their failure is recovered beyond the expectations.
- VCs don’t sign the non-disclosure agreement generally. It’s important to understand for the aspiring entrepreneurs. If two parties come to them with very similar idea, they don’t take any guarantee on whom they would prefer to fund.
- They’re smart enough to sniff your dedication for the proposed idea. Be single minded – either job or this startup because it’s not for 1-2 days but probably for the rest of your life.
- What’s important? The 4Ps formulae – Problem, Proof, Passion, Partners.
My Question – How probable is it for a VC to suggest two different teams with similar ideas to merge and get the fund as a unit? Will they prefer solving the problem first?
That’s the general doubt I had based on the non-disclosure point above.
Their answer – Chances are likely but that doesn’t generally work. There are many factors that comes into picture than just similar ideas. Their compatibility, their willingness, their priority (startup or solving the problems?) – all these things matter.
Although, it’s not totally out of the scenario. Citing on the example – Flipkart snapping up Myntra, TaxiForSure (an Ahmedabad based startup) was acquired by Ola. They have much larger valuation after merging.
Talking about the current startup scenario in India, about 98% of the startups was sold to big corporations last year owning to the founder’s will to dissolve. They couldn’t even get listed on the stock exchange.
Extra lessons –
- In between the talk they discussed on character vs. venture building. For the accelerators who work is to match the mentors (expertise) with startup founders (ideators), it is very hard to get the whole thing working. While this match would certainly be beneficial in character development from the ideator’s perspective, ensuring venture development is essential as well.
- Friendship built around business is more appreciated (an likely to be successful) than the other way round.
Where does the CampusMint (or any such incubators) come in?
You have an idea? – Very Well!
You’re young, confused and vulnerable? – Great!
You’re passionate about your startup & want to pursue it for the rest of your life?- Hmm…you might like to consider it then.
Though I can’t reproduce their whole presentation here, nonetheless I would try to summarize from whatever I noted down-
- They provide you with one year of office space for two (founder + 1 co-founder), in Bangalore currently.
- They take care of the legal issues like registering the startup, product copyrights, etc. Read this Quora thread to have an insight.
- Summing up all the cost that they put in around 40,00,000 INR for a year (they had a detailed cost breakdown but I couldn’t note it down in the process). All these things to ensure that you’ve successful running startup at the end.
- 3 tracks philosophy for proper incubation –
- Founder Development
- Business 101
- Venture Development
- They take 20% equity in your startup.
- They have several strategic partners on board . You can check them on their website.
- ‘Once a Co-Minter, always a Co-Minter‘ – after passing out from this startup school, you would be a registered alumni. They would be happy to have you there for mentoring other budding startups. Though they may not provide the facilities like before (while you were there ; if you’re still struggling with your business model).
- Starting from July 2016 in Bangalore, their plan is to take 20 ventures (40 Entrepreneurs) and incubate them.
My take on the whole event-
Don’t step into something until you’re totally sure about it. At the end of the session, they were distributing forms to get the general idea about you & your startup. Next day, one has to appear for the personal interview where they would check your credibility for the program.
Specially when you’re talking in thousands & millions of dollars, you have to be careful. Explore other options as well, introspect your execution planning and safely entertain your chances.
As an Entrepreneur, significant part of your life would be invested in raising money and exciting customers. This was the closing remark of the event and I think somewhere its true!
If you’re in your early 20s (average age of startup founders in India is around 28, so in that respect you’re fairly young) and serious about your entrepreneurial journey, do checkout this Mashable article that talk about hardships you might have to face on the way.
Note : This blog, in no way, endorses or is supported by Commence Mint. It’s just an attempt to share first hand experience of attending a startup school event. The details mentioned are true to the best of my knowledge, yet you’re encouraged to check the respective website of any such incubators for clarification. The opinions presented are of my own. Feel free to comment your take on this, down below. Ciao!