Archive for February, 2008

Power of Being Online

Voice of the CustomerAmong various benefits internet offers to its users, “Voice of the customer” is one of the most powerful tools. The notion “Customer is the King” is absolute reality in the internet age. Let me share a recent real life incident in which I personally experienced the power of being online.

Last year I bought a new Apple MacBook and I was very happy & excited when I started using it. Unfortunately, I faced multiple breakdowns – first battery crash, then data crash followed by hard disk failure. Even worse, I received horrible customer service from Apple’s service center in Delhi. More than the valuable data, I lost precious time fighting with Apple India. But they were reluctant to hear. Being an Online Marketing training provider, I thought of taking a different approach – instead of me going after them (push), let me create a pull towards me.

I authentically shared my experience of Apple MacBook and Apple India’s service at:
- Apple Sucks (MouthShut)
- Apple Sucks (CNet Reviews)

As expected, I got a call from them. They apologized for my experience and offered me a brand new and the next version of the laptop as the compensation. Although I didn’t want to but I finally accepted their request. Looking at the comments, view/read stats and the popularity of the above mentioned sites, I am sure that Apple paid a heavy price for the mistake of not listening to their customer. Since I’d given my email id in the review, I am receiving mails from people asking for my advice on whether they should buy Apple machine. Virtually, I am driving (or preventing) a part (however small it is) of their sales.

What lessons did I learn (equally applicable for you) from this experience?
1. My voice matters – As a customer, I am much more powerful today than ever before. I can and should demand the respect and service I expect from my vendors.

2. Customer is the king – As a business owner, I can’t ignore the voice of my customer or I will pay a very high price. Given the networked world (socially and professionally) today, it pays to be honest.

I can correlate this strongly to my previous venture in which we used to serve IT professionals who were strongly connected to each other through various discussion forums relevant to our services. Occasionally (especially in the very beginning of our venture), some people would say negative about our product/service. Instead of taking that as a feedback and an opportunity to grow, we used to defend ourselves by giving counter response. Till the moment we acknowledged our mistake, the problem would only grow. The moment my customer got the experience of being listened to, the discussion will end.

The same happened in this experience with Apple. The moment they called me I stopped thrashing them and when they again faltered I went out against them. This idea of writing a blog post about my experience serves two purposes – first, sharing the lessons I learnt with you and second, making Apple India realize the importance of customer service.

3. Pull always works better than Push – Whether you are selling or buying a product/service, pull always beat push. In the online world, pull is not only more effective but also more feasible.

I hope you find this experience valuable. Please do give your inputs and feel free to share any such experience you might have had in the past.

You may also want to check these 2 interesting experiences of Online Reputation Management (ORM):
a.) Ola Cabs Case Study
b.) Toyota Altis Review


Startup And Marketing


I guess i am a novice is this field and would like to throw a few questions at the community -

( I understand that answers to these questions may differ between different business types)

1. How much budget do you guys keep aside for just marketing (Pre/Post revenue) ? Please mention type of business.

2. Does web marketing/SEO generate positive sales leads ? I find most of the SEO guys unethical and spammers, and very annoying when they post about your company link in irrelevant blog articles.

3. Whats your take on print media, and how effective is that for positive leads?

4. Practically what worked better for you – google-adwords/ banner at some website ?

5. Any innovative ways you used to get positive coverage ?


Sponsor a Business

Dear Friends,

This is one of the better ventures I have come across, leveraging the power of community to empower entrepreneurs.

Its a matchmaking project, connecting entrepreneurs who need loans with lenders who can offer loans.

If an entrepreneurs needs Rs. 50,000 as loan, he can receive it from multiple lenders , maybe in smaller chunks of Rs. 5000 each. Similarly a lender can spread his loan of Rs. 2 Lacs, across maybe 10 or 20 businesses.

Last week statistics revealed on the site are inspiring to know, the model seems to be clearly working.

Close to 4000 lenders have joined, 1400+ entrepreneurs have been funded collectively amounting to Rs. 2.5 crores.

This idea needs to spread fast, it is currently being positioned to help poor people with a zeal to do business, but who lack basic resources.

To ensure that the people do not misuse, the project works with local micro finance companies.

Surprisingly in India, there is only one field partner listed, it is Delhi based Somaiya Group.

Pls, Pls share and forward the details about the venture to lenders, micro finance agencies, as well as worthy entrepreneurs.

And yes, the link to the project is


Ajay Sanghani
Cell : 098200 20753

Facebook: Really using the Social Graph

The number of Applications on Facebook has risen continuously since Facebook announced its Developer API in mid 2007. While there has been a slew of applications, it is very easy to see a clear trend. As much as 50% of the applications on Facebook are identity definition applications like Characteristics and Compare People, where people characterize their friends, and get characterized in various ways. A big share of the rest of the pie is taken by communication enabling applications like FunWall and SuperPoke which identified the limitations in Facebook early-on and made a field-day of the lower restrictions on spamming in the early days of the Facebook Developer Platform.

Is that all? Can a Facebook Application go beyond the fun to be had out of throwing cows at people, and try to do something that is useful, engaging and fun at the same time? Is there much sense in trying to do anything like that on Facebook? Why not an independent site? These are big questions. And questions any one launching a web-app today must answer.

On taking a close look, it seems it makes  sense for a lot of web-apps to start out on Facebook, and here’s why:

1. An existing Social Graph: Any web-app that needs connections between its users to be established should consider being on Facebook. It makes a lot of sense to utilize the connections that people have already built on Facebook with their friends, family and strangers, than to try building it all over again from scratch in a stand-alone web-application.

2. Diverse user demographics: While almost all of the current most successful applications on Facebook have ridden on huge activity of teenagers on Facebook, there is a continuously rising base of users who are post their mid twenties, are college grads, and are not really interested in xMe and SuperPoke. A “useful, engaging and fun app” sure might appeal to them.

3. Freedom to Developers: Facebook allows developers to do pretty much anything inside their applications as long as they do not bother Facebook users who don’t want to use the application. This allows developers to do just about as much they could have done on an independent web-site, at a place the user frequents often.

The above three factors, combined together, offer a very exciting possibility for anyone launching a web-app today. Your web-app might be of the “serious” kind, and not as much “fun” or “viral” as a FunWall or Compare People, but it would still make a lot of sense to launch it on Facebook. What more, a “serious” application can potentially put the Social Graph to more interesting, beneficial and directly monetizable uses.

Of course, the opportunity comes with its own set of hazards. More later!

Druvaa inSync

Druvaa launched a new Enterprise Laptop Sync solution called – Druvaa inSync. And within 4 weeks of the launch (of version 1.1), initial response and order books are looking good.

Idea – Fast, simple, secure synchronization for Laptops to an central enterprise server over LAN/VPN/WAN. The inSync client software monitors changes on configured folders and syncs up automatically when the connects to network, securely over a specified bandwidth. Other features

Target – Enterprises.

Presentation -

Future Key Differentiator (ver 2.0) – “Infinite versions” (continuous data protection) – user can go back any previous date/tag and see data “back then” OR a search of file, shows how it looked on various dates.


We are thinking of putting it free (of cost) for 50 clients. And charge when users want enterprise support.

Some questions

1. Did you like it ?

2. Would specially like to hear back from startups which tried this product under our startup and open source initiative.
3. Can this model scale for consumers, where a users sync 2 GB free and 10 centrs/GB after that. Yes, i have heard and tries , and IMO -

a) inSync stands appart as a solution

b) “infinite versions” and cost can be a key differentiator

c) Experience says, storage is a big enough market for 100 companies like this.

PS: I am not able to embed the slideshare presentation well :(

Forbes Column: The Smartest Unknown Indian Entrepreneur

Here’s my latest Forbes Column: The Smartest Unknown Indian Entrepreneur.

What is touching, is that the entrepreneur profiled here is also infinitely humble, embarrassed by this sort of attention from the media. In my private exchange with him, I have expressed my deepest respect, and the reason I want to feature this story repeatedly is that I truly think it is a case study worth emulating.

So Indian entrepreneurs, please pay attention to this story. There are many lessons buried in it.

Startups do fail. What’s New?

I am seeing a flurry of activity among the tech blogs who’ve caught on a interesting topic to latch onto. Failed startups. If you ask me, I am not sure what the big fuss in this is about.

Birds fly. Fishes Swim. Deals Fall through and Startups Fail. This is the natural order of things. The only thing we can do is alleviate the chances of success for a startup by a small degree. We do not, neither can anyone assure anyone of success and failures totally. Heck, the Silicon valley, which is considered to be this rich ecosystem, has its fair share of failures. What are we going to do about that?

“Success is one in a million. There is a very small chance that you could be that one and the obvious choice left is to fail. Are you ready for that?” is what my mentor used to ask me. For the first six and a half months, as I was pursuing him to be my mentor, every single book he gave me was on this amazing idea, great execution which went nowhere and resulted in a failed business. I used to think what was the point he was trying to make there. It was simple. Success in a startup is an anamoly. The natural route is failure. If there is one breed of people who can dare change that, it would be an entrepreneur. Yet there are factors and choices beyond our control which all contribute against it.

I remember talking to some students a few months back and the question kept going back to the concept of failing. How do you mitigate that risk and all that. I thought it was one of the profound and mature audiences that I had dealt with. I don’t even get some of those question at*, where startups are on a much progressive stage. I am hoping that they already know the answers to that.

Most of the startups that are slowly gaining traction are on an average on their third iteration. Most companies that come to themselves are on their second iteration. It’s quite obvious when you talk to them and see how they have evolved their offering based on market interaction. It is that iteration which actually is the strength of a startup. Remember Agile, evolving, and the path towards a “complete” product? It’s all part and parcel of that.

There is this interesting session that happens when you learn how to skate – whether on ice or on inlines. The first thing you learn is how to fall. How to fall gracefully is the next step. If you are afraid of failure, You wouldn’t even move a step ahead. You need to dare, and that’s what entrepreneurship essentially is all about. There is a high level of risk and high level of reward at the end. Not everyone who get a lottery wins, and not everyone who starts up a company also succeeds. I am not sure what is news about it.

As long as you are afraid of falling, you won’t be able to stand up on your feet either. I can assure you that. I’ll leave you with these following words, which we had posted on a high banner for the first edition of Perhaps it needs to be much more visible, perhaps even everyday:

It’s not the critic who counts, not the man who points out how the strong man stumbled, or when the doer of deeds could have done better. The credit belongs to the man who is actually in the arena; whose face is marred by dust and sweat and blood; who strives valiantly; who errs and comes short again and again; who knows the great enthusiasms, the great devotions and spends himself in a worth cause; who at the best, knows in the end the triumph of high achievement; and who at the worst if he fails, at least fails while daring greatly, so that his place shall never be with those cold and timid souls who know neither victory or defeat. – Theodore Roosevelt

*The Author is the Founding Member of

Team, Product or Market

It been a while. I just read a couple of posts on the relative importance of Team, Product and Market that motivated me to write.

Here are the post. The first is from Marc Andreson (Netscape fame) and the second is in response to Marc by Paul Buchheit (Gmail fame). I think both are worth reading.

If I read Marc right he states that the market wins and the product-market fit defines success.

Marc refers to Andy’s (Benchmark) quote

Andy puts it this way:

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.

Paul reiterated this but claimed that if your product is conducive to fast frequent iteration (web products) a good market will draw out the right product.

Paul says…

For web based products at least, there’s another very powerful technique: release early and iterate. The sooner you can start testing your ideas, the sooner you can start fixing them.

I think they both have good points however I would frame it differently.

When I look at a startup for Tandem Entrepreneurs, I look at the market as a target, the bigger the market the higher the probability of hitting the target. And I look at the team as the archer, the better the archer the more likely that they will hit the target. The product at the start should be at best treated as a guess of where you should aim.

Now having said this I would caveat it with the fact that defining a large market is easy. Defining the right market is an art and it is hard but critical.

The market becomes the focus of the startup and any startup without a focus is hard to execute. So I agree with Marc that the market is very important but it need not be huge. It needs to be big enough and clearly defined.

Once the market is defined and the team understands that the market and not the product is the focus; then begins the job of tuning the product-market fit whiich can be done well by releasing early and often (if your product and market are conducive to this) as Paul suggests.

A thoughtful definition of the market and a good team are critical to success. But I would contend that if you have a good team that understands the importance of the market, they will in the right environment, be able to find a good market – there is no dearth of opportunity.

Stock compensation in early stage start-ups: Shares or Stock options?

I have a question regarding compensation for key employees in early stage start-ups. From an employee and company standpoint which one is better? Shares or stock options? For example: Consider an early stage venture that has total share capital of say Rs.5Cr (50L shares at Rs.10 par value) post first round funding. They would like to hire a senior professional as the CEO. The CEO will take a huge pay cut in lieu of 10% equity (with a 4 yr vesting period) in the company. I can think of two ways to implement this:

1. Allotting shares to the CEO: 10% equity would amount to about 5.5L newly issued shares and new share capital of Rs.55L. However this would be a huge expense on the company’s books (even though there is no cash exchange. The company gives 55L to the executive and he/she gives it back by purchasing 5.5L shares). Is there any way the company can allot shares without incurring the expense on the books? Can shares be transferred from existing shareholders to the executive?
2. Stock options: The company can issue 5.5L stock options with a strike price of Rs.10. In this case what are the rights of option holders (ie the executive)? Is he/she eligible for dividends, bonus share grants, voting rights etc?

I am sure people in venturewoods must have faced this issue. Which is a better option?

How did you fund your startup?

In the US it is quite common for a startup to get its 1st round of funding from SBA (small business association) or an overdraft of $100K from the neighbourhood bank. After that if cash flows can support you should be able to get more credit from the bank. Then there are Mezzanine funds which will give you convertible debt. Infact VC funding is considered very rare in the US.

In India most lending is asset based lending and not cash flow based, meaning you have to have some kind of asset such as a house inorder to raise any debt. Or you have to have parents and family that support you. But how does the average guy get started? There are some inspirational stories about how some did it and it would be great if we can hear them!

So how did you fund your startup?