Nitin Seth

Keynote address at National Entrepreneurship Bug, April 30, 2017 organised by The Entrepreneurship School

It is very inspiring to talk to 100 students who have qualified for the final round of the National School Entrepreneurship contest. First, it is very encouraging to see such a competition happening for school children. And second, the energy and enthusiasm that I see from you and your parents is really heart warming.

I want to share with you why it is the right time to consider entrepreneurship and then 8 mantras from my experience on how to succeed as an entrepreneur. My insights are based on 3 sets of experiences – starting and failing in my own startup (ActiveKarma 2000-02), many years as an intrapreneur in McKinsey and Fidelity, and leadership role in Flipkart which is India’s largest and most successful start-up.

Why young professional should become entrepreneurs?

1. Technology disruption creating unprecedented new opportunities. The velocity of technology change and business disruption we are witnessing is perhaps unprecedented in human history. Mobile, Ecommerce, Cloud, Big Data have changed consumer behaviors and business models dramatically and yet these trends are barely 15 years old. We are now into a next phase with Artificial Intelligence, Machine Learning and Internet of Things dominating. Technology change is a great equalizer. Big companies don’t have an advantage at leveraging technology change, often they are at a disadvantage. Smart entrepreneurs are best placed to experiment and leverage new technology. We have seen with the example of Flipkart how you can leverage new technology (Ecommerce) to create a huge business in less than 10 years. And this is just the tip of the iceberg.
2. Accelerating personal growth. Pursuing your own idea provides great sense of purpose and energy, which is difficult to find in a job. This sense of purpose and energy helps you grow as a person and achieve things which will be impossible in a standard job. I meet many young entrepreneurs and always get amazed at how much they have grown and matured in a short period of time. In addition to personal growth there is off course the opportunity for life-changing wealth creation.
3. Availability of risk capital and entrepreneurial ecosystem. A positive development in India over the past 15 years is the development of the venture capital industry and entrepreneurial ecosystem. Capital is now available even for very early stage ideas. This makes it easier for young professionals to pursue their ideas without betting on hard-earned money of their parents. Capital also helps them scale up their ideas rapidly. Most importantly, there is development of an active entrepreneurial ecosystem where experienced entrepreneurs and professionals are themselves investing into ventures and are available for mentoring and support.
4. Make a contribution to the country. India’s biggest asset is it’s age pyramid. More than half the population of 1.25 billion is below the age of 25. However, this also presents a massive challenge of job creation. Government and the public sector will never be able to create the required of jobs. It needs massive entrepreneurial activity to create jobs. Moreover, entrepreneurs can create world-beating success ideas and companies and put India on the world map. IT and BPO industry, which was driven by first generation entrepreneurs has done that very successfully over the past 20 years. Opportunity is there for Indian entrepreneurs to rise and dominate in many more sectors.
5. Cost of failure is not high. Our parents generation saw a lot of hardship and was very risk averse. These conservative mindsets have historically permeated in our society and acted as a deterrent for taking risks. However, the India of today is very different. The cost of failure is low. I have already mentioned the availability of risk capital. Even more importantly, there are abundant opportunities and company mindsets have changed. An individual whose start-up has failed is not frowned upon. In fact, failure is increasingly seen as a positive experience. I have seen it in my own example. I did my venture ActiveKarma in 2000-02. The venture failed but I was able to bounce back very quickly. In fact, a lot of what I have achieved in my corporate career is because of the invaluable learnings from ActiveKarma.

So, hopefully I have convinced all of you to become entrepreneurs!!  Let me now share some insights based on my experiences that can help you succeed as an entrepreneur.

8 success mantras for young entrepreneurs

1. Passion and mission. This has to be the starting point of your entrepreneurial journey. There has to be a core idea and/or purpose that is really driving you. Entrepreneurship is a tough journey and there will be many moments when you might feel like giving up. It is this passion and mission that will keep you. Moreover, entrepreneurship is a journey into the unknown. When you are creating something new it is difficult to be clear about your strategy and plans at all stages. Your passion and mission will give you direction in moments of uncertainty. For example, Flipkart has a clear and strong mission, “transforming lives of a billion Indians through technology”. While the Flipkart strategy might have kept changing over the past 10 years, this mission has provided a strong anchor and inspiration for the organisation.
2. Audacity. Audacity is the willingness to take bold risks. This is a core aspect of the Flipkart culture and one that inspires me a lot. To build something new especially in a new or changing industry, you cannot be incremental. You have to think big and take bold risks. I believe this is a key strength that Sachin and Binny Bansal brought to Flipkart and is a key factor behind the company’s astounding success. This is quality that makes Flipkart dream and deliver so many market first innovations, and successfully take on and beat a giant like Amazon.
3. Innovation. One of the concerns I have with entrepreneurial activity in India is that there are many start-ups but not enough innovation. Most ideas tend to be copycat and follow a wave. That is one of the reasons why mortality rate for start-ups is so high. If your idea and execution is just a me-too chances of success are low. Innovation is the foundation of a start-up, the key value an entrepreneur brings. To drive innovation, customer focus is key. So, understand your customers deeply and have an intimate understanding of their pain points. This will not happen sitting in a room. So, go out and have a range of life experiences.Most powerful innovation often comes connecting the dots across different areas. This was the unique strength of the great Steve Jobs. He was able to connect the dots across his many life experiences and passions to create many market defining innovations. The other key requirement for innovation is deep product-tech expertise. While we have lot of software developers in India, I see a dearth of deep product-tech talent. Most only have shallow engineering expertise. Will encourage you to learn and build deep engineering expertise.
4. Patience and Resilience. Entrepreneurial journey can be a roller-coaster with many ups and downs. I have not yet come across any successful startup that has not gone through a near death experience at some point in their journey. Therefore, you need to have the patience to play for the long-term and resilience to bounce back. As mentioned in the first point, deep passion for the idea and sense of purpose inspire you to see the long-term and help you tide through the short-term challenges. In addition to this, I believe it is important to have anchors in life that give you strength and help you see the big picture. These anchors help you bounce back from disappointments. For example, my anchors are my family, spirituality (Meditation + Bhagavad Gita) and sports. These anchors have made me resilient and helped bounce back from the many challenges I have faced.
5. Team. We are in an increasingly complex environment where it is almost impossible for any individual, however talented, to have all the skills required to build a successful business on his own. Therefore, it is very important for an entrepreneur to build an effective team. While building a team we often seek people like us (I did that when I built my venture ActiveKarma, all 3 of us from IIT Delhi!!). While it is critical that you work with people who have similar values, it is important that from a skills perspective you bring together people who have complementary skills. Most successful partnerships have been of leaders who had such complementary skills. For example, Bill Gates – Paul Allen at Microsoft, Steve Jobs – Steve Wozniak at Apple, Larry Page – Sergey Brin at Google, and nearer home, the team of Infosys founders and Sachin & Binny Bansal at Flipkart.
6. Funding. It is critical that you secure adequate funding sooner than later for your venture. While the power of your idea and team are the most important determinants of success of your venture, lack of funding is the factor that can take you to failure immediately and irreversibly. Many entrepreneurs try to time the market or to delay funding to maximize value. Don’t delay raising funding; secure the future of your venture first. If your venture survives and thrives, you will create enough personal value for yourself. If it gets strangled for funds and dies, your high ownership of the venture will not help. Another point on funding is that the questioning you face in the process also helps you sharpen your idea improving your chances of success. A final point on funding, while raising too much capital can be problem (can lead to inefficient use of funds), make sure you raise adequate capital required to scale up and fight the competition.
7. Communication. It is very important that you as an entrepreneur are able to tell your story passionately, clearly and repetitively. You need to do so to sell your idea to investors, to attract talent to join your team, and most importantly to convince customers. And, you have to do so multiple times over because you will not succeed in any of the above 3 tasks first time around. Nobody else can tell your story with the authenticity and power that you can do so yourself. You cannot delegate this to anybody else. Sometimes entrepreneurs especially technologists can be introverts. You have to get out of that and build both your willingness and skills to communicate. Future of your venture depends on it!!
8. Managing opposites. This is a philosophical point but a very important one. In the complex and fast evolving business environment today, you need to build the ability to manage many opposites. You need to have very sharp execution focus, at the same time you need to be strategic. You need to survive in the short-term while also need to build for the long-term. You need to ensure outstanding customer experience and growth while also ensuring profitability. These opposites can becomes difficult to manage, however they are inevitable. It is important that you recognise this and build your mental ability to balance these opposites. Ability to manage this duality will be one of the most important skills in the 21st century.

I hope the above insights inspire you to pursue your entrepreneurial journey with even more passion and clarity. The time to start your journey is now, so go forth with hope and energy and let a thousand flowers bloom. This is the best possible journey you can take for yourself and for the country.

I will end with the famous quote by the great Steve Jobs, “those who are crazy enough to believe they can change the world are the ones who actually do so!!” So, go forth and shine on you crazy diamonds!!