Ashish Gupta of Helion Venture Partners is giving a great talk – something of a masterclass – at Headstart.in on execution in a startup and how to deal with many of the execution and organizational issues. The first part:
Ideas are easy, execution is hard.
Those of us in the tech space look at Information Technology companies – we value IP. Ideas are among the smallest part of building a company. Lots of folk thought of eBay before eBay…but the reality is that some guys are still thinking about it. The real protection of the idea comes out of execution of the idea, and not the idea itself.
Elements of execution
Sales & Marketing: Outside-in vs inside-out
Pay attention to outbound functions – sales and marketing. One of reasons these guys talk bullshit is because tech usually works with 90% known. The sales guy is asked at the beginning of the quarter how much revenue is going to get – he doesn’t know who their customers are. They’re expected to deliver stuff that they don’t know about. As you go closer and closer to customer, more gets known. You need to paint something RED or BLUE.
Q – don’t sales guys promise things that they can’t deliver?
So do engineers promise performance that they cant deliver. A lot of that is the process issue. Companies do not spend enough time in creating the right literature, so the client ends up assuming what they’re buying.
Not enough people look at why companies will not buy things. They don’t spend enough time listening to the customer. They don’t let the customer talk about what is their problem is to begin with. We tend to imagine this beautiful thing that we have, and try to convince them about our vision. The money is in the ugliness of the customers needs. The engineering and exception handling in a product is the crud, while the beautiful code is just 30%.
Simple stuff as a premium. No partner is interested unless you can show them money. On the basis of that, you will have partners and channels. When you take the simple stuff out, actually making it stick is more difficult. Your customer has a smaller attention span than your grandmother – she is more interested in your success than he is. You need to listen to them about why it will not work, and need to spend addressing their issues.
Try and simplify things down as much as you can. Companies die more often because of bad sales and marketing than bad implementation. Start selling from day 1. There has to be at least one person in the organization who is not in-bound. This is true for every product you can think of.
Marketing is more than advertising. Don’t get taken by fancy MBA degrees. You don’t need to figure out the problem that anyone is dealing with. That is what engineers do to begin with. Talk to people who are in established companies, to understand what a day in their life look like. Whether you need this “business guy”…he’s just another guy looking at another class of problems. You’ll find that some of the best business guys are engineers in the technology space.
Organization Structure & Processes:
I have been part of 4 tech organizations, and none has felt that the overhead of an organization structure is worth it. Organization structures in startups are key – they correlate your core people to core needs. You need clarity in organization. Let’s take the CEO of a company – in case of a large company, he should have functional responsibility for nothing. In a startup, a CEO does sales, is the janitor, writes code in the off hours, and is also the CEO – hiring and facility management.
This person should have a piece of paper and an excel sheet which lays out the 20 rows of jobs in this company – just that the personal handling all of these he himself his own name. The problem is that when the next guy comes in, you don’t know what role the person is going to take on. It becomes difficult to let go of any of these areas. Understand what the process should be. Many startups are plagued by the unwillingness to change, rather than the willingness to change, which is why they started up in the first place.
Not every person can scale. The reason why I like at least 3-4 people teams is because at least one of them scales. That is the reasons why startups change management – because a vast majority of the people cannot be a CEO, cannot scale. At Junglee, I was VP of Engineering, and I had not managed enough people. So we spent a lot of time hire a VP of Engineering to replace me. The great thing we did was that we hired three great directors of engineering who could have eaten me for lunch, and I focused on fund-raising.
A startup doesn’t have the luxury of saying this first, and that next. “I will hire the best person who comes in” is a philosophy issue. All I am saying is have a clear understanding what the business demands. You need to change the org structure as needed.
You are learning – learning endlessly. I am on the board of a company Jigrahak – they have merchants, partners like banks, consumers, device manufacturers. 7 months ago, device manufacturers did not fit into the picture, banks did not fit into the picture. That is not true today, so the organization has to change. The reality is, you are on a learning curve that is steeper than anything else we experience.
Don’t be afraid to keep changing.
Note: Part two, on Metrics, Horizons and Advisors on Monday, after we transcribe it.