My Thoughts & Views

IIMA Presentation: Startup

Posted on: July 20, 2007

Presentation to MBA students at IIM Ahmedabad. Given rapid growth in India there is interest in leading or joining a startup as opposed to a corporate job.

Slideshow transcript

Slide 1: Is a Startup Right For Me ? Sanjay Bhargava IIM, Ahmedabad, Aug 13, 2006

Slide 2: Passion & Talent • Sachin • Michael • Sanjay

Slide 3: Timing • Wealth Creation • The Indian Gold Rush • Information – OCW • Micro Multinational

Slide 4: Who is this ? • Indian entrepreneur • Incorporated in Gibraltar/ Banking Dubai • Ops/Mktg/CS in Mumbai • Servers in USA • Credit Card processing in Germany • Floral Delivery in 153 countries

Slide 5: Comfort v/s Creation • Why should we work with you ? • Why should we buy from you ? • Why should we invest in you ? • Why … Why … Why

Slide 6: Entrepreneurial Mindset • Can create magic one trick at a time • Understands how the game is played • Builds the right support structure • Controls the future rather than predicts it

Slide 7: Lead or Join • Joining Early stage will suit more • Lets do some math • Elephants are important

Slide 8: Opportunity Cost • The best time is now or 40+ • A bust will come • Societal Pressure • How much did you invest to come to IIM-A

Slide 9: India is Rapidly Evolving • Vision is still small • Focus is weak – Back left neurosurgeon • Looking for Ma • – Venture Jobs – Venture Talent

Slide 10: Elephantine Ideas • Too many not too few • FINO • Senior Opportunity • CFM • SaaS – Retail, Quicken, Turbo Tax

Slide 11: Build to Flip Ideas • 20 You tubes • 12 My Space • 7 Net Flix

Slide 12: Insanity • I see plans where there is no company, a one man army. There are obviously no customers and no revenues. There is a spreadsheet which shows an exit valuation of $50MM. The entrepreneur wants to raise $1.4 MM and is prepared to invest the princely sum of $10,000 including money from friends and family. Obviously this is the first company that the entrepreneur is doing and there is no lawyer that the entrepreneur has and no advisors. Another plan was trying to raise debt from angels at 9% because that is higher than the fixed deposit rate ?Would you invest as an angel? If you would there is a bridge in Brooklyn I want to sell to you. Please do not send me plans like this. You are wasting my time and yours.

Slide 13: Getting Started 1. Incorporate the company that is seeking funding 2. Get a good law firm and have basic documentation in place 3. Put some of your own/friends/family money in the company 4. Use that money to build something, get advisors, customers or atleast expressions of interest 5. Build a team. Part of the team may be angel employees 6. Be clear on how much money you want to raise and how will you use it to get to the next level 7. Think and articulate possible exits 8. Put yourselves in the shoes of the angel investor and make a pitch to yourself

Slide 14: Summary • You decide • Build elephants not rabbits • Takeaways

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