The Irrationality of Entrepreneurship
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When invited to speak about entrepreneurship, I felt compelled to speak about my journey that began from the Professor of computer systems @ UTS to Spinning out a company from the university and become a technology Entrepreneur.
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The Irrationality of Entrepreneurship
- 1. BecominganEntrepreneur Dr.SubhashChalla,CEO&Founder, SenSen Networks CDPProgram,IEEEStudentBranch, MonashUniversity 2nd August2016
- 2. Agenda – Entrepreneurs& Entrepreneurship – My Experiencesasan Entrepreneur
- 4. Theirrationality of Entrepreneurship “Birds fly, Fish swim, … and Startups die.” You are incredibly lucky if you succeed You are responsible if you fail Yet … Entrepreneurs Start Companies Are Entrepreneur’s irrational?
- 5. What is Entrepreneurship? – It’s not aJob that one can apply for. – It’s not about big exits, huge net worth, living a life of glamour. – It’s not about changing the world, where one feels like a hero.
- 6. What is Entrepreneurship? – It’s about pursuing something for passion. – Its about the pursuit of opportunitieswithout regard to – resources – results or – odds stacked against you. – It’s long grueling hours, and for years with no respite in sight. – It’s lonely and as only yousee the opportunity and no one else does for quite a long time. – It’s about the remarkable ability to keep faith when thingsare not looking up. – It’s about immersing yourself in meditation on what to do next when the client hasn’t paid youyet or an investor/bank refused to invest in your businessidea.
- 7. What is Entrepreneurship? – It’s an unavoidable life calling pursued by those who are – optimistic enough to believe in themselveswhen no one else does – aware enough to see problemsaround them – creative enough to find novel solutionsto those problems – bold enough to act repeatedly in the presence ofconstant failures – crazy enough to put their reputation,money,family & everything at risk
- 8. Distinguishing Characteristics of an Entrepreneur – Intelligent,High EmotionalQuotient – Passionate about their idea – Highly resourceful – will often be able find resources on the go – Great Leaders - they often inspire others to take up the entrepreneurial vision and make them own it astheir own – Never give up attitude – Often compassionate and care for others – There are alwaysexceptionsto the rule … not all entrepreneurs have all the above, most do.
- 10. Entrepreneurial reality is that the odds are stacked completely against you … Here is why? – Success in entrepreneurship isa chance meeting of an opportunity with a prepared entrepreneur. – But there are many ’prepared’ entrepreneurs and more are joining the queue. – No matter howbig you are in ‘your’ world,you are a ‘nobody’, a ‘stranger’, in the business& customer’s world. – So how do youwin enough trust of strangers so they can part with part of their money? – The first customer runs the risk of becoming a “Guinea pig” and they knowthat & no one wants to be one. – So how do youget your first customer?
- 11. Entrepreneur’s experience when they start out – Entrepreneur: Hello Mr. Tom, – Tom: Hi!… (with a grin on his face saying something like ... Why the hell are u disturbing me?) – Entrepreneur: I invented this great Product. Its pretty cool. It can do this ..., it can do that ... And this .... – Tom: So? – Entrepreneur: Are you interested to buy this? – Tom: What? Do I know you? Who are you? – Entrepreneur: I am Mr. So and So, i.e., “Mr. No body”, or “I am a new kid on the block” .... – Tom: And you want me to buy this from you? I do not trust you Mr. Entrepreneur to part with my money. – Entrepreneur: Sir Tom, Its a really cool product, it can do help you resolve your problems x, y, z. – Tom: Yeilding to Entrepreneur’s persistence, “I never saw this before. Does it really solve my problems, does it actually work? – Entrepreneur: Yes, yes, yes ... – Tom: Who else have bought it? – Entrepreneur: There is growing demand, every one is asking for it, we got so many pre-orders etc ... – Tom: Annoyed, repeats ‘I asked if any one bought it, has it solved their problem’ – Entrepreneur: umm ... No. – Tom: Where is your office – Entrepreneur: We are in the process of establishing an office ...i.e., we do not have one – Tom: So you want me to buy this one from some one whom I do not know, who does not have an office, and no other person on this planet has bought it, and there is no evidence or concrete proof that it actually works and solved the problems you claim to address. DO YOU THINK I am a fool.? – Entrepreneur: No sir, you are not a fool, you are a visionary if you buy this product.
- 12. If you somehow got your first customers … You have to figure out a way to cross “TheChasm” The Start Up Mortuary
- 14. Thedifference between Entrepreneurship & Small Business Ownership Entrepreneurs – Entrepreneurs start businesses with a passion to do what they love doingand help make the world a better place without regard to making a profit. – Entrepreneurship involves recognizing, and being willing to accept, the high risk that the venture may fail. – They are after a globally scalable business. – The people who have started Starbucks or boost juice or apple are often referred to as an Entrepreneur. Theydo the creative part --the concept, décor and menu – and taking the risk of changing the experience of coffee drinking from ‘drinking’ to a social experience. Small Business Owner – Small business owners are driven by self employment with a focus on profit making. – Small business owners are more likely to do something others are doing. Its low risk venture by choice. – They are after a profitable business deliveringreplacement income. – The people who runsa Starbucks, boost juice or apple store franchises are often referred to as a small business owner.They are focused on execution,delivering operational efficiency -- controlling costs and maximizing customer satisfaction.
- 15. My Entrepreneurial Journey 2006 – 2016, ItsStillOn …
- 16. OurCompany – SenSen was founded in 2007 asa spinout from the University ofTechnology Sydney. – SenSen is active inAustralia,USA,Canada,Europe, India,Singapore,&UAE – Proven, patented technology. – SenSen is backed by global team ofscientists& engineerswith HQ in Melbourne,Australia and offices in Hyderabad,India. – Growing strong by the day.
- 17. My Inspiration – My Father who started many businessesin hislife time – a Chit-fund business – a Cooperative Bank – a School – a ChemicalCompany – a Real Estate Firm – a Restaurant – By the time he died in 2008, there were over 2000 employeesin the ventures he founded. He used to measure hissuccess in the number of people who where employed and number offamiliesit they supported. – Google
- 18. Fundraising Eating the Humble Pie – Family & Friends (be careful with this, as this can strainfriendships if things do not workout) – Seed investors,High Net worth Individualsor groups – Crowd funding platforms– Kick-starter,ASSOB – never tried – Venture Capital – Not Successful to date – Strategic Investors/Partners–Companiesthat are in the value chain ofour markets – Banks – Private Equity – Not reached the scale yet and never tried. – IPO – Primary marketsor SecondaryMarkets– Not ready yet.
- 19. Our First Customers – National MotorVehicleTheft ReductionCouncil – A Local ShoppingCentre
- 20. Our visionary customers – Roadsand Maritime Services,NSW – IpswichCityCouncil – Abu DhabiAirport
- 21. The HardTimes – Not knowing which market takes off, we start playing in a few (too many). – Lack of focus on any particular market and experience in handling customers, delays happen. – Consequently Customers delay payments. – Investors hold off investment decisions as they are unsure of our viability. – With customers and investors holding their purses tight, Cashflow crisis hits. – Key staff members became insecure and leave. – Leads to further customer delivery delays. Loss of knowledge. – Then we ran out of money. – Lead to mortgaging our house and divertingall our family savingsto help keep save the sinking ship. – This is the time, you are at risk of losing everything,your reputation, your money, your family support,your everything. – You are literally riding against the tide here, your investors,banks, family, friends, customers are all losingfaith andare convinced thatyou will fail. – Remarkably, I kept my faithand survived these hard times.
- 22. My Experiences as an Entrepreneur – Leaving a safe, Professor’s job @ UTS to start a company for pure passion. – ‘Out-casted’ by (some) colleagues as I lost my ‘nobility’by chosing to go into the business world to make money. – ‘Out-casted’ by most investors & banksas I am an Academic. – The ’Prof’ title ... an epitome of academic success.... is indeed the worst possible qualification to go into the businessworld. – Raising investmentsfrom fundsand strategic partner companies. – Risking everything we have got. – The hurt one feels when the only hope for surviving yet another day fades away in a whim. – Experiance what running out of cash feels like on a daily basis.
- 23. My Experiences as an Entrepreneur – Inventing ingenous ways for findthe cashto survive yet another day. – Signing up the first customer and – Getting the first payment. – The first Milliondollar contract. – Establishing global parnershipswith established companies. – Seeing our company brand get established and watchingit grow. – Meeting extraordinarily people.
- 25. Entrepreneurship Passion Love Equally Irrational things but essential for human existence and progress I am aTechnologyEntrepreneur. My wife callsme an irrationalman for this reason. She still loves me though … and I callher irrationalfor loving me ... an irrationalman. I stilllove her though.