In my earlier post ( Tech Reskilling may not be the panacea: ), I had talked about Entrepreneurship as the top of the charts option for professionals experiencing mid life crisis and the fact that being a first time entrepreneur at this stage in life is quite different from experiencing entrepreneurship in the early/mid 20s! Before, I start detailing this out, a few qualifiers/assumptions about the would be entrepreneur:
- that you are experiencing life crisis and have worked in a Corporation till now
- that we are talking about ventures in the non manufacturing (tertiary sector)
- that we are talking about ventures which are mostly in the B2B space; while broad tenets are the same for B2C – it is difficult to get funding for a B2C idea for a first time entrepreneur starting at this stage in life!!
Now, your idea/venture could be of 2 kinds:
- The path breaking one – as Peter Thiel in his book Zero to One, refers to them as going from 0 to 1 i.e. vertical progress. Basically, doing new things. Examples – word processors replacing type writers, Uber etc.
- The regular one – Peter Thiel refers to these as going from 1 to n i.e. horizontal progress. This could of 2 kinds – a) Localization of an idea that is working elsewhere – e.g Flipkart modelled along Amazon, Ola along Uber etc. b) Incremental progress – e.g. Outsourcing giving way to Offshoring ; Offshoring driven by automation visavis plain vanilla Offshoring etc..
It may be obvious that the “ horizontal” ideas are easier to execute esp. with your years of experience and the maturity and enhanced perceptiveness of the mid life brain! However, the fundamental issues that plague most entrepreneurs is not going away for this category either:
- Working Capital Management – while most students of “Business” ( read MBAs) and “Entrepreneurship” know this but let me tell you that knowing is not enough! It is a very different thing to experience this on a daily/hourly basis esp. if you run a B2B business and your hard earned money is not paid on time by your customers and quite a lot of them may be in the Fortune 100/500 list! The pressure of running payroll every month and paying your suppliers gives shivers and keeps many awake through many nights! This one has to be experienced ???? to understand the real ramifications – however, a prepared mind does much better than an unprepared one!
- Regulations & Paperwork – budget for this, especially in India and probably other developing countries. If you run a private limited company then you’ll have to call upon spiritual/mythical powers for help esp. if you are not greasing palms! This can suck most of your creative energy and while dealing with this, the fire in your belly may leave the belly :). You’ll find it very difficult to come to terms with the world where people like you, who have given up a career in the illustrious Corporate world and, are willing to spend their own money and of course their time are not allowed to their bit. The reasons for this bizzare behavior are many and is best discussed over a drink. You’ll draw solace in Lord Curzon’s famous lines “Round and round like the diurnal revolution of the earth went the file, stately, solemn, sure and slow..”
- Fund raise – if you are looking at raising early stage funding then think twice as investors are shy when it comes to your category of entrepreneurs! You have to have this lined up before you jump in – both for the company requirements and for your personal needs ( maintaining that life style to keep the home front happy!) – 5 – 7 years is a decent horizon in the Indian context
But, there are aspects that are more pronounced for the “vertical” ideas and isn’t explicit knowledge ( for most people)! The key ones that come to mind:
- Logic fails most of the time! – the assumption is that you have risen the ranks in the Corporate world and must be good at planning and leveraging rationality to the fullest. You can break down a problem and solve it using your logical mind. However, a logical analysis tends to fail most of the times esp. for vertical ideas as the variables are many and quite often hidden/not understood ( this also happens for horizontal ideas, but to a lesser degree)
- “Business” and “Intellect” has to marry in the entrepreneur – this is extremely crucial for success esp. for the vertical ideas which are relatively ambiguous and the working model (and as a corollary, the related competencies) is yet to emerge! By design, esp. for professionals from the Corporate world , this tends to be “Either/Or” and not an “And” function – the ones who are good on the business side ( understanding; business acquisition) are typically not good in the content/subject depth from an understanding and execution stand point. It is very difficult to go with a 2 in a box model on this one! This is true of a Bill Gates, Steve Jobs, Jeff Bezos etc.
- People – While ability to attract and retain good talent is an issue for horizontal ideas ( esp. if you don’t have money to throw i.e. if you are not funded!) this almost becomes an unsurmountable issue for the vertical ideas where even throwing money doesn’t help at times, as the perceived risks are high! This is a big dampener on your ability to scale the idea and esp. if the vertical ideas are on the social side and addressing the BOP (Bottom of Pyramid) segment then life becomes even more difficult for the entrepreneur! Now, armed with this knowledge, you can do a gap analysis visavis the required state and where you stand today ( remember, you are from the Corporate world and this should be easy!) Some of the dimensions to consider apart from financial/business acumen are – thought leadership, strategic, relationships, operations, team, content etc. Finally, skilling is all about plugging in your gaps! Apart from your natural disposition, the nature and size of your gaps would also depend on whether you were preparing for this day/eventuality over the years during your Corporate stint ( and gathering rich learning/experience) or have been pushed into it due to one or many factors – shifts in the industry/market, inability to break through the glass ceiling, you really love your boss ???? etc. Now, the gaps have to be plugged, right? Since, you have been a seasoned professional and have plugged many gaps in the past, there is a tendency to believe that even this one shall get plugged! Be careful here. Do keep in mind that the world that you are attempting is relatively new to you and more importantly, your ability to unlearn has diminished over the years! It is proven that physiologically our fluid intelligence ( the one that gets measured on IQ tests) starts to plateau or go down around the 35 years mark and the brain tends to fossilize as far as new learning is concerned. Besides there is tendency to rationalise the world based on what you have experienced over the years! So net net, unlearning is going to be difficult and slow and is a battle that you have to be careful to fight ( remember, only those battles ought to be picked up where you know that you are going to win!). How do you deal with this? 2 options:
- Best option is if you chose a venture where the requirement for success align with your current strengths, belief systems etc. and where the gap is low. Work to the strengths of the middle aged brain which is a brain that is more balanced in terms of left and right orientation, a brain that can see patterns easily and quickly and is better at making judgements, finding solutions and even regulating our emotions! Then work on plugging the gaps working with a mentor – someone who has been there done that and more importantly is able/keen to coach/mentor/train. Best to have the business and intellect married in you, before you jump in!
- If this is not possible, then it is recommended that you stay with “horizontal” ventures and find a few like minded folks who can fill up the gaps! You have to be careful in this selection – it is not people whom you know but people with whom you have worked in the past and are compatible as far as working together is concerned. Now, this by design is difficult to find as the universe itself is quite small and the ones that you’s like to partner with may not be willing to make the plunge! The training/mentoring here will focus more on the application of the combined skills for the venture – remember, all of you are new to entrepreneurship!
And finally comes EXECUTION – the bane of most ideas/entrepreneurs! There are ideas galore – but, what differentiates a winning idea from the ones that don’t is the ability of the entrepreneur to execute the idea. In your case, you may be a champion in execution in your current job but don’t let that fool you – the variables and the eco system is very different out here. As a start, imagine how you’ll introduce yourself to your potential customer/employee without your old visiting card which has some fancy designation at a fancy company. Second, there is no support structure of that fancy company – and please for heaven’s sake don’t underestimate this as you probably don’t know what you don’t know! Refrain from behaving like an Abhimanyu and attempting the “Chakravyuh” and dying in the process… The above can take an eternity to accomplish! You can’t afford to lose valuable time as you are already late to the party. We can talk more about this offline – you know, for a consideration even we/I can help ????