From Flipkart, Myntra, Snapdeal to Housing.com and Ola Cabs, some of India’s leading startups have raised more than a 100 million dollars in funding, and have now become household names.Funding plays a key role in the success and growth of any startup, and finding the right investor is often the most challenging aspect of the startup journey.
Is it just about having a great idea, a great product and a great team? What metrics do investors look for while funding startups? When is the right time to go for subsequent rounds of funding? How important is the educational profile of the founder when it comes to attracting investors? These were just a few of the questions that were answered in the June edition of Startup Saturday Bangalore on the theme ‘All About Startup Funding’.
The session began with Sumit Jain, Co-Founder and CEO of CommonFloor.com, talking about the inspiring journey of Commonfloor from the idea stage to the stage where it is now – a startup funded by leading investors such as Accel Partners, Tiger Global and Google Capital. “You can do whatever it is that you want to do. You just have to want it badly enough,” Sumit stated, shedding light on the factors that contribute to the success of an entrepreneur. “Self-image is the most important thing. You are what you believe you are.” he further added.
“Should I find a co-founder for my startup? When is the right time to hire one?”- answering these questions that entrepreneurs ponder over while starting up, Sumit advised, “You don’t need a co-founder to start a business. You just have to believe in yourself. But, if you do go out looking for a co-founder, make sure you choose the right one. Your co-founder is going be a significant part of not only your business, but also your life. Make sure you find someone who has complementary skills, and someone with whom you can work hard and have fun.There’s never a bad time to hire a good guy, and never a good time to hire a bad guy.”
The entrepreneurial road being a long and lonely one, Sumit also stressed upon the importance of finding mentors. “Find someone who is unbiased with the true intention of helping you. Someone who can be a pillar of support during tough times.”
When asked about his experience finding investors for Commonfloor, Sumit recollected, “The first VC that we approached told us – ‘I will get back to you’, a softer way of saying ’Get Lost’.Your startup won’t get funded because you need funding. Entrepreneurs are not beggars, so don’t go around begging for money. Build a company that adds value, look for the right co-founder, build a great team and pitch your idea confidently to convince the VC to invest in you business.”
Sumit concluded his talk with the message that competition isn’t necessarily a bad thing for businesses. “Leverage it and let it drive you to move fast and strive to be the best. It doesn’t matter whether you start first or start last. Focus on fast-mover advantage, not first-mover advantage.”
Following Sumit’s inspiring talk was a workshop session on the ‘Basics of Funding’ by Manish Singhal, an entrepreneur, startup advisor and one of India’s leading angel investors. Manish spoke about the different exit routes that are available to investors such as acquisition, subsequent rounds of investment, investor buyback and IPO.
He also gave insight into the metrics that investors look for while funding a startup. He mentioned these 3 key factors: 1. Scalability of the startup, which depends on the quality of the team, their ability to achieve the goals, and the skill-sets they bring to the table. 2. Market size of the business 3. Secret Sauce – the x-factor that makes a startup stand out from the rest, and makes it a potential force to be reckoned with. While these are some of the startup traits that investors consider during investment, Manish added that, “Every venture is fundable. It’s all about finding the right investor.”
When asked about the role the educational background of the founder and the core team plays,when it comes to finding investors for a startup, Manish said, “Degree is overhyped. The capability and the thought process of the founder is more significant to the investors.” Answering a question about the need to have a tech co-founder for the startup, he stated, ”You do not need to have a tech founder. However, if technology is critical to your business, then you must have a good in-house tech team at the least.”
For entrepreneurs concerned about their startup idea getting stolen by investors, Manish suggested that if your startup idea is so simple that it can be stolen, you must do something to make it unique. Execution of an idea is more important and if your execution is exceptional then you don’t have to worry about the idea getting stolen.
Manish’s talk was followed by the event’s most awaited session – The Panel Discussion, moderated by Rohith Veerajappa(Co-founder at Wow Labz and Senior Volunteer at Headstart Network Foundation); and featuring panel speakers: Sumit Jain(Co-Founder and CEO at CommonFloor.com), Manish Singhal(Entrepreneur, Angel Investor, Startup Advisor), Sanjay Jha(Founder at LetsVenture), Sanjay Anandaram(Venture Partner at Seed Fund), Sanjay Swamy(Managing Partner at AngelPrime) and Girish Rowjee(CEO at Greytip Software). Below are some of the words of wisdom shared by the panelists as they answered the funding-related questions fired at them by the inquisitive audience:
For Funding everything is reasonable and everything is stupid – Sanjay Swamy
Funding is not the end. It’s the beginning of a huge responsibility – Girish Rowjee
Keep your investors excited about your business. Tell the bad news first and ensure that they are on the same page. – Sumit Jain
Scalability is the key factor when it comes to raising investment – Manish Singhal
Investors are not interested in products. They are interested in businesses – Sanjay Anandaram
It’s more important to have an execution plan than a business plan – Sumit Jain
If you are not an expert in the business, don’t start the business – Sanjay Swamy
Your goal must be to grow the business, not get money. – Manish Singhal
Solve real problems. Market trends come and go. But, startups that create value never go out of fashion – Sanjay Swamy
In addition to the main sessions, the event also featured impressive demos by ProcessBee, a startup that offers game-based learning solutions for the training needs of corporates and students; and DeliTreat, an app that allows you to explore your favorite places, earn treat points and reap rewards. The two startups got a chance to present their idea in front of the enthusiastic audience and gain some valuable customer insights. There were also numerous interesting startups that had their stalls put up at the event venue. The participating startups being KlubKonnect, a fitness clubs aggregator; Lumbertome.com, a platform connecting wood artisans with buyers; Merrygolearn.com, a startup that provides activity based teaching for kids upto the age of 12 years; and Trial Kart, a virtual reality app that lets you try outfits before buying them online.
The June 2015 edition of Startup Saturday Bangalore was a mega event attended by 500+ people that included a mix of entrepreneurs, aspiring entrepreneurs and early-stage startups. The event was the largest the Startup Saturday team has ever hosted till date. A huge thank you to the amazing audience who attended and participated actively in the event; and to our long list of event partners: IBM Bluemix, Dropkaffe, Yourstory,
About Headstart Bangalore:
Established in the year 2008 with the vision to ‘Change the World through Entrepreneurship’, Headstart Network Foundation (headstart.in) is the largest network of early stage startups in India. A non-profit, volunteer-driven organization, HeadStart Bangalore facilitates entrepreneurial learning, hiring and peer mentoring amongst the startups and addresses their issues through various initiatives such as: Startup Saturday Bangalore, Headstart Clubs, Headstart Higher, Headstart Cofounder Search Program and Headstart Inturn.
Catch a glimpse of the action here
If you are a startup founder, then Headstart’s another initiative ‘The Headstart Co-Founder Search Program’ can help you find your ideal co-founder. Scheduled for Saturday, 27th June 2015, this one-day, invite-only event will provide you with a platform to connect with potential co-founders, that match your requirements. The program goes beyond conversations over coffee, and includes speed dating sessions and fun team building activities that enable you to get to know the potential co-founders and make the right partnership. To register yourself for the event visit : http://www.cofounder.
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