Why me? Or why every Indian startup founder thinks they are the only ones with “bad luck”?

Its very hard to explain to an entrepreneur why another company got funded and they did not.

Or why they might not, even though they have “many boxes checked”.

It might seem fairly random. Correction – it is probably fairly random.

Raise your hand if you have read a techcrunch post that mentions a startup that raised an obscene amount of money and after reading the post 3 times you are still not sure why they got that much money?

Raise your other hand if you have read about a startup in the US Silicon Valley that is working on “pretty much” the “same idea” as your company is and you are schlepping code for 18 months and they have 45K daily users in less than 6 months (and funding to boot).

Now clap both your hands above your head. <Whatever>.

Most Indian entrepreneurs (in the technology space) consider themselves fairly unlucky.

They are baffled that Indian angel investors ask for revenue and monetization plans when the company is 3-6 months old.

The only comfort I have to offer is that its the same deal outside the valley.

Ask the Boston entrepreneur, or the New York entrepreneur. They also claim that companies there “suffocate” because the local investor ecosystem is fairly risk averse.

The second piece of knowledge I will share is that for every techcrunch post that mentions a funding for a startup, there are at least 25 failed funding stories that do not get published in the same space and general “idea”.

What then separates the funded versus the ones that did not get funded?

This is the point in the discussion when the entrepreneur blames their “luck”.

There are a few things I’d say that are easy to spot among the funded companies versus ones that dont get funding in the same “space”.

1. They usually tell a story dramatically different from that mentioned on TechCrunch or Pluggd.In or any other startup blog. The story the media publishes about dropbox is file sync across multiple devices. The story the VC’s bought is document virtualization.

“That’s just positioning” is your claim. I agree. It is. Storytelling is an art. Learn it well.

2. The founders are very credible, have a lot of background in the space and understand their customers / users very well.

3. They product shows the most amount of traction in the shortest period of time.

Thanks to angel list you can now target and get funded by Silicon Valley investors in India. If you have the same 3 elements – credibility, a great story and traction, you dont need to depend on luck any more.

5 thoughts on “Why me? Or why every Indian startup founder thinks they are the only ones with “bad luck”?

  1. Subramanyam Kasibhat

    Total number of folks who have made boat loads of money by taking risk in a tech startup in the valley is probably more than the total number of startups in Bangalore! It is that sheer number of folks with money to spare and risk, makes difference. Not necessarily the three points ;-)

    Contrary to that, look at India Angle network! Majority of them are “Managers” who have little or no risk taking attitudes! They made their money by serving other risk takers globally and so they can only take that calculated risk and never appreciate what it means to take risk and make it big!

    Reply
  2. badrirag

    Mukund,

    You hit the nail on the head.

    And if the story-telling is not powerful, it is because there is no clarity on the target customers and very little empathy with their problems. The focus seems to be to develop ‘cool’ products and ‘technologically superior’ products. I have seen many pitches of solutions without an understanding of the problem itself.

    I have a different take on the second issue, though!! Credibility is often confused with ‘track record’ which eliminates freshly minted entrepreneurs totally and while past experience is a good teacher, often the learnings are not fully relevant in the new environment.

    Thanks once again for the straight talk.

    Badri

    Reply
  3. virtualavi

    Mukund – wouldn’t just one of 3 – that is Traction – will suffice? A good traction means that founders are able to sell the story well and know their customer’s need well (credible). I agree with Badri that credibility cannot be equated to experience as it quickly becomes irrelevant and in fact pulls the person down by not letting him try out-of-box/never-tried ideas,

    Reply
  4. Nemesh Singh

    Mukund – Very wisely said. There is no space for excuses. I personally feel that there is nothing called bad luck. Convince your customers if you can’t convince your investors and soon investors will follow. What we feel like bad luck is sometimes a boon. Road to success goes through failures.

    Reply

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