First Column for Times Property

Image via WikipediaHi Everyone, I'm happy to post the first of my articles that will be appearing in the Times Property - a supplement of the Times of India - the world's largest selling English language newspaper. This being the first article, I tried to cover a basic set of tips when purchasing a holiday home with the view of generating income from the same. We've released the article first on the HomestaysDOS.com owner blog. You can read the article here. It's titled "10 Things to consider when researching your dream Holiday Home." I hope you all like it and please do send me your feedback. We have been progressing steadily in our mission to make homestaysDOS.com - the leader in the Holiday home Rental business in India. As part of that we have realized that by virtue of being the pioneer, it is not enough to be the largest - we already are - We need to grow the industry, ensure that we educate buyers and encourage more families to make an informed decision to buy a holiday home. This is part of that effort. We will also be launching a new line of business shortly towards that goal - within the next 1-2 days. In the meanwhile, enjoy the article.

Don't be a lonely King

Image via WikipediaA very quick post. In the course of meeting with companies (many of whom are run by friends), I've noticed that many companies in India have very low stock ownership even at a startup level. The founders tend to be techno-commercial guys (like myself) who are very used to selling and negotiating on a daily basis and the 'techies' - i.e. the people actually writing the code seem to be engineers who have never sold a pencil in their lives and probably don't even know how to negotiate with a rickshaw driver. Here the onus is on the founders to be fair and to not negotiate with the employee the best deal you can but to think about what would be fair. Some reasons why being fair is the best thing long term:- 

1. You will be able to get people to think about equity and the bigger aspects of the company, product and cash flow.

2. In tough times, you will be able to get everyone to make some sacrifices in the interest of equity.

3. You will be able to build an ecosystem around your people who in case of an exit would all have a decent amount of money to be enable you to take bigger bets which will take longer to pay off because the engineers - the core people building the product have the liquidity to last.

4. You will make friends and create a set of people who were committed to you in the bad times - guys you have worked with who worked out of bootstrapped offices and ate maggi noodles with who you can now go along with to Vegas, Macau, Thailand and to the best bars and restaurants. Going through life and through such experiences with genuine people is far superior as compared to the kind of people you will attract if you were to make it big but had no friends with that kind of money and had to seek such people out. 

I remember once discussing property prices with a friend of mine and he was trying hard to convince me to try and see if a bunch of us friends could all buy small holiday homes very close to each other. I remarked then that for that price, I would rather buy a large plantation and live like a King. I remember his words then - "Roshan, you might live like a king in your huge plantation, but you'll be a lonely King." - Wisdom.

Part 2: Online marketing - How to make sense of Google Adwords, SEO, SEM and all that jargon

Image by Danard Vincente via Flickr

Sorry everyone, know I promised to post the rest of the post the next day but was reading my own article after I posted it and I thought that I would change track a bit. I think in Part 1 I was able to explain some of the challenges but not clearly outline some suggestions. As such I'll quickly go through one more challenge and then put down a quick laundry list of stuff that every web entrepreneur must do in order to get results from online marketing.

The last challenge:

7. Directing user behavior in a very distracting environment.  The internet is a very distracting environment. Unlike when you advertise or market on television or else in print or one on one in a meeting, you have no psychological upper hand and the user feels no need to pay you any attention or let you make your case. In a sense it is like he is window shopping but inside the shop and in multiple shops at the same time (does that make sense?) It is also a unique medium (only maybe teleshopping compares) where you can convince someone and make him buy your product immediately. It is also the one medium where you have a storefront for which you may no rent, have no utility cost and where your sales are primarily under your control. Having said that the biggest challenge is to get users to follow a 'sales funnel' where you take them through a typical buying process without them explicitly feeling that they are being taken through the same. The way you do this is to continuously improve your usability as you mine data and figure out the typical buying path that customers are taking. Something easily said but very difficult to do.

So here are some things I feel every online entrepreneur must do:

1. Keep search very broad and implement filters on search results. Techies have a tendency to use advanced search and this is a valuable tool which must be put under an advanced search button. However, in your initial days, you will not have enough variety to satisfy users. Putting a very detailed search is akin to putting up a sign saying restaurant and not having a menu. Customers will come in ask for truffle and cake and other exotic dishes and you will return zero search results. In the initial stages it is much better to offer a broad search and maybe a direct category browse or graphical browse of featured products. Make sure you put the price on the featured products and choose products that are good deals. As you get more information about what customers are searching for work furiously to add to the catalog and feature those products. Make sure that on the search results page you have an ability to further filter these results based on the parameters that you usually would put in the advanced search page.

2. Do an excel sheet SEO exercise as outlined in the previous post. As mentioned take an excel sheet and list out all the keywords and going one by one take each keyword and reword content on your website to ensure it contains these keywords. Obviously, user experience is key and don't do anything that will look or feel stupid and as if you are stuffing garbage into the website but go through the exercise.


3. SEO internal pages. The way to do this is to rename links and ensure content on every page is SEOed and not just your homepage which will be actually the most difficult page to SEO effectively given that it has the most generic content. I'll give you an example if you are a seller of books it is rare that someone will come to your website after typing in 'online book seller india' - Instead it is more likely that there are a larger number of users who will type in particular authors names or the names of particular books e.g. "Selling the wheel" and you want those keywords to not point to your homepage but to an internal page for that particular product. Hence you must use these keywords and the authors names for your detailed page for that book.


4. Contribute to the internet. Create proprietary content which is not present anywhere else on the internet. This is treated favorably by search engines. Try and stay focussed to your business and create a depth of content which your audience will find useful. More importantly, try and syndicate the content to other websites who have higher Page Ranks and ask them to link back to you. This will ensure your page rank moves upwards. 


5. Direct user behavior by keeping the number of pages to the minimum.  Here is what I mean by this. Typically most websites will have a search results page and then on clicking on the search results you go to a product detail page. I would recommend instead of redirecting to a product detail page, try and see if you can replace the same with a HTML5 pop up. This is where there is no new page but a section pop out on the page itself and disables the background page. The popup must have all the information for the user to make his purchase decision and a two action buttons - to either close and go back to search results or else to purchase. This is called providing a strong funnel and I would recommend everyone do this.

6. Build an engaged audience and encourage contribution. This is really the toughest part of internet marketing. Build an engaged audience and get them to contribute to their website. Some of you might have seen on my About Me page that this is something I find very important ("businesses which can get more valuable not by attracting customers but by what customers 'leave behind') - I feel this is because a lot of websites feel that the way to get user generated content is to get user reviews and ratings on the website. This is not gonna help you get customers as it will be something that kicks in only after you have a large number of disgruntled customers :-) - Get inspired by Wikipedia. Is there a way to get other content on the website enhanced by the users?? Spend significant time and energy on this as it is a non trivial problem to solve. However the payoff of doing this is immense - you will build a great and loyal community and search engines and other directories will notice and reward the dynamism as part of their algorithms. 


7. Use alt tags for images. A simple tip but one that not many webmasters do. Remember images cannot be read by bots. The only thing that can be read is the meta data about them i.e. the alt tag. Ensure the alt tag is well formed and has content that is relevant to the particular image. Don't stuff it with crap. 


8. Spend time to figure out your facebook and twitter strategy. I will do detailed posts on using each of these tools and so at the moment I will not say much but to say that these are powerful tools and ones that cannot be ignored in todays internet. However, there is like all things in life a world of difference between the obvious and insight. Don't do stuff without spending some time to understand the implications of your actions and mapping out your goals from these exercises. 


9. Use Search Engine Marketing to get immediate results. SEO can never give you results in the same way. SEO is a gradual process. Search Engine Marketing or Online Advertising guarantee you immediate results at a price. In a sense it is like paying to get to the top of the queue. Use them effectively and you will be able to grow your business quickly and effectively. However, very few people understand how to use Online Advertising effectively. My view is that you need to prepare a business plan and ensure that you start with traffic that is coming vritually entirely from Online Advertising and gradually trending to where it is 40-50% of your total traffic. I say 40-50% of your traffic should come from online advertising as I feel you must grow your revenues by 100% every year. If you are able to get a base traffic from regular customers and SEO, then online advertising should be able to get you to this figure. However, remember with SEO that you must set a goal and dollar values and probability figures for every step of the selling process. Here you are spending real money and you need to get tangible results i.e. money in the bank. I like to think of SEM as pushing the gas on the accelerator because you don't have a lifetime to waste. Personally, I strongly advocate Search Advertising as opposed to Facebook, Display and other forms of Advertising. I have found it to be value for money.


10. Research creating an affiliate program. An affiliate program is where you partner with other websites, bloggers and online communities to promote your program in return for a success fee. Think of it as similar to online advertising but in a different format. A great affiliate program is the one from Amazon where once I sign up as an amazon affiliate - I get an affiliate code and then whenever I like a book, I can blog about it and my readers can click a link to view details of the book on amazon.com - If they purchase the book, I get a commission from Amazon - as simple as that. I have used a simplistic example of a blogger as an affiliate but there are many managers of large passionate online communities whose primary income stream is affiliate programs they participate in. Have a focused approach to creating a win-win affiliate program and reaching out to the right affiliates and recruiting them to your cause. 


Hope this was useful and I will write posts dedicated to facebook and twitter in the near future. Welcome comments and other feedback from others!! 

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Part 1: How to make sense of Google Adwords, SEO, SEM and all that jargon

Image by hober via Flickr

So everyone knows I have for a very long time been a product creator and innovator in the Telecom and Payments space. I have been very comfortable with the technology and business side of GSM, CDMA, USSD, GGSN, MSC, PCI, ISO and what not. I have never run or managed a dotcom and so running homestaysDOS.com has been a new and learning experience for me. I started the website on a lark without major commercial expectations and then being ambitious decided to try and run it as a business. Along the way, I've been learning how to run a pure online business and it has been one hell of an experience. I've just started and so I am sure there is a lot more to learn but I thought I must record some of my learnings as a means of sharing the same with others who embark on similar emarketing initiatives in the future. I will not cover the use of facebook and twitter in this post but I intend to do future posts to cover those in the near future.

So here are some of my learnings:-

Firstly, Overall my major learning is that selling a product online requires a very different mindset from selling an enterprise product or producing a physical product and marketing it. In other cases, you essentially are able to run the company in different silos albeit interconnected at the top but for the most part operating in silos. So typically in other cases, you conceptualize the product, you build it and once you have the product it is turned over to the sales team who then 'sells' the same. The sales team gathers feedback which is communicated back to the product team which then starts work on the new version of the product. There is clear distinction between engineering and the website which is essentially marketing. Now with an online offering there is no such distinction - the product is the marketing and the sales channel and so essentially there is no sense in having multiple departments and hence every individual working in the company has to work closely with each other and their individual functions need to be looked at in a holistic manner. Easier said than done. I am battling daily with having to change this mindset and will try below to share how I have tried to do it.

1. You Should Do It Yourself first: This is the first thing I wanted to emphasize. Today there are a large number of companies who specialize in emarketing and while many of them are very good, it is important that you start off on your own to understand what it takes to run this department and arrive at some key metrics so that you can keep an eye on these providers. The tools and ecosystem were built by many of the bigger players - google, yahoo, facebook etc. to provide a level playing field and enable a small business to reach out directly to customers without the need to hire expensive consultants and agencies. They add tremendous value but beyond a certain scale and I would never recommend hiring them when you know absolutely nothing about emarketing and metrics. Once you have done it yourself for a while, it may be worthwhile to save time and outsource the same to a professional.

2. Google Analytics is very simple yet powerful. Spend significant time playing with it and getting to use all its features. Without doubt, my search has shown me multiple analytics providers but none can compare with Google Analytics. It has its flaws but it is still the best tool there is and I would highly recommend that you use it to track visitors to your website. Some of the points below will emphasize the importance of certain statistics that are shown in google analytics.

3. SEO - how to go about it? SEO is the first real time when you will notice clearly the need for Product Development and Marketing to work together. Search Engine Optimization as the full form suggests is ensuring that your website ranks highly on the results page when someone searches for specific terms on google. I want to emphasize that only someone who knows nothing about SEO will be able to promise you that you will get ranked highly no matter what is typed into google. The best way I have found to improve your SEO ranking is to take an excel sheet and type out all the keywords users who you want to show up on your website may type. Ensure that these are keywords that demonstrate 'intent' and not just that the user is in your target Audience. Now the best way I have found is to go one by one and going over all content on the website ensure that you are using these keywords or are renaming link names and content text to include these terms instead of other words which may convey the same meaning but are not so commonly used. Repeat this process for every keyword and ensure that all dynamically generated pages have the same keywords autogenerated. Also make sure you autogenerate Alt tags for images which make sense. I would caution here against keyword stuffing -i.e. putting really large number of keywords into the meta tags and alt images - these will be ignored and will be penalized by many search engines so avoid the same. Think creative and think from the perspective of an user.

4. Figure out the whole Page Rank thingy:-  Page Rank is at the core of Google's technology and the single most important thing that affects the placement of your page on search results. Simply put, google assigns every page on the internet a PageRank. The more influential your page is the higher your page rank. The more number of people who link to you the higher your page rank. The more influential the person who links to you the higher your page rank. As such, focus on improving your page rank. The ways you can do this:- Be aware what your page rank is. There are nice toolbars which you can install on your browser which will show you the page rank of every page you visit. A good way to increase your page rank is to create original content and give it to other high page rank blogs or websites with the understanding that they will link back to you. The other option is to participate in a link exchange program or submit your website to directories etc. However, I have low confidence in such mechanisms.

5. Assign Dollar Values to Customers and segment the buying funnel into milestones with probabilities but no dollar value. This is another very important aspect to keep in mind with Running an online company. You must be able to say that if a customer gets to a particular point, it is equivalent to making x USD. As clear as that. You have to be clear that the metric must be well defined so that you can go to a crowded marketplace and yell - go to my website do so and so and I will be willing to pay you  75% of x USD. I like to make sure the metric is one which puts money into my wallet and I recommend you do so too but many web 2,0 companies will assign a dollar value to a user and so on and so forth. (I don't agree with this but thats the subject of another blog post). Now that you have defined your metrics, you can assign intermediate steps which tell you the probability of getting the x USD. Remember here you are assigning a probability to the steps but no dollar value. The value of a customer who gets to the final stage and drops off is still zero.

6. Keep tweaking your website to improve the drop off and bounce rate at every step. The bounce rate is the %age of visitors who come to your website and then decide that this was not what they were looking for and move on. The Drop off rate is the %age of visitors who drop off at every probability linked stage of your buying funnel. You need to measure each of these percentages using google analytics and make changes in the website usability to improve steadily and stabilize these percentages. This is an amazing exercise and something that should be done daily and on an ongoing basis.

Since this is a detailed subject, I have decided to break it up into two parts. Watch for the next part tomm.

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Focus: The great entrepreneur virtue

As readers of my blog might know, I recently started a website called www.homestaysDOS.com which quickly took off and became India's largest Holiday Home rental website. The sudden growth has taken me by surprise and as I'm building the business, I'm simultaneously building deeper relationships with mentors / advisors. Had a meeting with one of them today - I'll refrain from naming him as we've not officially announced our advisors but he's one of the founders of arguably India's most successful and loved travel company and someone whose inputs and advice I have grown to respect.

I'll set some context to our discussion: I'm grappling with the fact that Holiday Homes are owned by only a small minority in India. This is slowly changing with quite a few people having bought second homes in the past few years and over the next 5 years, a significant number of Indian families will get possession of their Holiday Homes. This is a big thing for us as it will significantly expand the number of Holiday Homes available to list on our website while also ensuring they are in clusters and so easier to manage as opposed to the stand alone farm houses and villas that presently populate our website. We have a series of challenges to navigate between when an upper Middle Class family decides to buy a second home to when they can list their property on our website and we can start displaying the same to travelers who can then book the same and go and vacation in them. It's tough being patient and esp given my character, I felt we as a company should ensure we do something and encourage or participate in the scaling of some of these challenges so that we could take control of our destiny (or hasten the arrival of the pot of gold at the end of the rainbow).

Mr. Mentor gave me some good advice which I felt I must share (with some summarizing and some of my own narration thrown in):

1. Figure out what would be core to your business when the business is in steady state. Only focus on that aspect even now and ensure that the 'business works' - this means transactions are happening, the customers are happy, the suppliers are happy and you can measure, monetize and analyze things easily. 

2. Focus on the existing low hanging fruit and the existing market no matter how tiny it is. You will be surprised as to how large even the existing market is. Focus on dominating the same.

3. Ensure you are building a community with the existing users and existing stakeholders while the market grows - when you are the de facto leader, the new stakeholders who come in will also gravitate towards you. 

4. Doing things to get to the mirage at the end of the road does not change the facts - there is no mirage. It's an optical illusion.

5. Studiously choose product and stakeholders that will position you in the light you want to be positioned and though of. Avoid products that will cause any friction or a bad experience for any set of stakeholders. 

6. Be patient. You cannot grow a market faster than it will grow. 

7. Position yourself as the leader. Ensure you are respected for your views, insight and business practices by all stakeholders. 

I am happy to have been able to attract some of the advisors we have and will continue to share some advice for the benefit of the larger universe. Please feel free to comment and give me your own advice!!

Some Things to keep in mind

Disclaimer: I try to follow all the below and try hard. Have formulated some of these rules through the mistakes I have made. The below are from my twitter account so some words have been shortened. You can follow me @roshandsilva


Never say anything bad about anyone. The A$$h0!$$ will communicate it to the person out of context.


Treat your team members as adults and individuals. Delegate power and set easy goals, measure performance.

As a leader be gracious and magnanimous. The wins are always of the team and the failures are yours personally.

Criticize in private and defend in public. Never underestimate the value to a subordinate of a leader who bats for him.


Leader's professional life will be lonely. Surround yourself in personal life with people who love you unconditionally.

Battle cynicism and people hiding under their desks. Get everyone to come out, bat for the company all guns blazing.


Prep ur team for an iterative process of market discovery. Many CEOs don't realize how disconcerting change and pivots are for team.


In tough times, forget sales, investors, focus on your team and making sure existing customers get high quality delivery.


Never tell people what to do. Suggest and steer. Let them come up with solutions and suggestions.


Management is baggage. Make sure the producers outnumber the bean counters by a healthy ratio


CEO travel is overrated. Plan outcomes and expectations, decisions before the meeting. Meet to close not to gettoknow.


Important as a leader to belv in God. Helps to ensure you do the right thing and endure the inevitable pain!!


Never let what other people say or do upset you. Focus on bettering yourself and doing good. Have faith that it will pay off


Take things at face value without discounting for bullshit. It will ensure that in the long run people throw less of it at u.


Genuinely wish for peers to do well. Leadership similar to golf. You play only against yourself. Others achievements/ failures don't affect ur handicap. 

Some CEO tips from Twitter

Feeling a bit lazy on a sunday so thought I would cross post some of my tweets. Here goes the first series: essentially a random set of tips for CEOs

• Most important rule: You might be tech/sales/BD/product guy but in a startup CEO is most imp. HR guy
• Sacrifice air/hotl miles, spend time in office w/ team. Listen, co-ordi and measure - let others acquire miles,see exotic places
• Imp CEO lesson: u r not a judge. Be a mavrick, treat diff. People differently based on the badges and scars they have earned.
• Set audacious goals - imagine you are trying to overthrow a dictator. Ensure team w/ skills to scale such heights. Not done it before.
• Ensure u connect with each individual and commit to taking care of whatever is most imp. For them so they can focus totally
• Another lesson: Remove separation between two txns with one entity and link them together if u benefit #reliance style
• Talk abt other party's P&L while keeping ur cashflow mind w dealin w bigcos. Few CEOs and BDguys knw tis trick& so do smll deals
• If u r doing a deal with some1 with no cash down, can u get further with money on table. can they give u credit to give cash??!!
• And finally - as the CEO be the good guy at the top and 'Do what you say you will do' - people must trust u to b sensible
• Never indulge in mud wrstlin/street figtin-is not done by CEOs - startup or big co. Boardroom battles are fine ;-)
• trust ur team.B clear that u will not police,violation of trust is death. U r after all overthrowin dictator

For more such stuff follow me on twitter - @roshandsilva

New article on HomestaysDOS Owner Blog

Hi Everyone,

I've just posted a new article on the HomestaysDOS.com owner blog. The article deals with things to watch out for when buying land for your second home. I've never mentioned much about homestaysDOS on my blog but felt I should as some of you who enjoy my writing may enjoy the owner blog too. There are links on the blog to subscribe to it.

http://owners.homestaysdos.com 

A dose of Reality - Planning not to fail

Image by Birmingham City University via Flickr

This post is inspired by one of my friends. He's been a business person for a very long time - He's dabbled in many businesses and never been able to get a business off the ground. He's very well connected and has amazing drive and energy but ends up never being able to really build a business. Whenever I discuss him with common friends, the view is the same - he's always perceived as a trader or a wheeler dealer. I thought I should write about a few basic principles in life which could probably help those who struggle or find themselves in similar situations.

1. Develop Competence. Competence comes from knowing stuff really really well. Much better than anyone else. Knowledge that can just not be found in books or on the internet. Competence so deep that it requires years of study and focus and perspective.

2. Build relationships. People do business with people they are comfortable with. Don't look at every person and think "How can I make some money from the 30 mins that I am spending with this person?" Recognize that you and the other person were doing other things before the meeting and have probably a schedule planned out already for things to do after this meeting. It is possible that one out of 500 people you meet may discuss something that is mind blowingly amazing and you would want to drop everything and focus on the same, but if that becomes 40 or 50 out of 100 people you meet, you are probably not reacting rationally.

3. Understand that building a real business takes time, energy and people. All of these are in short supply. The money comes if you are lucky when a dedicated team is provided the necessary resources and kept motivated and incentivized to attack a truly great market. It is not possible for you to attack multiple such markets simultaneously.

4. Recognize that you as someone who knows the customer is unimportant. A company who has real competence and has an acclaimed product most probably is known to customers. Even if they did not know the decision maker, they could easily get a meeting by displaying their credentials. You cannot make money without the assistance of their brand. You don't have credibility without the company who owns the product.

5. Recognize the business that you are in. Very few people have the balls to be 'traders' - A trader is one who makes money by using capital. He buys lows and sells high (f he is astute). A distributor is one who makes money by acquiring rights to a product and distributing it to individual buyers. If you are not paying money upfront or taking a bet on the actual movement of the price of what you are selling you most probably are a distributor. A stock broker is a distributor. A stock trader who is buying / selling to generate money is a trader. If you are a distributor, focus on building your distribution network. Don't try to or expect trader margins in the distributor model.

6. Don't bullshit / Go into Hyperbole. The world is small. Your shit will hit the fan and you will look like an idiot.

and last and more importantly

7. Take baby steps. Decisions makers unfortunately have to tolerate lots of bullshitters. Decide on the one thing you want to do and take baby steps towards your goal. Celebrate the small wins and build competence and your team so that you can take larger steps in the future. Winning small battles early will help you in laying the foundation of a profitable quality oriented business - fundamentals that will hold you in good stead in the future.

Making the tough decisions in life

Lots of people have told me that I've led a colorful life. I'll be 31 this year and have seen and experienced a lot courtesy my drive to not walk down the beaten path and my tendency to go with my heart and what I feel is the right decision as opposed to what is the easiest path. It however has never been the easy path. I have had multiple occasions when I've had to make tough decisions - whether it was to layoff staff, to fire people who were friends, to leave companies I founded and other decisions in my personal life. Today as I talk with friends I advise, I sometimes get a sense of deja vu as I see some of the decisions they are grappling with. I thought I would write a bit about some of the things I always try and keep in mind when I'm faced with tough decisions:-

1. I have obviously considered the facts and am unable to decide. What is my heart telling me when I reflect deep down inside?
2. Is the presence of loved ones and entrenched relationships coloring my decision making? Is my making the decision difficult because I know that going down the right path will hurt someone? Is that someone else rational and logical and would they have seen the merit of my decision if they were in my shoes? If so, can I work out a midway path that relieves some of their immediate discomfort as long as they let me proceed? Are they being unreasonably closed to a fair deal? If so, should I not do the right thing?
3. I am my own person and I will make every decision independent of the baggage of industry norms, cultural norms, and societal pressures. I will give people a fair chance to make it in spite of their circumstances and will stick my neck out for the meritorious side even if that means I may have to sustain short term pain.
4. Decisions always have consequences. It is foolish to expect that life is the same no matter what path you choose. Am I prepared to sustain financial, societal, reputational damage in order to make what I feel is the right decision? Are the people I am going to make this decision for prepared to stick by me even if the worst case scenario comes true?
5. Lastly,  am I being consistent with all the commitments I have made if I make this decision? Have I ever directly or indirectly signaled that I will be going down a different path and caused people to be emotionally, financially and socially invested in this decision? Can I resignal?

While thinking through the above points helps me in arriving at my decision, I also feel having an experienced friend or guide to talk things with / share a drink with or else just vent to helps me tremendously. We usually know what we need to do. We just need to hear our thoughts aloud. And we need someone to tell us what we already know - It's time to be brave and courageous.

Lastly, this is a tip to esp. people who are facing tough decisions: Believe in God. In moments when things really get tough, it is comforting to believe that someone out there is listening to you and protecting you.

I leave you with something from Shakespeare

This above all, to thine own self be true,
And it must follow, as the night the day,
Thou canst not then be false to any man.


---
Act I,. Scene 3, Hamlet


All the best!!

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Facebook, Twitter - Vitamin or Pill?

Image via CrunchBase

So I had an interesting discussion today with a startup coach who mentioned to me that he loved investing in companies which were pills and not vitamins and that in his opinion Facebook and Twitter were both vitamins. I strongly disagreed with this assessment and felt I must write this blog post to detail out my views on why.

Firstly I want to write a bit about this business of investing in Pills Vs. Vitamins. I have never categorized nor do I look at companies and whether they are in the business of selling Vitamins or Pills. I believe from my experience that this is an oversimplification and categorizing something as a vitamin or a pill means that the target audience has not been segmented or identified clearly. Instead, I think of products with this viewpoint - will the product drive consumer change?- there will always be a section of consumers who adopt early or for whom the need is most - can these be targeted cheaply and made to buy the product at a higher cost? Can the money generated be used to further drive marketing that will precipitate a change in consumer behavior - effectively ensuring that the product crosses the tipping point and becomes a must have for a larger audience who then flocks to the product thus reducing customer acquisition costs and ensuring that the company can reduce the price of the product and thus ensure widespread adoption and hence become a part of everybody's lives. With widespread adoption can the company then enjoy a monopolistic position and create an entry barrier through brand, network effects and R&D? To sum up: I look at products not as vitamins or pills - I consider them all as drugs and look at whether there is a real strategy to ensure that the pill becomes widely popped over time.

Coming to the question of facebook / twitter being Vitamins or Pills - I will restrict my thoughts to Facebook as I am still studying twitter and so will restrict my comments on them till I have had some more time to firm up my views. I consider Facebook a pill and not a vitamin by my friends definitions.Why so?

I consider man a social being. Human beings live in society and meeting others, socializing, being parts of groups and communicating are in my opinion part of the very fabric of being human. Being social is not a choice that most people have. How social is a choice but being social is not one. I truly believe facebook is the future of society. It is inconceivable to me that in the future a human being will be able to live in the world without a facebook account and without socializing on facebook. It is also a business with very strong network effects. As such, it is in my opinion a true pill by my friends definition.

Now coming to some more complicated examples of two products I feel illustrate how smart business people create drugs and ensure that their pills are popped.

The first is mobile telephony. In the initial phases mobile telephony was what my friend would have considered a vitamin. If you were a pill Vs. vitamin investor you would never have invested in a mobile telephony company - after all no one really needed a cell phone. It was just an indulgence for the rich who wanted to spend 20Rs. per min when the landline could do the same job at 1 Re a min. A smart entrepreneur instead would have decided to segment his audience - go after the audience for whom mobility and urgency was a must and then slowly target other market segments before the tipping point was crossed and the masses flocked to get a cell phone. In the interim, smart entrepreneurs used marketing to hasten the arrival of the tipping point. Today of course mobile telephony is a basic necessity of life - a pill for sure but for a small section of India for whom it still is a vitamin by my friends definition.

The second and a not very Indian example is Viagra. I am sure most people would consider it a vitamin. However, I would not. Again I am sure the very smart people at Pfizer recognized the huge opportunity that this drug was and decided to do the right thing - segment the market - they went after the audience that needed it most and addressed them through the right channel - the doctors. However, with time and growing awareness, I am sure that today probably less than 1/10th of the viagra being sold is for people who really need it and the rest is for people for whom it is an enabler of a better 'lifestyle'. This in my opinion is a valid reason to buy something and in my books makes it a pill that people are popping. Even in a young country like India I am sure every person in the target audience has already heard of Viagra and when and if they need it, they will be consumers of the product. This is without Pfizer having spent any advertising or marketing dollars to promote the product in India. This is what smart marketing has caused - a shift in behavior making a huge number of people - pop this pill.

To sum up:- The trick is not to look at things and decide whether they are vitamins or pills. This is a strategy that does not demonstrate gumption. Instead the things I ponder and I ask other advisors, investors and mentors to ponder: Is there value that this product is delivering? Can the target audience be segmented and targeted at a reasonable cost? Can the company precipitate a change in consumer behavior and take the product mass market in time? Do I have the vision to see far enough and see how people, companies, communities will change by adopting this product? Is that a scenario I think is likely or one I think smart marketing can precipitate in the near future? Making money is never easy and simplistic and creating markets and blockbuster products require many things to fall in place most importantly luck. What definitely does not make money is watching from the sidelines.

Related articles

• Can You Have Sale Before Scale? (tommartin.typepad.com)
• What's The Deal with Vitamin Supplements? (fooducate.com)
• Have the BIG Idea for the Next Twitter? What's that Worth? (successful-blog.com)

Things to notice on candidate's LinkedIN profiles

Image via CrunchBase

Today LinkedIN has become a very good source of information on candidates. I find myself using it regularly when hiring Senior people as part of my team. However, I've now realized there is a particular class of person who is lurking on LinkedIN and it is very important to notice this person and to take their linkedIN profile with a pinch of salt. Here are some of the things that if I notice I generally avoid connecting with the person.

1. Over 10 recommendations (usually from people who don't matter): This usually means the person has gone out actively to seek recommendations or has asked others to recommend him. Reasons why people do this is that they have been on the job market for a long long time and at the outset are not confident of landing a job as per their expectations. Your eyebrows should esp. go up if you notice the recommendations are from former or present colleagues (former - usually an indication that the person was fired or laid off, present - person has been told to leave and is serving time). I always try and read thinking if the person who wrote was a junior, why would he feel he was entitled to recommend another person unless the person requested it.

2. The person has a large number of groups he has joined and has not participated in any discussions or contributed to the same. It usually means that they are trying to contact as many people as possible during their job search and have very limited real life contacts and so their only means of connecting with other people is to join the same groups as them.

3. You see brand name universities like IIT, IIM, Harvard etc. as part of the qualifications when all the person has done is a certificate program or a Continuing education program from these institutes. This is called 'Resume Embellishment' by recruiters and bullshitting by the rest of us.

4. Vague terms in their profile that seem disconnected with their job title or else their title itself seems Vague and something that no professional company would give them. So you might see Key Member of Management team instead of Vice President or General Manager. Job description may include references to 'opportunities' they created, 'pipeline' they generated or 'potential' business they got or 'revenue/ business they managed'. This is to portray a bigger image of their actual position to recruiters.

5. Connections who seem to have never worked with the person or who seem to be from competing companies. This is a very key flag that I look for. It is a dead giveaway that the person has been interviewing at multiple companies in the industry. Such a person cannot be trusted to not sleep with the enemy in case you apply pressure on them once they join your company.

6. People who send you connection requests in spite of not knowing you, knowing you very briefly. It means that the person is highly insecure in his/present present position and is putting you down as a valuable contact who he will approach for a job or some matlabi reason in the future.

7. Anything emphasizing that they did something major in a short time. This means that they were quickly fired for not doing anything and they were expecting the firing and so did some bullshit to show activity in the short time they were around. Real achievers know nothing real and major happens in a short time.

On the flip side here are certain things that I see which add to the credibility of the person:-
1. Recommendations from other individuals whose enjoy credibility in the marketplace and who would not recommend lightly.

2. A LinkedIN paid user - this means the person is serious about using LinkedIN as a business tool.

3. A very brief outline for technical staff. This means the techie is right about not needing to put himself up on LinkedIN. It is more a resource for business development people.

4. A person who has made sense through their postings on LinkedIN groups as opposed to one who is just commenting to get noticed.

5. A person who is from an A-grade university and  has mentioned societies he was part of during university days, is part of specific alumni groups - Harvard Grads of 2000 for instance. These groups are usually moderated and so very difficult for a poser to join.

Hope this was useful and welcome any comments. Sorry If I sound a bit harsh and judgmental but for me hiring the right team is one of the most important aspects of building a great company and these are things I wish I had known earlier.

What my desk looks like

Upon the King

William Shakespeare

Upon the king! let us our lives, our souls,
Our debts, our careful wives,
Our children and our sins lay on the king!
We must bear all. O hard condition,
Twin-born with greatness, subject to the breath
Of every fool, whose sense no more can feel
But his own wringing! What infinite heart’s-ease
Must kings neglect, that private men enjoy!

Henry V—William Shakespeare

Dedicated to the CEOs and leaders out there. A stark reminder from Shakespeare that being the leader often is a lonely position.

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Sula Mosaic White - Chenin Blanc + Sauvignon Blanc

So Parshu came over from Bangalore to stay over at our place recently and we opened a bottle of wine on one of the few evenings that we decided to stay over at home. Parshu is also very knowledgeable about wine and so it was a pleasure to open a bottle with someone who is not particular about the price of the bottle but just enjoys trying different wines. We opened a bottle of the Sula White Mosaic from my collection - If you remember a few weeks ago I had reviewed the Sula Red Mosaic. Now the Mosaics are called so because they are a blend of two different grapes from Sula's vineyards. This particular one is a blend of the Chenin Blanc grape (very popular in India for it's sweet taste) and the Sauvignon Blanc grape. Firstly the bottle

As you can see the bottle is a more contemporary as compared to the traditional wine bottle in keeping with the more young and easy drinking market segment that Sula is trying to position the Mosaic range in. It's a very elegant bottle green bottle with a black and green label.
The actual wine:

As you can see the wine is a light yellow and not a dark yellow as some chenin blancs tend to be. It's actually straw colored and in some ways similar in color to some of the lighter champagnes.
Finally our verdict

Yes. We are all smiles for this wine. It helped that we were not expecting much and Parshu and me were good friends catching up after a long time but we agreed that this was an excellent easy drinking wine. It was a bit on the sweet side and not very strong on tannins (that make the more mature wines bitter) that got me thinking that probably college kids would love to have this around at parties and you could probably consume quite a bit and only realize a bit later that it has the same amount of alcohol as a regular bottle. This bottle was also very fruity and I want to one day try using it for a Sangria. It would probably really rock as a mixer. The price is another thing that I must mention. At around 350 Rs. it is a killer and is ideally suited for afternoon parties at your place. I would highly recommend this new introduction from Sula. A must try for anyone wanting to taste different wines. I will also always keep a few bottles of this to serve on relaxed saturdays or to use to prepare my next Sangria. Cheers

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Building a Viable Merchant Network - An exercise in Critical Mass

Image via Wikipedia

I often get approached by a range of people looking to build Merchant Networks in different parts of the world. This business plan bores me as I have seen and analyzed over the past 3 years possibly every variation on this core theme. I wanted to give a tip to entrepreneurs and managers building Merchant Networks.

Firstly, the merchant network has three main components - The Merchants, The End Consumer and The Operator (yourself) of the Merchant Network. Running this business successfully is an exercise in building immediate value for each of these stakeholders. So in effect in order to do this business successfully, you must create three Financial Analysis sheets- one for the merchant, one for the consumer and one for the operator of the network. List out the financial benefits that an average participant in each class - an average merchant or an average consumer or you - will enjoy and do a common sense check on two things:-
1. Whether the financial benefit is positive. (It is surprising how many merchant network business plans are built on propositions which are loss making for the average merchant)
2. Whether the financial benefit is significantly lucrative on an absolute basis for the average merchant and average consumer. I call this the significance test and a lot of products in my opinion fail this test. I firmly believe most loyalty programs, cash card programs and other merchant rewards programs will fail this test.

If your analysis leads you to believe that the above two checks are not going to be met by a large margin, my view is that the Merchant Network will not be viable.

So if they do, is everything hunky dory? I wish life was so simple.

The more usual situation will end up being the following:-
Your Merchant Network will need scale to be viable. What I mean by scale is the following - The Merchant Network is a network akin to other networks like the phone network - I would encourage you to think of your application in a similar frame of mind as SMS - the short messaging service. The value of the network becomes more compelling as the number of network participants increases - i.e. the number of merchants increases. Once there are a larger number of merchants the average customer is more motivated to join the network and once there are a large number of customers on the network, the average merchant who is sitting on the fence also will be eager to join the network further strengthening it.

As such, it is important to scale the network significant in the initial days in order to get to the critical mass required where the target customer encounters the network multiple times in your circle of competence. 


How is this done? Some tips:-
1. Focus geographically. This is in my opinion the best strategy someone trying to build a large merchant network can adopt. Ensure you focus on a small geographic location which is self-contained and manageable. Ensure that you narrow your target consumer down to a resident of that geographic area and acquire enough merchants to get to critical mass in that area and make participating in the network a must-have for the target consumer.
2. Focus on Narrow easily addressed Target Groups (more difficult but more profitable on a percentage basis). This could be identified niches e.g. foodies, movie buffs, frequent travelers, train commuters and ensure that you sign up enough merchants to be relevant to this target audience.
3. Build a hub and spoke model - Ideally, own the hubs yourself so that you are closer to the market and are investing adequate resources to ensure that the cluster is viable. Do not succumb to temptation to do away with the hubs or replace them with hubs owned by third parties - e.g. Distributors.
4. Do the math- Calculate precisely how many spokes and what volume of commerce is required to ensure viability of a hub. Only invest in a hub when there exists demonstrable commerce of that volume. Believe marketing when they say that the commerce will improve due to their efforts. That additional volume will be much needed free cash to invest in a new hub. The intention is to make money and not to just break even with every hub.
5. Stress test all partnerships, systems and economic assumptions in the concentrated first geography before expanding to another geography. The trick is to drive around a new track once to familiarize yourself and then drive the next 9 laps at full speed when you know what to expect.  

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• What will it take to make mobile payments mainstream in the US? (venturebeat.com)

Good reasons to have a meeting

Image by ylakeland via Flickr

So I started off writing a post on 10 things to do so that meetings remain useful. As soon as I started typing, I realized that I did not feel motivated enough to write that post. I personally believe 90% of all face to face meetings are useless and could have been avoided. As such, did not want to write something which then others would use primarily (9 cases out of 10) for meetings which did not need to happen. So I thought instead I would list out some of the reasons why I feel meetings are important:-

1. Social meetings are important. I would never want to underestimate the rapport one can build over a heart to heart chat, a drink or over lunch or dinner. Successful people become successful because they very rarely lie and while in a corporate situation they may try to be diplomatic, in a heart to heart chat they would be upfront and direct with you. Getting to this level of comfort takes time otherwise and so I feel doing such social meetings are important. Social meet and greet meetings are also great where the leader meets people across the spectrum of the company and builds empathy and gets ground level feedback.

2. All hands meetings or meetings where the top boss is present (Any other meeting does not qualify as an 'All' Hands). I don't support all hands meetings where the leader is talking or taking questions. I feel this is much better done over email. I feel All hands meetings are best called on a regular basis to cut through corporate bureaucracy and to ensure that there are no silly wait times because some department is 'waiting' for information that they don't have or for some other department to act. 

3. Briefing meetings. This is when you are working with an external company / contractor and you need to brief them on your requirements. I have found in such situations, the RFP may not be comprehensive enough and so it may be best to spend some time with the sales guy front ending the deal to ensure he has absorbed exactly what you want from the solution. 

4. Meetings with important people. This one is bound to be controversial but I feel these meetings need to happen in person. Unfortunately, super important people are super busy. It is very difficult - sometimes near impossible for them to respond to email or to schedule a meeting. My feeling is if you have got a relationship with such a person it is worth your while to head to their office and wait in line to see them. 

5. Show of support meetings. This is where you are trying to drive a larger industry wide issue and where it is necessary for a bunch of people from the same Special Interest Group to meet a third party who can make a difference. I feel here things are best done faces to face where they can appreciate that a bunch of high powered people are serious about pushing through an agenda. This is just not effectively done through email. 

Ideal Times for such meetings -Social Meetings-45-60mins, All Hands Meetings- 20mins, Briefing Meetings-10mins, Imp people meetings-20mins, Show of support meetings-45mins 

I've been recently trying a new strategy to keep meetings short which is to do meetings standing up. I will post my analysis on the effectiveness of this strategy once I have more experience with it. 

P.S. I have made some changes to my blog template. Wanted some feedback on how it is displaying in blog readers. Do let me know if you feel your reader is not displaying my posts in a reader friendly manner.

Life should be busy

Image via Wikipedia

So I watched two people living their lives recently and they've inspired me to work harder. One is of course the Indian Film Star Shahrukh Khan who I've been following on twitter. He's either got a very good team around him or else it's inspiring to see him put in the effort to connect with his fans. I am seriously amazed that he spends time responding to queries, interacting with his fans and showing off his personal side. The tweets come in really late at night and so I imagine he must be a workaholic.

The other person who I noticed is Dr. Nozer Sheriar - our baby doctor. He's one of the well known baby doctors in Mumbai and I was very inspired to see that on a regular day he works till mid-night. A doctor's job as you all know is not like a regular desk job. He was seeing a patient every 15mins and I don't think a single patient went away with a feeling that the doctor did not give her the necessary time and attention. I remember thinking the same when visiting Dr. Milind Kirtane - a very renowned ENT specialist in Mumbai along with my dad. His appointment slots were of 15mins each and needed to be booked 15 days in advance. I'm don't know if it was a stroke of luck or providence but in a 15minute consultation he diagnosed and fixed an ailment that my dad has been battling for over 15 years with multiple specialists across the globe. These two Doctors and a lot of the other doctors must love their work in order to sacrifice their personal life, rest, relaxation etc. for it.

I am inspired to work longer hours and put in even more energy into meeting my professional goals having seen these people. Thanks Guys!!

New Wine Tasting: Sula Mosaic Grenache Syrah

So I opened a new bottle after a really long time. Hemant, a close friend came over to my new place and I decided to open a bottle which I have had with me for quite some time and had not opened for lack of company. So We decided to open the Sula Mosaic Grenache Syrah bottle of Red Wine. As the name suggests, the wine is a blend of two varietals - Syrah and Grenache.

I liked the bottle. Interesting packaging though not very expensive looking in keeping with its positioning to be a daily drinking wine. Good pricing too - the wine had an MRP of 360 Rs. Me and Hemant both agreed that this price needs to come further down to 150-200 Rs. a bottle so the average person can really start experimenting and consuming different types of wines in India.

On to the wine:

As you can see its got a very dark fruity color - I guess the influence of the Syrah. Low tanins and so you don't really get too much of a headache.

About the actual wine: We felt it was decent and good for casual drinking. It has a bit of an after taste so it needs some getting used to for the white wine drinkers esp. But all in all a very nice smooth wine. We had the wine a bit chilled (10mins) - something I would recommend doing in India. The wine was fruity and in my opinion could be a good accompaniment to Indian food esp. at restaurants where I hate ordering expensive wines as I always end up feeling ripped off. I'm going to order this one instead. I must also give credit to Sula for really being the one Indian wine company that seems to be able to deliver in quality between their bottles.

Would I recommend this wine? Yes. My advice to all wine drinkers is to buy and drink as many different types and varietals as possible without looking at the price. The price here will definitely surprise you esp. if like me you are used to always paying more than double for a bottle.

Going to leave you with another picture of the bottle with some nice sweets I picked up from Lonavala both residing on a center table that I designed for my new house.

Happy Drinking!!

The Old Man and His Cat

There was once an old man
Very wise and of stately bearing
He had lived a long life
One filled with students, journals and meetings
A very busy life
And one of great challenges no doubt.
But tonight was a special night.
He was in his office and he knew this was it
The culmination of his career so bright
Of endless nights and frustrating experiments
Here it finally was
Something bcos of which he would be remembered
His time of glory unencumbered
Something that would empower his nation
Grant it global domination
And make it the policeman of the world.
It would soon be over. So he got out his
Ole bottle of Jack and poured it on the rocks
He downed the first one straight
And poured himself another long one.
As he sat down swirling the rocks
Along came his trusted cat Alex
"Alex, tomm. I shall be famous
I will be able to rest at last
Knowing that I have left my legacy
Bcos of which the world will remember me
And the government will honor me.
Finally. I will be counted among Achilles, janus, theseus, Edison, Einstein, "
The cat he goes
"Wow. Is tonight's discovery such a big one?"
"Yes it is. It will transform the world
And make my whole slavery meaningful.
Without this night I would be just another
Prof. Rubenstein
tinkering away in a lab in vain
And wasting government money.
I have lived my life to its logical end.
What about you Mr. Cat?"
"I have eight lives more you see
Since we are born with nine lives
And I am yet on my first one.
I will use this life to relax
To try and make the world a better place
And give lots of love to my human friends
And make them love all cats
You see I know not who will be my next master
Or will I be a stray
So I need to do small things
For my own future
As all my other cat friends are doing the same. "
And so night fell
And the next day came.
The wise man woke up and flossed his teeth
The cat woke up scratched himself
And it was business as usual
In the East and the West.


- attempt at poetry inspired by Mr. Bojangles

Act I, Scene 3, Hamlet

"Yet here, Laertes?  Aboard, aboard, for shame!
The wind sits in the shoulder of your sail,
And you are stay'd for.   There, my blessing with thee,
And these few precepts in thy memory
Look thou character.  Give thy thoughts no tongue,
Nor any unproportion'd thought his act;
Be thou familiar, but by no means vulgar;
Those friends thou hast, and their adoption tried,
Grapple them unto thy soul with hoops of steel,
But do not dull they palm with entertainment
of each new-hatch'd unfledg'd comrade; beware
Of entrance to a quarrel, but being in,
Bear 't that the opposed may beware of thee;
Give every man thy ear, but reserve thy judgement;
Costly thy habit as thy purse can buy,
For apparel oft proclaims the man,
And they in France of the best rank and station
Are of a most select and generous chief in that.
Neither a borrower nor a lender be,
For loan oft loses both itself and friend,
And borroing dulleth the edge of husbandry;
This above all, to thine own self be true,
And it must follow, as the night the day,
Thou canst not then be false to any man.
Farewell; my blessings season this in thee!"