Why it makes sense to join start-ups

I have always questioned my decision to join a startup. I am still questioning it. But only reason why I wanted to join a start-up was to start something of my own in future. Another reason was to make it big, to prove to the world that I exist. Joining a start-up throws at you lots of challenges which you could not have encountered at a normal workplace. But this can also go against you if the company fails. There are lots of other reasons why I want to start something of my own, and I am still thinking about them.

Amar Goel has also tried to explain why it makes difference to join a start-up than an established firm. Following are some of his views:

“Generally speaking, youngsters in India are still too concerned about the stability of their jobs and getting married,” writes Amar Goel, CEO and founder of Komli Media, in his blog. Then he goes on to analyse “why this concern with job stability just doesn’t make sense if you are really good at what you do and are confident in that.”

“If you want to make some serious money you have to take some risk and join something early, at least among the first 50 employees."

“If you are smart, have a good idea, and can assemble a good team, then statistically, you have a lesser chance of failing today and in the next 10 years than at any time in India’s past."

“What is the difference between joining a startup that you like and the worst case happens in 2 years versus you join a “stable” company and in 2 years you leave because you don’t like the work?"

“I know a number of people in Silicon Valley who have made a career of working at startups, and are fully aware that some will be winners, and most won’t. They figure if they work at 5 startups over 10 years maybe one or two will be successful and that’s more financially rewarding than working at an already successful company as the 2000th employee.”

You can read the full article at: http://amargoel.com/2007/07/14/startups-are-way-too-risky-arent-they/

P.S. - Also check out the comments, they are great

American Indians working for Rural India

I just came across a group of American Indians who run a Fund called IRDF India Rural Development Fund with a vision of providing support to NGOs in India targeting Rural Sector. I found this group Fund motivating and I hope that more NRIs pitch in to work for the upliftment of the country. You can read all about them at their website - http://www.indiarural.org/

Excerpt from website - "In 1996 a few Indian Americans living in the west coast of the United States of America, became the change agents to translate the dream of giving back to the country of their birth. They realized that poverty is the worst malady and that the remedy was education, health care and social development. They set out to refine, define and foster a prosperous rural India, along with the financial support of many successful Indian's in the Silicon Valley and elsewhere in the US. Today, India Rural Development Fund projects have helped many poor rural families in India."

"India Rural Development Fund (IRDF), finances and supports rural development projects run by non-governmental organizations in India. Our focus is on education, vocational training, health, family planning, and infrastructure development."

"IRDF partnering with other nonprofit organizations would like to achieve the following goals in rural India:

• access to primary and vocational education;
• reduce population growth rate;
• reduce infant mortality, and improve health and hygiene;
• promote sustainable economic development."

Please do send your comments/ suggestions or if you think that you know similar organizations/funds.

Venture Capital is over rated - Komli Founder

In a blog post, Amar Goel, CEO and founder of Komli Media, has shared his thoughts, experiences and learnings in raising venture capital, how it works and what it’s like. An excerpt-

“If you are not sure about wanting to build a large business then do not raise venture capital. If you are concerned giving other people a lot of say in your business do not raise venture capital. If you never want to sell your company or go public do not raise venture capital."

“If you would like to build at least a $20M business over 3-5 years and ideally a $100M+ business over 5-7 years you are a prime candidate for venture capital. If you want to build a $3M business over the next 5 years do not raise venture capital."

“I find lots of people who seem to get really excited by the prospect of raising venture capital. Don’t be… The sexiness of a press release saying you raised venture capital from XYZ and ABC lasts about 1 day."

“VCs are not in the business of coming up with crazy ideas and then throwing them against the wall and seeing if they stick. That is the job of entrepreneurs. That’s why most VCs will be loathe to invest in some “idea” you have that will change the world that nobody has ever done before."

“Venture capital is a very expensive form of investment for your company. If you are the typical early stage startup you are going to give 20-35% of your startup for $1-4 million of investment.”

Check out : http://amargoel.com/

Rediff in radar of Google and Yahoo (News in HT; Later came to be fake)

An article from Hindustan Times (Later denied by Rediff CEO, Ajit Balakrishnan)

US-based Internet giants such as Google and Yahoo are eyeing Rediff.com India Ltd, which runs one of India's most popular consumer Internet portals, for a possible acquisition. Investment banking sources told Hindustan Times that the management of Nasdaq-listed Rediff was in talks with the global companies for a negotiated takeover deal.

Rediff, Google and Yahoo officials could not be immediately reached for their comments. Talk of the deal is emerging in the context of a general worldwide rebound in the Internet business, and India emerging as a hot story in the global economy with strong growth in both telephone penetration and the Internet in urban areas.

Leading US-based investment journal Barrons reported this month that Rediff is seeing speculation that it could be a takeover target. Rediff’s stock has witnessed a sharp jump in share price and volume on Nasdaq over the past week, when it also launched a Website to help consumers upload voice, video and photographic content for free.

The company's stock moved up to $25.41 per share on July 13 from $17.94 on July 5 and. The trading volume has increased to more than a million shares from an average of 50,000 share a day. In fact, on July 12, Rediff shares closed at $26.46 and more than 3.3 million shares traded hands. The company has a current market capitalisation of $738 million.

The sources said if the deal comes through, the valuation may be close to a billion US dollars.

The Barrons report quoted Ashish Thadani, an analyst at Gilford Securities, as saying that Rediff could fetch more than $ 25 a share in a sale and could see other suitors besides Yahoo and Google

Other suitors could possibly include AOL (America On Line), a division of Time Warner, which has a strong presence in offshore services from India, but is not a significant player in the market. Microsoft's MSN portal is also keenly stepping up its presence in the Indian market.

Rediff.com India, an online provider of news, information, communication, entertainment and shopping services, reported a net income of $2 million for the fourth quarter or $6.89 per ADS, compared with $0.53 million or $1.96 per ADS in the same quarter of the previous year.

The company's revenues increased 66 per cent to $8.48 million from $5.11 million in the same quarter of last year. India Online revenues, which include advertising and fee-based revenues, jumped 76 per cent to $6.30 million from $3.57 million in the year-ago quarter, while US Publishing revenues were $2.18 million, up 42 per cent from $1.54 million a year earlier.

I 'Chose' Not To Be One Of Them

I wish, I could point out, the exact day, time and the catalytic incident that pushed me over to the other side of the fence. But as an afterthought, I guess it would have made it more of a fairytale. Less convincing. Though let me admit, it would have surely made for a better story to tell... ;)

If I were to point my finger at one particular incident that was responsible for making me want to be an Entrepreneur, I think I would stick with my 'Attitude Problem'. I think its been forever that my Mom was summoned to the Staff Room at school, only to be told that although her son was a wonderful and intelligent student, his attitude was pulling him down; And Mummy would return from each of those meetings, all the more convinced to encourage me to follow my own thought process. Not to blindly follow, but to question.

If school was bearable, college was an unending saga of insurmountable agonies; incompetent teachers, preaching mediocrity, praising under achievers. It was a farce, in the name of education. Originality was deemed a sin. A questioning mind was termed arrogant and considered unfit for disciplined formal education.

What was worse, was the blind rat race, that the students themselves opted to become a part of. Everything else faded into the background. All that mattered was Marks. Percentage. A University ranking. And this stifled me. Suffocated me. This was not what I had come to do. This was not what I was meant to do. This was not what I wanted to do. And yet, it seemed that this is what I had to do.