Sunday, June 28, 2009
Farewell Blogger! Here I come Wordpress
I apologize to all my followers to do this to you. I am moving my blog to Wordpress. I know. I know. I should have researched the blogging platforms a little more before I started writing one. I believe the choice is very similar to Mac Vs PCs and I think Blogger is like the PC and Wordpress is like the Mac. I hate PCs! My new blog is at http://indianstartupgyaan.wordpress.com/
Should you fund your product Startup by performing Services?
What prompted me to write on this topic is an email from one of the followers of my blog (completely anonymized) wrote to me seeking advice:
"Dear Abhinash,
I am XXX
I currently run my co-founded startup YYY with a team of 7 people.
The urge to email you started after reading your thoughts at http://randommusingsofabinash.blogspot.com/2009/06/building-kick-ass-team-part-i.html ! Pretty useful insights. However there are few challenges that we are facing and would love to have your suggestions over it.
We are basically a 6 months old startup who is working on social media strategies and as a web dev workshop, originally started with a vision of being a primarily product company we have shrunk to become a services company and see ourself under a deadlock . We need money to run our operations and thus need to make quick money. For quick money , We need to work. However , at the end of the month we end up spending all our time on outsourced projects and thus come in a deadlock of earning and spending.
However, we are doing good and are very positive. We are getting pretty good projects and customer feedback, But as mentioned in your blog post ("if candidate has worked in {ibm|infosys|tcs|satyam|patni..........any services firm in India} then move to Trash") something tells me inside that this is not something that we were supposed to be doing ! , Outsourcing projects , completing them , Fighting for payments slowly seeming to me a waste of time now.
Would love to have your suggestions....
Regards,
XXX
Co-founder
YYY"
This is something I have heard time and again and watch these companies with bright people just becoming high end consulting shops moving from one short-term project to another. I am by no means a purist and the advice I will provide is not going to take the moral high ground.
1. I have not seen any Silicon Valley company take the path of being a services company and succeed as a product company.
2. Most Indian companies which start out with a product vision but have to resort to services is primarily because:
a) they could not excite a VC or an Investor about their product Idea or the team and could not raise funding
b) believe that VCs /Angels are evil and think that giving up large chunks of equity to them is unjustified and they would rather become a services company to raise money
3. The Indian IT services industry is not about IP creation and works in the wafer thin less than ~20% profit margins zone. Product companies need to develop IP and working on projects does not help as you are generally working on somebody else's IP. I believe this kills the innovation capacity of startups. Nasscom would like for you to believe otherwise. You should seriously go to Nasscom's site and start reading their paid research if you believe them.
4. Delivering Services breeds some bad behavior in the team due to the time and material nature of billing. Poor quality code writing, lack of adequate quality control etc. However, the biggest issue I see is that developers become very impatient and don't enjoy long term product execution and building depth after working in the Services world. Typically short projects require you to learn something fast and to do something fairly basic with it. They believe that being a "Jack of All Trade and Master of None" and jumping from one technology to another as quickly as possible is the best way to remain competent. Their resumes look impressive with all kinds of cool technology listed in it but then when you interview this breed, you quickly realize that they can possibly string together a bunch of technologies and copy and paste code from Google to quickly create a nice prototype. But, if you ask them to turn this into a product that needs to scale, perform and deliver a quality experience, then they just haven't built the depth to do these things.
My advice is that if you are going to create a tech startup to build a cool new product or service, then you need to have the discipline to not get tempted by consulting/services opportunities. Stay the course, raise enough money to fund a team that can execute and execute like crazy. The IP you create will ultimately get you the valuation that will make you rich. Take the case of Zimbra, we raised US$31 million from VCs in 3 rounds of funding and were sold for US$350 million (~10X ROI to our investors) when we were making revenues well below US$20M per year. Services companies are typically valued around ~1.6 to 2 times revenue. The Indian IT services industry is an anomaly compared to the rest of the world and enjoys better valuations as IT Services is what is considered to be the Tech industry. This will change rapidly when IP creating technology companies start to grow and succeed in India. The Choice is very Simple :)
"Dear Abhinash,
I am XXX
I currently run my co-founded startup YYY with a team of 7 people.
The urge to email you started after reading your thoughts at http://randommusingsofabinash.blogspot.com/2009/06/building-kick-ass-team-part-i.html ! Pretty useful insights. However there are few challenges that we are facing and would love to have your suggestions over it.
We are basically a 6 months old startup who is working on social media strategies and as a web dev workshop, originally started with a vision of being a primarily product company we have shrunk to become a services company and see ourself under a deadlock . We need money to run our operations and thus need to make quick money. For quick money , We need to work. However , at the end of the month we end up spending all our time on outsourced projects and thus come in a deadlock of earning and spending.
However, we are doing good and are very positive. We are getting pretty good projects and customer feedback, But as mentioned in your blog post ("if candidate has worked in {ibm|infosys|tcs|satyam|patni..........any services firm in India} then move to Trash") something tells me inside that this is not something that we were supposed to be doing ! , Outsourcing projects , completing them , Fighting for payments slowly seeming to me a waste of time now.
Would love to have your suggestions....
Regards,
XXX
Co-founder
YYY"
This is something I have heard time and again and watch these companies with bright people just becoming high end consulting shops moving from one short-term project to another. I am by no means a purist and the advice I will provide is not going to take the moral high ground.
1. I have not seen any Silicon Valley company take the path of being a services company and succeed as a product company.
2. Most Indian companies which start out with a product vision but have to resort to services is primarily because:
a) they could not excite a VC or an Investor about their product Idea or the team and could not raise funding
b) believe that VCs /Angels are evil and think that giving up large chunks of equity to them is unjustified and they would rather become a services company to raise money
3. The Indian IT services industry is not about IP creation and works in the wafer thin less than ~20% profit margins zone. Product companies need to develop IP and working on projects does not help as you are generally working on somebody else's IP. I believe this kills the innovation capacity of startups. Nasscom would like for you to believe otherwise. You should seriously go to Nasscom's site and start reading their paid research if you believe them.
4. Delivering Services breeds some bad behavior in the team due to the time and material nature of billing. Poor quality code writing, lack of adequate quality control etc. However, the biggest issue I see is that developers become very impatient and don't enjoy long term product execution and building depth after working in the Services world. Typically short projects require you to learn something fast and to do something fairly basic with it. They believe that being a "Jack of All Trade and Master of None" and jumping from one technology to another as quickly as possible is the best way to remain competent. Their resumes look impressive with all kinds of cool technology listed in it but then when you interview this breed, you quickly realize that they can possibly string together a bunch of technologies and copy and paste code from Google to quickly create a nice prototype. But, if you ask them to turn this into a product that needs to scale, perform and deliver a quality experience, then they just haven't built the depth to do these things.
My advice is that if you are going to create a tech startup to build a cool new product or service, then you need to have the discipline to not get tempted by consulting/services opportunities. Stay the course, raise enough money to fund a team that can execute and execute like crazy. The IP you create will ultimately get you the valuation that will make you rich. Take the case of Zimbra, we raised US$31 million from VCs in 3 rounds of funding and were sold for US$350 million (~10X ROI to our investors) when we were making revenues well below US$20M per year. Services companies are typically valued around ~1.6 to 2 times revenue. The Indian IT services industry is an anomaly compared to the rest of the world and enjoys better valuations as IT Services is what is considered to be the Tech industry. This will change rapidly when IP creating technology companies start to grow and succeed in India. The Choice is very Simple :)
Will the Indian Newspaper Industry follow its US counterparts?
Having worked very closely with one of India's largest Media houses that owns the most distributed English daily and who operates an Internet Business, I can say with confidence that the Indian News Printing Business is headed in the same direction as the US newspaper business - down the deathward spiral :)
Marc Andreesen has a very nice entry in his blog titled Inaugurating the New York Times Deathwatch
More reading on this topic at http://www.newspaperdeathwatch.com/
I am a straight shooter and my insights into this business is purely based on my real world experience working with companies in this line of business. The reasons I believe that the Indian Newspaper business will become irrelevant are:
1. Leadership has a Journalism background - Most of the leadership in these companies is tenured gray haired journalists who paid their dues in the Print business and believe that the Internet model is very similar to the traditional print business. There isn't a single technology based Internet company that has had journalists as leaders. All of us saw the case of Terry Semel, the gray haired Media Industry Suit (not even a Journo) run Yahoo! to the ground. This breed believes in old school journalism and don't believe that Internet companies are all about delivering quality journalism using the the best technology.
2. Cannot disrupt their cash cow(Newspapers) - Successful Internet companies were created when something was disrupted for something better, faster, cheaper. However, traditional media houses cannot even start to think of the inevitable end of their cash cow business.
3. Lack of appreciation for technology - Since these companies are typically run by media industry suits or journalists and not the technologists who are viewed as the second class citizens in these organizations, all critical decision making is handled by the the non-techie kind.
4. Inability to qualify, attract, retain talent - since the management of these companies is so caught up in promoting their own kind (media suits or journalists), they cannot attract good technical talent to create and run their own Internet Service. In my own experience, this large media house that I worked with introduced me to a high flying CTO that they had hired who was an expat from the US and claimed to be the god of Java, the designer of Sun's coolest Hardware architecture and Scott McNealy's personal advisor. The first 5 minutes I spent with this guy basically told me that he had little to no background in technology and was a great conman. Some statements he made and I quote them verbatim:
" You know Java just sucks. I told Scott (McNealy) to just kill it"
" Why is your software so bloated? (he was referring to Zimbra) I wrote an Entire ERP system in Java that fits on a floppy"
" You know I had an idea that a VC offered US$1B for but I turned it down as I wanted to make it real and get a higher valuation" - this was classic, if I were him, I would have taken the US$1B for the idea :-)
Anyway, I walked away from that meeting shaking my head in utter disbelief and wondering how such large successful businesses could hire such conmen. But then on further analysis, I realized that these companies don't have the talent that can spot the technologists that will drive them into the history books of success and hence end up with people at senior technical roles that could alter a companies course completely due to their incompetence. A year after this episode, this CTO was fired and the media company filed a lawsuit to try and recover money from him. I think the CTO was smart, came from the US, enjoyed a fat expat package and took the naive company for a big ride.
5. Lack of understanding of equitable partnerships - A lot of Indian Media houses because of their sheer might and questionable ethics get away with very good deals for themselves and leave the partners (typically small startups or technology providers) to eat the crumbs. An undernourished ecosystem is as good as dead. I have seen this behavior time and again in the large companies in India who treat smaller companies like dirt. This behavior is further re-inforced as self funded or poorly funded startups desperate for cash who are not mature enough to understand contracts or hire lawyers to help understand the contracts simply sign on the dotted line. Very soon these startups die and the big Media house that just bet its core service on this company are now looking for other small startups to prey on. My message to startup founders is to be very vary of un-equitable partnerships. Have the courage to walk away from a bad deal. It doesn't matter how big or famous the partner you are working with is.
The largest media houses in India are still privately owned and not public companies. There is little to no visibility into their financials. I believe an Industry that has not been transparent to the Public is doomed to begin with. March on to your Deathward Spiral.......
Marc Andreesen has a very nice entry in his blog titled Inaugurating the New York Times Deathwatch
More reading on this topic at http://www.newspaperdeathwatch.com/
I am a straight shooter and my insights into this business is purely based on my real world experience working with companies in this line of business. The reasons I believe that the Indian Newspaper business will become irrelevant are:
1. Leadership has a Journalism background - Most of the leadership in these companies is tenured gray haired journalists who paid their dues in the Print business and believe that the Internet model is very similar to the traditional print business. There isn't a single technology based Internet company that has had journalists as leaders. All of us saw the case of Terry Semel, the gray haired Media Industry Suit (not even a Journo) run Yahoo! to the ground. This breed believes in old school journalism and don't believe that Internet companies are all about delivering quality journalism using the the best technology.
2. Cannot disrupt their cash cow(Newspapers) - Successful Internet companies were created when something was disrupted for something better, faster, cheaper. However, traditional media houses cannot even start to think of the inevitable end of their cash cow business.
3. Lack of appreciation for technology - Since these companies are typically run by media industry suits or journalists and not the technologists who are viewed as the second class citizens in these organizations, all critical decision making is handled by the the non-techie kind.
4. Inability to qualify, attract, retain talent - since the management of these companies is so caught up in promoting their own kind (media suits or journalists), they cannot attract good technical talent to create and run their own Internet Service. In my own experience, this large media house that I worked with introduced me to a high flying CTO that they had hired who was an expat from the US and claimed to be the god of Java, the designer of Sun's coolest Hardware architecture and Scott McNealy's personal advisor. The first 5 minutes I spent with this guy basically told me that he had little to no background in technology and was a great conman. Some statements he made and I quote them verbatim:
" You know Java just sucks. I told Scott (McNealy) to just kill it"
" Why is your software so bloated? (he was referring to Zimbra) I wrote an Entire ERP system in Java that fits on a floppy"
" You know I had an idea that a VC offered US$1B for but I turned it down as I wanted to make it real and get a higher valuation" - this was classic, if I were him, I would have taken the US$1B for the idea :-)
Anyway, I walked away from that meeting shaking my head in utter disbelief and wondering how such large successful businesses could hire such conmen. But then on further analysis, I realized that these companies don't have the talent that can spot the technologists that will drive them into the history books of success and hence end up with people at senior technical roles that could alter a companies course completely due to their incompetence. A year after this episode, this CTO was fired and the media company filed a lawsuit to try and recover money from him. I think the CTO was smart, came from the US, enjoyed a fat expat package and took the naive company for a big ride.
5. Lack of understanding of equitable partnerships - A lot of Indian Media houses because of their sheer might and questionable ethics get away with very good deals for themselves and leave the partners (typically small startups or technology providers) to eat the crumbs. An undernourished ecosystem is as good as dead. I have seen this behavior time and again in the large companies in India who treat smaller companies like dirt. This behavior is further re-inforced as self funded or poorly funded startups desperate for cash who are not mature enough to understand contracts or hire lawyers to help understand the contracts simply sign on the dotted line. Very soon these startups die and the big Media house that just bet its core service on this company are now looking for other small startups to prey on. My message to startup founders is to be very vary of un-equitable partnerships. Have the courage to walk away from a bad deal. It doesn't matter how big or famous the partner you are working with is.
The largest media houses in India are still privately owned and not public companies. There is little to no visibility into their financials. I believe an Industry that has not been transparent to the Public is doomed to begin with. March on to your Deathward Spiral.......
The next 5000 days of the web
At the 2007 EG conference, Kevin Kelly shares a fun stat: The World Wide Web, as we know it, is only 5,000 days old. Now, Kelly asks, how can we predict what's coming in the next 5,000 days?
Watch the talk
Watch the talk
TED India - Nov 4th - 7th 2009, Mysore, India - Be There!
Inspired speakers and game-changing ideas, evocative locations and transporting entertainment: TEDIndia offers a vision of the future that's rich with invention, entrepreneurship, cross-disciplinary problem-solving, unexpected solutions and sensory delight. Hosted in a country that’s reinventing itself – and reshaping the world …
Friday, June 26, 2009
Signup for iAccelerator Winter Edition 2009 in Bangalore - http://iaccelerator.org/
iAccelerator
Announcing the Winter 2009 edition of the iAccelerator.
Bangalore, India December 1, 2009 - April 1 2010
http://iaccelerator.org/
Wednesday, June 24, 2009
Building a Kick Ass Team - Part I
Surround yourself with people smarter than you and see the impossible become possible. Startup founders who have built the biggest baddest companies have lived by this philosophy and proven time and again that it is possible for small groups of people to impact the world. Take the case of Google, Facebook or Twitter and all of them have one thing in common, there are small groups of great people impacting the entire planet in a very profound manner.
In the Indian context, we are just starting to realize that the next generation of leaders will not be the grey haired tenured industry veterans or people that went to cram schools with a roster of degrees and brands like IIT and IIM. The next generation of leaders in India will be young people with a dream that could assemble other young people and go change the world. The US went through this revolution and the Valley is a place where there are so many examples of young people just taking on the world and making the impossible possible. In the valley, people are not measured by their fancy degrees or their age. People are measured by what they can contribute. I love an article written by Paul Graham titled "After Credentials" - if you don't follow Paul Graham, now would be a nice time to do so (piece of advice - don't get carried away by his LISP can change the world rant). The article refers to a culture like ours where kids are pressured by parents to go to cram schools to prepare for entrance exams to the esteemed institutions of IIT and IIM, or the so called elite services (Civil services IAS etc) that make up the bureaucracy in India is a culture of credentials. The culture of judging people by their credentials and not by their performance is just broken. We cannot recreate silicon valley in India if we continue down this broken path of hiring people with credentials instead of people that perform into teams. I have several life lessons to share here that have made me a big believer in this theory as well.
My first startup experience after Oracle was a small startup called Software.com which made large scale emails servers for the earliest ISPs on the planet and became a dominant force in this market. It had a blazing IPO where I remember our US$0.25 cents options trading at US$225 in the pre-bubble and with a market cap of ~US$8B. The founder John MacFarlane, another role model I try to embody and like Satish was one of the greatest tech startup CEOs I have ever worked with, believed that it was time to bring in a professional executive team to run the company as he was not capable of leading a ~US$16B company (we had merged with Phone.com - the inventors of WAP to create Openwave which was also a public company with similar valuation of ours). {I will in a later article discuss what happens when the original founders of a startup leave or are forced to leave and the executive team gets replaced by the so called heavy hitters brought on by the board - a very important topic.} John brought in the number 2 guy from Cisco to run Openwave who was the heir apparent to John Chambers back in 2000. This CEO then brought in a creamy layer from Cisco who slowly and steadily filled up the ranks of Openwave's management team and put Openwave on a trajectory of doom. This e-staff team decided that the young hands running marketing and product management in the company were incapable of running a "large" company like Openwave. They brought in a high powered marketing team of 5-6 individuals with credentials that looked very similar Harvard MBAs with P&G / McKinsey experience. One would expect a pedigreed team like this to propel the company into ranks of glory. Against popular belief the same marketing team created so much chaos in the market that it was obvious the company was doomed forever. Within 18-24 months all of these high powered MBA types were shown the door and after a few quarters the Cisco creamy layer could not manage the expectations of the street and the self propelled hype they created and soon exited through the same revolving doors. They all belonged to a class the US has started to despise called "the empty suits" like the execs from Wall Street Banks and the Automobile Industry.
My next run-in with the so called pedigreed kind was after I moved to India to setup Openwave India. I was hiring technical resources and I saw the resume of an IIT grad who had spent time as a technologist at a very large Indian Telco. He came to the interview 45 minutes late, was not apologetic, was dressed like he was from a slum and wanted a job in an multi-national. I was open and willing to overlook his appearance and demeanor and see if he had the technical acumen to make the cut. He greatly underwhelmed me with his knowledge of the Industry and Technology. He was a CS grad from IIT Kanpur with 3-4 years of experience. After this experience I thought that this was a one off case and was still open to the pedigreed kind.
Then in 2006 when I setup Zimbra in India and the IIT community caught wind of our operation I had a flood of resumes of IIT grads who were graduating from various IITs who were looking for Jobs with Zimbra. I was delighted and talked to Satish about how I thought we could hire these talented young guys and create a kick ass engineering team. Then we put these guys through the paces of our recruitment process whose first gate was to write a piece of software in 12 hours in Java to test their coding skills. Not one IIT grad passed the first gate :-) I am not trying to generalize here and I dont live in an illusionary world. There are clear examples of great leaders from IIT in the past in our industry. However, I feel that somewhere along the way IITs have just lost the quality didactic capabilities of the past. What they are churning out today is an underwhelming set of people not hirable by startups and high-tech software companies. I think the current breed of IITs is being molded for an Infosys or a TCS job. The kick ass engineers in Zimbra India came from a team I cherry picked from Zoho famous for hiring hungry young engineers from the so called Tier-2 engineering schools in India and training them on the latest technologies. Each every one of these hires I would hire again in my next startup :-) Young, hungry, motivated, committed and most importantly humble...... these are the qualities I look for and not credentials.
More interesting reading on this topic here:
IIT Grad == Excellent Programmer?
How the IITs can suck less
1. Hire the absolute best - Talent acquisition in India SUCKS! I have tried to work with a number of talent/recruiting agencies in India including the big names and each and every one underwhelmed me. Unlike the Valley where some of the top recruiters understand how to source top notch talent due to their sheer experience working with startups and product companies, the recruiting firms we have in India have ZERO capability to hire quality talent. All recruiting companies simply go and search the popular job boards for resumes and do a simple key word search extracted for the Job Description you provided them and then the only level of filter is a casual conversation with the candidates on their requirements. I remember getting a flood of resumes that were totally unqualified from each and every recruiter we were using. Imagine the effort you spend in screening this mountain of resumes to find the needle in the haystack. It actually got worse when we became a part of Yahoo. You would imagine someone like Yahoo having the best talent acquisition teams in India. What we got back from Yahoo's TA team was worse than what we were getting from our recruiters. It really seems like talent acquisition in India is designed for the volume hiring that the IT services firms do. My advice to startup entrepreneurs is to network like crazy with groups where a lot of tech savvy entrepreneurs get together (barcamps, tweetups and the like), troll linkedin and network individually, find companies that are doing good related work but don't have the right environment to motivate and retain employees and cherry pick their best and brightest (this worked beautifully for me. I was successful in hiring the 5 top guys from Zimbra's then perceived competitor Zoho. This may sound unethical but hey we all live in a competitive world where only the best must win). Most of the young entrepreneurs I have met also believe that the only requirement when hiring technology people is technical knowledge and coding skills. While this is a given that you need to hire the best coders, you also need to be absolutely sure that the person has the right drive, motivation, energy, ethics and capability to work in a team. People make all the difference between a successful tech startup and a Loser. Hire the best and see the results for yourself.
2. Raise the bar with each hire - To vote them on to the island the candidate that is hired has to be better than our existing standards (which has to be the best in the world) - when you are hiring key resources into your enterprise, imagine you are stranded on an island with 10 candidates and a lifeboat lands from the heaven for 2 people. You now have to choose one out of the 10 that will ensure your safe passage back to mainland. For this not only do you need someone who is the strongest that can help you row the boat back to mainland but you need someone with the highest level of integrity - someone who will not push you out of the boat so he / she can have a safe passage easily. At Zimbra we were known to have set the highest level of recruiting standards for our Engineers. So high was the standard that my guys would receive calls from Google India recruiters trying to hire them away regularly. The culture at Zimbra was so strong that the Engineers never even felt like talking to the Google recruiters. They would walk into my office with the email and laugh about how lame the Google recruiters were and then discuss the latest 8 hour outage of Gmail and how even Google cannot build the best email system in the world. This confidence that the Zimbra Engineers exuded was passed down all the way from Satish and really helped us kick Gmail and Microsoft Exchange in the back side :)
3. Filter out the faint of heart - One strategy that worked for me was to set stringent filters for hiring. I then enforced these filters with all of my recruiters where the penalty was getting fired for sending me one resume that slipped through the filter. My filter was very simple:
if candidate has worked in {ibm|infosys|tcs|satyam|patni..........any services firm in India} then move to Trash
I know this may sound too out in the left field but trust me this was the best thing I ever did from a HR standpoint. The Services Industry was great in taking India to the Digital Age. It created the new economy and provided many jobs and bettered peoples lives. However, the same industry is caught in its own rut. This is an industry that has not evolved or created a single innovation that the world can point to as exemplary. They continue to induct 1000s of people into software factories where these employees are made to work on fairly automated software processes on projects that were considered non core by US companies and offloaded to a lower cost model. Why has Infosys - "the so called Microsoft of India" not come up with a single innovation or product that the world can point to and say "hmmm. that is cool!"? For more on this topic read Om Malik's article written in 2007 - Troubling Signs for Indian Tech Outsourcers. If I were to gaze into the crystal ball, I can only see two outcomes for the Tech Outsourcing Industry in India - they reinvent themselves and start creating IP and products and push India into a new era of greatness (or) the Bangalore IT Outsourcing industry goes down in the history books as an Industry that could not stay competitive and die like the auto industry in Detroit. Something tells me that the latter is the most likely scenario for India's tech outsourcing industry.
The other issue with the software Industry is that intense competition led to artificial escalation in wages at a totally unsustainable rate. The Indian IT industry is one of a kind in the world where wages increased in double digits year over year for a long period of time. I am a big believer in paying highly skilled and high performance individuals well over the industry and I am also known to have doubled my best resources salary 2 times in a single year. Most of the services industry folks do not fit the description of a high performance or highly skilled engineer but have expectations that are just unreasonable. This is an important message to many startup founders. Hire people that are hungry and willing to work for low salaries and higher equity initially. If you find that they exceed your expectations quickly raise their salaries to a level that it becomes a non issue for the employee for a long time.
Some other filters early stage startup founders may want to consider at the early stage are the following:
if {MBA | product analyst | business development type| project manager..........} then make sure you are absolutely sure that they are not empty suits.
So, who is this breed known as empty suits........ it is mostly people who:
1. don't have a deep understanding and more importantly INSIGHTS of technology, markets or have the inclination or drive to learn it.
2. when asked if you follow pluggd.in, techcrunch, gigaom, allthingsd, guykawasaki.com, paulgraham.com respond with a "ummm... I dunno, what is that?"
3. have never ever coded in their lives
4. believe that the MBA type is a higher class than the hacker type
5. believe their role is to tell the engineers what to do - I love this one!
6. don't understand the social phenomenon of the Internet - linkedin, twitter, fb etc
7. seemed to have walked the proven path and never broken rank (IIT, IIM, Management Consulting or Services type of career path)
8. hide behind powerpoints and throw mba jargon when they cannot understand technology issues
9. believe that impressing engineers is by writing a long list of un-prioritized features with no justification on why they matter
10. don't understand the terms seo, sem, social marketing, blogging etc
and the list goes on which you are probably getting a hang off now.
Let us all face it the only people who matter in a technology startup is people who build stuff and people who can sell stuff. The rest are overhead. Hire overhead carefully and only if you need it in-house. Most overhead skills can be outsourced. Even when Zimbra grew to 40 in India, we had one overhead - an office manager whose primary role I had defined was to keep the office entertained (dragging people out to parties, making sure they were well fed etc). The office manager was the one that coordinated with all our outsourced vendors for accounting, payroll etc.
(to be continued....)
In the Indian context, we are just starting to realize that the next generation of leaders will not be the grey haired tenured industry veterans or people that went to cram schools with a roster of degrees and brands like IIT and IIM. The next generation of leaders in India will be young people with a dream that could assemble other young people and go change the world. The US went through this revolution and the Valley is a place where there are so many examples of young people just taking on the world and making the impossible possible. In the valley, people are not measured by their fancy degrees or their age. People are measured by what they can contribute. I love an article written by Paul Graham titled "After Credentials" - if you don't follow Paul Graham, now would be a nice time to do so (piece of advice - don't get carried away by his LISP can change the world rant). The article refers to a culture like ours where kids are pressured by parents to go to cram schools to prepare for entrance exams to the esteemed institutions of IIT and IIM, or the so called elite services (Civil services IAS etc) that make up the bureaucracy in India is a culture of credentials. The culture of judging people by their credentials and not by their performance is just broken. We cannot recreate silicon valley in India if we continue down this broken path of hiring people with credentials instead of people that perform into teams. I have several life lessons to share here that have made me a big believer in this theory as well.
My first startup experience after Oracle was a small startup called Software.com which made large scale emails servers for the earliest ISPs on the planet and became a dominant force in this market. It had a blazing IPO where I remember our US$0.25 cents options trading at US$225 in the pre-bubble and with a market cap of ~US$8B. The founder John MacFarlane, another role model I try to embody and like Satish was one of the greatest tech startup CEOs I have ever worked with, believed that it was time to bring in a professional executive team to run the company as he was not capable of leading a ~US$16B company (we had merged with Phone.com - the inventors of WAP to create Openwave which was also a public company with similar valuation of ours). {I will in a later article discuss what happens when the original founders of a startup leave or are forced to leave and the executive team gets replaced by the so called heavy hitters brought on by the board - a very important topic.} John brought in the number 2 guy from Cisco to run Openwave who was the heir apparent to John Chambers back in 2000. This CEO then brought in a creamy layer from Cisco who slowly and steadily filled up the ranks of Openwave's management team and put Openwave on a trajectory of doom. This e-staff team decided that the young hands running marketing and product management in the company were incapable of running a "large" company like Openwave. They brought in a high powered marketing team of 5-6 individuals with credentials that looked very similar Harvard MBAs with P&G / McKinsey experience. One would expect a pedigreed team like this to propel the company into ranks of glory. Against popular belief the same marketing team created so much chaos in the market that it was obvious the company was doomed forever. Within 18-24 months all of these high powered MBA types were shown the door and after a few quarters the Cisco creamy layer could not manage the expectations of the street and the self propelled hype they created and soon exited through the same revolving doors. They all belonged to a class the US has started to despise called "the empty suits" like the execs from Wall Street Banks and the Automobile Industry.
My next run-in with the so called pedigreed kind was after I moved to India to setup Openwave India. I was hiring technical resources and I saw the resume of an IIT grad who had spent time as a technologist at a very large Indian Telco. He came to the interview 45 minutes late, was not apologetic, was dressed like he was from a slum and wanted a job in an multi-national. I was open and willing to overlook his appearance and demeanor and see if he had the technical acumen to make the cut. He greatly underwhelmed me with his knowledge of the Industry and Technology. He was a CS grad from IIT Kanpur with 3-4 years of experience. After this experience I thought that this was a one off case and was still open to the pedigreed kind.
Then in 2006 when I setup Zimbra in India and the IIT community caught wind of our operation I had a flood of resumes of IIT grads who were graduating from various IITs who were looking for Jobs with Zimbra. I was delighted and talked to Satish about how I thought we could hire these talented young guys and create a kick ass engineering team. Then we put these guys through the paces of our recruitment process whose first gate was to write a piece of software in 12 hours in Java to test their coding skills. Not one IIT grad passed the first gate :-) I am not trying to generalize here and I dont live in an illusionary world. There are clear examples of great leaders from IIT in the past in our industry. However, I feel that somewhere along the way IITs have just lost the quality didactic capabilities of the past. What they are churning out today is an underwhelming set of people not hirable by startups and high-tech software companies. I think the current breed of IITs is being molded for an Infosys or a TCS job. The kick ass engineers in Zimbra India came from a team I cherry picked from Zoho famous for hiring hungry young engineers from the so called Tier-2 engineering schools in India and training them on the latest technologies. Each every one of these hires I would hire again in my next startup :-) Young, hungry, motivated, committed and most importantly humble...... these are the qualities I look for and not credentials.
More interesting reading on this topic here:
IIT Grad == Excellent Programmer?
How the IITs can suck less
1. Hire the absolute best - Talent acquisition in India SUCKS! I have tried to work with a number of talent/recruiting agencies in India including the big names and each and every one underwhelmed me. Unlike the Valley where some of the top recruiters understand how to source top notch talent due to their sheer experience working with startups and product companies, the recruiting firms we have in India have ZERO capability to hire quality talent. All recruiting companies simply go and search the popular job boards for resumes and do a simple key word search extracted for the Job Description you provided them and then the only level of filter is a casual conversation with the candidates on their requirements. I remember getting a flood of resumes that were totally unqualified from each and every recruiter we were using. Imagine the effort you spend in screening this mountain of resumes to find the needle in the haystack. It actually got worse when we became a part of Yahoo. You would imagine someone like Yahoo having the best talent acquisition teams in India. What we got back from Yahoo's TA team was worse than what we were getting from our recruiters. It really seems like talent acquisition in India is designed for the volume hiring that the IT services firms do. My advice to startup entrepreneurs is to network like crazy with groups where a lot of tech savvy entrepreneurs get together (barcamps, tweetups and the like), troll linkedin and network individually, find companies that are doing good related work but don't have the right environment to motivate and retain employees and cherry pick their best and brightest (this worked beautifully for me. I was successful in hiring the 5 top guys from Zimbra's then perceived competitor Zoho. This may sound unethical but hey we all live in a competitive world where only the best must win). Most of the young entrepreneurs I have met also believe that the only requirement when hiring technology people is technical knowledge and coding skills. While this is a given that you need to hire the best coders, you also need to be absolutely sure that the person has the right drive, motivation, energy, ethics and capability to work in a team. People make all the difference between a successful tech startup and a Loser. Hire the best and see the results for yourself.
2. Raise the bar with each hire - To vote them on to the island the candidate that is hired has to be better than our existing standards (which has to be the best in the world) - when you are hiring key resources into your enterprise, imagine you are stranded on an island with 10 candidates and a lifeboat lands from the heaven for 2 people. You now have to choose one out of the 10 that will ensure your safe passage back to mainland. For this not only do you need someone who is the strongest that can help you row the boat back to mainland but you need someone with the highest level of integrity - someone who will not push you out of the boat so he / she can have a safe passage easily. At Zimbra we were known to have set the highest level of recruiting standards for our Engineers. So high was the standard that my guys would receive calls from Google India recruiters trying to hire them away regularly. The culture at Zimbra was so strong that the Engineers never even felt like talking to the Google recruiters. They would walk into my office with the email and laugh about how lame the Google recruiters were and then discuss the latest 8 hour outage of Gmail and how even Google cannot build the best email system in the world. This confidence that the Zimbra Engineers exuded was passed down all the way from Satish and really helped us kick Gmail and Microsoft Exchange in the back side :)
3. Filter out the faint of heart - One strategy that worked for me was to set stringent filters for hiring. I then enforced these filters with all of my recruiters where the penalty was getting fired for sending me one resume that slipped through the filter. My filter was very simple:
if candidate has worked in {ibm|infosys|tcs|satyam|patni..........any services firm in India} then move to Trash
I know this may sound too out in the left field but trust me this was the best thing I ever did from a HR standpoint. The Services Industry was great in taking India to the Digital Age. It created the new economy and provided many jobs and bettered peoples lives. However, the same industry is caught in its own rut. This is an industry that has not evolved or created a single innovation that the world can point to as exemplary. They continue to induct 1000s of people into software factories where these employees are made to work on fairly automated software processes on projects that were considered non core by US companies and offloaded to a lower cost model. Why has Infosys - "the so called Microsoft of India" not come up with a single innovation or product that the world can point to and say "hmmm. that is cool!"? For more on this topic read Om Malik's article written in 2007 - Troubling Signs for Indian Tech Outsourcers. If I were to gaze into the crystal ball, I can only see two outcomes for the Tech Outsourcing Industry in India - they reinvent themselves and start creating IP and products and push India into a new era of greatness (or) the Bangalore IT Outsourcing industry goes down in the history books as an Industry that could not stay competitive and die like the auto industry in Detroit. Something tells me that the latter is the most likely scenario for India's tech outsourcing industry.
The other issue with the software Industry is that intense competition led to artificial escalation in wages at a totally unsustainable rate. The Indian IT industry is one of a kind in the world where wages increased in double digits year over year for a long period of time. I am a big believer in paying highly skilled and high performance individuals well over the industry and I am also known to have doubled my best resources salary 2 times in a single year. Most of the services industry folks do not fit the description of a high performance or highly skilled engineer but have expectations that are just unreasonable. This is an important message to many startup founders. Hire people that are hungry and willing to work for low salaries and higher equity initially. If you find that they exceed your expectations quickly raise their salaries to a level that it becomes a non issue for the employee for a long time.
Some other filters early stage startup founders may want to consider at the early stage are the following:
if {MBA | product analyst | business development type| project manager..........} then make sure you are absolutely sure that they are not empty suits.
So, who is this breed known as empty suits........ it is mostly people who:
1. don't have a deep understanding and more importantly INSIGHTS of technology, markets or have the inclination or drive to learn it.
2. when asked if you follow pluggd.in, techcrunch, gigaom, allthingsd, guykawasaki.com, paulgraham.com respond with a "ummm... I dunno, what is that?"
3. have never ever coded in their lives
4. believe that the MBA type is a higher class than the hacker type
5. believe their role is to tell the engineers what to do - I love this one!
6. don't understand the social phenomenon of the Internet - linkedin, twitter, fb etc
7. seemed to have walked the proven path and never broken rank (IIT, IIM, Management Consulting or Services type of career path)
8. hide behind powerpoints and throw mba jargon when they cannot understand technology issues
9. believe that impressing engineers is by writing a long list of un-prioritized features with no justification on why they matter
10. don't understand the terms seo, sem, social marketing, blogging etc
and the list goes on which you are probably getting a hang off now.
Let us all face it the only people who matter in a technology startup is people who build stuff and people who can sell stuff. The rest are overhead. Hire overhead carefully and only if you need it in-house. Most overhead skills can be outsourced. Even when Zimbra grew to 40 in India, we had one overhead - an office manager whose primary role I had defined was to keep the office entertained (dragging people out to parties, making sure they were well fed etc). The office manager was the one that coordinated with all our outsourced vendors for accounting, payroll etc.
(to be continued....)
Thursday, March 12, 2009
The Making of a Technology Innovator/Entrepreneur
My life is truly amazing and I feel very blessed that I have had such a wonderful life with great parents, an amazing upbringing, a fantastic family, a rich professional life filled with interesting life experiences and most importantly connecting with great people.
In India, we are often given examples of great individuals who are termed Innovators. These individuals are usually heirs of large formidable empires with deep pockets and are able to take a successful empire and keep the Juggernaut rolling. However, true entrepreneurs are those that have risen from the dust and built large businesses and more importantly a culture of success. We have very few examples of such success in India. Silicon Valley and Israel have been able to provide an environment, culture, and a great pool of VCs, entrepreneurs, ecosystem and mentors that fuel the engine of innovation and keep creating a steady supply of new entrepreneurs/innovators. The point I am making is that if you dream of being an innovator/ entrepreneur, find people who truly deserve to be role models and try to learn as much about them and emulate their behavior closely as there are very important life lessons to be learned from them. But, it is important that you use your good judgment in picking these role models. Ask yourself if the person you want to follow has leadership qualities, is personable, is social, has risen from modest backgrounds to create something large, has created an enterprise culture that is designed to win. I will discuss the role of role models and mentors in later discussions but it is important that you start thinking about people who can inspire you to achieve greatness.
Innovators / Entrepreneurs have specific traits that make them who they are. I would like to share my life experiences about such people who rose from the dust and charted their own destiny of greatness and their specific qualities that make them successful.
Attitude is one of the key ingredients of being a successful entrepreneur and is a common thread I have observed in many great people that have touched my life. I have had the fortune of working closely with Satish Dharmaraj (founder and CEO of Zimbra) and who I consider my close friend and mentor and several great personalities in Silicon Valley and India. I will use Satish's example in discussing this very important ingredient of success. Satish grew up in a very modest middle class Indian background similar to my background and many of you who are reading this blog. He did not go to an IIT and did his MS at a decent school in the US but not an IVY league. However, he was on a path of greatness purely because of his attitude. Very early in his career (1995/1996), he became the co-creator of Server Side Java (aka. JSP/Servlets) and led the team at Javasoft that created one of the biggest innovations the world received - Java EE. He then was part of the founding team at Onebox.com which was sold to Openwave for US$850 million in the year 2000 and then the founder and CEO of Zimbra which was sold to Yahoo Inc for US$350 million.
One quality that sets him apart from the crowd is his Attitude. A very strong Type A personality that can mesmerize anyone that he interacts with. Attitude is a combination of many behaviors that a person embodies based on life experiences. The great people like Satish that I have had close relationships with have consistently demonstrated the following positive behaviors:
1. Confidence
2. Passion
3. Openness
4. Integrity
1. Confidence - Confidence in oneself is not the only form of confidence needed to succeed but confidence in others is equally important to be successful.
In India we are culturally taught not to have confidence in ourselves. We have all been raised in a very subservient culture. The English ruled us and treated us as their servants - hence absurd behaviors like calling people "Sir and Madam" even in Corporate India are still very much a part of our culture. In school we are taught to address teachers as "Sirs" and "Madams". In Government offices people refer to each other as "Sir" or "Madam". We are also taught not to dream big. I am sure you have personally experienced this in your childhood - you have a dream to do something great and run to your parents brimming with excitement and tell them about what you want to do and are quickly reprimanded and brought back to so called "Reality". How often have you heard from your parents or peers "arre sapne mat dekho" (Hey, stop dreaming)? Then you are given a lesson in being modest and dreaming of achievable and realistic goals where your ambition is reset quickly to a well treaded path that your parents or peers are familiar with. "Son, study for IIT and then do an MBA which will fetch you a nice job with a package of Rs. 50,000 per month - you will be very comfortable if you earn that kind of money". Even the so called "highly educated" middle class in India is well know for inculcating this behavior.
This behavior is reinforced in many aspects of our life as we grow in the subservient society we live in. All of us need to break away from such behavior of being subservient both in our personal and professional lives. Stop referring to your boss as "Sir" or "Madam" and address them by their first name. If they take offence to it, talk to everyone in your team and have everyone address him/her with their first name. As a team, approach your boss and tell them that you are not going to address them as Sir or Madam. Start by telling yourself that you can be bigger, better, faster than the "role model of your choice".
Most of the great Leaders in the world have immense confidence in themselves. With this confidence, they can challenge people, ideas and thoughts. Followers on the other hand lack confidence and are subservient. The world can clearly see a Leader as they demonstrate the quality of confidence. Confidence helps them communicate their ideas very strongly and people listening pay attention. Confidence is also the key ammunition of a young innovator / entrepreneur as it gives them the conviction to pursue an idea or a dream. It allows them to face all the challenges that they encounter in their life. They are heard and respected by VCs, Customers and Shareholders. Almost all the examples of greatness in the world are of people who have treaded on uncharted paths. I urge all young Indians to follow their dreams and to have the confidence that they can be bigger, better, faster than the next Bill Gates or Narayana Murthi.
I also truly believe that having Confidence in others abilities is also a key quality of a leader. "Rome was not built in a day" - and I would like to add "by one person" to this famous adage. Great companies cannot be built with just one individual. Great Leaders surround themselves with people smarter than themselves and know all the tricks of motivating and inspiring them to deliver their best. However, this requires the leader to trust the abilities of individuals they bring on board to help them on the journey of building great enterprises. Indians are also taught very early in their lives not to trust people easily and to always look at people with a veneer of doubt. It is true that we live in one of the most corrupt societies where a majority of our people demonstrate personal ethics that are less than desirable. However in Corporate environments, not having faith in people that work for or with you just creates an environment of distrust which leads to a several bad habits in the team that eventually lead to under performing teams that don't achieve greatness. In my personal life, when Satish and I started discussing setting up Zimbra in India, I am sure it was a big decision for Satish as he had the ultimate rock star high performance team in the valley and all his attempts to work with outsourced teams in India had only underwhelmed him in the past. Zimbra was also a very well funded startup and did not need an India team to be successful. However, Satish did have immense faith in my ability to deliver. I had worked with Satish from 2000 to 2004 at Openwave and we had built great mutual respect for each other. With this faith alone, he invested in Zimbra Asia Pacific in Pune which in 1 year grew to 30 people (we were a total of 90 between India and Rest of the World) when we were acquired by Yahoo. This team in Pune has the track record of being one of the high powered Software Engineering teams in India. Today, all of the cool, sexy Ajax technology Zimbra is know to have pioneered is developed out of Pune.
Walk with your head high as if you own the world and you will see the world bow down to you!
2. Passion - This is a innate quality I have seen in many of the folks I look up to. Lot of startup guys I meet who have usually worked in the Industry for a few years and felt that doing a startup is an interesting idea as the lame Outsourced software Industry in India cannot afford 14% raises anymore are the ones that lack this key ingredient. When they pitch their ideas you don't feel the hunger in their eyes or the sheer drive to change the world. My thumb twiddles and I look around here and there and cannot focus. The younger startup folks I meet in India seem to be hungry and their sheer drive and passion is infectious. In a recent visit to help my friend Freeman Murray with his iAccelerator startup incubator in IIM Ahmedabad, in mentoring the 8 teams there on Business Plan and Go To Market strategies, I observed that the 2 youngest teams seemed to be the most passionate about what they do and were able to articulate their vision and got me excited. One of these teams is a finalist and only entry from India in the 2009 DFJ Global Business Plan competition. Godspeed to them! The older guys seemed to have lost their mojo along the way.
The greatest example I can give of someone who exemplifies this quality is Steve Jobs. His passion for design is so ingrained in Apple's DNA that I am willing to bet that any innovation Apple comes up with will be lapped up by the masses. I have a personal story about Steve Jobs from the early days of my career which was narrated to me by my first boss at Oracle who went to work for Steve at NeXT Computers. Steve is know to be a extreme perfectionist and when the first prototype of the NeXT Cube was ready, it made its way to Steve's office for the ultimate QA pass :-) Steve rejected the machine and his complaint was that it was too noisy. The entire batch of drives manufactured by a leading OEM was rejected and shipped back delaying the launch of the Cube. Another local example I have heard (this is not qualified but hearsay) is of Vijay Mallya. Quality Control in all of Kingfisher / UB's operations reports directly to Vijay Mallya. I think this is a direct reflection of the intent of the founder to ensure the highest quality of the product or service they want to offer to the market. Passionate individuals who want to deliver the best experience to their customers is a telltale sign of success! At Zimbra, Satish played the same role. He was the first to test any new feature added to the product and played the role of Master Bitch Slapper if something was not of high quality. I think in India where we are all used to the "Santusht" philosophy of accepting substandard quality is unacceptable. Startup founders must embody the passion to design, innovate and deliver the best products in the market and success will follow.
Passion is the secret and vital ingredient of ALL successful startups.
3. Openness - The most successful people I have known demonstrate a level of openness that leaves the person interacting with them humbled. They are open to ideas, concepts, suggestions, criticism and are willing to listen and act on the information gathered. Again culture and upbringing has a huge role to play in how open or closed people are. Many Indians I have met have set and pre-conceived world views on how things should be and are not open to suggestions or feedback. Example: Lot of young startup folks I meet may have never raised a single $$ from a VC but believe that all VCs and Angels are evil who are after un-equitable partnerships with startups. This myth is spread around in the small startup community in India and you suddenly hear this consistently from several young entrepreneurs. What they forget is that the VC is putting hard cash into their businesses and betting on their ability to execute a vision. They are professionals and they evaluate opportunities opportunistically as any "for profit" enterprise behaves. This type of negativity is not helpful. The teams I have seen that have won big have had immense faith in their VCs, Advisors and mentors and are open to accept feedback on strategy and execution and use their reasonable judgment to convert ideas to action. I also see a lot of young engineers who are enamored by a certain technology which may be emerging and want to rewrite something on this new exciting piece of technology without evaluating the downstream effects of doing this. They forget to ask all the important questions such as "is it proven", " can I scale something with this and make it work when I face the scale challenge", "is there a mature ecosystem to support this", "can i hire people with these skills when I scale", "is the company completely de-risked if we make this change" etc. Instead they become closed to feedback from experienced people when asked these questions which is sheer arrogance. In a startup chances are you will be faced with decisions like these very often due to the sheer nature of the bleeding edge work you do. The best startup founders are the ones that have advisors / mentors or informal experts network that they can tap into and seek their counsel at anytime.
Be open and the World will open to you!
4. Integrity - I think a lot of us Indians are forced to live in a world where our personal and professional integrity is questionable. Corruption is rampant in our society and we are all guilty of being party to have indulged in some form of corruption in our day to day lives. This really lowers our moral standards and our ability to be transparent to each other in our professional life. The startup founders that are successful have the highest levels of personal and professional Integrity. Transparency between founders and employees is something that lacks in Indian startups. Founders don't want to share the wealth fairly and equitably with people they bring on. Unless this changes we can never create a Silicon Valley style sub culture in India. Satish my mentor is again exemplary. The core team at Zimbra followed Satish from JavaSoft to Onebox to Openwave to Zimbra. These are some of the most talented valley engineers who companies like GOOG, Facebook etc would have loved to have. However, they all followed Satish to Zimbra. Satish made sure that all the employees of Zimbra shared in the wealth created. Lets us all face it - we will all be part of multiple startups in our lives and we want to work with the best and the brightest. It only takes one act of lack of integrity by the founders of any company to lose the loyalty of all their employees.
In India, we are often given examples of great individuals who are termed Innovators. These individuals are usually heirs of large formidable empires with deep pockets and are able to take a successful empire and keep the Juggernaut rolling. However, true entrepreneurs are those that have risen from the dust and built large businesses and more importantly a culture of success. We have very few examples of such success in India. Silicon Valley and Israel have been able to provide an environment, culture, and a great pool of VCs, entrepreneurs, ecosystem and mentors that fuel the engine of innovation and keep creating a steady supply of new entrepreneurs/innovators. The point I am making is that if you dream of being an innovator/ entrepreneur, find people who truly deserve to be role models and try to learn as much about them and emulate their behavior closely as there are very important life lessons to be learned from them. But, it is important that you use your good judgment in picking these role models. Ask yourself if the person you want to follow has leadership qualities, is personable, is social, has risen from modest backgrounds to create something large, has created an enterprise culture that is designed to win. I will discuss the role of role models and mentors in later discussions but it is important that you start thinking about people who can inspire you to achieve greatness.
Innovators / Entrepreneurs have specific traits that make them who they are. I would like to share my life experiences about such people who rose from the dust and charted their own destiny of greatness and their specific qualities that make them successful.
Attitude is one of the key ingredients of being a successful entrepreneur and is a common thread I have observed in many great people that have touched my life. I have had the fortune of working closely with Satish Dharmaraj (founder and CEO of Zimbra) and who I consider my close friend and mentor and several great personalities in Silicon Valley and India. I will use Satish's example in discussing this very important ingredient of success. Satish grew up in a very modest middle class Indian background similar to my background and many of you who are reading this blog. He did not go to an IIT and did his MS at a decent school in the US but not an IVY league. However, he was on a path of greatness purely because of his attitude. Very early in his career (1995/1996), he became the co-creator of Server Side Java (aka. JSP/Servlets) and led the team at Javasoft that created one of the biggest innovations the world received - Java EE. He then was part of the founding team at Onebox.com which was sold to Openwave for US$850 million in the year 2000 and then the founder and CEO of Zimbra which was sold to Yahoo Inc for US$350 million.
One quality that sets him apart from the crowd is his Attitude. A very strong Type A personality that can mesmerize anyone that he interacts with. Attitude is a combination of many behaviors that a person embodies based on life experiences. The great people like Satish that I have had close relationships with have consistently demonstrated the following positive behaviors:
1. Confidence
2. Passion
3. Openness
4. Integrity
1. Confidence - Confidence in oneself is not the only form of confidence needed to succeed but confidence in others is equally important to be successful.
In India we are culturally taught not to have confidence in ourselves. We have all been raised in a very subservient culture. The English ruled us and treated us as their servants - hence absurd behaviors like calling people "Sir and Madam" even in Corporate India are still very much a part of our culture. In school we are taught to address teachers as "Sirs" and "Madams". In Government offices people refer to each other as "Sir" or "Madam". We are also taught not to dream big. I am sure you have personally experienced this in your childhood - you have a dream to do something great and run to your parents brimming with excitement and tell them about what you want to do and are quickly reprimanded and brought back to so called "Reality". How often have you heard from your parents or peers "arre sapne mat dekho" (Hey, stop dreaming)? Then you are given a lesson in being modest and dreaming of achievable and realistic goals where your ambition is reset quickly to a well treaded path that your parents or peers are familiar with. "Son, study for IIT and then do an MBA which will fetch you a nice job with a package of Rs. 50,000 per month - you will be very comfortable if you earn that kind of money". Even the so called "highly educated" middle class in India is well know for inculcating this behavior.
This behavior is reinforced in many aspects of our life as we grow in the subservient society we live in. All of us need to break away from such behavior of being subservient both in our personal and professional lives. Stop referring to your boss as "Sir" or "Madam" and address them by their first name. If they take offence to it, talk to everyone in your team and have everyone address him/her with their first name. As a team, approach your boss and tell them that you are not going to address them as Sir or Madam. Start by telling yourself that you can be bigger, better, faster than the "role model of your choice".
Most of the great Leaders in the world have immense confidence in themselves. With this confidence, they can challenge people, ideas and thoughts. Followers on the other hand lack confidence and are subservient. The world can clearly see a Leader as they demonstrate the quality of confidence. Confidence helps them communicate their ideas very strongly and people listening pay attention. Confidence is also the key ammunition of a young innovator / entrepreneur as it gives them the conviction to pursue an idea or a dream. It allows them to face all the challenges that they encounter in their life. They are heard and respected by VCs, Customers and Shareholders. Almost all the examples of greatness in the world are of people who have treaded on uncharted paths. I urge all young Indians to follow their dreams and to have the confidence that they can be bigger, better, faster than the next Bill Gates or Narayana Murthi.
I also truly believe that having Confidence in others abilities is also a key quality of a leader. "Rome was not built in a day" - and I would like to add "by one person" to this famous adage. Great companies cannot be built with just one individual. Great Leaders surround themselves with people smarter than themselves and know all the tricks of motivating and inspiring them to deliver their best. However, this requires the leader to trust the abilities of individuals they bring on board to help them on the journey of building great enterprises. Indians are also taught very early in their lives not to trust people easily and to always look at people with a veneer of doubt. It is true that we live in one of the most corrupt societies where a majority of our people demonstrate personal ethics that are less than desirable. However in Corporate environments, not having faith in people that work for or with you just creates an environment of distrust which leads to a several bad habits in the team that eventually lead to under performing teams that don't achieve greatness. In my personal life, when Satish and I started discussing setting up Zimbra in India, I am sure it was a big decision for Satish as he had the ultimate rock star high performance team in the valley and all his attempts to work with outsourced teams in India had only underwhelmed him in the past. Zimbra was also a very well funded startup and did not need an India team to be successful. However, Satish did have immense faith in my ability to deliver. I had worked with Satish from 2000 to 2004 at Openwave and we had built great mutual respect for each other. With this faith alone, he invested in Zimbra Asia Pacific in Pune which in 1 year grew to 30 people (we were a total of 90 between India and Rest of the World) when we were acquired by Yahoo. This team in Pune has the track record of being one of the high powered Software Engineering teams in India. Today, all of the cool, sexy Ajax technology Zimbra is know to have pioneered is developed out of Pune.
Walk with your head high as if you own the world and you will see the world bow down to you!
2. Passion - This is a innate quality I have seen in many of the folks I look up to. Lot of startup guys I meet who have usually worked in the Industry for a few years and felt that doing a startup is an interesting idea as the lame Outsourced software Industry in India cannot afford 14% raises anymore are the ones that lack this key ingredient. When they pitch their ideas you don't feel the hunger in their eyes or the sheer drive to change the world. My thumb twiddles and I look around here and there and cannot focus. The younger startup folks I meet in India seem to be hungry and their sheer drive and passion is infectious. In a recent visit to help my friend Freeman Murray with his iAccelerator startup incubator in IIM Ahmedabad, in mentoring the 8 teams there on Business Plan and Go To Market strategies, I observed that the 2 youngest teams seemed to be the most passionate about what they do and were able to articulate their vision and got me excited. One of these teams is a finalist and only entry from India in the 2009 DFJ Global Business Plan competition. Godspeed to them! The older guys seemed to have lost their mojo along the way.
The greatest example I can give of someone who exemplifies this quality is Steve Jobs. His passion for design is so ingrained in Apple's DNA that I am willing to bet that any innovation Apple comes up with will be lapped up by the masses. I have a personal story about Steve Jobs from the early days of my career which was narrated to me by my first boss at Oracle who went to work for Steve at NeXT Computers. Steve is know to be a extreme perfectionist and when the first prototype of the NeXT Cube was ready, it made its way to Steve's office for the ultimate QA pass :-) Steve rejected the machine and his complaint was that it was too noisy. The entire batch of drives manufactured by a leading OEM was rejected and shipped back delaying the launch of the Cube. Another local example I have heard (this is not qualified but hearsay) is of Vijay Mallya. Quality Control in all of Kingfisher / UB's operations reports directly to Vijay Mallya. I think this is a direct reflection of the intent of the founder to ensure the highest quality of the product or service they want to offer to the market. Passionate individuals who want to deliver the best experience to their customers is a telltale sign of success! At Zimbra, Satish played the same role. He was the first to test any new feature added to the product and played the role of Master Bitch Slapper if something was not of high quality. I think in India where we are all used to the "Santusht" philosophy of accepting substandard quality is unacceptable. Startup founders must embody the passion to design, innovate and deliver the best products in the market and success will follow.
Passion is the secret and vital ingredient of ALL successful startups.
3. Openness - The most successful people I have known demonstrate a level of openness that leaves the person interacting with them humbled. They are open to ideas, concepts, suggestions, criticism and are willing to listen and act on the information gathered. Again culture and upbringing has a huge role to play in how open or closed people are. Many Indians I have met have set and pre-conceived world views on how things should be and are not open to suggestions or feedback. Example: Lot of young startup folks I meet may have never raised a single $$ from a VC but believe that all VCs and Angels are evil who are after un-equitable partnerships with startups. This myth is spread around in the small startup community in India and you suddenly hear this consistently from several young entrepreneurs. What they forget is that the VC is putting hard cash into their businesses and betting on their ability to execute a vision. They are professionals and they evaluate opportunities opportunistically as any "for profit" enterprise behaves. This type of negativity is not helpful. The teams I have seen that have won big have had immense faith in their VCs, Advisors and mentors and are open to accept feedback on strategy and execution and use their reasonable judgment to convert ideas to action. I also see a lot of young engineers who are enamored by a certain technology which may be emerging and want to rewrite something on this new exciting piece of technology without evaluating the downstream effects of doing this. They forget to ask all the important questions such as "is it proven", " can I scale something with this and make it work when I face the scale challenge", "is there a mature ecosystem to support this", "can i hire people with these skills when I scale", "is the company completely de-risked if we make this change" etc. Instead they become closed to feedback from experienced people when asked these questions which is sheer arrogance. In a startup chances are you will be faced with decisions like these very often due to the sheer nature of the bleeding edge work you do. The best startup founders are the ones that have advisors / mentors or informal experts network that they can tap into and seek their counsel at anytime.
Be open and the World will open to you!
4. Integrity - I think a lot of us Indians are forced to live in a world where our personal and professional integrity is questionable. Corruption is rampant in our society and we are all guilty of being party to have indulged in some form of corruption in our day to day lives. This really lowers our moral standards and our ability to be transparent to each other in our professional life. The startup founders that are successful have the highest levels of personal and professional Integrity. Transparency between founders and employees is something that lacks in Indian startups. Founders don't want to share the wealth fairly and equitably with people they bring on. Unless this changes we can never create a Silicon Valley style sub culture in India. Satish my mentor is again exemplary. The core team at Zimbra followed Satish from JavaSoft to Onebox to Openwave to Zimbra. These are some of the most talented valley engineers who companies like GOOG, Facebook etc would have loved to have. However, they all followed Satish to Zimbra. Satish made sure that all the employees of Zimbra shared in the wealth created. Lets us all face it - we will all be part of multiple startups in our lives and we want to work with the best and the brightest. It only takes one act of lack of integrity by the founders of any company to lose the loyalty of all their employees.
Wednesday, March 11, 2009
My inspiration to start blogging
I resigned on Feb 5th 2009 as the General Manager of the Zimbra Business Unit in Yahoo! which has led me down the path of entrepreneurship once again. One of the people I met during this journey is Rajesh Jain who runs his own blog http://emergic.org/ and is truly an inspiration. If you are a young Indian with dreams of greatness, I highly recommend that you read Rajesh's blog. The last couple of years were a lot of fun building Zimbra from scratch in India and hiring a rockstar team that helped us build value and eventually get acquired by Yahoo! for US$350M. Yahoo! was one of the best companies to work at as a cultural fit for young innovators who are provided with an environment to think independently and express their freedom. However, it fell short of providing an environment for entrepreunership. I have worked for 1 large company (Oracle) and 2 startups (Openwave and Zimbra) that either became large or got acquired by a large company in the last 15 years. My beliefs that "Elephants can't Dance" (Sorry Lou Gerstner - you are wrong) were reinforced in my experience with working at these large companies. I am starting this blog to communicate with young Indians about the experiences of being a high tech innovator, an entrepreneur and a change agent for the New Modern Developed India.
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