6 VCs and a room

What happens when you have 6 VCs in a room - and I mean apart from a lot of money! You get see a lot of experience, tough questions and some very enlightening answers. That sums up the second class of SLP Hyderabad. A big thank you and congratulations from all Hyderabad fellows to the CEO, Asha Jayaraman for putting together an eminent panel of venture capitalists comprising Sateesh Andra of DFJ, Raghu Batta of Ojas Ventures, Purushottam Modani of Mumbai Angels and Alberto Alonzo and Brooks Schaden of Baseline Partners . She definitely has raised the bar quite high for everyone else in the course.

Shreedhar Kanetkar from ISB, kicked off the day's proceedings by warming up everyone to the idea, purpose and importance of a (good) business plan. For an entrepreneur, a business plan is not just something that he needs to present to a VC. It is also a guiding light which can hold the team together. And this is a point that one should bear in mind - the audience for your BP is not only an external VC but also the internal team. A few important questions/points that emerged after discussion with the fellows

How do you measure your market in the initial stages. Especially if your market is unorganized and lacking clear data points. In fact one of our VCs made a very pertinent point about estimating your market - "You cannot get away by saying America is a USD 14 trillion market". So those with wishful numbers on their presentations, its back to the drawing board.

It is always a good idea to get your business plan vetted/reviewed by others.  You will be amazed at how different your versions 0.9 and 1.0 look.

A business does not necessarily have to look at the long term plan. It greatly depends on how young your startup is. As one of our VCs succinctly put it, "We do not look at more than a quarter or two is its an early stage startup". So if if your projections were stopping you from completing your business plan, there is hope.

When preparing a business plan, do not get bogged down by templates. In fact you do not even have to follow one if you know what exactly you need to present. But remember, the benefit of a template is that it gives you an idea of what most people think about business plans.

Audience - how your business plan looks depends a great deal on who is the audience for your business plan. If you are pitching to a bank, your presentation may need to cover financials in detail whereas for a VC the focus may be on the market opportunity and idea.

Abhishek Nayak of Gharpay, took over from Shreedhar and gave a presentation on what he thought was important to keep in mind when writing your business plan. Interestingly, Abhishek did not have a business plan to start with. He had to create one when a particular VC got interested in his venture and asked him to make a presentation - which definitely is a good situation to be in. Abhishek emphasized on the need to believe in the problem and in your ability to solve it. You need to know why a problem has not been solved before and this is going to help you when you are developing your solution. All this and more will happen when you are writing your business plan.

In the next part of the session which comprised of two 15 minute presentations and more than 20 5 minute ones, all VCs on the panel including the gracious Suchitra Shenoy took turns and gave feedback to the presenters. However, in hindsight, we do feel that it is better that entrepreneurs with existing ventures present the longer pitches. This helps because the contours of the problems they are face are defined, at least more clearly as compared to ventures which are yet to take their first step. This helps the whole class discuss real issues that they may face in their startups. Raghu exhorted the fellows to answer three important questions to themselves before they venture out with anything - "What is being bought", "by whom" and "why".

Even though the focus was on business pitches, the panel was kind enough to provide feedback on the business as well as the presentations. Shreedhar gave the fellows some very important pointers about presenting. After seeing a few of the speakers trying to rush through the presentation to stick to the 5 minutes timeline, he shared his thoughts about the same. If one's presentation is time-bound, he suggested that the speaker take a moment and then speak the most meaningful concluding remarks. His reason about the audience being less interested to hear rushed material was absolutely spot on.

The idea behind the 5 min pitches (shortened from the usual SLP norm of 7 mins) was to help fellows hone their presentation skills and learn how to present things in a crisp, concise and most importantly, in a manner which gets the point across.

A few important points that emerged after the panel discussion

Do not rush through your presentation. Remember, your objective is to convince your audience not to finish the presentation. Practice definitely helps and so does the structure of your presentation.

Make all efforts to identify your market....correctly! As mentioned earlier in this post, you really need to know the market you are catering to. Sweeping generalizations are just a sign of pure laziness and are in fact a bad portent for your startup. As they say "If you don't know where you are going any road will get you there"

Research adequately on your competition. Only when you do that can you start highlighting your differentiators. 

Identify and evolve your revenue model and financials. Many people leave this most important bit for the last or to God. Your revenue model shows how seriously you are thinking about the sustainability of your venture. 

The day ended with an informal gathering at News Cafe with promises of much more learning and fun in the next session.

A truly first class first class at SLP Hyderabad

If the first class is anything to go by, the maiden SLP program of Hyderabad promises to be a journey full of learning, fun and, of course, entrepreneurship. Once all of us pledged our allegiance to the SLP charter by signing the joint commitment, each of us took turns to take the rest on their respective entrepreneurial journeys. BITS Pilani was definitely conspicuous as the alma mater of many of the fellows. Curiously many of the fellows said that they were not academic toppers while in college and in fact, many of them rarely attended the classes. That says a lot about how much you can learn outside the classrooms.

The uniqueness in each story was refreshing. The Entrepreneurial Journeys exercise was a great one, not only for the class to know each other better but also for many of us to take a look at what makes us. The fellows are good mix of full-time entrepreneurs, part-time entrepreneurs and yet-to-be or just-to-be entrepreneurs.

In the next leg of the class, Vishal Vasishth of Song Investment Advisors talked to the fellows about the 5 Ps that make a successful organization and definitely a successful startup. He explained the 5 Ps - Product, Passion, People, Purpose, Profit -  with examples from his own experience including the companies he has worked with and invested in. There was a lot to learn and discuss with him.

Naeem Khan of The Lead took over from Vishal and drove home the point of branding (and the lack thereof) in startups. He advised fellows to think about the branding for their startups early and not wait for a later stage when they would have more time and money in their hands. In fact, he stressed that branding need not necessarily be a costly affair. It is more about giving mind share to it among other issues like financials and strategy.

The last part of the class was a practical take on The Lean Startup Movement. The 5 cohorts of formed from the fellows were given the case of Foody's - a startup founded by one of the Hyderabad fellows, Mili Srivastava. Mili briefed the class on her company's objectives and problems. She offered the cohorts a set of hypotheses which she wanted to validate (or invalidate). The cohorts brainstormed and generated data from quick in-person and phone surveys. The ideas and discussions that came up helped not only Mili but also the entire group by opening of new perspectives.

On that high note, the first class of the Hyderabad chapter ended. Stayed tuned for the next update.

Written by Aishwarya Mishra