Sunday, January 08, 2012

Entrepreneurs Boot-camp: 4Startups Series

NSRCEL of IIMB organized a one day Boot-camp for all those interested in Entrepreneurship on 8th January in the campus Auditorium. The workshop was conducted by Ms. Saras Saraswathy - Professor in Darden School of Business and one of the most famous scholars in the area of new venture research . For those students of PGSEM who have read her thesis on Effectuation, to hear Prof Saraswathy in person and know more about her research was truly a fascinating experience.

The whole boot-camp was organized into four broad sessions. The first session started with Prof Saraswathy introducing the participants to the idea of Effectuation in such an interactive manner that the whole audience was in raptures for her skill in witty facilitation. The second session was an interview of Mr R. Sundarrajan, entrepreneur and CEO of Just-Books. Post lunch was a panel discussion on VC funding chaired by Mr. Rahul Chowdhri of Helion Venuture Partners. The final session was for Q&A and synthesis. The audience registered themselves into various groups - Greenhorns (still thinking of ideas), Red & Orange badges (those with ideas and thinking of starting off), Lavender (those who have made the great leap). This division was a great idea.. simply because many people were seen all through the day identifying those with differing colors and walking up to them to talking to them.. networking made easy.

'Do the doable' is one of the fundamentals of Effectuation. And this new theory challenges the idea of 'Causation' to spell-out the makings of a successful entrepreneurial venture. The theory tries to explain the 'Entrepreneurial Mindset' by 4 simple principles -

·       Bird in Hand Principle – Start with your means. Don’t wait for the perfect opportunity. Start taking action, based on what you have readily available: who you are, what you know, and who you know.
·         Affordable Loss Principle – Set affordable loss Evaluate opportunities based on whether the downside is acceptable, rather than on the attractiveness of the predicted upside.
·         Lemonade Principle – Leverage contingencies Embrace surprises that arise from uncertain situations, remaining flexible rather than tethered to existing goals.
·         Crazy-Quilt Principle – Form partnerships with people and organizations willing to make a real commitment to jointly creating the future—product, firm, market—with you. Don’t worry so much about competitive analyses and strategic planning.

The story of Just-Books is a classic example of how the theory of Effectuation plays out in reality. Mr. Sundarrajan had never heard of the theory till date, but acknowledged at one point in the interview that how incredible it was that his venture so closely tracked the principles of Effectuation! And what an incredible story Just-Books itself is in the humble works of its founder. For those of us who have heard our professors talk about ideas like 'ready-fire-aim' or 'thought-action-together' it felt like the ideas had jumped out of book and onto the stage!

Professor Saraswathy has herself been an entrepreneur of five ventures. She expertly drew parallels between the story of Just-Books with those like Kirloskar, Starbucks and Sears. Those in the audience pitched forth their own ventures in areas as diverse as catering, garment design and ERP software and tried to imbibe where they stood on the ladder and what the theories could say on what lay ahead.

The VC panel discussion threw light on insightful things like - go for VC funding as late as possible, go for VC funding only when the 2nd VC interested in your venture calls you, different categories of VC, typical funding percentages, E-commerce VC, pro's and con's of being on the VC radar, importance of a well rounded team backing your venture, what the VC typically look in the entrepreneur and so on..

To me, however, the comment that took the cake was this observation by a VIP - in America, if you hold a seminar on Entrepreneurship these days, the biggest point of discussion is law/lawyers. While in India, the debate hinges around funding. And its easier getting progressively easier in our world to overcome financial bottlenecks than legal issues everywhere and anywhere!

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